Cabinet approved changes in definition of MSMEs

The Union cabinet has approved further changes to the definition of micro, small and medium enterprises, a Rs 20,000-crore fund to provide equity support to stressed entities in the sector, and equity infusion of Rs 50,000 crore into MSMEs through a fund of funds.

As per the new definition, MSMEs with an investment of Rs.1 crore and turnover of Rs.5 crore will be classified as micro-units.

Units with an investment of Rs.10 crore and turnover of Rs.50 crore will be classified as small units.

Units with an investment of Rs.50 crore and turnover of Rs.250 crore will be classified as medium units.

According to the new definition, exports will not be excluded from the turnover cap.

GoI has formulated the roadmap for implementing various measures for the MSME sector, as announced in the Atmanirbhar Bharat package.

The measure aims to improve the ease of doing business, attract investment, and generate new job opportunities across the country.

Union Cabinet also approved a provision for more loans of up to Rs.10,000 for street vendors. It is expected that this would benefit 5 million vendors.