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Opinion | A better way to rescue MSMEs from the tyranny of thresholds

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₹5 crore with an investment of ₹1 crore or less?Data indicates the turnover to investment ratio, or TIR, ranges across Indian industries and sectors between 0.08 and about 3, with an average of between 1 and 1.2.

Perhaps, purely micro service enterprises that rely on investment in human resources rather than in plant, machinery and equipment might have a higher TIR.

But it is doubtful if even they would be able to achieve a revenue of ₹5 crore with an investment of ₹1 crore or less. Similarly, small and medium manufacturing enterprises cannot achieve a sales revenue of ₹50 crore and ₹250 crore with investments of ₹10 crore and ₹50 crore, respectively.As they stand, the policy changes may achieve the perverse effect of keeping manufacturing.

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