PM launches historic Support and Outreach Initiative for MSME Sector
The PM Shri Narendra Modi, launched a historic support and outreach programme for the Micro, Small and Medium Enterprises MSME sector. As part of this programme, the Prime Minister unveiled 12 key initiatives which will help the growth, expansion, and facilitation of MSMEs across the country.The launch of the programme was witnessed by Union Minister for Finance and Corporate Affairs, Arun Jaitley and the Union Minister of State for MSME, Giriraj Singh, among other dignitaries.
Five key aspects of facilitating the MSME sector
- Access to credit
- Access to market
- Technology upgradation
- Ease of doing business
- A sense of security for employees
Access to credit
- 59-minute loan portal to enable easy access to credit for MSMEs. Loans up to Rs. 1 crore can be granted in-principle approval in just 59 minutes through GST Portal.
- 2 percent interest subvention for all GST registered MSMEs on fresh or incremental loans. Increase in interest rebate from 3 percent to 5 percent For exporters who receive loans in the pre-shipment and post-shipment period.
- All companies with a turnover more than Rs 500 crore will now compulsorily be brought on the Trade Receivables e-Discounting System (TReDS). It will enable entrepreneurs to access credit from banks. This will resolve the problems of the cash cycle.
Access to market
- Public sector companies will now need to compulsorily procure 25 percent, instead of 20 percent of their total purchases from MSMEs.
- Out of the 25 percent procurement mandated from MSMEs, 3 percent will now be reserved for women entrepreneurs.
- All public sector undertakings of the Union Government must now compulsorily be a part of GeM.
- 20 hubs will be formed across the country and 100 spokes in the form of tool rooms will be established.
Ease of Doing Business
- Clusters will be formed of pharma MSMEs. 70 percent cost of establishing these clusters will be borne by the Union Government. The return under 8 labor laws and 10 Union regulations will now need to be filed only once a year.
- Establishments to be visited by an Inspector will be decided through a computerized random allotment.
- Air pollution and water pollution laws have now been merged as a single consent. The return will be accepted through self-certification.
- The ordinance has been brought under which, for minor violations under the Companies Act, the entrepreneur will no longer have to approach the Courts, but can correct them through simple procedures.
Social Security for MSME Sector Employees
- A mission will be launched to ensure that they have Jan Dhan Accounts, provident fund, and insurance.
About Indian Micro, Small and Medium Enterprises Sector
- The Indian MSME sector provides maximum opportunities for both self-employment and wage-employment outside the agricultural sector. The sector generates around 100 million jobs through over 46 million units situated throughout the geographical expanse of the country.
- With 38 percent contribution to the nation’s Gross Domestic Product (GDP) and 40 percent and 45 percent share of the overall exports and manufacturing output respectively, the sector plays a key role in our economy.
- Besides the wide range of services provided by the sector, the sector is engaged in the manufacturing of over 6000 products ranging from traditional to hi-tech items.