‘MSMEs, Textiles To Be Future Job Generators’
MSME minister Giriraj Singh has a stereotyped image in the media. Not many, however, know that Singh has grand plans for the sector, even when he’s readying a blueprint for jobs in rural India which he plans to share with the PM shortly. In an interview with Suman K. Jha, Singh lists his priorities and concerns.
Edited excerpts:
There was an adverse impact of demonetisation and GST on the MSME sector. Do you think that phase is over now?
Demonetisation was a phase and it was a transition phase. Prime Minister Narendra Modi took such a big decision in national interest, where Indira Gandhi had refused to endorse the same. The phase (of ill-effects on MSMEs) has ended now. That phase of demonetisation is over. Now it’s all about GST. There have been some teething issues. But it’s my 200 per cent faith that May onwards things will be on track.
So there’s no more impact?
For demonetisation, it’s done. For GST, it will be soon. After 31 March, all will be resolved.
There were special provisions for the MSME sector in the last Budget. Do you think they were sufficient?
It’s the first time in Indian history that 59 per cent budgetary increase for MSMEs was given in the Union Budget. It clearly reflects the importance given to MSMEs by the PM and the finance minister of India. Talking of budgets, I say it was the biggest decision by any government. When it’s (provisions for MSMEs) in budget, it reflects a national concern.
And what about the corporate tax relaxation?
Earlier, the government of India gave 5 per cent rebate to those who had turnover of up to Rs 50 crore or less. According to the new norms for MSMEs, Rs 5 crore for micro, Rs 75 crore for small and Rs 250 crore is the limit for medium enterprises. Now the rebate is applicable to all. This is a long-standing demand getting fulfilled.
You recently got a job creation survey done. What was the need and what were the highlights of the survey?
I have heard that wherever Rahul Gandhi is going, including to foreign shores, he’s attacking the government on the supposed unemployment figures. So, I got a survey done. In fact, two. It was my way of getting done a reality check on the issue.
In the survey, I asked MSMEs if they do advance planning for their jobs. The responses were varied, ranging from on job training, interest subsidies, etc. When I asked them how many people they employed on average, while some said none, but if one were to take an average of the numbers, they said seven persons on average were employed by each MSME firm.
According to the National Service Scheme figures, there are over six crore MSMEs. And as per Goods and Services Tax Network (GSTN) registrations, they are more than 1 crore.
So if we put together the average number of employed persons with the total number of MSMEs, eight to 10 crore people are being provided jobs by this sector alone.
I got the survey findings rechecked by a private surveyor, which more or less corroborated the earlier findings. Why is this fact not being highlighted?
So what are the challenges?
I would say the population explosion is the real challenge. Let me give you an example. The Metro service in Delhi was started in 1998-99. But if you look at the traffic today during peak hours, there is not an inch of space available (in the metro trains).
When I raise the issue of population explosion, some point out the demographic dividend. They fail to realise that resources are limited. And if not planned properly, this could become a big problem for the government.
You have an ambitious employment generation roadmap for the future that you want to present to the Prime Minister. Can you please share the details?
By 2020, the textile sector will be a major source of employment. In textiles, apparels will be the biggest sub sector, wherein, it’s estimated that over 6 crore jobs would be created by the said year.
But there’s a challenge. The average pay in the sector is Rs 7,000 to 12,000 per month.
Earlier, composite mills were established in centres such as Mumbai, Kanpur, etc. Today such units can be found in places such as Delhi, Noida, Gurgaon, which bring with them their own set of challenges. You cannot expect people to make a living with Rs 10,000 in Delhi!
Therefore, the need of the hour is to take the entire ecosystem to rural India as that will also help industrialise the hinterlands.
I have already started an experiment in Navada in Bihar, and the initial results are very encouraging.
Then there is the issue of solar charkha (spinning wheel). It is highly cost effective, and can revolutionise garment manufacturing in India.
Many complain that we are losing out to countries such as Cambodia and Bangladesh in textiles.
I have studied Bangladesh. The manufacturing units there are in the rural areas. There’s a need to recreate that model here. This will revolutionise the rural areas, and will create a major avenue for job generation for the rural populace.
With minor policy tweaking, this can be a major source of employment. I am going to propose this to the PM.
What challenges are you facing in the MSME sector?
We must acknowledge globalisation as a reality. We may be facing competition from China, but it is also true that we are beating it in many areas. We need to invest more in technology and R&D.
The biggest gap here is in financial inclusion. The government has addressed this challenge, and now we are also aggressively promoting cluster scheme.
In many countries MSMEs’ contribution to gross domestic product (GDP) is around 50 to 80 per cent.MSMEs’ share in India’s GDP is may be 30 per cent presently, and their share in exports is at 35 per cent. By 2022, the sector must be 50 per cent of GDP. We are working towards that national objective.
What other initiatives are you taking?
I am undertaking newer experiments in rural empowerment. Recently, I took the NITIAayog CEO to visit one such hotspot in Bihar. The solar charkha there, and the ecosystem it will spawn has the potential to give employment to over five crore people.
I am also stressing on a cow-based agrarian economy. World over, there’s a thrust on organic farming.
In one such experiment, human hair and cow urine is being mixed to produce amino acid, which with cow dung will help achieve the objective of organic farming.
This also fits well into the PM’s vision of reducing chemical fertilisers by half by 2022.
The entire country is shifting towards organic farming. The farmers in Punjab prefer wheat produced in Madhya Pradesh because there’s less chemical fertiliser. As a consequence of chemical fertilisers, many are getting deadly diseases such as cancer.
I am also trying to see how agro industries in the MSME space can be combined and promoted.
