Finance Minister Nirmala Sitharaman during her press conference on Wednesday said that global tenders of up to Rs 200 crore will not be allowed for government procurement. The minister said that this move has been announced to ensure that micro, small and medium enterprises (MSMEs) do not face unfair competition from foreign companies.
The Finance Minister said that Indian MSMEs and other companies have often faced unfair competition from foreign companies. "Therefore, global tenders in government procurement up to Rs 200 crore will be disallowed," said Sitharaman.
The minister said that this will not only help MSMEs increase their business but also help to achieve Atma Nirbhar Bharat or self-reliant India. It will also help the Make in India initiative, she said.
Nirmala Sitharaman announced a slew of measures for MSMEs on Wednesday. The minister announced Rs 3 lakh crore collateral-free automatic loans for businesses or SMEs. businesses that have Rs 25 crore of outstanding loans or Rs 100 crore of turnover will be eligible.
She further announced Rs 20,000 crore as subordinate debt in order to provide stressed MSMEs with equity support. Moreover Rs 50,000 crore of equity infusion through a Fund of Funds that will be operated through a mother fund and few daughter funds was also announced. Nirmala Sitharaman said that this fund will help MSMEs to expand in size and capacity.
The Finance Minister said that the definition of MSMEs have also been changed in order to cover businesses that have grown beyond the existing definition. Investment limit has been revised and a criteria of turnover has been introduced, stated the minister. There will also be no differentiation between service and manufacturing MSMEs, she said.