07-Oct-2013
The Associated Chambers of Commerce and Industry of India (Assocham) has recommended that the definition of micro, small and medium enterprises (MSMEs) under the MSMED Act 2006 should be revised. This is one of eight major recommendations by the chamber to help the MSME sector.
In a report titled Indian MSMEs: Current Scenario and the Way Forward, which Assocham recently submitted to Finance Minister P Chidambaram, the chamber said that keeping in view the definitions of MSMEs in other countries and inflation in India in the last few years, the capital investment limits on the basis of which MSMEs are defined are too low. They should therefore be increased by at least 50 per cent.
Moreover, the number of employees should also be incorporated in the definition, as in other countries, it said. For sustained growth, it is important for MSMEs across the country not only to deal with big corporates and government companies, but also to interact among themselves to identify new business opportunities, said Assocham.
The other major recommendations pertain to availability and cost of credit, marketing support, modification in labour laws, infrastructure, incentives and expanded tax benefits, constitution of a standing committee of secretaries to resolve policy and implementation-related issues, and greater and coordination at the ground level between Customs and DGFT offices.
Assocham feels that the current global economic scenario has thrown up both opportunities and challenges to the Indian MSME sector. On the one hand, opportunities have opened up enhance productivity and look at new national and international markets.
On the other, these opportunities compel MSMEs to upgrade the competencies that will be needed to withstand competition, since obsolescence is rapid, with new products being launched at an incredible pace and being available worldwide in a short time.
The chamber said that if its recommendations are implemented, the result will be a big boost for the MSME sector.
Source:- business-standard.com
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