MSMEs: Some Hits & Some Misses

India Business Journal - - COVER STORY -

MEA­SURES

New clas­si­fi­ca­tion based on turnover

2% in­ter­est sub­ven­tion for MSMEs and 3% to 5% in­ter­est re­bate for MSME ex­porters

Fac­tory in­spec­tions to be sanc­tioned only through com­put­erised ran­dom al­lot­ment

PSUs' pro­cure­ment from

MSMEs raised from 20% to 25% of their pur­chases

PSUs told to get on board TReDS

Cor­po­rate Tax for com­pa­nies with turnover of up to Rs 250 crore cut from 30% to 25%

Ded­i­cated por­tal for loans up to Rs 1 crore in 59 min­utes

IM­PACT

Set to spur small busi­nesses to make huge in­vest­ments and ex­pand in size and scale

Ac­cess to cheaper credit

Re­lief to small busi­nesses from dreaded In­spec­tor Raj

Ac­cess to big mar­ket for small busi­nesses on the GeM plat­form

On­line trade re­ceiv­ables plat­form set to solve MSMEs' de­layed pay­ment prob­lem

Not much im­pact on MSMEs as most of them op­er­at­ing as pro­pri­etor­ships or part­ner­ships and only a few are com­pa­nies

Sim­ply pop­ulist, no big dif­fer­ence for small units which need more funds, likely to trig­ger higher NPAs for banks

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