Home / Economy / Small exporters demand ‘empowered’ grievance redressal mechanism

NEW DELHI : Micro, small and medium enterprises have sought an “empowered" grievance redressal mechanism, blaming a fall in their share of exports on lack of coordination among central ministries among other factors.

Despite overall exports hitting a record high of $420 bn in FY22, the share of MSME exports declined to 45% compared with 49.35% in FY21, official numbers showed.

The US, UAE, Germany and China are among the top exports destination for Indian MSMEs.

“Whether it is policy decisions such as profiling of risky exporters which continue to harass a large number of exporters or retrieving a shipment stuck at a foreign port requiring coordination of central ministries there is no system that small exporters can reach out to for timely resolution of their grievances," the Federation of Indian Micro and Small & Medium Enterprises (FISMI) said.

The matter was brought to the attention of commerce and industry minister Piyush Goyal at a recent meeting of the Board of Trade.

“In a memorandum submitted to the minister during the meeting, FISME demanded an empowered grievance redressal mechanism, with a dashboard, to capture and see what kind of problems exporters face both internally and externally and find a way to resolve them," the federation said.

Goyal had called a meeting of the newly constituted Board of Trade on 13 September amid slowing exports growth. Exports declined sequentially in August even as the trade deficit eased slightly in August to $28.7 billion from a record $30 billion in July.

FISMI said that despite the high potential for trade in India, traders move to Dubai, Hong Kong and Singapore to do third party trading due to restrictive environment in India.

“During the peak of covid-19 when there was huge shortage of ships and containers, in some cases banks refused to credit payment citing a discrepancy in shipping document. The bank did not understand the volume of Dubai port and the huge upheavel in shipping during the period," Prashant Patel, president FISME said.

FISME has also suggested setting up a working group to identify and ease the regulatory and policy constraints in conducting third party trading. The MSME group also suggested revamping EXIM bank to focus on MSMEs.

To be sure the Union government has launched several initiatives including MUDRA Yojana, Emergency Credit Line Guarantee Scheme, Scheme of Fund for Regeneration of Traditional Industries (SFURTI) to provide support to the MSME sector.

A scheme called ‘Capacity Building of First-Time MSME Exporters’ was launched to encourage MSMEs to offer products and services of international standard for the global market. The scheme aimed at enhancing the participation of Indian MSMEs in the global value chain and help them realise their export potential.

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