Union Budget 2018-19 comes as a huge disappointment for MSMEs: KASSIA

New Delhi, Feb 2 (KNN) Responding to the Union Budget that was proposed by the Finance Minister yesterday, Karnataka Small Scale Industries Association (KASSIA) has expressed disappointment over the announcements made for the Micro, Small and Medium Enterprises (MSMEs).

“The Union Budget 2018-19, has come as a huge disappointment to MSMEs as there is very little in terms of giving a boost to the sector which has suffered considerably from the economic downturn in the last 2 years”, KASSIA said in a release.

The release further said that the allocation made in terms of credit support of Rs.3,974 crores is quite insubstantial when compared to the requirement of the sector.  The sector largely suffers from lack of access to good credit with Government schemes meant to help the sector such as CGTMSE & CLCSS having been largely dysfunctional.

Though the Finance Minister talked of addressing the non-performing and stressed accounts, this issue has been disturbing the micro and small enterprises due to the mismatch of their receipts and expenditures.

Raising concerns that continue to haunt the sector and needs to be addressed, KASSIA said that the MSMEs suffer from lack of adequate infrastructure in terms of connectivity including the functioning of the ports in the country.

The proposal to revamp and speed up the sanctioning of loan to MSMEs is welcome but remains to be seen how it would be implemented. The increase in the turnover limit to Rs.250 crores at 25% corporate tax is welcome but will not benefit the larger segment of MSMEs in their composition. The expansion of Wi-Fi to rural areas is the need of the hour and welcome.

KASSIA, however, welcomed the decision of the Government to contribute 12% of the wages of new employees towards EPF for 3 years.  We also would like to commend the increased allocation to the health and education sectors which will generally benefit everyone, the release said.

KASSIA also welcomed the move to liberalize export of agri commodities and the increased allocation of credit to the agriculture sector. (KNN/DA)