Centre implements Quality Control Orders with relaxations for MSMEs to protect domestic production

New Delhi [India], December 14 (ANI): The Central Government has implemented Quality Control Orders (QCOs) in a manner with exemptions and relaxations for the Micro, Small, and Medium Enterprises (MSMEs) to ensure no disruption to the domestic production, said Union Minister Shobha Karandlaje in a written reply in Lok Sabha.

Minister of State for MSMEs Karandlaje highlighted key relaxations and exemptions for MSMEs, according to a release by the Ministry of Micro, Small & Medium Enterprises.

As part of the relaxations, an additional six-month extension will be provided to the micro enterprises and a three-month extension for small enterprises to ensure the QCOs. Exemption for imports will also be provided to the domestic manufacturers for producing export-oriented products.

An exemption for the import of up to 200 units for research & development purposes is also made. The provision for clearance of legacy stock (manufactured or imported before implementation) within six months from the effective date has also been made.

She added that based on the feedback on certification processes, the Bureau of Indian Standards (BIS) has implemented some financial and technical relaxations for the MSME sector.

"To support MSMEs, financial incentives are provided by BIS in annual minimum marking fee with concession of 80% (for Micro Enterprises), 50% (Small enterprises) and 20% (Medium Enterprises). An additional concession of 10% is also provided to enterprises which are either located in north-east areas or women entrepreneur MSME units," the Minister said in her reply.

"The requirement of maintaining in-house laboratory has been made optional for MSME units. MSME units are allowed to utilize the services of outside BIS recognized laboratories, NABL accredited labs or even sharing of resources like cluster based labs or laboratories of other manufacturing units. The 'Levels of Control' in the Scheme of Inspection and Testing (SIT) are made recommendatory in nature. The manufacturer has the choice to define their own control unit/batch/lot and their own Levels of Control and inform the BIS," Shobha Karandlaje said.

The Union Minister added that the BIS has also made the product certification process guidelines publicly available on the BIS website and is also issuing product-wise manuals as guidance documents for conformity assessment as per various Indian Standards.

As per the information provided by the Reserve Bank of India, with a view to improve monetary policy transmission, banks have been advised by the Reserve Bank of India to link loans to MSMEs to an external benchmark," she said.

The Minister further highlighted that the reset clause for loans has been reduced to three months under the external benchmark system, adding, "To make the benefit of the external benchmark-based interest regime available to the existing borrowers, banks have been advised to provide a switchover option as per mutually agreed terms. Further, RBI also took various other measures for improving credit flow to the MSME sector."

Karandlaje, in her reply, added that the government has announced the Mutual Credit Guarantee Scheme for MSMEs (MCGS-MSME), designed to help MSMEs access loans to grow their businesses. She added that specific targets for lending to the MSME sector have been prescribed in the Priority Sector guidelines.

"Scheduled commercial banks have been mandated not to accept collateral security in the case of loans up to Rs 10 lakh extended to units in the MSE sector. Computation of working capital requirements of MSE units to be minimum 20% of the projected annual turnover for borrow limits up to Rs 5 crore," she said. (ANI)

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