Congress party has promised to rehabilitate small businesses which were badly hit by Modi government's demonetisation move in 2016. The party's manifesto released on Tuesday said the Congress would "devise a rehabilitation plan for MSMEs that were severely affected and help them revive and grow."
Congress has promised to reverse the "gross distortions" caused by the NDA government through demonetisation by "working closely with the RBI, re-start the process of credit delivery and ensure sufficient liquidity and cash in circulation."
Here are the main points addressing the MSME sector woes in the Congress manifesto 2019:
1. As MSMEs account for 90 per cent of all employment outside agriculture, its definition based on capital employed is biased against labour. The Congress manifesto offers solution of linking the definition of MSME to employment. A business employing 10 persons or less will be 'micro;' between 11 and 100 will be 'small;' and between 101 and 500 will be 'medium.'
2. The party has pledged to create an Enterprise Support Agency to help entrepreneurs, including start-ups, with an all-round business support.
3. The party promises a regulatory forbearance for MSMEs which means they will be exempt from all applicable laws and regulations (except the Mininum Wages Act and tax laws) for a period of 3 years from 1 April 2019, or in case of new businesses, the date of commencement of business. This means freedom from 'Inspector Raj' until they stabilise.
4. Congress will promote 'Mass Entrepreneurship' and support entrepreneurs to replicate tried and tested models of businesses.
5. The party will encourage the establishment of State-level and Regional-level institutions, including small banks, to provide bank credit to MSMEs.
6. The party will also encourage state governments to revive State Financial Corporations to provide long-term credit and risk capital to MSMEs.
7. To trigger rapid growth of the manufacturing sector, particularly of MSMEs, Congress will ensure world-class infrastructure in industrial hubs and cluster towns to aid the expansionof current units and creation of new units.
8. The party will acquire patents, create a patent pool and make advanced technologies available to small and medium enterprises.