No global tenders upto Rs 200 cr, ease of doing business and subsidy benefits for projects in urban and rural areas are among other initiatives in the MSME to promote Make-in-India under Atmanirbhar Bharat package were highlighted in the virtual event organised by the Tourism Ministry.
With a view to provide information and guidance to the stakeholders on benefits from the various elements and schemes of MSME, the webinar titled “Atmanirbhar Bharat- Issues confronting Tourism and Travel” under Dekho Apna Desh series showcased the MSME sector and its classification, registration process for MSMEs, credit/finance schemes of the MSME Ministry for services sector, public procurement policy etc.
A step towards self-reliant India, global tenders will be disallowed up to Rs 200 cr. This will be a step towards Atmanirbhar India and support Make in India initiatives of the government. The presenters also shared the subsidy benefits of the programme wherein general category beneficiaries can avail of margin money subsidy of 25 % of the project cost in rural areas and 15% in urban areas. For beneficiaries belonging to special categories such as scheduled caste/scheduled tribe /women the margin money subsidy is 35% in rural areas and 25% in urban areas.
The webinar was presented by Devendra Kumar Singh, Additional Secretary and Development Commissioner, MSME and Anand Sherkhane, Additional Development Commissioner, Ministry of Micro, small and medium Enterprises. After 14 years since the MSME Development Act came into existence in 2006, a revision in MSME definition was announced in the Atmanirbhar Bharat package on May 13, 2020.
As per this announcement, the definition of Micro manufacturing and services units was increased to Rs 1 cr of investment and Rs 5 cr of turnover. The limit of the small unit was increased to Rs 10 cr of investment and Rs 50 cr of turnover. Similarly, the limit of medium unit was increased to Rs 20 cr of investment and Rs 100 cr of turnover.
The Government had decided in June 2020 for further upward revision of the MSME Definition. For medium Enterprises, now it will be Rs 50 cr of investment and Rs 250 cr of turnover.
After the package was announced on May 13, 2020, there were several representations saying that the announced revision is still not in line with market and price conditions and hence it should be further revised upwardly.
Keeping in mind these representations, the Prime Minister decided to further increase the limit for medium Units. This has been done in order to be realistic with time and to establish an objective system of classification and to provide ease of doing business.
The Ministry of MSME has reiterated that it has put in place a very strong handholding mechanism for MSMEs and new entrepreneurs in the name of Champions (www.champions.gov.in) which was recently launched by the Prime Minister.
Interested Enterprises/People can take benefit of this mechanism and can also put their queries or complaints. The same will be attended to with utmost promptness.
The presenters also highlighted the MSME registration benefits pertaining to small businesses:
Loans without collaterals:
The Government has introduced various initiatives for MSME/SSI that allow them to avail credit without collateral. One of the best MSME registration benefits, the initiative to provide collateral-free loan is undertaken by GOI (Government of India), SIDBI (Small Industries Development Bank of India) and the Ministry of Micro, Small and Medium Enterprise under the name The Credit Guarantee Trust Fund Scheme. This is by far the best MSME registration benefits for small business owners.
Subsidy on Patent Registration & Industrial Promotion:
Business enterprises registered under the MSME Act are given a hefty subsidy of 50 per cent for patent registration. This can be availed by sending an application to the respective ministry. In addition to this, one of the great MSME registration benefits is to get subsidies for industrial promotion suggested by the Government.
The presenters also highlighted Pradhan Mantri Mudra Yojana: Three offerings ‘Shishu’, ‘Kishore’ and ‘Tarun’. The primary product of Pradhan Mantri MUDRA Yojana will be providing refinance for lending to micro businesses/units (medium and small entrepreneurs). The initial products and schemes under this umbrella have already been created and the interventions have been named ‘Shishu’, ‘Kishor’ and ‘Tarun’ to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur as also provide a reference point for the next phase of graduation / growth for the entrepreneur to aspire for:
Shishu: covering loans up to Rs 50,000
Kishor: covering loans above Rs 50,000 and up to Rs. 5 lakh
Tarun: covering loans above Rs 5 lakh and up to Rs. 10 lakh
Now, there will be no difference between manufacturing and service sectors.The new definition will pave the way for strengthening and growth of the MSMEs. Particularly, the provision of excluding the exports from counting of turnover will encourage the MSMEs to export more and more without fearing to lose the benefits of a MSME unit. This is expected to exponentially add to exports from the country leading to more growth and economic activity and creation of jobs.
Tourism ADG Rupinder Brar concluded the webinar acknowledging the efforts of MSME in recognizing the Service sector which will work in the benefit of the travel, tourism and hospitality businesses in the country to receive the additional collateral-free liquidity support announced by the government.
The announcement of Rs 3 lakh cr collateral-free automatic loans for MSME businesses through banks and NBFCs will go a long way in motivating the service providers.