New Delhi, May 13: Union Finance Minister Nirmala Sitharaman on Wednesday said the definition of Micro, Small and Medium Enterprises (MSMEs) has been revised in order to boost small-scale industries. Listing details of the financial package of worth 3 lakh crore, announced by Prime Minister Narendra Modi on Tuesday, Nirmala Sitharaman said an additional criteria of turnover is also being introduced for SMEs. FM Nirmala Sitharaman Announces Rs 3 Lakh Crore Collateral Free Automatic Loan for Businesses, MSMEs.

According to the revised definition of MSMEs, businesses with investment up to Rs 10 crore, and turnover up to Rs 50 crore will be classified as a small business. Similarly, businesses with investment up to Rs 20 crore, and turnover up to Rs 100 crore to be classified as a medium business. "The distinction between manufacturing and service sector MSMEs will be eliminated," Sitharaman announced.

New Definition And Criteria For MSMEs:

Also, MSME definition has been changed to allow units with investment up to Rs 1 crore to be called micro-units in place of Rs 25 lakh now. The Finance Minister also announced a corpus of Rs 50,000 crore MSMEs with growth potential through a fund of funds.

"The fund will be operated through a mother fund and a few daughter funds. This will help MSMEs expand in size and capacity. It will also encourage them to get listed," Sitharaman said. Global tenders will be banned for government procurement up to Rs 200 crore, she said, adding this would help MSMEs to compete and supply in government tenders.

(The above story first appeared on LatestLY on May 13, 2020 05:00 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).