FACSI Calls for Budget Relief to Boost Small Businesses
The Federation of Associations of Cottage and Small Industries (FACSI) has made a strong appeal to the central government. They want tax, credit, and regulatory relief measures for micro and small enterprises in the upcoming 2026-27 Union Budget. This move aims to sustain growth and strengthen the role of these businesses in India's industrial ecosystem.
Pre-Budget Recommendations Sent to Finance Minister
In a recent pre-budget letter, FACSI president H K Guha communicated these demands to Finance Minister Nirmala Sitharaman. Guha stated that the recommendations resulted from extensive consultations with various entrepreneur associations and MSE groups across the country. The federation believes these steps are crucial for supporting small-scale industries.
Key Demands for GST and Regulatory Reforms
Among the primary requests, FACSI seeks the formation of an exclusive council for small and micro enterprises under the Ministry of MSME. They also advocate for a higher exemption threshold under the GST regime. Additionally, the industry body proposes a single, simplified GST return for small units to reduce compliance burdens.
Credit and Lending Support for MSEs
FACSI has called for statutory collateral-free lending of up to ₹1 crore for MSEs. They recommend an interest cap of 6-7 per cent. The federation also suggests interest subvention during periods of financial stress. Automatic renewal of working capital limits for units complying with banking norms is another key demand.
Addressing Liquidity and Legal Concerns
Highlighting liquidity issues, FACSI demands GST refunds within 15 days. They propose statutory interest for any delays by the government. The federation also urges complete decriminalisation of procedural lapses related to GST returns, labour laws, and local regulations.
Support for Export-Oriented Units
For export-focused businesses, FACSI recommends creating an Export Risk Equalisation Fund. This fund would compensate small exporters affected by sudden tariff hikes. The letter also calls for enhanced lending targets for MSEs by SIDBI and public sector banks.
Improvements in Tender Processes and Payments
The federation seeks a reduction in fees for MSEs submitting tenders through the GeM portal. They also want stronger functioning of State Facilitation Councils to expedite cases of delayed payments. FACSI notes that certain issues might require amendments to the MSMED Act, 2006.
Coordination with State Governments
FACSI emphasises the need for closer coordination with state governments. They propose extending subsidies on renewable energy installations, electricity charges, and local levies. Special facilities for units located in industrial estates run by state development corporations are also requested.
"These measures will be a significant enabler for the growth of MSEs in India," Guha said. The recommendations aim to create a more supportive environment for small businesses across the nation.
