Lucknow, May 15 (KNN) The enhancement of investment limit for MSMEs, as proposed in the MSMED (Amendment) Bill 2015 and by the One Man Committee for National MSME Policy, will not ease the existing issues being faced by the sector, Indian Industries Association (IIA) said in a letter to the Ministry of MSME.

The industry body IIA has written a letter to the Ministry of MSME, Government of India, making suggestions for re-classification of enterprises into micro, small and medium.

In the letter, IIA said it has opposed to any change in the existing classification of MSME’s as proposed in the MSMED (Amendment) Bill 2015 and also as proposed by One Man Committee for National MSME Policy on several grounds.

“At present the Micro and Small Enterprises with the existing investment limits are facing several problems including non-availability of finance, marketing, delayed payments, complexities of acts & rules and so on. Enhancement of investment limit is not going to ease out any of these problems. Let us first handle these problems and then think of stretching their size,” Manish Goel, President, IIA, said in the letter.

By enhancement of investment limit bigger fishes (MSMEs) will be added in to the pond of smaller fishes (MSME’s) who will eat away the share of smaller MSMEs e.g. in public procurement and MSME Budget etc, he addded.

IIA letter stated that the real benefit of the proposed reclassification will accrue to the enterprises having investment in plant & machinery more than Rs 10 crores and upto 30 Crores who are out of MSME Category. As such the proposal is for Large Enterprises rather than MSME’s.

Indian Industries Association agreed with the views of One Man Committee on MSME Policy that “Use of Turnover and Employment to define MSME will not add anything worthwhile over the present system”, mentioned the letter. (KNN Bureau)