Ease of Doing Business for MSMEs: Even as the country’s micro, compact, and medium enterprise (MSME) has been amongst the sectors hit hardest due to the Covid induced lockdown, which led to the closure or short-term shutdown of organizations, there is no official record maintained for the identical by the government. While numerous schemes have been announced by the Centre to support Covid-hit MSMEs recover, “however, as MSMEs are there in both formal and informal sector, data regarding temporary or permanent closure of the units are not maintained by the Government of India in Ministry of Micro, Small and Medium Enterprises (MSME),” MSME Minister Nitin Gadkari stated in a written reply to a query in the Rajya Sabha.
Gadkari stated that the figures of the genuine GDP in India in the course of the very first quarter of 2020-21 indicated that financial activity contracted due to the strict lockdown measures imposed by the Government and this contraction also had an influence on the MSME sector. In reply to a separate query in the upper home of Parliament on Monday Gadkari cited a study undertaken by Khadi and Village Industries Commission (KVIC) to assess the influence of the pandemic on the micro-units set up below the Prime Minister’s Employment Generation Programme (PMEGP). The minister noted that 88 per cent of the PMEGP beneficiaries reported that they have been negatively impacted whilst the remaining 12 per cent have been benefitted due to Covid. According to the MSME Ministry’s FY20 report, more than 99 per cent (6.30 crore) of 6.33 crore MSMEs are micro-enterprises in India.
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Importantly, in September 2020 as effectively, MSME MoS Pratap Chandra Sarangi in a written reply to a query in the Rajya Sabha had stated that “no such record is available” for the quantity of MSME units shut down in the course of the March-August 2020 period of the pandemic. In reality, there is no information with the government on the quantity of MSMEs closed down from FY15 to FY20, Sarangi had added.
In a comparable instance, the Commerce Ministry had informed in September final year that there is no information on the quantity of startups as effectively that had shut operations due to the Covid influence and these which managed to continue. Commerce Minister Piyush Goyal in a written reply to a query in the Rajya Sabha on September 23, 2020, had stated that no such information is maintained by the Department for Promotion of Industry and Internal Trade.