SMALL IS BEAU­TI­FUL

Chief Min­is­ter Ashok Gehlot bets big on MSMEs with a three-year, write-your-own-ticket of­fer

India Today - - STATES - By Ro­hit Par­i­har

The Congress may have lost the gen­eral elec­tion but in Ra­jasthan, it is putting into ac­tion one of the big prom­ises in its elec­tion man­i­festo—a fo­cus on Mi­cro, Small and Medium En­ter­prises or MSMEs as a route to job creation. As part of this ini­tia­tive, the state launched a website for MSMEs on June 12. An online regis­tra­tion fol­lowed by an in­stant ac­knowl­edg­ment is all the ‘pa­per­work’ needed to start a busi­ness unit. In about three weeks, 708

peo­ple, in­clud­ing sev­eral women, had reg­is­tered.

For the next three years, as the spiel goes, they needn’t worry about any ap­provals and can fo­cus on build­ing their busi­nesses. The new rules for the Ra­jasthan MSME (Fa­cil­i­ta­tion of Es­tab­lish­ment and Op­er­a­tion) Or­di­nance, 2019 were no­ti­fied on May 24 and will come into force if passed dur­ing the cur­rent budget ses­sion. Given the low cap­i­tal thresh­old for MSMEs and the as­sur­ance of no in­spec­tions

under any state or even cen­tral laws (those that the state is em­pow­ered to waive on dec­la­ra­tion of in­tent), this re­form may have far­reach­ing ben­e­fits for as­pir­ing en­trepreneur­s, besides cre­at­ing jobs. Of course, the preva­lent laws on safety, labour and en­vi­ron­ment have to be fol­lowed but no ver­i­fi­ca­tions are re­quired. Chief min­is­ter Ashok Gehlot said on the side­lines of the website launch, “This will be the end of the Inspector and Per­mis­sion Raj.”

‘Reg­u­la­tory for­bear­ance’ is key here. No govern­ment agency can seek en­try into MSME premises dur­ing these three years for in­spec­tion, nor do in­vestors have to dis­close the ex­tent of in­vest­ment, em­ploy­ment and land use. The website sends a copy of the cer­tifi­cate to the de­part­ments con­cerned, who can take ac­tion af­ter three years if the facts are found to be mis­rep­re­sented.

Af­ter the three­year grace pe­riod, in­vestors will have to get all the nec­es­sary per­mits within the next six months. In all this, the hope is that only a mi­nus­cule frac­tion will mis­use the faith the Ra­jasthan govern­ment is plac­ing in in­vestors. The new Gehlot regime is also set­ting up an Ex­port Promotion Coun­cil while the near­fi­nal Ra­jasthan In­dus­trial Pol­icy in­cludes mas­sive fis­cal pack­ages, dy­namic power tar­iffs, a fo­cus on the ser­vice sec­tor, and a 50 per cent re­duc­tion in time­line and de­vel­op­ment of new in­dus­try clus­ters. The chief min­is­ter says “any­one ap­proach­ing us for in­vest­ment should not be able to say he is getting a better of­fer some­where else”. The pro­posed changes be­ing ex­am­ined by fi­nance and other de­part­ments in­clude a sub­stan­tial ex­emp­tion in stamp duty, elec­tric­ity and land con­ver­sions, sub­sidy for em­ploy­ment and state GST and in­cen­tives for wa­ter con­ser­va­tion and evi­ron­ment­friend­li­ness. There will also be ‘dis­pute res­o­lu­tion mech­a­nisms’ at the dis­trict and state lev­els.

In the past, the Ra­jasthan bu­reau­cracy has been no­to­ri­ous for red tape and a lack of vi­sion. Dur­ing the pre­vi­ous BJP govern­ment too, most of the project MoUs of­fi­cials signed failed to take off. Per­haps why Gehlot has set no targets so far. As he puts it, “If our govern­ment is seen as in­vestor­friendly, both lo­cals and out­siders will choose us for busi­ness.” The re­sults will be vis­i­ble on the ground in the next two years.

UNENCUMBER­ED CM Gehlot launches the MSME por­tal in Jaipur

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