MSME body seeks intervention of PM on rising raw material prices. As we all know, the prices of raw materials such as steel, iron ore, aluminum, copper, plastics, and paper are increasing. MSMEs are still suffering from the crisis caused by the pandemic. Consequently, MSME is struggling to find the way out and seeking the help of Prime Minister Narendra Modi. In this article, we will read about the All India Council of Association of MSMEs (AICA)’s request to PM Modi regarding eight major points.
MSME body seeks intervention of the PM
One hundred seventy industrial groups have joined together to create the All India Association of MSMEs (AICA) to address the pandemic-hit sector. On Wednesday, AICA immediately requested assistance from Prime Minister Narendra Modi as the increase in pricing of raw commodities like steel, iron ores, aluminum, copper, plastics, and paper is causing problems.
Furthermore, AICA highlighted that this industry has significant problems as the working capital has been eroded as raw materials prices have increased enormously.
MSME body ( AICA) seeks intervention of PM on eight major points
The AICA says that “We understand this volatile situation is temporary in nature. But the MSME sector might be permanently damaged. Although demand has dropped owing to the lock-down, costs are increasing, especially steel, pig iron, and other raw materials ”
Entrepreneurs having MSME Registration said steel and other producers of base materials declared profits 10-20 times greater, while every MSME is about to be extinguished.
Therefore, To resolve the problem, the association proposed eight points. These are as follows.
- Firstly, Protection against an acceleration in costs for some days.
- Secondly, The government must direct public sector enterprises (PSUs) to cancel bookings from MSMEs with zero penalties/ blacklisting.
- Furthermore, The government should derive a formula for price escalation.
- In addition, the quota for MSMEs at concessional price.
- Additionally, allow the import of all steel supplies based on price and quality requirements at zero import duty and no anti-dumping
- Government should also ban the export of iron ore and steel products.
- Similarly, the government should allow MSMEs to refresh their price with a new quote under a government contract.
- Lastly, MSMEs should be able to invoke the escalation clause and requote all finalized government and PSU supplies.
AICA for boosting the Atamnirbhar Bharat
The core team members are urging the PM’s intervention. These include Coimbatore District Small Industries Association President M V Ramesh Babu, Arise Chairman Yogesh Pawar, Southern India Engineering Manufacturers’ Association President K V Karthik, and Ludhiana Hand Tools Association President S C Ralhan.
The AICA also states that If the MSMEs become crippled and hit because of a spiraling price rise in raw materials, it would only deter entrepreneurship, ultimately failing to achieve Atma Nirbhar Bharath’s aim.
Interestingly, MSMEs make up 30% of Indian GDP. Similarly, 45% of the production yield, 48% of exports, and employ more than 11 crore workers. The country has around 63.5 million MSMEs.
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