‘Make In India’ designed to Escalate Indian MSMEs, But Needs to Focus of MSME Issues

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Article by Mr Pramod Gupta, CMD, United Drilling Tools Ltd 


One of the policy of Govt. Of India has been to encourage production within the country instead of import so that Industries in India develop, cost of production is reduced, foreign exchange is saved and employment opportunities are created.

As per the fourth census of MSME’s the report which was published in 2012 the total number of MSMEs in India was 3.6 Crores employing over 8 crores people.

It also account for 45 % of total industrial production, 40% of total exports and contributes to the GDP on 40%. MSME’s in India would be the cradle for the “make in India” vision.

Small scale enterprises in general face a lot of problems including availability of raw materials at competitive prices, owing to their low off-take as well as their inability to hold large inventories, adequate and timely financing from banks and other financial institutions as well as problem relating to various other factors such as access to largest technological developments, improved logistics, ever increasing interest rates, frequent break down in power supply, low voltages, perpetual increase in the prices of fuel and furnaces oil etc. In nutshell the cost of production of the items is bound to be much more for small scale industrial units/MSEs.

Besides above constraints export of finished goods emanating for countries like China, Venezula, UAE etc are highly subsidized by respective origination countries. Whereas no such support is available to small scale industries in India and therefore the cost of supplies from small scale enterprises is higher as compare to those emanating from above mentioned foreign countries.

In view of the above facts the Govt. of India Ministry of SSI and Agro rural Industries (Now Ministry of MSME) provided Price Preference policy waiver of security deposit and other benefits to ensure that small scale industries do not fail in playing definite role of providing boost to the economy of the country, contribution to GDP and avenue of employment vide letters dated 28.8.2000, 08.03.2011 and 14.10.2011.

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