Historic decisions for MSME,street vendors & farmers

02-06-2020

New Delhi (UNI)

Decisions that will have a transformative impact on the lives of India’s hardworking farmers, MSME sector and those working as street vendors were taken at the first meeting of the Union cabinet, under the chairmanship of Prime Minister Narendra Modi, in the second year in office of the NDA in its second term. 

In a significant decision taken for the benefit of the MSMEs Sector, the NDA Government laid down the road map for effective implementation of other announcements under the Atmanirbhar Bharat Package. 

These include Upward revision of MSME Definition that will help in attracting investments and creating more jobs in the MSME sector, approval of proposal for provisioning of Rs 20,000 crore as subordinate debt to provide equity support to the stressed MSMEs and a proposal for equity infusion of Rs. 50,000 crores for MSMEs through fund of funds. 

The Cabinet decided for further upward revision of MSME definition. In the package announcement, the definition of micro manufacturing and services unit was increased to Rs. 1 crore of investment and Rs. 5 crore of turnover. The limit of small unit was increased to Rs. 10 crore of investment and Rs 50 crore of turnover. Similarly, the limit of a medium unit was increased to Rs 20 crore of investment and Rs. 100 crore of turnover. 

It may be noted that this revision was done after 14 years since the MSME Development Act came into existence in 2006. After the package announcement on 13th May, 2020, there were several representations that the announced revision is still not in tune with market and pricing conditions and it should be further revised up wards. Keeping in mind these representations, 

Prime Minister decided to further increase the limit for medium manufacturing and service units. Now it will be Rs. 50 crore of investment and Rs. 250 crore of turnover. It has also been decided that the turnover with respect to exports will not be counted in the limits of turnover for any category of MSME units whether micro, small or medium. Mr Javadekar said it was decided to further increase the limit for medium manufacturing and service units. 

After the package announcement on May 13, there were several representations that the announced revision is still not in tune with market and pricing conditions and it should be further revised upwards. In the announcement, the definition of micro manufacturing and services unit was increased to Rs 1 crore of investment and Rs 5 crore of turnover. The limit of small unit was increased to Rs 10 crore of investment and Rs 50 crore of turnover.  

 

 

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