MSME Revised Definition & Road Map

Background:

Micro, small and Medium Enterprises (MSMEs) popularly called as MSMEs are the backbone of Indian economy. Silently operating in different areas across the country, more than 6 crore MSMEs have a crucial role to play in building a stronger and self-reliant India. These small economic engines have a huge impact on the country's GDP-making a contribution of 29 percent. They contribute to almost half of exports from the country. Additionally, more than 11 crore people are employed in the MSME sector

“Fully paved way for Energising the MSME Sector through entire gamut of 'Atmanirbhar Bharat Package”

1.    Revised Definition of MSME in terms of Capital & Turnover:

2.    Approval for provisioning of Rs 20,000 crore as subordinate debt to provide equity support to the stressed MSMEs. This will benefit 2 lakh stressed MSMEs.

3.    Approval for equity infusion of Rs. 50,000 crore for MSMEs through Fund of Funds (FoF) to help MSMEs in capacity augmentation & opportunity to get listed in Stock Exchanges.

“In the aftermath of COVID-19 pandemic, Prime Minister Shri Modi was quick to recognise the role of MSMEs in building the Nation. As such, MSMEs formed a very prominent part of the announcements made under the Atmanirbhar Bharat Abhiyaan” which are listed below:

? Rupees Three lakh crore collateral-free automatic loans for MSMEs to meet operational liabilities, buy raw material and restart businesses

? Disallowing global tenders in procurements up to Rs. 200 crores- to create more opportunities for domestic players

? And clearing of MSME dues by the Government and Public Sector Units within 45 days

“For Handholding the MSMEs in this regard, the following policy decisions & Implementation strategy have been put into place”

? The scheme for Rs. Three lakh crore col lateral-free automatic loans was earlier approved by CCEA and has been formally launched

? To ensure that MSME payments are released within the timeframe of 45 days, directions have been issued at the level of Cabinet Secretary, Expenditure Secretary and Secretary, MSME

? Amendments in General Financial Rules mandating no global tenders for procurement up to 200 crores have been carried out

? RBI has extended a moratorium on repayment of loans for another three months

To manage all this, a robust ICT based system called CHAMPIONS has also been launched by the Ministry of MSME. The portal is not only helping and handholding MSMEs in the present situation but is also providing guidance to grab the new business opportunities and in the long run, become national and international Champions.

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