PM Modi's Diwali gift for small businesses: Here are 12 major decisions taken by govt for MSMEs

PM Modi launched the ‘MSME Support and Outreach Program’ and has announced 12 big decisions to catalyse the growth of small businesses across the country.

PM Modi has announced that MSMEs registered under GST will be sanctioned a loan of Rs 1 crore in just 59 minutes. (Image: AFP)

New Delhi: In order to boost the entrepreneurial ecosystem and further strengthen the Micro Small and Medium Enterprises (MSMEs), Prime Minister Narendra Modi on Friday announced some major initiatives to revive the sector which somehow lagged in the wake of economic reforms implemented by the Central government. MSEMs undoubtedly witnessed a slowdown in the wake of demonetisation and implement of Goods and Services Tax (GST). However, prime minister launched the ‘MSME Support and Outreach Program’ and has announced 12 big decisions to catalyse the growth of small businesses across the country. Launching the initiatives, PM Modi took to Twitter and said, “Let there be no limitations for India’s entrepreneurial energy!” Here’s the list of 12 key decisions taken by PM Modi-led Bharatiya Janata Party (BJP) government for MSMEs of the country: 1. Instant Loan in 59 minutes! PM Modi has announced that MSMEs registered under GST will be sanctioned a loan of Rs 1 crore in just 59 minutes through a new portal. The prime minister also said that earlier access to credit was a major challenge for the MSME sector. 2. Relaxation in Interest Rates The Government has announced that MSMEs registered under GST will get 2 per cent subvention or rebate on incremental new loans of up to Rs 1 crore. Interest subvention on pre- and post-shipment credit for exports by MSMEs has also been increased from 3 per cent to 5 per cent. 3. Cash flow Mechanism Announcing the initiative, PM Modi said, “It was been decided that all CPSEs and Corporates having a turnover of more than Rs 500 crore must be on the Trade Receivables e-Discounting System or the TReDS Platform.” This has been done so that MSMEs do not face trouble in managing their cash flow. 4. Market Expansion The government is also planning to expand the market for MSMEs and ensuring that their customer base also widens. PM said that now, a mandatory 25 per cent of all procurements by CPSEs must be from MSMEs. 5. Women Entrepreneurs PM Modi has also announced that the government will be working towards creating favourable opportunities for women entrepreneurs. Out of the 25 per cent procurement mandated for the MSMEs, 3 per cent will now be reserved for women. 6. Online Marketplaces Taking the digital way, PM Modi has also decided to infuse Government e-Marketplace (GeM) for MSMEs which he said is an excellent platform for customer offerings and convenience. All Central Public Sector Enterprises (CPSEs) will now have to be a part of GeM. 7. Tech Support for MSMEs The Central government has announced a massive Rs 6,000 cr fund to ensure tech infusion in the industry. The funds will be allotted for 20 hubs and 100 tool room for technology upgradation. 8. Pharma Companies “I hope this decision makes the Diwali for MSMEs working in the Pharma Sector even more special,” said the Prime Minister stating that 70 per cent cost of establishing MSME pharma clusters will be funded by the government. 9. Single Annual Return In order to simplify processes and make businesses easier, PM Modi said that MSMEs will now have to file just one annual return on eight labour laws and 10 central rules. 10. Abolishing Inspector Raj PM Modi has announced abolishment of Inspector Raj for MSMEs. Now, inspection of factories will be sanctioned through computerised random allotment and inspectors will have to upload the report on the portal with 48 hours. 11. Environmental Clearance PM Modi has also announced simplifying the processes for environmental clearances and 'Consent to Establish’ through steps such as self-certification. 12. Ordinance in Companies Act Last but not the least, PM Modi said that an ordinance has been promulgated to further simplify the penalties norms for minor offences under the Companies Act.