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Exclude service enterprises and medium industries from ambit of MSMED act: RSS affiliate

Press Trust of India  |  New Delhi 

RSS-affiliated small industries body Laghu Udyog Bharati (LUB) on Thursday demanded formulation of a separate and new policy for micro and small industries, in which manufacturers with investment up to Rs 50 lakh be defined as micro and those with investment of more than Rs 50 lakh and up to Rs 5 crore as small industries.

The new policy, which LUB demands, is only meant for micro and small manufacturing industries. For service enterprises and medium industries government can define separate policy, its general secretary Govind Lele said.

The service enterprises and medium industries should be excluded from the current Micro, Small and Medium Enterprises Development (MSMED) Act, and the government should come up with a policy that focusses only on micro and small industries, the LUB demanded.

"Formulate separate Micro and Small Industry Policy, and exclude the Enterprises and Medium Sector from the purview of current MSMED Act 2006 and make it as 'Micro and Small Industry Act'," LUB said.

The definition criterion of micro and small industry to be based only on investment in plant and machinery rather than on turnover as planned by the government, Lele said.

As per LUB, industries with investment up to Rs 50 lakh should be identified as micro and more than Rs 50 lacs and up to Rs 5 crore as small industries.

Whereas, as per the current definition, industries with investment: up to Rs 25 lakh as micro, from Rs 25 lakh to Rs 5 core as small and investment above Rs 5 crore and till Rs 10 crore as medium industries.

The separate Ministry for Micro and Small Industry was found with the basic objective of preserve, promote, protect and give preference to such industries, but it was diluted by including service sector and medium sector under its ambit, Lele said.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, November 14 2019. 23:35 IST