The Hindu : Tamil Nadu / Chennai News : `Withdraw small and medium industries bill'

Online edition of India's National Newspaper
Tuesday, Jun 21, 2005

Tamil Nadu

Tamil Nadu - Chennai

`Withdraw small and medium industries bill'

Special Correspondent

Fear over smaller units being annihilated Credit to small and tiny sector was steadily going down and the bill had not addressed the issue

CHENNAI: The Industrial Estate Manufacturers Association (IEMA), Guindy, and other small industries associations on Monday demanded the total scrapping of the Small and Medium Enterprises Development Bill, 2005.

Implementation of the legislation would sound the death knell for small and tiny units, the associations said.

Office-bearers of the IEMA and other small-scale industries associations said that all political parties paid only lip service to small and tiny industries, which provided huge employment opportunities. It appeared that the bill had been drafted in a hurry without discussions with stakeholders.

`A rude shock'

The legislation came as a rude shock to the small and tiny sector. The bill would wipe out the small and tiny sector. They demanded a separate Act for tiny and small industries. Medium industries should not be linked with small-scale units.

The formulation of the bill itself was defective, they said. Apart from redefining tiny, small and medium units, their turnover should also be fixed as a criterion.

While for tiny units the turnover should be up to Rs.1 crore, that for small industries it should be Rs. 1crore to Rs.10 crores, for medium units Rs.10 crores to Rs.100 crores and for large units Rs.100 crores and above. The investment limit for small-scale units should be limited to Rs.1 crore.

K. Gopalakrishnan, president, IEMA, said there was no word about the tiny sector in the bill.

M.S. Parthasarathy, a doyen of the small industry movement, said the bill should be opposed in all seriousness.

V.S. Narasimhan, president, Small Industries Management Association, said that over the years, the relevance of small industries was getting diluted. The fundamental problem was of credit.

Credit to the small and tiny sector was steadily going down and the bill had not addressed the issue.

Documentation

Another problem faced by small units was unnecessary documentation. He said the recommendation of the National SSI Board should be made mandatory. The bill was not promotional and hence it did not serve any purpose.

A.S. Kannan, MLA, said the bill would cause the extinction of the small and tiny sector.

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