Lok Sabha Question No. 1302 (UNSTARRED), answered on 2019-02-11
Subject: Development of MSMEs
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: JUGAL KISHORE SHARMA, RITI PATHAK

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO.  †1302 TO BE ANSWERED ON 11.02.2019

## DEVELOPMENT OF MSMEs

## †1302.   SHRI JUGAL KISHORE: SHRIMATI RITI PATHAK:

Will the Minister of MICRO, SMALL AND   MEDIUM ENTERPRISES be pleased to state:

- (a) whether  the  Government  is  satisfied  with  the  development  of  micro,  small  and  medium enterprises  (MSME)  sector  in  the  State  of  Jammu  and  Kashmir  and  Madhya  Pradesh,  if  so,  the details thereof;

(b) the details of the important steps taken/achievements made in the aforesaid sector during each of the last three years and the current year;

(c) whether  the  task  force  constituted  for  development    and  promotion  of  MSMEs  has recommended  to  encourage  micro  financing  institutes  for  setting  up  of  self  help  groups  and financing for these enterprises at reasonable rates, if so, the details thereof;

- (d) the salient features of the other recommendations made by the said task force; and

(e) the  details  of  the  several  memoranda  of  understanding  signed  with  the  various  countries including Mozambique for co-operation in the MSME sector during the said period?

## ANSWER

## MINISTER OF STATE (INDEPENDENT CHARGE) FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI GIRIRAJ SINGH)

(a): Several  Measures  have  been  put  in  place  for  the  development  of  MSME  Sector  in  the country, including Jammu and Kashmir and Madhya Pradesh.

The  Central  Government  implements  various  schemes  and  programmes  such  as  Prime Minister's Employment Generation Programme (PMEGP), Scheme of  Fund for Regeneration of Traditional  Industries  (SFURTI),  A  Scheme  for  Promoting  Innovation,  Rural  Industry  and Entrepreneurship  (ASPIRE),  Credit  Guarantee  Fund  Scheme  for  Micro  and  Small  Enterprises, Credit Linked  Capital  Subsidy  Scheme  (CLCSS),  National  Manufacturing  Competitiveness Programme (NMCP), Micro & Small Enterprises - Cluster Development Programme (MSE-CDP), National Scheduled Caste and Scheduled Tribe Hub (NSSH), and Schemes for Coir products and Khadi & Village Industries.

National Small Industries Corporation (NSIC) under the Ministry of MSME also promotes and  supports  Micro,  Small  and  Medium  Enterprises  by  providing  integrated  support  services encompassing marketing, finance, technology and other services.

(b): The details of achievements made and new initiatives taken for promotion and development of the MSME sector during each of the last 3 years and current year are as under:-

(i) The  Prime  Minister's  Employment  Generation  Programme  (PMEGP),  a  credit-linked subsidy  programme aimed at  generating self-employment opportunities  through  establishment  of micro-enterprises. A provision of second loan of upto Rs. 1 crore has been introduced under this Programme for well performing units.

- (ii) To  ease  credit  flow  to  Micro  and  Small  Enterprises,  Government  implements  'Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE)' Scheme. The corpus of this fund has been enhanced from Rs. 2500 crore to Rs. 7500 crore. The eligible loan limit under the CGTMSE  has  been  enhanced  from  Rs.  1  crore  to  Rs.  2  crore  and  the  Non-Banking  Financial Companies (NBFCs) have been allowed to become Member Lending Institutions (MLIs) under the Scheme.
- (iii) National Scheduled Caste and Scheduled Tribes (SC/ST) Hub (NSSH) has been set up to provide professional support to SC/ST entrepreneurs.
- (iv) Hon'ble  Prime  Minister's  12  key  announcements  on  02.11.2018  regarding  Support  and Outreach Initiatives for MSME Sector:
1. Loans upto 1 crore within 59 minutes through online portal.
2. Interest subvention of 2% for all GST registered MSMEs, on fresh or incremental loans.
3. All companies with turnover of more than Rs. 500 crores to be mandatorily on TReDS platform to enable entrepreneurs to access credit from banks, based on their upcoming receivables, thus, solving the problems of cash cycle.
4. All Central Public Sector Undertaking (CPSUs) to achieve an overall procurement of a minimum of 25% from MSEs.
5. Out  of  the  25%  procurement,  mandated  from  MSEs,  3%  reserved  for  women entrepreneurs.
6. All CPSUs to compulsorily procure through Government e-Marketplace (GeM) portal.
7. 20 Hubs and 100 Spokes in the form of Tool Rooms for Technological Upgradation to be established across the country with a fund allotment of Rs. 6000 crore.
8. Govt. of India to bear 70% of the cost for establishing Pharma clusters.
9. Returns under 8 Labour laws and 10 Union regulations to be filed once in a year.
10. Establishments  to  be  visited  by  an  Inspector  will  be  decided  through  a  computerized random allotment.
11. Single consent under air and water pollution laws. Returns to be accepted through selfcertification and only 10% MSME units to be inspected.
12. For  minor  violations  under  the  Companies  Act,  entrepreneurs  no  longer  have  to approach court but can correct them through simple procedures.

(c)&(d): The Government had constituted One Man Committee under the Chairmanship of Shri Prabhat Kumar to make recommendations for a National Policy for Micro, Small and Medium Enterprises. Recommendations of the Committee include the following:-

- (i) The  Government  scales up  Micro  Units  Development  &  Refinance  Agency Ltd. (MUDRA) as a Financial Institution responsible for the entire Micro enterprises sector in the country and MUDRA undertakes developmental activities for the overall development of Micro enterprises sector including regulation and monitoring of Micro Finance industry.
- (ii) The Government takes a new look on policies to reap the advantages of a growing young MSME entrepreneurial class.
- (iii) Development of a synergistic ecosystem for development of MSMEs.
- (iv) Effective Coordination with State governments.
- (v) The Public-Private-Participation mode of implementation to be encouraged.
- (vi) Aggregation of livelihood oriented micro enterprises.
- (vii) A transparent database that can be gainfully used by the key stakeholders at the national, state and local levels.

(e): During last three years and current year, Memoranda of Understanding have been signed by the Ministry of MSME with various countries in the fields of Micro, Small and Medium Enterprises and innovation and cooperation.  No Memorandum of Understanding was signed with Republic of Mozambique during the said period. A Memorandum of Understanding was, however, signed in the year 2010 with Republic of Mozambique by the Ministry of MSME.