Govt initiates key reforms for MSME sector

Economic Survey 2020: Govt initiates key reforms for MSME sector

Representative image. (iStock Photo)

The Economic Survey, which was tabled by the Finance Minister Nirmala Sitharaman in the Parliament on Friday, has listed a detailed analysis of the measures undertaken to support the MSME sector. The Survey said that the government has taken measures to ensure better credit flow, technology up-gradation, ease of doing business and market access to the sector.

Prime Minister Narendra Modi on November 2, 2018, had announced key reforms for faster growth of this sector.  The initiatives and the status of these initiatives are as follows:

(i) In-principle approval for loans up to Rs 1 crore within 59 minutes through an online portal. About 1,59,422 number of loans have been sanctioned involving Rs 49,330 crore. Of this, Rs 37,106 crore has been disbursed up to October 2019. 

(ii)  Interest subvention of 2% for all GST registered MSMEs on incremental credit up to Rs 1 crore. SIDBI has received and settled a claim of Rs 18 crore from 43 banks/NBFCs for the period from November 2018 to March 2019.

(iii)  All companies with a turnover more than Rs 500 crore to be mandatorily on TReDS platform to enable entrepreneurs to access credit from banks. So far, 329 companies have registered themselves on the TReDS portal.

(iv) All central public sector undertakings (CPSUs) to compulsorily procure at least 25 per cent of their total purchases from MSMEs. CPSUs have procured goods and services worth Rs 15,936.39 crore from 59,903 MSMEs.

(v)  Out of the 25 per cent procurement mandated from MSMEs, 3 per cent has been reserved for women entrepreneurs.  During 2019-20, procurement has been done from 1,471 women-owned MSMEs to the tune of Rs 242.12 crore.

(vi)  All CPSUs must mandatorily procure through GeM portal. A total of 258 CPSUs/CPSVs have been onboarded/registered on the GeM portal and a total of 57,351 MSME sellers and service providers have been registered on the portal.

(vii)  Twenty Technology Centres (TCs) and 100 Extension Centres (ECs) to be established at the cost of Rs 6,000 crore. So far, Rs 99.30 crore has been released for setting up of these TCs and ECs. 

(viii) The government to bear 70 per cent of the cost for establishing a pharma cluster.  Four districts of Solan, Indore, Aurangabad and Pune have been selected for pharma clusters and developing of common facilities.

(ix)  Returns under eight labour laws and 10 Union Regulations to be filed once a year.

(x)  Establishments to be visited by an Inspector will be decided through a computerized random allotment.  A total of 3,080 inspections have been conducted and all inspection reports have been uploaded on Shram Suvidha portal.