New Delhi, Feb 1 (KNN) The Indian Micro Small and Medium Enterprises (MSMEs) have welcomed the Union Budget presented by Finance Minister Nirmala Sitharaman today.

“The Budget makes a big bet on infrastructure and social spending to fuel growth and yet does not look inflationary”, says their chief representative body FISME- the Federation of Indian Micro, Small & Medium Enterprises.

FISME particularly lauded reduction in Customs duties of the Steel and on ferrous and non-ferrous scrap (copper) as it was the top demand they placed during pre-budget consultations before the Finance Minister.

The Customs duty has been reduced uniformly to 7.5% on semis, flat, and long products of non-alloy, alloy, and stainless steels.

“To provide relief to metal re-cyclers, mostly MSMEs, I am exempting duty on steel scrap for a period up to 31st March, 2022. Further, I am also revoking ADD and CVD on certain steel products. Also, to provide relief to copper recyclers, I am reducing duty on copper scrap from 5% to 2.5%”, the Finance Minister said in her Budget speech.

A positive intervention through the Budget has been to rationalize duties on raw material inputs to manmade textiles and to bring the nylon chain at par with polyester and other man-made fibers.

“We are uniformly reducing the BCD rates on caprolactam, nylon chips and nylon fiber & yarn to 5%. This will help the textile industry, MSMEs, and exports, too”, she had added.

The Union Budget proposed an increase in Customs duties for several MSME products specially the auto components to 15%.  

FISME has also reacted positively to the Budget announcement regarding strengthening of NCLT framework, implementing e-Courts system and developing an alternate methods of debt resolution and special framework for MSMEs shall be introduced.

According to FISME this could pave way for establishment of a mechanism for proprietorship and partnership firms also which constitute 97% of MSME sector under the Insolvency and Bankruptcy Code.

FISME appreciated doubling of the outlay for Ministry of MSMEs to over Rs. 15,000 cr which is largely to be used primarily for capitalizing the Credit Guarantee Fund running the Emergency Credit Line Guarantee Scheme (ECLGS) announced as part of recovery package during COVID pandemic last year.