SME Times is powered by   
Search News
Just in:   • Adani Group to invest Rs 57,575 crore in Odisha  • 'Dollar Distancing' finally happening? Time for India to pitch Rupee as credible alternative: SBI Ecowrap  • 49% Indian startups now from tier 2, 3 cities: Jitendra Singh  • 'India ranks 3rd in global startup ecosystem & number of unicorns'  • LinkedIn lays off entire global events marketing team: Report 
Last updated: 30 Jul, 2015  

FICCI Logo New THMB FICCI-CMSME urges Govt to create conducive biz environment for MSMEs

MSME.9.5.jpg
   Top Stories
» 49% Indian startups now from tier 2, 3 cities: Jitendra Singh
» 'India ranks 3rd in global startup ecosystem & number of unicorns'
» Tripura exported over 9K tonnes of pineapples in 2 years
» CPI inflation eases to 6.71% in July, IIP falls to 12.3%
» Rupee depreciates 12 paise to close at 79.64 against US dollar
SME Times News Bureau | 29 Jul, 2015
FICCI-Confederation of Micro, Small and Medium Enterprises (FICCI-CMSME) has made wide-ranging recommendations to address the contentious and complex issues relating to land acquisition, compliance, inspection, labour laws and access to finance in order to create a conducive business environment for Micro Small and Medium Enterprises (MSMEs).

The action agenda paper titled 'Ease of Doing Business: Recommendation for the MSME Sector has been presented to the Government and the Prime Minister's Office with specific recommendations' to facilitate MSMEs and enable them to make their optimum contribution to the national economy, the apex industry body FICCI said in a press release on Wednesday.

According to a latter to PMO, land acquisition has been a key area of concern for the Indian industry and particularly for the Micro Small and Medium Enterprises (MSMEs). The process of land acquisition remains cumbersome and long drawn. A review of the Right to Fair Compensation and Transparency in Land Acquisition Act shows that there are several critical issues emanating from its various provisions and these make the land acquisition process extremely complex, lengthy and difficult, besides having huge cost implications.

There is an urgent need for a stable land policy that balances interest of all stakeholders. Industry needs confirmed availability of land at an affordable rate over the long term, it said.

Government should consider developing Industrial Estates exclusively for MSMEs with sound infrastructure base that includes transport, power, water, road, etc. and with adequate support from budgetary allocation.

Encourage setting up of affordable housing complexes for workers near industrial areas by compulsorily allocating 20% land of industrial belt for low cost housing; fast tracking change of land use for housing purposes; and reducing land registration charges for affordable housing to 20% of the rates applicable in other cases;

Government can consider allotting a 'rented accommodation' to MSMEs in an industrial area, giving them the option of purchasing the same after a stipulated time period. This will be beneficial for the MSMEs as the units are usually constrained for funds in the initial stages.

The latter highlighted that the biggest challenge that remains is that the institutions which execute single window clearance system both at Centre and State level are not sufficiently empowered to provide such one stop shop services. It remains imperative that such a function is backed by a Law/Act to make it effective with in-built provisions for time bound and deemed clearances.

Minimize human interaction by shifting routine submissions to an online platform. For instance, routine registrations, repeated filing and reporting of information should all be web enabled. Introduce self-certification and third-party certification in various laws.

In the issue of Inspector Raj, it said that the experience of MSME units with inspectors is not at all congenial and the inspectors are often dreaded. In fact, the inspectors themselves lack understanding of rules and there is a general lack of awareness. Inspection officials are not objective and harassment is rampant.

There is an urgent need to minimize Inspector Raj. Simple, easy to understand information packages on regulations and related inspection procedures should be created and these should be made easily accessible.

Inspectors should act as mentors to MSME units and must play the role of a facilitator. In case units are found lacking in compliance with certain norms, then the role of the inspectors / inspection agencies should be to help / support industrial units in complying with these norms. However, if an MSME unit fails to comply despite the mentoring provided, they should be appropriately penalized.

MSME sector looks forward to simplified labor law procedures that are both employee and employer friendly.

Government should consider introducing a single form for compliance and deposit of Provident Fund (PF) & Employees' State Insurance (ESI). This would help save time & efforts and improve compliance. MSMEs should be allowed to deposit PF & ESI towards employer's contribution only. The contribution from employee should not be the responsibility of the employer. At present, in most cases the employee does not want to contribute & the compliance burden of the employee also comes under the employer

Timely availability of credit at the right cost is the key expectation of MSME industry from their banks. While large corporate manage to get the attention of bankers, often the smaller companies have a disadvantage in sourcing credit at right cost and right time. MSME sector is a backbone of economy and banks have an important role in propelling growth of this important segment.

Banks are not forthcoming to lend under various schemes like the CGTSME due to it being non-collateralized and their risk perception pertaining to MSME lending. The prime objective of setting up SIDBI was to fulfill credit needs of MSMEs. SIDBI should play an aggressive role and track the lending made by bank to MSMEs. It should work closely with the banks and help them to meet their target for lending to MSMEs

Government may work on penalizing the banks who are unable to meet the MSME lending targets.

As per the store and purchase programme of the Government of India there was a provision of waiver of security deposit up to the monetary limit for which the Micro and Small Enterprises (MSEs) is registered with National Small Industries Corporation Ltd (NSIC) under its single point registration scheme.

However, this provision for waiver was withdrawn in the year 2012. It is well known that MSEs have limited financial resources and do not really have the scope for reserving funds for security deposits being blocked for long term. It is hence recommended that this benefit be reinstated for MSMEs, it added. 
 
Print the Page Add to Favorite
 
Share this on :
 

Please comment on this story:
 
Subject :
Message:
(Maximum 1500 characters)  Characters left 1500
Your name:
 

 
  Customs Exchange Rates
Currency Import Export
US Dollar
66.20
64.50
UK Pound
87.50
84.65
Euro
78.25
75.65
Japanese Yen 58.85 56.85
As on 13 Aug, 2022
  Daily Poll
PM Modi's recent US visit to redefine India-US bilateral relations
 Yes
 No
 Can't say
  Commented Stories
» GIC Re's revenue from obligatory cession threatened(1)
 
 
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter