As the NDA government completes its three years, we take a look at the initiatives taken to ensure the upward trajectory of Ministry of Micro, Small and Medium Enterprises
There is a need to improve the technology, credit availability, innovation and industrial infrastructure for the Indian Micro, Small and Medium Enterprises (MSMEs) to be able to compete effectively with imports and to cater to export markets. Government and Ministry of MSME has considered all the essential necessities and designed schemes for MSME including, technological upgradation, increased formalisation of the enterprises through easy registration, skill training and improving credit availability. Other Ministries also implemented schemes such as Mudra, Stand Up India, Start Up India and Prime Minister’s Kaushal Vikas Yojana to contribute towards MSME’s development.
Prioritising self employment and MSMEs, Hon’ble Prime Minister for the first time gave away annual MSME awards at a function in ludhiana on October 18, 2016. Currently, it is proposed to support 22,222 MSMEs for upgradation under ZED. He also launched National SC/ST Hub and Zero Defect, Zero Effect (ZED) under Ministry of MSME. These include increasing the coverage of Credit Guarantee Trust Fund for MSMEs for collateral free loans up to Rs 2 crore and extending its coverage to loans given by NBFCs. Currently, In order to address the credit constraints being faced by MSMEs, he announced a number of measures in his address on December 31, 2016. Also, the National SC/ST Hub has already resulted in registration of 8951 SC and 1845 ST enterprises on MSME Data bank by March 31, 2017. 38 vendor development programme have been held to support SC/ST entrepreneurs as suppliers to various CPSEs.
The Budget for 2017-18 also gave high importance to MSMEs. The budgetary allocation for the Ministry of MSME was increased by 216 per cent. The budget also reduced the income tax for small companies with annual turnover upto Rs 50 crore to 25 per cent and for businesses with turnover upto Rs 2 crore by reducing rate of presumptive to 6 per cent. Target for lending under Prime Minister Mudra Yojana has been doubled to Rs 2,44,000 crore.
Prime Minister’s Employment Generation Programme (PMEGP) has not only been given increased allocations but, the system has been made more transparent and easy for the entrepreneurs. During April, 2014 - March, 2017, a total of 1,45,420 units were setup under PMEGP which provided employment to 10,87,644 person. Budget expenditure for subsidy under PMEGP on last three years amounted to Rs 3,440.20 crore. During financial year 2016-17, 52,912 units have been set up, generating employment to 4,06,780 people by utilising Margin Money of Rs 1,280.91 crore.
SFURTI scheme was revamped during 2014 with an outlay of Rs 149.44 crore for developing 71 clusters (including coir) with coverage of 44,500 artisans in the first phase. During FY 2015- 16, and 2016-17, 78 diagnostic study reports and 69 detailed project reports of clusters were approved, which would provide employment to 58,904 artisans with funding of Rs 135.07 crore. Under ASPIRE, 57 livelihood business incubators and 8 technology business incubators have been approved. ASPIRE Fund (Fund of Funds) has also been created under SIDBI with a corpus of Rs 60 crore. Four Alternate Investment Funds (AIFs) have been identified and approved for assistance of Rs 39.50 crore out of the ASPIRE Fund.
Under Credit linked Capital Subsidy Scheme (ClCSS), Rs 1027.82 crore of subsidy was released to 16,304 MSEs during 2014-17 in ClCSS. Under Credit Guarantee Trust Fund for MSEs Scheme, during 2014-17, 13,69,527 proposals with credit guarantee of Rs 61,155.73 crore have been approved. National Manufacturing Competitiveness Programme of the Ministry contributed significantly on technological upgradation of MSMEs through its various components like lean manufacturing, design clinic etc.
Ministry is actively pursuing setting up of 15 new technology centre and upgradation of 18 existing Technology Centres at the cost of Rs 2200 crore with the help of World Bank assistance. 250 crore would be spent during the year 2017-18 for opening technology centres. Rs 5 crore would be spent for opening new Mini-Tool Rooms under the Promotion of MSMEs in NER Scheme. 4,94,885 people have been trained through Tool Rooms, and technological support has been provided to 1,03,459 MSEs during 2014-17.
As part of formalisation of MSMEs through simplified registration system, Udyog Aadhar Memorandum was launched on September 18, 2015 and presently, about 31 lakh UAMs have been registered.
Rs 315 crore was allocated by the Government under Modified Marketing Development Assistance (MMDA) scheme to Khadi Village and Industries Commission. It has increased Khadi production to Rs 1600 crore in 2016-17, creating employment for more than 11 lakh. Khadi sales has now reached Rs 2005 crore. The Village Industries production during 2016-17 crossed Rs 50,000 crore creating employment for more than 133 lakh people.
Annual Coir production increased to more than 5.00 lakh MT providing employment for 7 lakh. Also, during 2016-17 export of coir and it’s products increased to Rs 2282 crore.
Ministry of MSME took many e-governance initiatives, including the launch of My MSME mobile application for access to different schemes, effective implementation of the online grievance system, online portal for monitoring of cases of delayed payment of MSEs under MSE facilitation councils and launch of online finance facilitation centres.