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INDUSTRY

Credit stimulus for incremental loans. For exporters who than 14,000 crore have been made so as a single consent. The return will be
receive loans in the pre-shipment
far through GeM. He said the sixth an-
accepted through self-certification.
nouncement is that all public sector
As the twelfth announcement, an
and post-shipment period, the Prime
undertakings of the Union Govern -
Ordinance has been brought, under
Minister announced an increase in
which, for minor violations under the
interest rebate from 3 percent to 5
ment must now compulsorily be a part
MSME sector good, but percent. of GeM. He said they should also get all Companies Act, the entrepreneur will
their vendors registered on GeM.
The third announcement made by
no longer have to approach the Courts,
but can correct them through simple
the Prime Minister was that all com-

panies with a turnover more than
procedures.
Technology Upgradation
500 crore, must now compulsorily
Coming to technological up gradation,
has inherent dangers be brought on the Trade Receivables the tool rooms across the country are Social Security for Employees
a vital part of product design. The sev-
e-Discounting System (TReDS). He
As far as social security for the MSME
enth announcement as such was that
said that joining this portal will en-
sector employees is concerned, a mis-
able entrepreneurs to access credit
they have Jan Dhan Accounts, provident
from banks, based ontheir upcoming 20 hubs will be formed across the coun- sion will be launched to ensure that
try, and 100 spokes in the form of tool
receivables. This will resolve their rooms will be established. fund and insurance. These decisions are
problems of cash cycle. expected to go a long way in strength-
the glorious Indian traditions of small- upgradation. Ease of Doing Business
TEHELKA BUREAU scale industry, including Ludhiana’s Access to Markets On Ease of Doing Business, the eighth
hosiery, and Varanasi’s sarees are be- Access to Credit The fourth announcement is that pub- announcement is related to pharma About 65 million
fore anyone to see. The first announcement, is the launch lic sector companies have now been companies. He said clusters will be
n the run-up to the general elec- There are five key aspects for of the 59 minute loan portal to en - asked to compulsorily procure 25 formed of pharma MSMEs. As per the micro, small, and
tion next year, the Centre has an- facilitating the MSME sector. These able easy access to credit for MSMEs. percent, instead of 20 percent of their initiative, 70 percent cost of establish- medium enterprises
nounced an important initiative include access to credit, access to mar- Under this, loans upto 1 crore can be total purchases, from MSMEs. The fifth ing these clusters will be borne by the
or credit stimulus package for mi- ket, technology up gradation, ease of granted in-principle approval through announcement is related to women Union Government. The Prime Minister account for about
I cro, small, and medium enterpris- doing business, and a sense of secu- this portal, in just 59 minutes. A link to entrepreneurs. Out of the 25 percent claimed that the success of economic 120 million jobs
es (MSMEs) sector. The government has rity for employees. The Prime Minister this portal is likely to be made available procurement mandated from MSMEs, reforms launched by the Union Govern-
finally thought of the small industry, described the initiatives as a Diwali gift through the GST portal. Idea is that no 3 percent must now be reserved for ment, can be gauged from the rise in In- while about 30 per
which has been the engine of growth for the sector and the 12 announce - one should be compelled to visit a bank women entrepreneurs. dia’s “Ease of Doing Business Rankings,”
for the country for several decades. ments address each of these five cate- branch repeatedly. It is learnt that more than 1.5 lakh from 142 to 77 in four years. The ninth cent of the country’s
They are India’s second-largest job cre- gories. Among the many sops doled out The second announcement pertains suppliers have now registered with announcement is on simplification of economic output
ators. About 65 million MSMEs account under the new scheme include access to a 2 percent interest subvention for GeM, out of which 40,000 are MS - government procedures. The return
for about 120 million jobs while about to credit, markets and technology to all GST registered MSMEs, on fresh or MEs. He said transactions worth more under 8 labour laws and 10 Union reg- comes from MSMEs
30 per cent of the country’s economic ulations must now
output comes from MSMEs. be filed only once a
The 12 initiatives include 59-minute year. The 10th an - ening the MSME sector in India. The
loan portal to enable easy access to nouncement is that government has made it clear that the
credit for MSMEs, mandatory 25 per- now the establish- implementation of this outreach pro-
cent procurement from MSMEs by ments to be visited gramme will be intensively monitored
CPSEs and an Ordinance for simplify- by an Inspector will over the next 100 days.
ing procedures for minor offences un- be decided through On paper the scheme looks good but
der Companies Act a computerised ran- it has the risk of misallocation of pro-
It is worth noting that MSMEs, dom allotment. ductive economic resources and credit.
which account for 30 per cent of In- As part of estab- Small businesses also demand access to
dia’s gross domestic product (GDP). lishing a unit, an land at competitive rates, lower power
Little doubt that the Prime Minister, entrepreneur needs tariff, easier rules for inter-state busi-
Narendra Modi has launched sup - two clearances ness and direct and indirect tax breaks.
port and outreach programme for namely, environ - However, the initiatives announced
the Micro, Small and Medium Enter- mental clearance are enough to instill a feel-good factor
prises (MSME) sector. As part of this and consent to estab- in the run-up to elections. Aggressive
programme, the Prime Minister has lish. The eleventh an- lending can also have wrong conse-
unveiled 12 key initiatives, which will nouncement is that quences. Future would tell whether it is
help the growth, expansion and fa - under air pollution good politics and bad economics or bad
cilitation of MSMEs across the country. and water pollution economics but good politics.
The MSMEs are one of the principal laws, now both these
employment generators in India, and have been merged LETTERS@TEHELKA.COM
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