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Highlights of the Prime Minister’s support & outreach initiative for the MSME sector


Access to credit


As the first announcement, the Prime Minister announced the launch of the 59-minute loan portal to enable easy access to credit for MSMEs. He said that loans up to Rs 1 crore can be granted in-principle approval through this portal, in just 59 minutes. He said a link to this portal will be made available through the GST portal. The Prime Minister asserted that in New India, no one should be compelled to visit a bank branch repeatedly.


The Prime Minister mentioned the second announcement as a 2 per cent interest subvention for all GST-registered MSMEs, on fresh or incremental loans. For exporters who receive loans in the pre-shipment and post-shipment period, the Prime Minister announced an increase in interest rebate from 3 per cent to 5 per cent.


The third announcement made by the Prime Minister was that all companies with a turnover more than Rs. 500 crore must now compulsorily be brought on the Trade Receivables e-Discounting System (TReDS). He said that joining this portal will enable entrepreneurs to access credit from banks, based on their upcoming receivables. This will resolve their problems of cash cycle.


Access to markets


The Prime Minister said that on access to markets for entrepreneurs, the Union government has taken a number of steps already. In this context, he made his fourth announcement that public sector companies have now been asked to compulsorily procure 25 per cent, instead of 20 per cent of their total purchases from MSMEs.


The Prime Minister said his fifth announcement is related to women entrepreneurs. He said that out of the 25 per cent procurement mandated from MSMEs, 3 per cent must now be reserved for women entrepreneurs.


The Prime Minister said that more than 1.5 lakh suppliers have now registered with GeM, of which 40,000 are MSMEs. He said transactions worth more than Rs 14,000 crore have been made so far through GeM. He said the sixth announcement is that all public sector undertakings of the government must now compulsorily be a part of GeM. He said they should also get all their vendors registered on GeM.


Technology upgradation


Coming to technological upgradation, the Prime Minister said that tool rooms across the country are a vital part of product design. His seventh announcement was that 20 hubs will be formed across the country, and 100 spokes in the form of tool rooms will be established.


Ease of Doing Business


On Ease of Doing Business, the Prime Minister said his eighth announcement is related to pharma companies. He said clusters will be formed of pharma MSMEs. He said 70 per cent cost of establishing these clusters will be borne by the government.


The Prime Minister said that the ninth announcement is on simplification of government procedures. He said the ninth announcement is that the return under 8 labour laws and 10 Union regulations must now be filed only once a year.


The Prime Minister said that the tenth announcement is that now the establishments to be visited by an inspector will be decided through a computerised random allotment.


The Prime Minister noted that as part of establishing a unit, an entrepreneur needs two clearances, namely, environmental clearance and consent to establish. He said that the eleventh announcement is that under air pollution and water pollution laws, now both these have been merged as a single consent. He further said that the return will be accepted through self-certification.


As the twelfth announcement, the Prime Minister mentioned that an Ordinance has been brought, under which, for minor violations under the Companies Act, the entrepreneur will no longer have to approach the Courts, but can correct them through simple procedures, said a release.


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