Micro, Small and Medium Enterprises (MSMEs) are the backbone of any country, driving employment generation and GDP growth.
In India, MSMEs manufacture over 6,000 products and contribute about 45 per cent to manufacturing and about 40 per cent to exports. This sector can help realise the National Manufacturing Policy target of raising the share of the sector in GDP from the current 16 per cent to 25 per cent by the end of 2022.
Tamil Nadu has a strong and vibrant MSME segment across all the major industries, including textiles and garments, engineering products, auto-ancillaries, leather products and plastics.
According to State government data, around 18 lakh entrepreneurs provide employment opportunities to about 114 lakh persons with a total investment of Rs. 1,93,704 crore.
The State government has also announced a slew of initiatives to reinvigorate MSMEs.
The most important is the Single Window Clearance Committee for the sector, at http://www.easybusiness.tn.gov.in/msme , launched in May this year.
Entrepreneurs planning to set up a unit can get licences/approvals from various departments via this single window.
These include the Directorate of Town and Country Planning, the Tamil Nadu Pollution Control Board and the Directorate of Industrial Safety and Health.
The second most important initiative of the State government to help MSMEs is the Business Facilitation Act/Rules, 2018.
This ensures the single-point receipt of applications to secure clearances required to establish or expand an enterprise, and in normal course of business, including renewals, in a time-bound manner.
The Act also provides for an effective grievance redress mechanism and penalties in case the competent authority fails to act within a time frame.
The Act covers 54 clearances, including pre-establishment, pre-operation, renewals and incentives. It provides for a three-tier institutional structure — District MSME Single Window Committee, State MSME Single Window Committee and MSME Investment Promotion and Monitoring Board — to monitor and review the progress of the single-window mechanism.
At the Global Investors Meet in September 2015, an investment of Rs. 16,532 crore by 10,073 MSMEs was announced.
As on March 31, 2018, 5,358 enterprises that had signed MoUs had commenced production with an investment of Rs. 6,182.03 crore, creating employment for 71,691 persons.