By TCN Staff Reporter
Delhi: In an attempt to help people from marginalised communities set up their own businesses, the Union Budget has allocated Rs 500 crore for scheduled caste, scheduled tribes and women entrepreneurs under the ‘Stand up India’ scheme.
Finance Minister Arun Jaitley, while presenting the Budget on Monday in the Parliament, said that a national hub will also be set up in the Ministry of Micro Small and Medium Enterprises (MSME) in partnership with industry associations to provide professional support to SC/ST entrepreneurs.
“Scheduled Caste and Scheduled Tribe entrepreneurs are beginning to show great promise in starting and running successful business enterprises…the Union Cabinet has approved the ‘Stand Up India Scheme’ to promote entrepreneurship among SC/ST and women…The Scheme will facilitate at least two such projects per bank branch, one for each category of entrepreneur. This will benefit at least 2.5 lakh entrepreneurs,” he said in his Budget speech.
“We are celebrating the 125th birth anniversary of Shri B Ambedkar. This must become the year of the economic empowerment for SC/ST entrepreneurs… It is proposed to constitute a national SC/ST hub in the MSME Ministry in partnership with industry associations,” Jaitley said. Announcing the scheme, Jaitley said there had been extensive interactions with Dalit India Chamber of Commerce and Industry [DICCI] on building an entrepreneurship ecosystem. “This hub will provide a professional support to SC/ST entrepreneurs to fulfil the obligations under the Central government procurement policy adopted best practices and leverage the Stand up initiative. The scheme for welfare and skill development of minorities such as multi-sectoral development and USTADD (Upgrading the Skills and Training in Traditional Arts/Crafts for Development) shall be implemented effectively,” he said.
Commenting on the scheme, Chandrabhan Prasad, Mentor, DICCI, said he saw the scheme as a positive for marginalised communities. “The scheme is a welcome step in encouraging marginalised communities, and I hope this amount is increased over time,” he told Twocircles.net
There are other questions that have been left unanswered. In November 2011, the UPA government had announced the Public Procurement Policy. Under this, every central ministry/PSU had to set an annual goal for procurement from the MSE sector at the beginning of the year, with the objective of achieving an overall procurement goal of minimum 20% of the total annual purchases of the products or services produced or rendered by MSEs from the latter in a period of three years. Out of 20% target of annual procurement from MSEs, a sub-target of 4% (i.e. 20% out of 20%) was to be earmarked for procurement from MSEs owned by SC/ST entrepreneurs. The scheme also said then, that at the end of three years, the overall procurement goal of minimum 20% will be made mandatory.
However, after the scheme was made mandatory, a report prepared by the Prime Minister’s Office showed that the Central Government departments and Central PSUS made only 10%purchases from medium, small and micro enterprises (MSMEs), against the mandatory requirement of 20%. Meanwhile, procurement from SC/ST enterprises is worse at 0.2%, against the mandatory 4%.
“To me, it is a riddle. As it stands, 4% is a low number to encourage SC/ST entrepreneurs. More than providing credit, we need to open markets for these entrepreneurs. Once they have a market to sell to, credit becomes easier. However, not much seems to be done in this regard and this was not talked about in the Budget speech. I believe that if the government had also focussed on improving demand from SC/ST entrepreneurs, it would have helped tremendously,” said Prasad.