BHUBANESWAR: Reserve Bank of India (RBI) Governor Raghuram Rajan on Saturday emphasised on regulatory and administrative reforms for growth of small and medium enterprises (SMEs). India has done away with the licence raj, but 'inspector raj' continues to put road blocks for entrepreneurs, he said.
"Regulatory norms should provide the scope for easy entry and exit, smooth availability of finance, access to input and output market, protection from creditable taxes and basic safety net for entrepreneurs and workers," Rajan said in his address to ministers and civil servants here. Addressing ministers, bankers, bureaucrats at the fourth Odisha Knowledge Hub lecture series on 'India: Prospects & Challenges', Rajan said regulations should be for betterment of the industry and not to discourage entrepreneurs.
He suggested a system of self-certification for the industries with some checks on the part of the authorities to prevent any misuse.
Calling for a need to focus on the development of SMEs, the RBI Governor said Indian economy is in the midst of recovery. However, some areas are still under stress and need to be focused in order to improve them. "A good monsoon will be helpful for the economy," he added.
Stating that SMEs require focused attention, the RBI Governor said public sector banks have increased credit to small and medium enterprises after RBI identified medium enterprises as priority sector.
Rajan said he is optimistic about growth of start-ups if required facilities are provided.
Rajan went on to add that entrepreneurs need smooth access to finance and markets. He suggested that the small and medium enterprises be linked to national and international marketing entities through web-based technology.
Light regulations and system of self certification will be more helpful for small and medium enterprisers to navigate through bureaucratic system. He also suggested that the front-line regulators like inspectors and field officers be updated with new reformative initiatives of Government for promotion and growth of enterprises.
He further emphasised on capacity enhancement of people to derive benefit from reforms and improving skill base in the society. Noting that land acquisition is a big problem for the sector, Rajan said the state governments should create land bank or industrial parks to provide land to the start-ups.
Chief Minister Naveen Patnaik watched the programme which was video linked to all 30 districts for participation of collectors and senior officers.
Development Commissioner R Balakrishnan outlined the objectives of OKH and said the basic objective of this endeavour is to acquaint public functionaries with emerging technologies and innovations in various priority areas of governance.