Help SMEs kick-start economic growth
India could become the seventh largest economy by 2017 and a five trillion economy by 2025. This statement by the finance minister has filled us with a lot of confidence - some changes for the better are definitely around the corner.
Though the market has not reacted with excitement, I am sure many steps will be taken in the coming days to strengthen the economy and increase foreign investment.
On my wish list for this year's budget, especially when it comes to e-commerce, was a uniform GST.
While it didn't come through in the way one expected, I am happy that the FM has promised to introduce a draft bill and take the issue forward. The Centre must take a strong leadership position and ensure they drive it to a favourable conclusion.
Next are SMEs who play a vital role in the growth of e-commerce. An example is in the book publishing space where regional publishers play an important role in developing the market.
Unfortunately, most SMEs have what I call a high infant mortality rate due to lack of funding. Banks and institutional lenders need to seriously think about this sector and I am glad the FM has identified this area.
As he has acknowledged, angel investors bring both experience and capital to new ventures. While angel investing and early stage venture capital investment has grown in the last five years, we need to focus on bringing in larger investors.
An immediate answer is for banks to democratise lending. They need to come out with new ways of financing SMEs. A profusion of small players will go a long way in kick-starting the economy at the micro level.