With the newly elected NDA government led by Prime Minister Narendra Modi preparing to announce ministry allocations, several policy changes are anticipated to enhance job creation, entrepreneurship, and business growth.
According to a report by CNBC-TV18, citing sources, at least nine policy changes are expected, some of which may be introduced in the upcoming July budget. These include higher indemnity for banks issuing loans to MSMEs, integrating MSMEs into production-linked incentive (PLI) schemes, and establishing a new institute to facilitate increased credit access for small businesses and enhance exports.
Additional anticipated changes include a revamp of the government’s Atal Innovation Mission to focus more on entrepreneurship and job generation, increased funding for the aspirational districts program, and more.
Industry experts are also advocating for increased support for MSMEs to drive job creation and export growth. Vijay Kalantri, Chairman of MVIRDC World Trade Center in Mumbai, emphasized the need for Prime Minister Modi to simplify regulations and expand the PLI scheme to boost industry and trade productivity.
“The capacity building is crucial to enable us to export more and employ more people,” said Kalantri.
One of the key changes expected is a revision of the 45-day payment rule for MSMEs to address delayed payment challenges. Last month, Finance Minister Nirmala Sitharaman hinted at potential changes during an interaction with MSMEs and local industries in Ludhiana. She mentioned that the government would consider repealing modifications to Section 43B of the Income Tax Act if MSMEs prefer operating without payment timeline uncertainties.
Additionally, the Federation of All India Vyapar Mandal (FAIVM) has called for extending the payment period for MSMEs from buyers to 180 days from the current 45 days. FAIVM President Jayendra Tanna indicated that the body will urge the new NDA government to implement this extension to better support MSMEs.