Finance Minister Arun Jaitley has said amendments to the Companies Act 2013 being considered by Parliament will help ease institutional fund flow to small businesses, acknowledging this has been an issue with the MSME sector that has also not received adequate policy attention.
“There were procedural constraints concerning related party transactions whereby the main source of finance for MSMEs (micro, small and medium enterprises) was jeopardised but the government is working on it“, the Finance Minister said at the launch of an online databank for MSMEs on August 11.
He conceded that even though the micro, small and medium enterprises were the backbone of the economy, they had not received enough policy attention.
“The MSME sector is not given enough space during policy making or due media coverage, given how vast the sector is,” Jaitley said, adding that the sector was facing competition from not only domestic industries with economies of scale but also globally.
Despite these challenges the sector continues to expand, he said and promised that the government will create a conducive environment for the sector to grow.
The MSME database portal and finance facilitation portal are part of the Digital India initiative and will facilitate ease of doing business in the country. MSME sector is one of the biggest job creators in the country, employing about 110 million people. The online databank is expected to cut down on the costs and efforts put in conducting census physically.
It will also provide information about MSMEs in the country, including their credit and technology, requirement in terms of raw material, marketing, etc. Minister of micro, small and medium enterprises Kalraj Mishra said the portals will enable MSME units and their various association to furnish data easily.
Source: The Economic Times
