Start a drive to register all MSMEs: entrepreneur
Updated: Sep 01, 2014 03:54:11pm
New Delhi, Sept 1 (KNN) Managing Director of Dayachand Engineering, Naveen Jain from Meerut has said that a drive should be launched along the lines of Pradhan Mantri Jan Dhan Yojana or National Mission of Financial Inclusion to get all micro, small and medium units to register.
Jain’s recommendation comes in the backdrop of the Secretary MSME, Madhav Lal recently stating that they were unable to make meaningful policies for MSMEs as a large chunk is not registered.
“Before making any amendment, we should try to understand that why small industries don’t get registered and by removing those obstacles we should start a drive to register all of them on the lines of Jan Dhan Yojana for financial inclusion,” Jain who is former Chairman, Indian Industries Association, Muzaffarnagar told KNN.
After mass registration we will get data to make meaningful policies, he added.
The entrepreneur from Muzaffarnagar who is also a CEC member of the Federation of Micro, Small and Medium Enterprises (FISME) also pointed out that there is a move to amend the MSMED Act of 2006 and change the definition of MSMEs.
“Lots of examples are being collected from different European countries, which have no relevance to the circumstances and environment for MSMEs in India,” Jain said.
Citing the example of applicable labour laws in India, he said, “For units with less than ten employees and with pay less than Rs 15,000, there is no cost on the employer and the employee in context to the deductions.
As for the units with number of employees between 10 and 19, and with pay less than Rs 15,000, the cost on the employee after the deductions is 1.75 per cent, and that on the employer is 17.89 per cent and the total cost is 19.64 per cent.
He further explained that the for units with more than 20 employees with pay less than Rs 15,000, the cost on employee after the deductions in 13.75 per cent, that on the employer is 31.5 per cent leading to a total cost of 45.25 per cent.
With regard to units with employees having pay more than Rs 15,000 and with no difference of strength, the cost on the employer is 4.81 per cent.
The other problem, according to the entrepreneur is availability of space at affordable price to start units.
Owing to the problem, most of unregistered units are located in agricultural/ residential land or slums and not in industrial areas. “We can try to shift them on to vacant plots in approved industrial areas,” Jain suggested. (KNN/ES)
Jain’s recommendation comes in the backdrop of the Secretary MSME, Madhav Lal recently stating that they were unable to make meaningful policies for MSMEs as a large chunk is not registered.
“Before making any amendment, we should try to understand that why small industries don’t get registered and by removing those obstacles we should start a drive to register all of them on the lines of Jan Dhan Yojana for financial inclusion,” Jain who is former Chairman, Indian Industries Association, Muzaffarnagar told KNN.
After mass registration we will get data to make meaningful policies, he added.
The entrepreneur from Muzaffarnagar who is also a CEC member of the Federation of Micro, Small and Medium Enterprises (FISME) also pointed out that there is a move to amend the MSMED Act of 2006 and change the definition of MSMEs.
“Lots of examples are being collected from different European countries, which have no relevance to the circumstances and environment for MSMEs in India,” Jain said.
Citing the example of applicable labour laws in India, he said, “For units with less than ten employees and with pay less than Rs 15,000, there is no cost on the employer and the employee in context to the deductions.
As for the units with number of employees between 10 and 19, and with pay less than Rs 15,000, the cost on the employee after the deductions is 1.75 per cent, and that on the employer is 17.89 per cent and the total cost is 19.64 per cent.
He further explained that the for units with more than 20 employees with pay less than Rs 15,000, the cost on employee after the deductions in 13.75 per cent, that on the employer is 31.5 per cent leading to a total cost of 45.25 per cent.
With regard to units with employees having pay more than Rs 15,000 and with no difference of strength, the cost on the employer is 4.81 per cent.
The other problem, according to the entrepreneur is availability of space at affordable price to start units.
Owing to the problem, most of unregistered units are located in agricultural/ residential land or slums and not in industrial areas. “We can try to shift them on to vacant plots in approved industrial areas,” Jain suggested. (KNN/ES)
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