May 13: As part of the series of announcements by the finance minister Nirmala Sitharaman today also redefined the age-old definition of MSME.
Earlier in India, the MSMEs were categorized only by means of Investments. However, in the International market, it was based on the Turnover of the company.
The announcement also mentioned that the limits will be the same for both Manufacturing and Services and there will be no discrimination among them. Earlier special benefits were provided to the manufacturing segments to which service segments were deprived of.
The new announcement of MSME will follow the below limits
Micro Enterprises: Investment of less than 1 crore and Turnover of less than 5 Crores (earlier limits were an investment of less than 25 lacs for Manufacturing and less than 10 lacs for services)
Small Enterprises: Investment of less than 10 crores and Turnover of less than 50 crores (earlier limits were an investment of less than 5 crores for Manufacturing and less than 2 crores for services)
Medium Enterprises: Investment of less than 20 crores and turnover of less than 100 crores (earlier limits were an investment of less than 10 crores for manufacturing and less than 5 crores for services)
The new limits are expected to provide opportunities for MSMEs to grow much more while still enjoying the benefits of the MSME. The last revision was as part of the MSME act in 2006 and was due for revisions.