ES – Yesterday, the Economic Survey of India was released and in that Chief Economic Advisor has given a blue print on how to achieve US$ 5 trillion economy in next 5 years. How do you see the role of MSME sector in this entire panorama?
Mr. Kumar- MSME (Micro, Small & Medium Enterprise) sector is the only sector which can provide the export and marketing of the products manufactured by them. If we promote more MSMEs by way of providing more new value added products means it is available for the consumer locally and the export market. You might have read yesterday, our honourable Minister has said that India is going to launch a similar platform like Amazon and Alibaba very soon. The platform will be used to provide marketing and export support to millions of MSMEs India. So right now, the dream is to make India a $ 5 trillion economy by 2024-25.
ES – There are mainly over 2 million MSMEs in India. So as ministry how do you coordinate with them and also, the prominent measures taken to promote them?
Mr. Kumar- Let me tell you, the correct figure is actually about 60 million units. The reason I am saying so, is that there are numerous small scale units where only 2-3 people are working, and they are family members. And these 60 million units are a source of employment to about 120-130 million people. Now we as a ministry cannot practically reach to each unit separately and it’s not even easy for those people to reach to the ministry. Suppose a unit a working in hinterland of India, that unit may not be knowing the ministry, but that unit knows its own association. So whenever we need to pass any message, we pass the message to the association and the association percolates the message to their members. Secondly, we at ministry organize awareness programmes across the country, from Jammu & Kashmir to Kanyakumari, where we invite Association leaders and explain our schemes to them. Thirdly, through our own website and My MSME app, we put various useful information for awareness generation. Fourthly, as you might have seen it we do extensive advertisements through electronic and print media. So we are using every platform possible, to publicise and pass on the information to the MSMEs.
Under the International Cooperation Scheme, we provide Rs. 1.25 lakh as the economic class airfare (maximum limit) to the exibitior and Rs. 1 lakh for stall charges. If there are more events, then 2.25 lakh Rs. per unit twice in a year. And under the Marketing Assistance Scheme, for participating in domestic exhibitions, we pay Rs. 30,000 for stall charges and Rs. 15,000 for the contingency. This Rs. 15000 for contingency is for your to and fro transport fair, goods transportation and branding and publicity. So total amount is Rs. 45000 per unit twice in a year.”
ES – As you said in your earlier answer that there are around 60 million MSME enterprises in our country. So, especially in tier 2 cities how can an enterprise get registered under the Ministry and what kind of benefits do they get after registering with the ministry?
Mr. Kumar – This is a good question. We have a registration platform by the name Udyog Aadhar and we have a dedicated website for that as well. Any person sitting on any town or any village can register his unit within 5 minutes sitting at his home. He need not to go to anywhere. All he needs to do is to log on o the website www.udyogaadhar.gov.in.
All he should have is an Aadhar card number and a Bank Account. With these two things ready, open the website, fill the form, submit it and take a print out and your form is registered within 5 minutes. The moment you get an Udyog Aadhar, it means it is a legal document with which say, you go to the electricity department, they will give you the electricity connection; you go to any bank, you will get the loan or if they’ll come to our ministry for ministry programme, they can avail it.
Now coming to benefits, say, if the person wants to supply anything to a Central Public Sector Undertaking, if he has Udyog Aadhar, he is eligible to become a supplier and can participate in tenders. This is the biggest advantage. Secondly, if you are a small scale entrepreneur and if your turnover is less than rs. 40 lakhs and if you have an Udyog Aadhar, you need not to go for GST registration. GST is mandatory now a days.
So, Udyog Aadhar has become a legal identity that has a mention of your personal details, items he manufactures, and the category of this enterprise. So the Udyog Aadhar certificate provides all the necessary details at one place and is valid in all departments of Central as well as the state governments.
ES – Over the past few years, the government has taken a plethora of steps for Ease of Doing Business (EODB) across the country. Although the World bank’s EODB report covers only Delhi and Bombay, but talking about the whole of India, what are the key steps taken by the government in the past few years to improve the Ease of Doing Business aspects especially in the MSME sector?
Mr. Kumar- GST was the biggest reform taken for improving the Ease of Doing Business in India. Earlier there were several taxes like Sales tax, Excise tax VAT, Octroi etc. were there which have now been subsumed to one GST. Secondly, the provision has now been made for credit free loans upto Rs. 2 crore. Thirdly, through the MUDRA Yojna, one can take loans upto rs. 10 lakh very easily from the bank. Fourthly, for SC/ST and women entreprenures, under the Stand-up India scheme, upto rs. 1 crore loan is easily available.
These were the financial aspects. Now coming to the marketing aspect, hundreds and thousands of exhibitions are being organised all over India every year. This acts as a great platform for the marketing and also for exports. Now, the heavy amount that these MSMEs pay for registering and stall charges, that money is reimbursed by us as a subsidy to them.
Also, hundreds of exhibitions and fairs are organised across the globe. We promote these units to go and participate there. We pay their to and fro economic class airfare and also the stall charges. So all these steps together contribute in improving the ease of doing business with respect to MSMEs.
ES – As you talked about how you promote MSMEs to participate in these trade fairs and exhibitions, as per our information, the ministry runs two prominent schemes in this regard- International Cooperation Scheme and the Marketing Assistance Scheme. So under these schemes what are the key benefits available to MSMEs if they go for participation in international exhibitions/trade fairs?
Mr. Kumar- You see, the International Cooperation Scheme is only meant for participating in overseas exhibitions. That’s why it’s termed as the International Cooperation Scheme. MSMEs go and participate and we provide rs. 1.25 lakh as the economic class airfare (maximum limit), and rs. 1 lakh for stall charges. If there are more events, then 2.25 lakh rs. per unit twice in a year. So that unit can participate anywhere in the world- Japan, United States of America, Russia, China, anywhere they want to go.
So we provide assistance to hundreds and thousands of these entrepreneurs to go abroad and participate in such exhibitions. This was the International Cooperation Scheme. Now coming to the Marketing Assistance Scheme, it has multiple components-
One component is, you go and participate in say in Jaipur fair, Mumbai fair, Chennai fair etc., as much as you want to take part across the country. There is no upper limit on this. We pay rs. 30,000 for stall charges and rs. 15,000 for contingency. This rs. 15000 for contingency is for your to and fro transport fair, goods transportation and branding and publicity. So total rs. 45000 per unit twice in a year. Second is, sometimes the organiser says that he wants to make a special MSME Pavilion. So rather than giving individual unit subsidy, we pay the money to the organiser, say 30-40 lakh or 50 lakh rupees. Third, we organise big exhibition programmes with Central Public Sector Undertakings (CPSUs).
They are there in maximum demand. We call it the National level Vendor Development Programme. We invite many prominent CPSUs like Indian Oil Corporation Limited(IOCL), National Thermal Power Corporation(NTPC), Bharat Heavy Electronics Limited(BHEL) etc. They also showcase their products and explain the registration process for their tenders and these MSMEs also showcase their products. So, this is a match-making. Third, is the packaging. The biggest problem for MSMEs is packaging. We have designed a programme for the development of packaging. Finally, there are many issues of these units where they want to cover solutions through seminars and conferences. We invite several experts, take into account the issues of MSMEs, and a two-way dialogue takes places between the experts/consultants and MSMEs. This is entirely funded by the ministry.
ES – Most of the companies related to the MICE (Meetings, Incentives, Conferences, Exhibitions) sector come under the ambit of MSMEs. So, for companies who organise exhibitions in India, is there any specific scheme of the ministry for their benefit?
Mr. Kumar- As I already told you above, we pay 15 lakhs to 40-50 lakhs to organisers, depending upon how much it costs to them. For example, any exhibition organiser comes to us and say- ‘Sir, I am organising an exhibition for textile in Jaipur. I will make a special pavilion for 100 Micro, Scale and Medium units with a stall size of 3×2 feet each. It will cost me 40 lakh rupees and I will give the stalls free of cost to these 100 Micro, Scale and Medium units.’ The ministry will give rs. 40 lakh to the organiser and the organiser will provide stalls to MSMEs free of cost. So these organisers thus have a motivation to invite more and more MSMEs to their exhibition. Rather than the ministry paying to 100 separate units in their bank accounts, it directly pays to the organiser. The units are also very happy as they got the stall free of cost. Apart from this, when I went to the Exhibition Excellence Awards, 2019 in March, I also said there that there are many schemes and programmes which the organisers can discuss and do, which unfortunately they are not doing it. In these exhibitions, new products are being launched and displayed. I expect the entrepreneurs to do the value addition. Now we call it as ‘Design Clinic Scheme’. Those MSME units which will do the value-addition or designing of these products, will be eligible for the funding from ministry from rupees 15-40 lakhs per product per unit. The designing will help them to capture a better market share.
ES – At Exhibition Excellence Awards, 2019, in your special address, you have emphasised that companies need to go for more and more exhibitions and these exhibitions should be organised on a wider scale. So, over the next 4-5 years how do you see the future of exhibition sector in India?
Mr. Kumar- Yes, the future is quite excellent and I believe that exhibitions are the only way forward if we want to achieve the target of US$ 5 trillion economy over next 5 years. Because this only platform for marketing and exports where you showcase your products to buyers. It is a huge market, and let me also tell you, at present those who are organising 2-3-4 exhibitions in a year as of now, you will see them organising 20-30 such exhibitions across the country in the next 4-5 years. This is the level of the future of exhibitions in the country. I am confident that it will be achieved.
ES – Lastly, since you have been informed of Exhibition Showcase, for a quite long time now. So your opinions about Exhibition Showcase.
Mr. Kumar- Let me say it is an excellent platform. And it’s an excellent approach also to award exhibition industry professionals in Exhibition Excellence Awards. This is an act of recognition of their hard work done by them. Exhibition Excellence Awards provides them a platform to their efforts which also help in the overall growth of the country.