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The Mediation Bill Is The Goldilocks For The MSME Sector

Updated: Aug 12, 2023 03:58:05pm

The Mediation Bill Is The Goldilocks For The MSME Sector

New Delhi, Aug 12 (KNN) The Mediation Bill passed by Lok Sabha and Rajya Sabha during the monsoon session of the Parliament will help reduce time and cost of litigation for MSMEs, said Arjun Ram Meghwal, Minister for Law and Justice for Government of India, at a seminar organised by FISME on reducing cost of litigation for MSMEs. 

Attending the closing session, the Minister  mentioned that the delay in the judicial system is the real overburdening cost for MSMEs and even with the pre litigation facilitation acts like Arbitration Act etc. most of the disputes ultimately land in courts.


The Minister also mentioned that Alternative Dispute Resolution Mechanism including Mediation, Conciliation and Arbitration are the main tools for dispute resolution, globally, at minimum time and cost.

The seminar was organised by FISME on Thursday at Delhi to discuss the increasing  litigation of MSMEs on supplies to particularly Government departments and PSUs resulting in huge financial costs. 

At the programme entrepreneurs presented cases where MSMEs faced near bankruptcy due to delayed payments and prolonged litigations.

Rajendra Agarwal, Member of Parliament and Chairman of Friends of MSMEs Group in Parliament mentioned that Mediation should always be the first  step to resolve disputes and for that the mediation process should be efficient. He hoped that the rules under the Mediation Act will help in resolving disputes of MSMEs.

Speaking on the occasion J P Singh, Senior Advocate and Secretary of Delhi Mediation Forum mentioned efficiency of the Mediation process depends on the efficiency of the Mediator and India lacks trained Mediators which leads to delay and failure in mediation process.

Entrepreneurs participating the Seminar urged to the Minister that at least the Government procuring agencies should be advised to depend on mediation, arbitration etc. and not to approach the court of law for resolution of disputes on contracts below a certain value. 

This will save the small suppliers from serious financial crises due to delay in litigation process.  (KNN Bureau)


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