The primary goal of Industrial and MSME Policy Resolutions was to advance industrial development and furthermore decide the example of state help to small industrial units for satisfying financial targets. The advancement of businesses has been viewed as an essential component of the development system hidden Five Year plans.
The appearance of a planned economy from 1951 and the consequent industrial policy pursued by the Government of India, both government and organizers reserved a specific position of Micro, Small and Medium Enterprises in the Indian economy. Government’s targets and goals towards industry, including small scale industry were declared through Industrial Policy Resolutions (IPRs).
Industrial Policy Resolution, 1991
For the first time, the Government of India postponed the new MSME Policy titled approach measures for advancing, reinforcing and enhancing little, modest and town undertakings in the Parliament on August 6, 1991. This strategy augmented as far as possible for the minor segments expelled the professional limitations and perceived business and industry related services as small industrial units keeping pace with the modest units. The Small and Ancillary Industries were exempted from authorizing for all articles of manufacture, which were not secured by the public sector. The investment of 0.5 million and other area conditions was withdrawn. All business linked services and business ventures with an investment limit as those of modest undertakings, regardless of area, were perceived as small industrial units. Another plan of incorporated infrastructural advancement for small industrial units was given the cooperation of State Government and Financial Institutions.
The New Industrial Policy, 1999
The rising financial scenario in the changed labialized and aggressive monetary environment required basic and major changes in the policy structure set up of the improvement of SSI. The fundamental goal of the Industrial Policy, 1999 was to make a friendly situation for the small industrial units to adapt to the rising difficulties of globalization. To concentrate completely on the advancement and improvement of small industrial units, a different Ministry of Small Industrial Units and Agro and Rural Industries was made. The policy initiatives were:
- The yearly turnover limit for computation of working capital cutoff for smaller industrial units was raised to Rs. 5 crores from Rs. 4 Crores.
- The greatest roof limit for Composite Loan Scheme has expanded to Rs. 5 lakhs.
- To increment the credit flow to small industrial units, another credit insurance scheme was launched.
- Small Industrial units delivering goods in provincial territories are permitted excise exemption on third-party branded merchandise.
- The meaning of small and auxiliary industrial units was changed by lessening venture limit in plant and hardware to Rs. 1 crore from Rs. 3 crores.
- Special package for the upgrading of small and town enterprises in North Eastern areas was reported. The industrial units in the North Eastern Region were given an exception from extract obligation for a long time from the date of the beginning of production
- Special accentuation was given to the units which have high export potential.
Through the ministry, the Government has achieved changes in approaches and development support that need to empower quick and considerable development of MSMEs in India and give them an aggressive edge over their worldwide nations. A few projects and strategies have been illustrated here. The facilities can be arranged into three: MSME Policy initiatives, Institutional help, and credit allotment. The accompanying diagram demonstrates three classified policies.
Schemes For Financing Micro, Small And Medium Enterprises:
- Repayment For Iso-9000 Certification Scheme
The scheme was begun in March 1994, and it gives up to Rs. 75,000 for every small industrial unit which procured ISO-9000 Certification. Since the beginning of the scheme of ISO-9000 repayment, 4101 small industrial units to the tune of Rs. 1944 crore have been profited up to Nov – 2006.
- Laghu Udyami Credit Card Scheme
Laghu Udyami Credit Card Scheme, presented in November 2001, has been executed by the banks for giving borrower-friendly credit facilities to small venture.
- Credit Guarantee Fund Trust Scheme For Micro And Small Industries
The plan covers guarantee free credit facility reached out by qualified loaning establishments to new and existing Micro and Small Enterprises up to Rs. 50 lakh per borrowing unit.
- National Equity Fund Scheme (NEF)
The target of NEF Scheme is to provide equity type finance to business visionaries for setting up new tasks in the tiny or small industrial sector for undertaking extension, modernization, technology upgradation and enhancement of existing modest, Small Industries and Service Enterprises and for reinstallation of practical wiped out units. In this scheme, the expense ought not to surpass Rs. 50 Lakhs.
- Integrated Infrastructure Development Scheme (IIDS)
IIDS was launched in 1994 with the target of giving essential infrastructural facilities like Power Distribution network, Telecommunication, Water, Roads, Drainage and Pollution control facility, Storage, Banks, and Marketing outlets, Common administration facilities and Technological backup administrations, and so on.
The MSME Policy Development Act of 2006 is maybe the most significant of these ongoing strategy changes. The development of small scale businesses can be assessed in two different ways: To look at the development rates of units. Work, exports and output of Small-scale enterprises in 2000 with that of the 1990s.To determine the adjustment in the overall commitment of Small Scale ventures to GDP, Exports and Organized Sector work during the 2000s with that of 1990s. The small scale sector has become quickly throughout the years. The time of development and the improvement of the MSMEs sector comprised a critical portion of our economy. MSME Policy is an essential portion of the Indian industrial sector and would keep on assuming an urgent job in the Indian Economy later on. It additionally got tremendous measures of remote investments into the nation and gave work opportunities to numerous individuals in the nation which in its turn diminished the dimension of poverty in the nation. A compensating feature of financial development in India has been a noteworthy development of current MSMEs.