The Uttar Pradesh government, to facilitate the promotion of the micro, small and medium enterprises sector in the state in the post-COVID-19 times, has decided to fast track the setting up the unit that allows MSMEs to start operations within 72 hours after submitting their application.
The new MSME units will not have to wait for obtaining no objection certificates (NOCs) from various departments and government agencies. The UP cabinet has approved a draft bill, ‘Micro Small and Medium Enterprises (Infrastructure and Operation) Bill, 2020’, which will be tabled in the monsoon session of UP legislature for approval.
The bill seeks to exempt MSMEs from various approvals and inspections that are required for their establishment and operations in the initial years.
At present, one needs to get clearances from 29 different departments before being allowed to establish an MSME unit in the state. Interestingly, until now UP did not have its own MSME Act and was working on the basis of the Central legislation.
According to Additional Chief Secretary (MSME) Navneet Sehgal, henceforth anybody willing to set up a new MSME unit can submit an application on a prescribed format and will be given approval within 72 hours.
“An application can be made through a ‘Declaration of Intent’ to the district level nodal agency (DLNA), which will have to issue an acknowledgement within 72 hours of receiving the application. This acknowledgement certificate will remain valid for 1,000 days from the date on which it is issued. On the basis of this acknowledgement, one can establish the unit,” the ACS said, adding that the investor will then have 1,000 days to get the necessary clearances after the first go-ahead.
“The new law would help in setting up of more MSME units in the state, which in turn will help in creating employment opportunities. We have set a target to create about 15 lakh jobs in the next one year,” Sehgal said.
However, MSME units producing products like tobacco, gutka, pan masala, alcohol, carbonated drinks, fire crackers, plastic bags of 40 microns or less and other items that are banned by the government or marked by UP Pollution Control Board in red category will not be covered by the proposed law.
Meanwhile, in another related development, MSMEs in UP will get a marketing assistance of up to Rs 5 lakh under the new startup policy.
Addressing a virtual conference on ‘Role of information technology in transforming MSMEs’ future during COVID-19’, organised by PHDCCI, Additional Chief Secretary (Electronics and Information Technology) Alok Kumar said the government had notified the new Start-Up Policy, 2020, which aimed at extending support and encouragement to start-ups and incubation centres in the state.
“Under the new policy, there is a window of up to Rs 5 lakh as marketing assistance to MSMEs,” he said.