Deregulation must for MSMEs’ growth: Economic Survey – The Tribune-OxBig News Network

Lowering the cost of business through deregulation will make a significant contribution to accelerating economic growth and generating employment amidst unprecedented global challenges, stated the Economic Survey.

“Deregulation is more critical for the growth of MSMEs (Micro, Small, and Medium Enterprises) than large enterprises. Compliance costs in terms of time and financial resources are non-trivial for MSMEs. Large enterprises usually find a way around compliance. Management and financial bandwidth are also limited for smaller enterprises. Therefore, deregulation is a policy agenda for small businesses,” stressed the survey.

It further stated that key structural reforms, including simplification of labour laws, tax rationalisation and digital governance initiatives, would be instrumental in improving India’s investment climate. The focus on human capital development through skill enhancement programmes and higher education reforms was also expected to drive productivity and innovation.

The survey highlighted that regulatory reforms, policy simplifications, and state-level initiatives aimed at reducing compliance costs would be crucial for India’s medium-term economic growth.The industrial sector is expected to grow by 6.2 per cent in FY25, driven by robust growth in electricity and construction with MSME sector set to emerge as a highly vibrant sector of the Indian economy. In the services sector, the average growth rate stood at 8.3 per cent in the post-pandemic period (FY23–FY25).

The survey stressed the path to further industrialisation was to be paved with R&D and innovation.