MSME registration gone up to 3 lakh

Introduction of online facility has helped registrations see a sharp increase in three years.

Over the past three years, registration of Micro, Small and Medium Enterprises (MSME) units has gone up from 16,000 to three lakh. The sharp increase in the number of registered units is being ascribed to the online registration facility that was introduced by the government in 2016. Speaking to The Sunday Guardian, Rajnish Goenka, chairman, MSME Development Forum, said that it is a big success because until now, manufacturers have largely remained reluctant to get registered.

“The scenario has changed because now people are attracted by government benefit schemes and can see that getting registered is in favour of their businesses. Until now, evading tax was known to be a major reason for low registration. The culture of bribe for an entrepreneur who was willing to get his/her company registered was discouraging. Entrepreneurs turned into thieves because they were evading tax though they did not want to evade it. Entrepreneurs had to pay at least Rs 20,000-Rs 30,000 to get their company on the roll. But now that has changed. MSME is a crucial sector for the Indian economy and still most of it is being run unregistered, but there is progress now,” said Goenka.

The sector contributes 8% to GDP, 45% of the industrial output and 40% of exports through more than 57.7 mil- lion enterprises employing 120 million people. Diverse in terms of size, technology and location, MSMEs manufacture a range of 8,000 products, ranging from grassroots village industry to hi-tech components for satellites.

Goenka, former National Convener of BJP’s Micro and Small Industry Cell, said, “As much as 90% of entrepreneurs are in the MSME sector. While the government has introduced schemes to benefit various stakeholders, working through bureaucracy is tough. It takes time even for the best of schemes to percolate down to the grassroots after weaving its way through bureaucratic corridors. On the other hand, entrepreneurs are generally one-man armies with limited finance and human resources, which is why effective government outreach becomes a crucial role.”

Stating core challenges for a small-scale enterprise, Goenka said, “Among technological and financial shortcomings, a practical challenge for small entrepreneurs is awareness about the government’s schemes. The notifications are generally written in high English that a not-soeducated entrepreneur may not be able to understand. One way to promote government schemes is to advertise them in local languages.”

Speaking about the effects of demonetisation on the MSME sector, Goenka said, “It is true that the MSME sector was the worst hit by demonetisation. In smallscale industries, business is largely done in cash, so entrepreneurs had to go through a hard time. MSMEs have taken a harsh hit. But I am sure that the sector will find its way back. Growth will be slow, but the current government is committed towards entrepreneurship, so we can see this sector grow. Specifically in the farming sector, the youth needs to realise its scope and the number of opportunities that are coming on the agricultural start-up scene.”

Goenka said, “Developed nations like Germany etc., have done exceedingly well in growing their MSME sectors. However, in India, our social conditions are different. Therefore, we must learn from their best practices and improvise according to our challenges.” Vistara, a joint venture between TATA Sons and Singapore Airlines Ltd., signed a Memorandum of Understanding (MoU) with Japan Airlines ( JAL) this week, to pursue commercial opportunities in the Indian market.

Speaking to The Sunday Guardian, Phee Teik Yeoh, CEO of Vistara, who has been a senior executive at Singapore Airlines, shared insights on the latest MoU and how Indian consumers will be able to benefit from it. Excerpts: Q: As somebody who has worked in the aviation sector around the world, what are the challenges you face in the Indian market? A: A lot of people talk about India being a challenging market, but that is just one aspect of the market. A better contemplation is to ask what opportunities can grow the Indian market and how we can channel the potential of the aviation sector. India is not an easy market, but with perseverance, things can get done. At Vistara, we have a passionate team and despite all odds, we have managed to reach 21 destinations in three years. So while the market is challenging, we should not be disillusioned and work with patience. The growth story and potential of the Indian market is well documented. The aviation industry is expected to become the third largest in the world by 2020 which is why it is an exciting time in the sector. Q: How will the MoU signed between Japan Airlines (JAL) and Vistara help you tap the said potential in the Indian aviation industry? A: This is very significant for us because the MoU is an affirmation that both the airlines will now actively pursue the commercial opportu- expertise and assets, subject to necessary approvals from authorities. Q: What does the collaboration between JAL and Vistara mean for customers? A: JAL and Vistara had already signed an “InterAirline Through Check-In” (IATCI) partnership earlier this year that helped customers avail seamless “through check-in” facility, when connecting to or from a Vistara flight in India and over 50 countries across the world on JAL’s network using a single ticket. The customers will have better access to destinations in Japan and India. Our latest Codeshare partnership, which will be in place by next year, will provide seamless duct four new aircraft in our fleet. Once we have 20 aircraft in our fleet, we will be able to start international flight operations as per Indian regulations and here our MoU with JAL will play a crucial role. About the type of aircraft, flight frequency etc., we are still working out the details. Work is in progress and we are close to finalising things. Q: For a challenging market like India, Vistara created a niche product. When do you think you will be able to make profit? A: I cannot share the financial figures as of now. But we are on the right track. We started with five aircraft and now we will have 20. Our revenue indicators and cost indicators are growing and not in a linear fashion. Our frequent flyer programme is helping us expand our database. We expect to hit the mark soon but how soon, I will not be able to say that as of now.