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MoUs won't help, rather they will end up having negative impact on MSMEs: FOPSIA

Updated: Dec 06, 2019 07:22:01am
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MoUs won't help, rather they will end up having negative impact on MSMEs: FOPSIA

New Delhi, Dec 6 (KNN) On the first day of the two-day Progressive Punjab Investors Summit, the Punjab government signed Memorandum of Understandings (MoUs) with e-commerce giants like Amazon and Flipkart to enable Punjab based Micro, Small and Medium Enterprises (MSMEs) to access new markets and to increase business and trade inclusion opportunities for MSMEs in the state.

The MoUs were signed by state Industries and Commerce Minister Sunder Sham Arora. The minister said that the government had signed the MoU with Amazon to enable B2B (business to business) linkages with key international markets, including the US, Canada and key European markets while the MoU was signed with the Flipkart to facilitate access for MSMEs to new domestic markets, for pushing handloom weavers and small enterprises in Punjab towards growth.

To get more insight of the same and in what way, the agreement will help MSME to grow, KNN India spoke to Federation of Punjab Small Industries Association (FOPSIA) President Badish Jindal, who, however, doesn't seem to be lauding the steps taken by Punjab government.

''Already, we have enough MoUs but still the situation of the industries are same. With the help of incentive new companies have come into existence and due to this government is not focusing on the existing industries,'' Jindal told KNN India over phone.

''There is no Ease of Doing business (EODB). They managed to set up some companies by providing free land and attractive intensive. At what time, these agreements will get matured. Agreement can be signed regularly, but till the time it gets matured and the investments comes on ground, then we can say such. As of now, these MoUs will not help MSMEs at all rather  it will create competition for the existing MSMEs," he said.

''It won't help, instead the impact will be negative on MSMEs," he added.

He further said that promises which are being made in the MoUs are fake, MSMSEs will realize it soon. ''By the time these MoUs will expire, MSMEs will realize that the promises are all fake which were made to them,'' he asserted.        

He further reminded that nearly 600 applications are pending since 2013 under the Industrial promotion policy of the previous government. He also said that the revenue is getting deficit of GST and centre is contributing to cover losses, then how can you show progress?

''If the government is setting up the new industries by providing free land and attractive incentives, for an example, if they (Government) are giving more facilities by reducing costs like power cost and tax to the new one, then what about the existing one, the government is almost killing the existing industry,'' he concluded. 

Notably, Punjab is home to over 1.6 lakh micro, small and medium-sized enterprises which are crucial drivers of job creation and economic growth. However, many of them are unfamiliar with how to sell online and do not get to interact with online marketplaces to clear their doubts regularly.

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