Executive Summary:
The Indian government acknowledges the challenges faced by small businesses, exporters, and startups due to global economic factors. In response, various schemes and policy measures have been introduced to support trade, boost manufacturing, and promote ease of doing business. Initiatives include financial support, infrastructure development, and regulatory reforms, with ongoing efforts to enhance the investment ecosystem and reduce compliance burdens.
Key Points / Main Content:
Support for MSMEs and Startups:
Various schemes are being implemented to strengthen MSMEs, including:
Prime Minister's Employment Generation Programme (PMEGP)
PM Vishwakarma Scheme
Credit Guarantee Scheme for Micro and Small Enterprises
Public Procurement Policy for Micro and Small Enterprises (MSEs)
Micro and Small Enterprises-Cluster Development Programme (MSECDP)
MSME Champions Scheme
International Cooperation Scheme
Procurement and Marketing Support Scheme (PMS)
Udyam Registration Portal
Trade Receivables e-Discounting System (TReDS)
Fee rebates (at least 80%) for patent applications and maintenance are provided to startups, small entities (MSMEs), and educational institutes. Expedited patent examination is also available.
The Startup India initiative, launched on January 16, 2016, has recognized over 1.75 lakh startups.
The government is implementing three flagship schemes under Startup India: Fund of Funds for Startups (FFS), Startup India Seed Fund Scheme (SISFS), and Credit Guarantee Scheme for Startups (CGSS).
Boosting Manufacturing and Trade:
The Make in India initiative aims to establish India as a hub for manufacturing, design, and innovation, focusing on 27 sectors.
Production Linked Incentive (PLI) schemes have been launched for 14 key sectors with an outlay of 1.97 lakh crore to enhance manufacturing capabilities and exports.
Twelve new project proposals have been approved under the National Industrial Corridor Development Programme (NICDP) with a total project cost of 28,602 crore.
Other initiatives include FDI policy reforms, the National Logistics Policy, PM Gati Shakti National Master Plan, GIS-enabled Land Bank, and the Project Monitoring Group.
The Boilers Act, 1923 has been re-enacted as the Boilers Act, 2025, modernizing provisions to benefit industries reliant on boiler systems.
The New Foreign Trade Policy 2023 and the Interest Equalization Scheme support trade and exports.
The Common Digital Platform for Certificate of Origin facilitates trade.
The Districts as Export Hubs initiative identifies and supports products with export potential in each district.
Ease of Doing Business:
The government is focused on Reducing Compliance Burden (RCB), Decriminalization, and the National Single Window System (NSWS).
The Business Reform Action Plan (BRAP) incentivizes states to reduce compliance burdens.
The National Single Window System (NSWS) is a one-stop digital platform for Government to Business (G2B) approvals.
The Jan Vishwas Amendment of Provisions Act, 2023, has decriminalized 183 provisions across 42 Central Acts.
The Jan Vishwas 2.0 initiative is analyzing criminal provisions across various Acts.
Inflation Management:
A combination of fiscal and monetary policy tools is being used to manage inflation.
Impact Analysis:
MSMEs and Startups:
Impact: Benefit from financial assistance, streamlined processes, and reduced regulatory burdens, fostering growth and innovation.
Action Required: Utilize available schemes and resources, comply with updated regulations, and participate in initiatives like Startup India.
Exporters:
Impact: Benefit from enhanced trade facilitation, financial support, and infrastructure development, improving competitiveness in global markets.
Action Required: Leverage the New Foreign Trade Policy, utilize the Common Digital Platform for Certificate of Origin, and engage with the Districts as Export Hubs initiative.
Manufacturers:
Impact: Benefit from the Make in India initiative, PLI schemes, and improved infrastructure, driving increased production and investment.
Action Required: Explore opportunities under PLI schemes, invest in manufacturing capabilities, and utilize the National Industrial Corridor Development Programme.
Investors (Domestic and Foreign):
Impact: Benefit from a more transparent and efficient regulatory environment, reduced compliance burdens, and streamlined approval processes, encouraging investment.
Action Required: Utilize the National Single Window System, take advantage of FDI policy reforms, and explore investment opportunities in identified sectors.
State Governments:
Impact: Incentivized to reduce compliance burdens and improve the ease of doing business, fostering economic growth and attracting investment.
Action Required: Participate in the Business Reform Action Plan (BRAP), implement policies to reduce compliance burdens, and support national initiatives at the state level.
Key Entities Referenced
Ministry of Micro, Small and Medium Enterprises: The Indian government ministry responsible for formulating and administering rules, regulations and laws relating to micro, small and medium enterprises in India.
Prime Ministers Employment Generation Programme PMEGP: A credit-linked subsidy program in India aimed at generating employment opportunities by assisting in the establishment of micro-enterprises in rural and urban areas.
Startup India initiative: An initiative by the Government of India to build a strong ecosystem for nurturing innovation and startups in the country.
Make in India: An initiative by the Government of India to encourage companies to manufacture their products in India.
National Industrial Corridor Development Programme NICDP: A program by the Government of India to develop industrial corridors with integrated infrastructure to promote manufacturing and investments.
National Logistics Policy: A policy by the Government of India to address logistics costs and improve the efficiency of the logistics sector.
Jan Vishwas Amendment of Provisions Act, 2023: An act by the Government of India to decriminalize minor offences across various central acts to promote ease of doing business.
New Foreign Trade Policy 2023: A policy by the Government of India to provide a framework for increasing exports, promoting trade, and facilitating ease of doing business in the foreign trade sector.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE
LOK SABHA
UNSTARRED QUESTION NO. 322.
TO BE ANSWERED ON TUESDAY, THE 22ND JULY, 2025.
CHALLENGES FACED BY SMALL BUSINESSES
322. SHRI ZIA UR REHMAN:
Will the Minister of COMMERCE AND INDUSTRY be pleased to state:
वाणिज्य एवं उद्योग मंत्री
(a) whether the Government has taken cognizance of the challenges faced by
small businesses, exporters and start-ups due to global economic slowdown,
inflation and rising logistics costs; and
(b) if so, the details thereof along with the policy measures introduced to support
trade, boost manufacturing and promote ease of doing business and if not, the
reasons therefor?
ANSWER
वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री (श्री णिणिन प्रसाद)
THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY
(SHRI JITIN PRASADA)
(a) & (b): To strengthen Micro, Small and Medium Enterprises (MSMEs), the Ministry of Micro,
Small and Medium Enterprises has been implementing various schemes/programmes
and initiatives such as the Prime Minister’s Employment Generation Programme
(PMEGP), PM Vishwakarma Scheme, Credit Guarantee Scheme for Micro and Small
Enterprises, Public Procurement Policy for Micro and Small Enterprises (MSEs), Micro
and Small Enterprises-Cluster Development Programme (MSE-CDP), MSME
Champions Scheme, International Cooperation Scheme, Procurement and Marketing
Support Scheme (PMS), Udyam Registration Portal and Trade Receivables e-
Discounting System(TReDS), to name the major ones.
To support small businesses, fee rebates of at least 80% for filing and processing of
patent applications and maintenance of patents have been given to Startups, small
entities (MSMEs) and educational institutes. Facility of expedited examination has also
been given to startups, small entities (MSMEs). Further, in order to fast-track
examination of patent application, electronic submission of documents by patent
agents has been made mandatory and timelines have been streamlined.
Further, the Government, with an intent to build a strong ecosystem for nurturing
innovation, startups and encouraging private investments in startup ecosystem of the
country launched Startup India initiative on 16th January 2016. Over 1.75 lakh startups
have been recognised by DPIIT so far. Under the Startup India initiative, the
Government is implementing three flagship Schemes, namely, Fund of Funds for
Startups (FFS), Startup India Seed Fund Scheme (SISFS) and Credit Guarantee
Scheme for Startups (CGSS) to support startups at various stages of their business
cycle.
Similarly, Government has also introduced several policy measures to support trade,
boost manufacturing, and promote ease of doing business. The ‘Make in India’
initiative has been launched to make India a hub for manufacturing, design, and
innovation. Presently, ‘Make in India’ focuses on 27 sectors including 15 manufacturing
sectors, implemented across various Ministries and Departments and StateGovernments. Further, keeping in view India’s vision of becoming ‘Aatmanirbhar’ and
to enhance India’s manufacturing capabilities and exports, Production Linked Incentive
(PLI) schemes have been launched for 14 key sectors with an outlay of ₹1.97 lakh
crore. The Government has also approved 12 new project proposals under the
National Industrial Corridor Development Programme (NICDP) with total project cost
of ₹28,602 crore (incl. land cost) to facilitate manufacturing investments into the
country. The other major initiatives include Foreign Direct Investment (FDI) policy
reforms, National Logistics Policy to address logistics cost, PM Gati Shakti National
Master Plan for integrated planning of multi-modal infrastructure, GIS enabled Land
Bank, Project Monitoring Group to remove bottlenecks in setting up of major
infrastructure projects, setting up of industrial parks, policy measures to boost domestic
manufacturing through public procurement orders, Phased Manufacturing Programme
(PMP) and Quality Control Orders (QCOs). The Boilers Act 1923 has been re-enacted
as the Boilers Act, 2025 (12 of 2025), wherein redundant /obsolete provisions have
been omitted and certain substantive enabling provisions have been made for the rules
and regulations, which is expected to benefit industries reliant on boiler system. A
combination of fiscal and monetary policy tools have been used by the government
and central bank to keep inflation in check.
To enhance ease of doing business, several initiatives have been introduced which
mainly focus on Reducing Compliance Burden (RCB), Decriminalization and National
Single Window System (NSWS). The Business Reform Action Plan (BRAP) focuses
on reduction in compliance burden and incentivises state government to lessen burden
of compliance. The National Single Window System (NSWS) has been launched as a
one-stop digital platform for facilitating Government to Business (G2B) approvals and
investor-related clearances for industry. Also, the Government of India is determined
to create an investment friendly ecosystem that strongly supports domestic as well as
foreign investments.
To enhance ease of doing business, the Government, through the Jan Vishwas
(Amendment of Provisions) Act, 2023, has decriminalized 183 provisions across 42
Central Acts administered by 19 Ministries/ Departments. Building on this reform, the
Hon’ble Finance Minister has announced the Jan Vishwas 2.0 initiative, under which
DPIIT has undertaken an analysis of criminal provisions (including both major and
minor offences) across Acts under 39 Ministries/Departments.
To boost trade and exports, the Government has launched the New Foreign Trade
Policy (2023) and implemented the Interest Equalization Scheme on pre and post
shipment rupee export credit. Common Digital Platform for Certificate of Origin has
been launched to facilitate trade and increase Free Trade Agreement (FTA) utilization
by exporters. Further, Districts as Export Hubs initiative has been launched by
identifying products with export potential in each district, addressing bottlenecks for
exporting these products and supporting local exporters/manufacturers to generate
employment in the district.
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