NEW DELHI: The government will soon make changes to the definition of a micro, small and medium enterprise, Union Minister Nitin Gadkari said on Tuesday and hoped to generate five crore jobs in the MSME sector in five years. Finance Minister Nirmala Sitharaman had in August said the government would consider amending the MSME Act to move towards a single definition.
The update in the definition of micro, small and medium enterprises (MSMEs) may allow a single definition for purposes related to taxation, investment, etc. The new definition is likely to be effected through an amendment to the MSME Act and may lead to further improvement in India's ease of doing business scenario.
In February last year, the Union Cabinet had approved amendments to the law to change the criteria for classifying MSMEs from 'investment in plant and machinery' to 'annual turnover'.
Asked about proposed changes to the definition of MSME, the minister for micro, small and medium enterprises said this will soon be implemented.
"We will have one meeting and then finalise it (changes to MSME definition)," Gadkari told , adding that extensive changes will be made soon.
The minister was speaking on the sidelines of the Luxury Symposium 2019 here.
Observing that MSMEs are the heart of the Indian economy, contributing 29 per cent to the gross domestic product and have created 11 crore jobs till now, the minister said "now, the mission for five years is that we need to create more than five crore jobs in five years, particularly in tribal, rural and agricultural areas".
He said the government is already in the process of sanctioning 13 clusters under the Solar Vastra scheme and every cluster has a potential of creating 3,000-3,500 jobs.
Besides, Gadkari, who also holds the portfolio of the road transport and highways ministry, said work has begun on the 12-lane concrete express highway between New Delhi and Mumbai and mooted the idea of setting up an international standard museum on the highway which would prove beneficial for marketing of Indian Handlooms and Handicraft and also promote tourism.