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MSME proposes to set up Rs 10,000-cr fund for tech acquisition and support

The amount is to undertake technology upgradation, acquisition, adaptation and innovation

Anindita Dey  |  Mumbai 

The ministry of micro, small and medium enterprises has proposed to set up a fund for technology acquisition and support to assist the indigenous technology and acquisition of global technology by the India MSMEs. To this effect, A  Technology  Development Fund of  Rs.10,000 crore is proposed for supporting MSMEs to undertake technology upgradation, acquisition,  adaptation and innovation to enable them to move up the value chain.

The ministry also proposes to refine the current in vogue to bring up capacity, capability  and  technology  development  of  the  SMEs.  In respect of all large projects involving FDI, ancillary development should be made a condition, as per the recommendations of the report.

According to the proposal, the Working Group suggested that sector is the major base of manufacturing sector in India, with its contribution of over 45 per cent  in the overall industrial output. On the other hand, the National Manufacturing Policy  envisages  increasing  the sectoral share of  Manufacturing in  GDP to 25% over the next decade  and generating  additional  100  million  jobs  in  manufacturing  sector  through an annual average growth rate of 12-14% in manufacturing sector.  Thus this goal will require  substantial  enhancement  of  the  growth  rate  of  sector during the from the current growth rate of 12-13%.

Setting up of a fund for Technology Acquisition and Support is line with the recommendation of the Prime  Minister’s  Task  Force  on  MSME  sector. The key areas covered  under technology development and acquisition are  Information technology (ICT) adoption in business processes,  Bio Tech product groups,  use of Nano tech in developing products / components, and use of Clean tech / Renewable energy based products and processes.

Towards this endeavor, it is also proposed to lift the ban on setting up of new institutions  and  more  number  of  product specific technology centers (e.g., toys) should be set up in  different parts of the country for effectively facing the challenges  posed by imported goods, as per the report.

Another important measure suggested by the working group to widen the market for technology based activities  is to set  up  a  mechanism  in  the  Defense  Ministry  to  ensure  that  the offsets under Defense purchases are suitably focused to support the small and medium  enterprises  in  upgrading  their  capacities,  capabilities  and  technology.  Further, the Offset Policy for other departments under consideration, such as Railways, should also give priority for passing on the benefits under the off-set policies to the  small  and  medium  enterprises  in  the  country.

First Published: Thu, March 27 2014. 16:03 IST