The Government announces a new policy for Small and Medium Enterprises (SMEs) to promote inclusive economic growth. The policy aims to facilitate around 5 million businesses in registration, streamlining of taxes, access to credit and provision of land.
The new policy includes zero time to startup which will help to either minimize or exclude the condition of obtaining a Non-objection certificate (NOC). Earlier, the process of acquiring NOC was a drag that led to discouraging the sponsors to seek permission from the concerned authorities. A web portal will also develop to promote transparency and check corruption. For small enterprises, the turnover tax will be decreased to 0.25% and 0.5% turnover tax for medium enterprises. Also, the Asian scheme has been launched, under which the Government will give a loan of Rs 10 million to 30,000 new businesses.
Small and Medium Enterprises play a key role in shaping a country’s national growth strategies, employment generation, and social cohesion by improving the standard of living of vulnerable segments of society. SMEs contribute 25% to the GDP and make $86 billion of the country’s total wealth. Despite their significant importance in economic growth, the young ones do not have enough economic opportunities for their professional growth. The Government should focus on further concrete steps to fully utilize the potential of the SME sector that will lead it to a trajectory of growth. A strong SME sector will enhance the indigenisation process which will eliminate expensive imports in the long run and boost the economy.