MSMEs in Rajasthan Grapple with Growing Challenges

ENA MSME 2024-06-27 14:55:46 Jaipur, Jun 27 (KNN) Micro, Small, and Medium Enterprises (MSMEs) in Rajasthan, a vital cog in the state's economic machinery, are facing an uphill battle against a growing array of challenges. While these businesses account for over 90 per cent of Rajasthan's industrial footprint and number more than 26 lakh units, their path to sustainability and growth is increasingly fraught with obstacles. Gaurav Rungta, former chairman of CII-Rajasthan, paints a grim picture of the MSME landscape. Protecting margins and paying salaries has become a constant battle for survival, he says. Rungta points to the burgeoning compliance burden, with over 360 different requirements, as a significant drain on resources. Financial woes continue to plague these enterprises. Ravi Modani of 121 Finance highlights the persistent struggle MSMEs face in accessing capital from scheduled banks. While alternative funding options like factoring finance and trade credit have emerged, many small businesses still find themselves in a tight spot, especially when government departments and PSUs delay payments for goods supplied. Suresh Agarwal, president of the Federation of Rajasthan Trade and Industry, emphasises the issue of high land costs. Large companies get cheaper land through customised packages, while MSMEs are forced to buy expensive land through auctions, Agarwal explains. He also points out the need for RIICO to grant industrial status to warehouses, a move that could have significant investment implications. The struggle extends to basic operational needs. Unreliable power supply and rising electricity costs continue to be major concerns for MSMEs in the state. These issues, coupled with hurdles in land conversion and a higher compliance burden, are pushing many small businesses to the brink. Technology adoption, crucial for future competitiveness, remains a distant dream for many. The lack of surplus cash for investment in tech, research, and development puts MSMEs at a disadvantage in an increasingly digital economy. Rungta advocates for a dedicated government fund to bridge this gap, arguing that tech adoption is essential not just for MSME growth but also for fulfilling the broader agenda of job creation. (KNN Bureau) 38371 https://knnindia.co.in/news/newsdetails/msme/msmes-in-rajasthan-grapple-with-growing-challenges 2024-06-27 14:55:46 knnindia.co.in MSMEs in Rajasthan Grapple with Growing Challenges