Finance Minister Nirmala Sitharaman on Wednesday cleared the air around the Prime Minister’s self-reliance call stating that it did not mean being isolationist and banning foreign firms and investors from setting up shop in India. It’s more like “India First,” where local entrepreneurs would get priority. Sitharaman reiterated what Prime Minister Modi said the previous evening about a confident India that can rest on its strengths even while it would contribute to the globe. At a time when the economy is literally on a precipice the Finance Minister is injecting confidence in Indians and India incorporated by spelling out what the Rs 20 lakh crore package will help bring the flagging economy on the rails. Hopefully India will now build the capacities of its entrepreneurs and make it easy for them to do business. That would mean a major shift from the normal bureaucratic red-tape that continues to plague governance in India.
The Modi Government is keenly aware that a huge chunk of the young workforce on this country are engaged in Micro, Small and Medium Enterprises (MSMEs) which therefore are the backbone of the economy and also the job creators at the lowest rung of the economic ladder. Hence a good percentage of the Rs 20 lakh crore economic boost would perhaps be directed at reviving SMSEs which had suffered a major blow during the Covid-induced lockdown. Roughly 45 lakh SMSE units will be revived so they can resume work and save jobs. Another announcement that should warm the hearts of the MSME sector is that global tenders will be barred from procurements up to Rs 200 crore. In the past the Government’s e-procurement sites have literally been taken over by large foreign players. This results in unfair advantage in terms of pricing and size. This important decision would improve the competitiveness of Indian MSMEs on government contracts resulting in an increase in registration by MSMEs and on e-procurement sites.