Ahead of Budget 2020, a number of small industry bodies have put forward their recommendations for benefit of the MSME sector. This sector is contributing in a massive way, creating millions of jobs and accounting for a major portion of the country’s manufacturing output and exports, but unfortunately our MSMEs have been grappling with several issues for some time now, considering which, these demands sound quite reasonable.
While such demands are many, what tops the list – it's a no brainer to say – is lack of credit. It is a must to avail easy and affordable credit to MSMEs if we want to see the sector revive from the ongoing slowdown. According a latest World Bank report, economic activity in India is constrained by insufficient credit availability, and there is no doubt that Indian MSMEs are suffering the brunt of it. Therefore, Budget 2020 should make every effort to put more money with MSMEs, in every possible way.
Lack of affordable industrial space is another major challenge. Post Land Acquisition Act enactment, prices of land have risen is many states making it difficult for MSMEs to set up their units. Also, while some of the states are offering land free or at subsidized rates to large industries, MSMEs are hardly covered by such policies. This is why time has come that government explores innovative ways like developing exclusive industrial space for SMEs to offer them industrial land at affordable prices.