FISME submits proposal to Fin Min on Union Budget 2017-18
New Delhi, Nov 16 (KNN) The apex body for MSME Associations in the country, FISME, submitted its proposal for consideration for Union Budget 2017-18.
Union Finance Minister Arun Jaitley will hold Pre-Budget Consultations on Union Budget 2017-18 with industry bodies on November 26, 2016.
The Federation of Micro and Small & Medium Enterprises (FISM) has also been invited by the Ministry for consultation.
In its proposal, FISME has urged the Finance Minister to tweak the import duties within the framework of multi-lateral and regional commitments to create a pull for “Make in India” and encourage manufacture of value added products.
It suggested, “Rates of Custom Duties on various stages of production - from raw material to finished products may be finely differentiated allowing small breathing space to each of the value adder. A study could be commissioned to identify potential sectors and slabs to encourage such. value addition activities.”
Access to Finance has always been a key challenge for the MSME sector.
On this, FISME urged the government should encourage Banks and RBI to develop different financial products for the MSME manufacturing sector, viz., insurance products towards Bank Guarantees, discounting platform for secured receivables etc.
Recently, RBI Deputy Governor SS Mundra said the Reserve Bank of India is preparing a framework to provide accreditation to credit counsellors for facilitating easy flow of credit to the MSMEs.
The main aim towards setting up of TReDS platform was to facilitate an electronic bill factoring exchange in the country for MSMEs.
FISME sought operationalizing RBI TReDS platform for sale-purchase of MSME bills.
It said, “To provide succour to fund starved MSMEs, setting up of an online platform for discounting of their supply bills as suggested by Kamath Committee may be expedited. To make it purposeful, it is necessary that the invoices are uploaded mandatorily and status of deemed acceptance is granted to them to convert them into negotiable financial instruments. This will not only provide much needed liquidity to MSMEs but will also usher in financial discipline in corporate and PSUs which is equally important for the country’s financial system.”
The other suggestions made by the industry body includes – no lower threshold om investment allowance on capex; Incentive for employment; Income Tax for enterprises operating in the much desired (by the government) company format may be levied in slabs as available to individual tax payers.
On Public Procurement Policy, FISME said, “public procurement comprises almost 1/3 of India’s GDP. By having a direct control through buying on almost a third of goods and service produced in the country, Governments exercise enormous influence on the behaviour of economic actors of all hues. Utilities –water, electricity Boards etc, are among the largest buyers.”
It said, “Though these utilities are expected to run on commercial terms, their accounting systems and their inventory management systems are obsolete which allow a lot of unscrupulous practices to take place. While on the one hand, it results into enormous financial leakages, on the other hand such a devious system encourages inefficient firms and crowd-out efficient ones. This, many experts warn, in the long term lead to hollowing out of manufacturing in India as efficient firms may go out of business leaving the inefficient ones who also would not be able to withstand global competition.”
FISME suggested that the Central funds/ assistance ought not to go the utilities/ agencies engaged in providing services commercially but not having - double entry accounting system; and 100% computerization of Inventory with IT based management systems.
The government has decided to advance the Budget process by a month to ensure that it is completed before the start of the new financial year on April 1.
In the past, Budget has been presented on the last working day of February.
To View The Full Proposal Submitted by FISME Please Click the Link Below:
Mumbai, Mar 25 (KNN) The 1st Trade and Investment Working Group (TIWG) meeting under India’s…
New Delhi, Mar 24 (KNN) The growth of India’s MSME sector is heavily accelerated…
New Delhi, Mar 24 (KNN) Minister of State for MSME, Bhanu Pratap Singh Verma…
Ahmedabad, Mar 23 (KNN) The Ministry of MSME has informed the Gujarat High Court that…
New Delhi, Mar 23 (KNN) The Reserve Bank of India (RBI) has been reached out…