What are the Opportunities for MSMEs and Exporters from the Union Budget of India in 2023?
The union budget for 2023 is here. What does this year’s union budget have for MSMEs and exporters? We walk you through some of the major fiscal outlay provisions and opportunities for MSMEs and exporters here.
Some of the key opportunities for MSMEs and exporters from the budget include:
1. Allocation of Fiscal Outlay for MSMEs in the Union Budget for 2023
The government has proposed an allocation of Rs. 15,700 crores for MSMEs in 2023.
The outlay in this year’s union budget is a significant increase from the previous year. One of the highlights of this increased outlay is the sharp surge in capex.
2. Ease of Doing Business and Simplification of Compliance for MSMEs
The union budget for 2023 has several measures for simplifying compliance for MSMEs and exporters. Of these, the simplification of the Goods and Services tax (GST) regime is a significant step towards augmenting the ease of doing business.
Not only will it lead to a reduced tax burden, but is also likely to reduce staff hour engagements into maintaining data trails manually and filing for input tax credits.
3. Corpus of INR 5000 Crore for MSMEs to Enable Access to Credit
One of the biggest pain points for Indian exporters is the short shelf life of export opportunities. The global market is getting flatter and customers have a plethora of choices for importing goods.
Indian exporters, especially MSMEs need credit on-demand to purchase raw materials and intermediate goods to process purchase orders. There is a definite mandate for agile supply chain finance for exporters and MSMEs.
To solve this pain point, the union budget 2023 has a provision for a corpus of Rs 5000 crore. The corpus will be uses to provide collateral-free debt to MSME exporters and MSMEs that are active in the domestic trade circuit.
4. Export Promotion Measures to Integrate MSMEs with the Global Supply Chain
The honorable FM has introduced several measures for export promotion in the union budget for 2023. Of the several measures, the one that deserves special mention is the setting up of a corpus worth Rs 20,000 crore to support export-oriented MSMEs.
5. Infrastructure Development to Boost MSMEs and Exporters
The government has proposed several measures to improve infrastructure in the union budget for 2023 to promote MSMEs and exporters. These include the development of local industrial parks and clusters. Such clusters and manufacturing zones will provide MSMEs with access to basic amenities like real estate, electricity, and logistical and digital connectivity.
Learn about the detailed analysis of opportunities and procurement and supply chain recommendations for CEOs, CFOs, CTOs, and CPOs of MSMEs and exporters in the e-book: “Union Budget 2023; The Decision Maker’s Vantage Point”.