msme reform

question is we know that msme are labour intensive and crucial for the economy; but if we keep them protected by means of reserved items, tax , subsidy benefits, easy credit etc then how do we make them grow into MNCs of tomorrow; further it is claimed that MSMEs have the potential to grow but it is these gvt regulations that inhibit/incentivise them from growing large and attaining economies of scale.

Recall gandhi--gvt interference leads to fraud, suppression of truth, intensification of  black market and artificial scarcity. Above all it unmans the people and deprives them of the initiative of self help

1. Create a website with all the rules and regulations applicable to businesses across states and the centre.
2. Department of industrial Policy and Promotion (DIPP) implement “E-biz” module under National E-governance plan. We can utilized it for this purpose
3. Minimize human interaction. Shift reporting/data submission to an online-only mode whenever possible, e.g. for routine registration, repeated filing and reporting of information.
4. Ask State Governments to share best practices on business regulations- and adopt it at national level.

# less interference

1. Strengthen grievance redressal mechanisms against inspections- with clear norms and deadlines.
2. Give extension time to companies, to correct their fault instead of penalizing them immediately.
3. System for self-certification and third-party certification.
4. Review and remove outdated regulations
5. Reform the Apprenticeships Act of 1961.
6. Amend MSME act to help financially distressed companies
7. Long term: completely revamp Indian laws governing taxation, labour, environment, and safety.
8. Setup a productivity commission similar to Australian Productivity Commission. It’ll serve a knowledge base, and champion for business change.

# Land availability

1. Permit mixed use of residential and commercial properties. Otherwise, given the real estate inflation- the MSME entreprenurs cannot expand.
2. Ask PSUs and departments to sell away their “Surplus / unutilized” land to MSME. The government could institute a ‘use it or lose it’ policy to free up this locked land.

#social security

1. Give wider social security and health benefits like New Pension Scheme (NPS) and Rashtriya Swasthya Bima Yojna (RSBY).
2. Coupon system for casual workers- which grants them social security benefits.