Govt to integrate MSME Global Mart with ONDC

In an interview, Rane said that the move would improve the visibility of Indian MSMEs among customers. The minister said that the draft of the MSME policy, prepared by the Indian Institute of Public Administration (IIPA), is being finalized and will likely be published in three to four months. He said the government aims to increase the share of MSMEs’ contribution to the GDP to 40% from 30% now. Rane said that the government is focusing on nurturing high-growth industries that can become the driving force of the economy. Edited excerpts:

Digitization has been a focus of the government. How does the ministry plan to help MSMEs leverage e-commerce and integrate them into the digital economy?

The ministry has taken a number of initiatives to help MSMEs onboard on e-commerce for marketing their products. On 75 years of independence, the MSME ministry has offered a 75% subsidy for the adoption of an e-commerce platform by micro-enterprises through MSME Global Mart, which is a nodal B2B portal of the MSME ministry. MSME Global Mart is a global business-to-business e-marketing portal facilitating market access to micro, small and medium enterprises to grow their business by way of increased visibility. MSME Global Mart is being upgraded to offer virtual exhibitions for MSMEs to be promoted to act as a replacement for trade fairs and exhibitions. It is also being integrated with ONDC (Open Network For Digital Commerce) to help MSMEs.

Further, a procurement and marketing support (PMS) scheme of the ministry of MSME is designed to promote new market access initiatives and enhance the marketability of products and services in the MSME sector. The scheme extends benefits to micro enterprises through its component “Adoption of e-Commerce Platform", wherein micro-enterprises are provided with financial assistance on annual membership fees, subscription fees and contingency expenses for selling their products or services through the portal MSME Global Mart being operated by National Small Industries Corporation. The financial assistance provided under this component is 75% of the paid amount by micro-enterprises, subject to a maximum of ₹25,000 (excluding applicable taxes), whichever is less per financial year.

The ministry released the draft MSME policy last year, and it has been revised since then. What growth prospects do you expect in the sector? By when should we expect the revised policy to be released?

The ministry of MSME had wide consultations with stakeholders, central government departments, state governments and industry associations on the draft of the proposed policy document, prepared by the Indian Institute of Public Administration (IIPA), which was assigned the task of framing comprehensive a policy for MSME by this ministry. On the basis of feedback received from stakeholders, the ministry revised the draft prepared by IIPA.

The revised draft policy document is being perused and finalized in the ministry to give it a final shape in view of the far-reaching impact of the proposed policy on the MSME sector. Also, it is the first time that the policy is being made, and there is no previous reference document. So, stakeholders are still being consulted and have been giving a lot of inputs. Examination of the same is taking time. Around 613 references have been received on MyGov, and 210 references otherwise. We are targeting to complete the exercise and publish the policy within the time span of 3-4 months.

The ECLGS scheme, launched in 2020, provided sovereign guarantees to the loans taken by pandemic-hit businesses. What has been the credit demand trend from small businesses since then?

Emergency Credit Line Guarantee Scheme (ECLGS) was announced as part of the Aatmanirbhar Bharat Package in 2020 to help businesses, including MSMEs, to meet their operational liabilities and resume business in view of the distress caused by the covid-19 crisis by providing member lending institutions (MLIs), 100% guarantee against any losses suffered by them due to non-repayment of the ECLGS funding by borrowers.

The overall ceiling initially announced for ECLGS was ₹3 trillion, which was subsequently enhanced to ₹4.5 trillion and further to ₹5 trillion. ECLGS being a demand-driven scheme, sanctions/disbursements are made by lending institutions based on the assessment of borrower’s requirement and their eligibility. Under the ECLGS, as of 31 March 2023, a total of 11.9 million guarantees amounting to ₹3.65 trillion have been issued. Out of the total, 11.3 million guarantees amounting to ₹. 2.41 trillion have been provided to MSMEs.

The Udyam portal and registration of MSMEs is seen as a major development for Indian MSMEs. How many MSMEs have registered on the portal, and shall we see changes to the portal in order to bring more ease of doing business?

After the revision of the MSME definition in 2020, the Udyam registration portal was launched on 1 July 2020. This online, free-of-cost portal needs no documents to be uploaded and is based on the self-declaration of information by the entrepreneur. This portal itself is an example of ease of doing business. The revision of the MSME definition led to the widening of the MSME ambit, and registration of MSMEs has emerged as a major turning point for Indian MSMEs. Since the launch of the Udyam Registration Portal on 1 July 2020 till 8 May 2023, more than 16 million MSMEs, with employment of 112.7 million, have registered. Another 1.3 million MSMEs have registered with PAN on the Udyam Assist Platform. Currently, we are working on linking Udyam with portals of other ministries, departments and state governments so that MSMEs can benefit. For us, Udyam is like e-KYC.

MSME ministry’s National SC-ST Hub scheme has so far brought over 100,000 entrepreneurs under its ambit. Will we see further expansion of the scheme?

The National SC-ST Hub scheme was launched in 2016. During the first phase of NSSH implementation, the focus was to reach out to the SC-ST beneficiaries and bring them to the mainstream through skill and entrepreneurship training programmes in various sectors, awareness, and outreach activities.

As more than 70% of the SC-ST entrepreneurs are engaged in the service sector, the scheme guidelines were revised in 2021 with certain new features such as the inclusion of the service sector under the Special Credit-Linked Capital Subsidy Scheme (SCLCSS) component, assistance for participation in virtual exhibitions, assistance for registration in government promoted e-commerce portals, among others.