UNIFORM DEFINITION OF MSMEs URGED ON THE BASIS OF TURNOVER

The Union of Small and Medium Enterprises (UNISAME) has urged the prime minister (PM) Shehbaz Sharif to direct the Small and Medium Enterprises Development Authority (SMEDA) to widen the definition of SMEs in view of the current parity rate of rupee against US Dollar which has increased to Rs278 for a dollar as against Rs 58 to a dollar more than a decade ago.
President UNISAME Zulfikar Thaver said the definition of the micro to medium enterprises is outdated and suggested broadening to make it appropriate as rupee has become small and now that it is valued at almost Rs 278 to a dollar, the definition of micro, small and medium enterprises must be adjusted/revised accordingly forth with.
Secondly he suggested the need for a uniform definition of micro to medium enterprises by State Bank of Pakistan (SBP),SMEDA and UNISAME which is very necessary for promotion and development by the institutions.
Thaver said that our contention is that the parameters also need to be revisited as they were based on turnover, assets and number of employees but he said there is no need for consideration of assets and employment size as assets were mostly inherited by the SMEs and employment size is not of much consequences as some units are making valuable goods with machinery and are mechanized and some are are doing online businesses. What matters is the turnover and according to UNISAME a micro or cottage industry could be defined as one whose turnover is less than Rs 40 million per annum and a small unit may be defined as one having a turnover of Rs 400 million and a medium enterprise as one having a turnover up to Rs 2 billion.
The Union Council members also emphasized the need for inclusion of SME farmers on the basis of their produce because after all they are also involved in commercial activities of income generation.

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