20% rule

The problem in India is that people here are smart enough to circumvent any rule those come-up, with good intentions from the Govt. Anyone can register a company under MSME, import goods, and sale those to private industry and it's within 20% limit. In my 35-years in the industry I see only imported goods are sold by the importer companies to its clients, and the clients pay with RUPEE so they easily classify those goods under MSME quota.

It is time that the Govt. gets smarter and the 20% rule must be specific to direct MSME manufacturer companies who source all (or say over 70 to 80%) raw material requirements from local (within India) vendors. It's very easy to check and implement by the client company, BY ASKING THE MSME COMPANY TO DECLARE THEIR PREVIOUS YEARS IMPORT COMPONENT, AND ALSO OBTAINING A SELF-CERTIFICATE ABOUT THE EXTENT OF THEIR CURRENT YEAR'S IMPORT COMPONENT. more  

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good to point out flaws of law, in fact, no body can question mark on the working/intentions of this central govt. but here less than half of the business man are only honest, rest are always try to find a quick money, by using flaws of law. and there is no direct control of central govt, on the state level business. hence central authorities are handicapped on this matter. also, there no feed back mechanism for such misuses. more  
The phenomenon is also prevalent in China also, but their government all out for the exporters. more  
I feel that now we should now start thinking of competing in the international markets and not expect the government to protect us. We will make our mark only if we are able to compete. Of course the government should pull up its executives to come out of its slumber who still view an entrepreneur as a drain on resources of the country. more  
You are 100% right and I agree with you. Our Government should facilitate in Import substitute vigorously by encouraging in setting up more R&D centres by Private entrepreneurs. There is no shortage of scientists and intellectuals in India but due to lack of facilities, under utilized and most of such highly educated people are entering in to their own Business of consultancy or advising Industry. Make in India has to be established with proper actions and opening opportunity. Subhasish Banerjee more  
This problem is not in India only. But it is prevailing more or less similar problem in other countries also. Refer recent financial jugglery of Deutsche Bank. more  
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