The economic stimulus measures announced by the Finance Minister are landslide changes which will lead India towards self-reliance as mandatory sourcing — up to ₹200 crore — would insulate local companies from external competition, said Ravi Uppal, chairman, SISCOL, and formerly the MD and CEO of ABB India and Volvo. MSMEs, including stressed ones, are being given financial support both in terms of loans and equity support for revival after the recent setbacks and activity paralysis suffered due to a series of lockdowns. Mr. Uppal said, “MSMEs will now be able to grow without fear of disqualification due to exceeding either volume of investment or turnover. This would definitely motivate MSMEs to grow without the need for creating more entities or such adjustments.”
“The government at the moment has announced that such facility is available only up to October 31. I feel this should be extended at least up to the end of the financial year to realise full benefit of the scheme,” he added. “The government has taken a very pragmatic step by formally recognising the period of lockdown as ‘Force Majeure’ and thus avoid any possibility of conflict relating to contract completion dates and consequent delay In related claims,” Mr. Uppal added.
Stating that the announcements for the MSME sector were insightful, Mallika Srinivasan, chairman,Tractors and Farm Equipment Ltd., said these recognised the critical role that MSMEs played. “MSME are the backbone of the economy and they are most needed. The vision also addresses the service sector MSME which played an important role as manufacturing sector. The definition change to MSMEs is welcome. This will have a important effect on both supply chain partners as well as distribution partners,” she said.
According to her, the automatic loan of ₹3 lakh crore without any collateral will be of immense benefit to MSMEs.