ADAPTING TO THE NEW REGIME
SME sector has been playing an important role in socio-economic development of the country. The sector's contribution to the country's GDP is expected to increase to 22% in 2020 from 17% in 2011. The strongest di£ferentiator for SMEs is the competitive business model, which emphasizes the use of cost-effective and local resources, capital, processes and labor, ensuring an effective ROI.
Recently demonetization coupled with other historic reforms like CST resulted in several changes in the SME business models going forward. The implementation of GST could accelerate the growth of Indian SMEs & Startups by promoting the government-led "Make in India" initiative and helping small-scale enterprises in terms of ease of doing business. Other factors like cash flow-related issues, delays, and uncertainties prove to be a challenge for SMEs & Startups, which they need to overcome with better planning and execution. It could result in several winners/losers in multiple sectors apart from disrupting existing ways of doing business.
After successful completion of four series of SME
Sammellan, ASSOCHAM organised its 5th SME Sammellan with the theme of' GST Impact on SME'S & Startup's: Challenges & Opportunities', on July 29,2017. This Sammellan provided a platform to spread awareness of the impact of GST on SMEs and Startups with the help of experts from the Industries, CA Firms, Tax Consultants, Policy makers, and technocrats. The Sammellan also discussed on fuelling the growth of SMEs through Finance, IPOs, Credit ratings, Technology processes, Services and Innovation.
The session was inaugurated by Mr. R. N. Raval, Joint Commissioner, Department of Industries, Government of Cujarat, with participation of around 120 delegates.
During the Sammellan, a Knowledge Paper on 'GST
impact on SMEsand Startups' was released. The Knowledge Paper was prepared by ResurgentIndia, ASSOCHAM's KnowledgePartner.
Mr. Dhaval Raval in his welcome address said that the SME sector is an important pillar of Indian economy and with the implementation of CST, India's 51 million small medium enterprises (SMEs)will take the digital route and this will significantly change the way of doing business across industries.
Mr. Pramod Kumar Vijayvargia, DCM, SIDBI, said that the SMEsector should adapt to the new technology and with the implementation of CST, this sector will become more competitive in the long run. It will facilitate ease of doing business with the simple tax regime. The new tax regime will help the small scale industries to grow into the large scale industries.
Mr. [yoti Prakash Cadia, MD, ResurgentIndia, shared his views on the issues and difficulties faced by the entrepreneur and startups, he shared the statistics of total number of MSME visa-vis gap of total no of SMEs. He elaborated on the issues of working capital arbitrage process, and issues related to tax compliance post CST. He also suggested the participants to list down the issued faced by SMEand start up post CST and present their recommendation to the competent Covt. authority to promote ease of doing business.
Mr. Ajay Thakur, Head BSE- SME Platform elaborating on the positive impact of CST stated that post CST, SME sector will flourish as it is a simple and uniform tax. He said that SME sector contributes around 60% to the CDP and is the backbone of Indian economy. He said disruption will come as an obstacle in a growth of SMEs but this sector will have to overcome these hurdles and prosper to become large scale enterprise. He emphasized to get venture into equity market. In his concluding remarks he said that equity is mother of all funds.
Mr. B. N.Mankad, Joint Commissioner of State Tax, GoG, emphasized on the positive impact of GST on SMEs. He discussed on the conceptual aspects, uniformity and simplicity of GST structure. By giving an example of seamless flow of tax credit, he encouraged the SMEs and startup to get maximum benefits of this tax structure.
Mr. R. N. Raval, Joint Commissioner, Department of Industries, highlighted on the various financial incentive schemes of Gujarat industrial policy 2015to promote the SMEs & Startups.
Mr. Ohaval Raval, Chairman, SME Committee, ASSOCHAM Gujarat Council,
Mr. Bharat Patel, Chairman Yudiz Solution, Mr. B. N. Mankad, Joint Commissioner of State Tax, GaG, Mr. R. N. Raval, Joint Commissioner; Department of Industries, GaG, Mr. Ajay Thakur; Head BSE, SME Platform, Mr. Pramod Kumar Vijayvargia OGM, SIOBI, Mr. Jyoti Prakash Gadia, MO, Resurgent India.