Context: Recently, the Union minister for Micro, Small and Medium Enterprises launched the revamped MSME Competitive (LEAN) scheme to make it more beneficial for enterprises and stakeholders. 

• Under the revamped scheme, the Centre's contribution will be 90 per cent of the implementation cost for handholding and consultancy fees as against 80 per cent previously.

Key Points

• Earlier, the implementation period for the scheme was set at 18 months.

• However, under the revamped scheme it has been divided into phases - Basic (2 months), Intermediate (6 months) and Advanced (12 months).

• The first phase will cover the manufacturing sector while the services sector will be covered in the second phase.

About MSME Competitive (LEAN) Scheme

• The Scheme aims at reducing manufacturing waste and is an extensive drive to create awareness amongst MSMEs about LEAN Manufacturing practices. 

• Further, the purpose is to motivate and incentivize them to attain LEAN levels while also encouraging them to become MSME Champions.

• Under the scheme, MSMEs will implement LEAN manufacturing tools like 5S, Kaizen, KANBAN, Visual workplace, Poka Yoka etc under the able guidance of trained and competent LEAN Consultants to attain LEAN levels like Basic, Intermediate and Advanced. 

• Through the LEAN journey, MSMEs can reduce wastages substantially, increase productivity, improve quality, work safely, expanding their markets, and finally becoming competitive and profitable.

• This Scheme is an extensive drive to create awareness amongst MSMEs about LEAN Manufacturing practices and motivate and incentivize them to attain LEAN levels while also encouraging them to become MSME Champions.

• LEAN has the potential to become a national movement and that it aims to provide a roadmap to global competitiveness for the MSMEs of India. 

• LEAN will not only attempt to improve quality, productivity & performance, but also the capability to change the mind-sets of manufacturers and transform them into a world class manufacturers. 

Key Contribution

• In addition to this, to support MSMEs, Government will contribute 90% of implementation cost for handholding and consultancy fees. 

• There will be an additional contribution of 5% for the MSMEs which are part of SFURTI clusters, owned by Women/SC/ST and located in North East Region.

• Furthermore, there will be an additional contribution of 5% for MSMEs which are registering through Industry Associations/ Overall Equipment Manufacturing (OEM) organizations after completing all levels. 

• There is a unique feature to encourage Industry Associations and OEMs for motivating their supply chain vendors to participate in this scheme.

Initiatives for MSME

• According to the government, 1 crore 20 lakh MSMEs received huge help from the government during the pandemic. 

• Moreover, in this year’s budget, the MSME sector got additional collateral-free guaranteed credit of 2 lakh crores. This would help the banks to reach out and provide them with adequate finance.

• Similarly, there are numerous government initiatives that aim at the development of the MSME sector. 

• The Ministry of MSME promotes growth and development of the sector, including Khadi, Village and Coir industries, by implementing various schemes/programmes towards credit support, technological assistance, infrastructure development, skill development and training, enhancing competitiveness and market assistance.

• Udyami Mitra Portal: launched by SIDBI to improve accessibility of credit and handholding services to MSMEs.

• MSME Sambandh: To monitor the implementation of the public procurement from MSMEs by Central Public Sector Enterprises.

• MSME Samadhaan MSME Delayed Payment Portal –– will empower Micro and Small entrepreneurs across the country to directly register their cases relating to delayed payments by Central Ministries/Departments/CPSEs/State Governments.

• Digital MSME Scheme: It involves usage of Cloud Computing where MSMEs use the internet to access common as well as tailor-made IT infrastructure

• Prime Minister Employment Generation Programme: It is a credit linked subsidy program under Ministry of MSME.

• Revamped Scheme of Fund for Regeneration Of Traditional Industries (SFURTI): organizes traditional industries and artisans into clusters and make them competitive by enhancing their marketability & equipping them with improved skills.

• A Scheme for Promoting Innovation, Rural Industry & Entrepreneurship (ASPIRE): creates new jobs & reduce unemployment, promotes entrepreneurship culture, facilitates innovative business solution etc.

• National Manufacturing Competitiveness Programme (NMCP): to develop global competitiveness among Indian MSMEs by improving their processes, designs, technology and market access.

• Micro & Small Enterprises Cluster Development Programme (MSE-CDP)- adopts cluster development approach for enhancing the productivity and competitiveness as well as capacity building of MSEs.

• Credit Linked Capital Subsidy Scheme (CLCSS) is operational for upgradation of technology for MSMEs.