Thu Jan 29 16:47:07 UTC 2026: ### Streamlining Regulations: India Prioritizes Ease of Doing Business for MSMEs

The Story:
On January 29, 2026, the Comptroller and Auditor General of India (CAG) advocated for a comprehensive four-pronged strategy—simplification, digitalization, decriminalization, and elimination of redundant laws—to bolster the Micro, Small and Medium Enterprises (MSME) sector. Speaking at a conclave focused on a Pan-India Horizontal Audit on Ease of Doing Business (EoDB) for MSMEs, CAG K. Sanjay Murthy emphasized the sector’s crucial role in economic growth, inclusive development, entrepreneurship, supply chain strengthening, and livelihood creation across India.

The proposed audit will evaluate the period from 2021-22 to 2025-26, with fieldwork commencing under the Annual Audit Plan 2026-27. This initiative, led by the Office of the Principal Accountant General (Audit-II), West Bengal, seeks to identify areas where reforms can be refined and compliance burdens reduced, leading to a more predictable and transparent business environment for MSMEs.

Key Points:

  • The CAG proposed a four-pronged strategy for MSME development: simplification, digitalization, decriminalization, and elimination of redundant laws.
  • A Pan-India Horizontal Audit on EoDB for MSMEs will assess the period from 2021-22 to 2025-26, with fieldwork starting in 2026-27.
  • The audit will cover Central Ministries, State Departments, district-level institutions, and State Public Sector Undertakings.
  • MSME Secretary S.C.L. Das highlighted positive collaboration between government and industry in reducing compliance burdens.
  • The focus is shifting towards data-driven audits and decision-making to improve policy formulation and implementation.

Critical Analysis:
The context surrounding this article reveals a broader economic strategy in India. The mention of “Expanding network of FTAs supports India’s trade strategy: Economic Survey” suggests that streamlining regulations for MSMEs is part of a larger initiative to enhance India’s competitiveness in global trade. By making it easier for MSMEs to operate, the government aims to boost exports and integrate these smaller businesses more effectively into international supply chains. Additionally, the suggestion from the First report of the 7th State Finance Commission of devolution of 29% of State Plan to local bodies can aid MSME growth.

Key Takeaways:

  • The Indian government recognizes MSMEs as vital engines of economic growth and inclusive development.
  • Reducing regulatory burdens and improving the ease of doing business are key priorities.
  • The focus on data-driven decision-making reflects a commitment to evidence-based policy formulation.
  • Collaboration between government and industry is seen as essential for successful MSME reform.
  • This initiative aligns with India’s broader trade strategy and aims to enhance global competitiveness.

Impact Analysis:

The Pan-India Horizontal Audit on EoDB for MSMEs, and its subsequent reforms, is likely to have a significant long-term impact. By streamlining regulations and reducing compliance burdens, MSMEs can focus on innovation, productivity, and growth. This, in turn, will create more jobs, strengthen supply chains, and boost exports. The emphasis on data-driven decision-making will also lead to more effective and targeted policies, ensuring that resources are allocated efficiently. A more transparent and predictable business environment will encourage investment and entrepreneurship, further fueling economic growth. Ultimately, these efforts will contribute to a more resilient and inclusive Indian economy.

Read More

Related News: