New Delhi, July 5 (KNN) There were several announcements made in the Union Budget 2019-20 for the micro, small and medium enterprises (MSME) sector. The budget was crucial because the government had made several promises to the entrepreneurs during the election campaigns and in the memorandum. The MSMEs were all ears to listen to the announcements made for them.

Keeping upto the promises, Union Finance Minister Nirmala Sitharaman gave focus to the MSME sector and traders in her maiden budget as a Finance Minister.

KNN India spoke to MSME associations from across the country to know their views on the Budget.

 

Animesh Saxena, President, Federation of Indian Micro and Small & Medium Enterprises (FISME):

This was a very balanced budget trying to increase the overall economic activities. As far as MSMEs are concerned, the interchangeability of PAN with Aadhaar is a good step because it will further bring in operational ease.

Also, Government’s decision to put in more money in infrastructure development and setting up of mega manufacturing plants will boost up the economic activities and MSMEs will be benefitted as they will become a part of the supply chain. So, in short businesses will be generated for them.

For any new loan and incremental loan, the allocation of Rs 350 crore for 2% interest subvention for all GST-registered MSMEs is a good move as it will reduce the cost.

For startups, there will be no scrutiny of funds which will bring ease in doing business for them.

In short, I believe government has given indirect benefits to MSMEs by reducing direct benefits and creating a bigger economy.

 

Vipin Malhan, President, Noida Entrepreneurs Association (NEA):

Overall Budget is good and the decision to levy corporate tax at the lower rate of 25 per cent from companies with turnover up to Rs 400 crore is appreciable.

Focus has been given to all the segments, which is also appreciable.

The proposal to implement ‘One Nation One Grid' in the power sector for the availability of power to all states at affordable prices will bring equalization in all over India.

 

Nimish Phadke, Managing Director, Federation of Kutch Industries Association (FOKIA):

The turn over bracket hiked to Rs 400 crore from 250 crore for a corporate tax of 25% is a good move taken by Government.

One lakh crore for infrastructure, more FDI in aviation, 100% FDI in insurance intermediaries good all these decisions of the government are appreciable. Intention to develop more water ways is also a good move.

In addition, 70 thousand Crore for Bank capitalization will increase credit and angel tax issue resolved, it appears with the announcements. More PPP in railway is also good move.

R Raju, President, Karnataka Small Scale Industries Association (KASSIA):

KASSIA commends the Finance Minister for the initiative to create payments platform for the MSMEs in addition to the quick loan schemes available for MSMEs and the interest subvention for SMEs.

KASSIA would like to particularly welcome the proposed streamlining of the labour laws into 4 codes along with the continued emphasis on development of skilled manpower in the country.  The proposed creation of 75000 new entrepreneurs under, the livelihood business Incubator scheme is indeed the need of the hour.

KASSIA would particularly like to welcome the reforms proposed to be implemented with regard to GST including in the filing of returns and the other procedural issues to help small industry and business.

The reduction in corporate tax to 25% on a large number of companies, besides, the concession in income tax making it zero tax up to income of Rs.5 lakhs will be great relief for the ordinary tax payer.

 

Yatinder Suri, Chairman, Process Plant and Machinery Association of India (PPMAI):

The impact of various incentives to the MSME sector will be positive. The 2% interest subvention would enable the cash-starved MSMEs to ensure smooth credit line flow for their firms. This government support to the MSME sector will provide stimuli to the local manufacturers to grow and prosper. This is also an answer to the employability avenues.

Manmohan Giand, Secretary General, Manesar Industries Welfare Association (MIWA): We were expecting more, much more than what was offered. Otherwise it’s a growth budget. It’s the budget for future, for taking the country forward but some relief was definitely anticipated.

 

Balaji Shinde, President, Marathwada Associations of Small Scale Industries and Agriculture (MASSIA):

From the budget, the politicians are getting the benefits but the Small Scale Industries are still on the verge of their sufferings. A relief of Rs 5 Lakhs as per the budget will be given but it will not benefit the small scale. Now the industries will have to pay 3 percent extra tax as the turnover for each industry will be increased from Rs 3 crores- Rs 5 crores. The increase in taxes will not only hamper the growth of Small Scale Industries but also act as a break in their growth.

MSMEs are the backbone of Industries and are one of the major reasons for the increase in employment but these MSMEs are still not given any benefit.

S.K. Jain, President, Mysore industries Association: MIA welcomes the two (2) % interest subvention scheme for registered GST units on all existing and new MSME loans. It also welcomes the new payment platform for MSME proposed to be created. It is in continuation of delayed payment act 2006 strengthening the act, It may make receivable payment from PSU’s and large Industries easier.The other announcements welcomes by MIA include - IT limit enhanced to Rs.  5 lakhs; Electric vehicle GST reduced to 5%; Up to Rs 1.25 lakhs subsidy for Electric vehicle upto Rs. 10 lacks; Skilling 10 lack youth to facilitate MSME; Support scheme to bring more Women in Industrial activity; Increase of Customs on import of goods to promote Indian manufacturers under Make in India; and Reduction of GST on electronic goods.

 

R.S Joshi, President, Federation of North Eastern Region (FINER):

Overall it’s a good budget and Finance Minister has announced MSME centric measures like interest subvention and easy access to credit.

Because there is a push to infrastructure and all other factors, so naturally MSMEs will also get benefitted that way. But one thing is little disappointing is that the economy is facing a slowdown and no immediate measures as such not reflected in the budget.

Snapdeal:

The government has done well to focus on the rural economy - electricity, roads, skill development & entrepreneurship are much needed for the $5 Tn goal. Also welcome the positive measures for start-ups, angel tax, payments, MSMEs & research promotion. A good roadmap for the next 5 years.
 
 
P.K.Agrawal, President, Bihar Chamber of Commerce & Industries:

People of trade and industry were eagerly looking forward to declare special economic package for backward State like Bihar or concept of industrially backward area grant fund in the Budget because previously policies relating to Freight Equalization, Royalty on Minerals and repeated floods in the State, resulting in huge losses year after year.
 
 
Cashew Export Promotion Council of India (CEPCI):

The cashew exporters from the country have welcomed the Union Budget for the year 2019-20 which has announced hike in  the import duty of cashew kernels (both wholes & brokens) and cashew nut others (semi – finished cashew and other products) from 45% to 70%. This decision is a relief to the already crisis hit industry on its path to revival.

 

Ravi Sehgal, Chairman, EEPC India:

The Budget presented by Finance Minister Nirmala Sitharaman will boost investment in key infrastructure which will help exports in a big way. The government's stress on MSME would further help exporters, particularly in the small segments. Stress on Make in India should strengthen India's manufacturing capabilities to value addition in exports. The ease doing business is an impressive effort in the budget as also priority to the high end technology areas.
 

Sharad Kumar Saraf, President, FIEO:

The interest subvention of 2% given to MSME as well as payment platform for bill filing for MSME will help in flow of credit at competitive cost. The investment of Rs.100 lakh crore in infrastructure in next 5 years through Bharatmala, Sagarmala, Jal Marg Vikas Project will help in improving logistics, reducing transportation cost and increasing competitiveness. The PMMSY for the robust fisheries management framework will give a push to marine exports from the country in which India has emerged as the largest exporter though huge untapped potential still exists. The support given to GI products and artisans to showcase in global markets will provide much needed exposure to them paving the way for further exports. Focus on clusters in Bamboo, Honey and Khadi will not only create huge employment opportunity but will also give a push to their exports. The identification of 17 iconic tourism sites will give a push to tourism exports in the country.
 

Biswanath Bhattacharya, President, FOSMI:

Budget did not provide any kind of lucrative benefit to MSMEs though there was lot of expectation of MSMEs from this budget. There was reflection of  earlier declared  extension of 1 crore  loan in 59 Minutes and  the limit  for the payment corporate tax @25% has been increased from 250 crores to 400 crores which hardly would have any kind of appreciable benefit to MSMEs. MSMEs’ expectations of incentives on Trade and Export did not materialise in this budget. However in reinforcing MSME growth, interest subversion of 2% for fresh or incremental loans for the registered assesses will get additional flexibility in this sector.