Small entrepreneurs are denied subsidies due to procedural hurdles: FOCIA

Coimbatore: The Federation of Coimbatore Industrial Associations (FOCIA) has urged the Tamil Nadu govt to relax certain conditions under the capital subsidy scheme for MSMEs, alleging that genuine micro and small entrepreneurs are denied benefits by district industrial centres due to procedural hurdles.

In a petition submitted to MSME minister Madan Raja, FOCIA said the state’s machinery subsidy, which offers support ranging from 25% to 35% for eligible purchases, is aimed at boosting small industries that contribute significantly to Tamil Nadu’s growth and employment. However, it claimed that a key eligibility condition is becoming a barrier for job-work based units.

FOCIA said applications are being rejected on the ground that beneficiaries must demonstrate at least a 25% increase in production within three months of purchasing machinery, compared to pre-purchase output.

J James, coordinator, FOCIA, said modernisation is unavoidable as clients demand faster and more precise output. “A CNC machine costs Rs 22 lakh to Rs 25 lakh. A VMC costs around Rs 35 lakh. We need advanced machines to improve productivity and meet client timelines,” he said, adding that the current condition does not reflect market realities for job-work units.

“Many MSMEs, especially job-order units, do not receive consistent orders throughout the year. One year can be good, another may have no orders,” he said, seeking removal of the clause and issuance of clear guidelines to ensure subsidies reach intended beneficiaries.

He urged the govt to provide subsidies during the 2025–26 period to applicants whose applications were rejected or cancelled under these criteria.

Separately, a petition to commercial taxes and registration minister Lokesh Tamizhselvan flagged difficulties in renewing registrations of partnership firms and associations. Petitioners alleged they are asked to upload documents online and also submit hard copies, after which approvals are delayed for months. They said offices do not communicate defects via phone, SMS or email, insisting on in-person follow-ups, while citing “software issues” for missing records and erroneous flags showing non-payment or non-renewal despite compliance. They sought directions for time-bound updation of association registrations.

EOM