FOCIA seeks further amendments in MSME classification

Coimbatore, July 15 (KNN) Seeking changes in the reclassification, the Micro, Small and Medium Enterprise (MSME) association have written to the MSME Minister Nitin Gadkari.

According to members of the Federation of Coimbatore Industrial Associations (FOCIA), the new changes undermined the identity of micro and small units and shifted focus to the creamy layer of medium enterprises.

According to the gazette notification on June 26, a medium enterprise is where the investment in plant and machinery or equipment does not exceed Rs 50 crore and turnover does not exceed Rs 250 crore.

FOCIA representatives said that if implemented, it will equate a micro unit with less than Rs 1crore turnover with a medium enterprise, which has more than Rs 250crore turnover, excluding export turnover.

“As per statistics, 95% of MSMEs are micro units, 4.5 % are small and only less than 0.5% are medium enterprises. The changes should focus to uplift the downtrodden,” they added.

The Government should consider formation of a separate ministry for Cottage, Micro and Small Enterprises (CMS) and focus on the development and upliftment of the deprived strata of society,” they suggested.

They also alleged that the notification makes mandatory for MSMEs to register on the Udyam portal, which does not enhance the ease of doing business adding ''the existing Udyog Aadhar Memorandum (UAM) should be continued.''

''The reservation for procurements by public sector undertakings from CMS should be increased from 25% to 50%,” they said.