Modi on front foot ahead of elections; announces Rs 1 crore loan in 59 minutes and other sops for MSMEs

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First Published 2, Nov 2018, 7:22 PM IST
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Narendra Modi elections Rs 1 crore loan in 59 minutes MSMEs BJP GST Assembly elections
Highlights

Addressing the middle class, which owns most of the micro, small and medium enterprises (MSMEs), at a function in New Delhi, Modi announced a slew of incentives for the MSME sector that has been reeling under economic crisis ever since the goods and services tax (GST) was brought in

New Delhi: Just ahead of the Assembly elections in five states, Prime Minister Narendra Modi addressed the anti-incumbency factor in style. 

Addressing the middle class, which owns most of the micro, small and medium enterprises (MSMEs), at a function in New Delhi, Modi announced a slew of incentives for the MSME sector that has been reeling under economic crisis ever since the goods and services tax (GST) was brought in. In an animated speech, PM Modi said that the very GST that businessmen were fearing will be the reason for them to smile.       

Also read: Prime Minister Narendra Modi on Rashtriya Ekta Diwas: Sardar Patel created united India

Here are the major announcements made by Modi

 

Political implications

Remember GST has been a key concern for mid-level businesses. Many have complained of a decrease of turnover or losses. So if ahead of the Gujarat elections, GST rates for certain goods were brought down to appease the Gujarati businessmen, ahead of the Assembly elections in Madhya Pradesh, Chhattisgarh, Rajasthan, Mizoram and Telangana, in most of which BJP governments are facing a huge anti-incumbency wave, this move can be seen as an effort to win voters back. This adds a fresh boost to the enthusiasm of the BJP workers in these five states. 

Economic ramifications

In Madhya Pradesh, there are three major issues: farmer distress, GST and SC/ST ordinance. With these measures for the MSME sector, Modi has tried to address people's displeasure with GST. 

Just a few days ago, there were reports that collections from GST crossed Rs 1 lakh crore in October. These MSME reforms couldn’t have been more timely for the Modi sarkar.

These announcements have come closely on the heels of India registering a massive jump in World Bank's Ease of Doing Business index to from 142 rank in 2014 to 77 in 2018.

MSMEs have become the thrust for Modi, who has realised that the BJP's middle and upper middle class core constituency is largely engaged in MSME businesses, and so addressing their comncern is of utmost priority.

Since most of these businesses are indigenous, it will also contribute to Modi's Make in India project.

Talking of India's progress in the Ease of Doing Business ranking, Modi said in four years his government has achieved what many did not believe possible and what no other nation has done. Breaking into the top 50 is not far away, he added.

Reform of processes will help MSMEs, Modi said. Modi ended by inviting government officials to implement the measures that were announced to take part in 'nation-building'. The PM said he will himself monitor the implementation of the MSME reform for the next 100 days. 

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