Dec 20 2021 | 5:27 AM HIST

The center must find a solution for MSMEs to survive

At the call of the Indian Council of Association of MSMEs (AICA), Micro, Small and Medium Enterprises (MSMEs) will observe a symbolic one-day shutdown of all industries across India on December 20. This will also include a peaceful hour-long protest outside the respective district collector / magistrate’s office, possibly not in Goa, to pressure Prime Minister Narendra Modi’s intervention to reduce commodity prices to the level of commodities. prices prevailing in April 2021. With countries like Japan, which hosted the Olympics recently and China reducing steel production in their respective countries for environmental reasons, the price of steel in the international market has increased. increased considerably and many steel producing countries, including India, preferred to export rather than make their product available on the domestic market. Obviously, because of this, the price of raw materials has skyrocketed, making it difficult for small units and MSMEs to maintain themselves economically.

The IAIS was established by over 200 MSME associations covering approximately over ten million MSME industries across India, which forms the backbone of the Indian economy which contributes around 30 percent of the gross domestic product (GDP), 48 percent of exports and employs nearly more than 50 percent of the workforce in manufacturing units. This one-day shutdown, according to the IAIS, will result in a loss of production of Rs 25,000 crore, in addition to the loss of jobs for many. Large MSME associations will participate in this closure and one-day event and MSMEs from other states such as Punjab, Haryana, Odisha, Assam, Karnataka (entire Belgaum region), Gujarat, Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh, Maharashtra. , Madhya Pradesh and even our own state, Goa, are supporting the IAIS call by shutting down the operations of their member industries on December 20.

According to MSME Ministry data made available on November 26, 2021, India has around 6.3 million MSMEs. The Udyam Registration Portal has registered 5,767,734 MSMEs, replacing the old Udyog Aadhaar (UAM) memorandum filing process. Registered micro-enterprises stood at 5,441,220 (94.34%), followed by small enterprises at 293,555 (5.09%) and medium-sized enterprises at 32,959 (0.57%). Among the top five state-level Udyam records, Maharashtra recorded a maximum number of records with 12.18 lakh units, followed by Tamil Nadu (6.23), Gujarat (4.86) , Rajasthan (4.68) and Uttar Pradesh (4.45). The new online MSME / Udyam registration system launched by the Union Ministry of MSMEs, with effect from July 1, 2020, has successfully registered over 5.7 million MSMEs up to November 2021.

While domestic enterprises need strong financial stimulus and support with concessional working capital loans to ensure adequate liquidity is maintained in the business operations of government and financial institutes, they are now affected by the crisis. rising commodity prices. However, this pandemic showed a sharp increase in the registration of MSMEs in the country, which meant that the “job providers” were doing their jobs with the expectations of the “support” of the Union government. Such strikes do not bode well against the policies and slow movements of the Union’s finance ministry. The Union government dreamed of doubling the Indian economy to $ 5,000 billion. In order to achieve this goal, career opportunities for the young population have been generated and MSMEs have the potential to serve as a key job generator. Certainly, the government has undertaken to promote MSMEs in order to create new jobs in the sector in order to keep the economy moving. In addition, the government aims to increase the share of MSMEs in exports and its contribution to GDP. So why is the MSME sector crying out for help?

In order to achieve these goals, the Union government should invest in the provision of more back-end services to improve the performance of the MSME sector as it provides goods and services to large industrial companies. Lack of technology-based production activities and low investment in research and development activities are bottlenecks and obstacles, preventing the sector from becoming self-sustaining. The Union government must subsidize the technology available in the world so that the quality of the products of MSME actors can be improved using existing resources. It also requires the help of academic institutions in the form of research and development services for product innovation. Yes, without a doubt, the economy of saving the domestic industry should be given priority, rather than mere profit.