CODISSIA makes suggestions for Union Budget 2021-22

As the seriousness of the pandemic seems to be coming down now in various places in India; the eyes of Indian industries are focused towards the upcoming Union Budget for 2021-22 that will be presented by Finance Minister Nirmala Sitharaman on February 1, 2021. The Finance Ministry invited suggestions for Union Budget 2021-22 in November 2020 and CODISSIA had sent its suggestions promptly.

Right now, the industry needs much help from the Government than ever; and keeping that in mind, CODISSIA had said that MSMEs should be treated as Priority Sector and a Special Budget provision should be made, as it is the largest employment provider ( 12 crore employement) and it will increase in 2 years’ time.

Taking note that a committee is to be formed by the center to regulate the 25% compulsory purchase obligation of PSU’s, Defence and Railways from MSME units, CODISSIA requests this limit to be enhanced to 40%. It has also asked for labour laws to be simplified and relaxed for MSMEs.

The association has also asked for financial relaxation. It has stated that Banks should provide loans to MSMEs upto Rs.3 crores without taking any collateral security.  The interest rates for MSMEs should be at par with Agricultural Sector or interest to be charged below 7%.

It also brought to the centre’s notice that few banks charge for NEFT, RTGS, IMPS while some don’t. It has asked for a uniform policy where not such charges are levied for the above mentioned operations; and all other banking charges should be waived off for MSMEs. It has asked for extension in moratorium period for interest payments and all existing loans. The new date should be extended upto March 31, 2021.

Regarding the raw materials price-hike, it has asked the Govt to reduce the prices of raw materials at the Pre-COVID level to compete with international market and to fix up the price prevailing at the time of pre-COVID 19 as MRP price for all raw materials.

CODISSIA has asked the centre to allow MSMEs to stock their finished goods all over India at a subsidized warehouse charge. It said that this would allow MSMEs to sell their products through E-Commerce platforms thereby reaching the customers directly without any delay in delivery time and the payments also become hassle free.  Like this, CODISSIA has asked for several revisions in Defence Procurement Policy, Income Tax, GST, Labour Laws and few other areas.