A now-scrapped requirement for GSTIN, lack of awareness and grim economic realities post pandemic could be factors. The gap must be bridged if MSMEs are to avail subsidies and other credit facilities
The focus should be to create an enabling environment for entrepreneurship and small businesses to thrive, creating productive firms that will generate formal employment.
The costs of formalisation and compliance are high and onerous in many states in India. In such an ecosystem, there are perverse incentives to remaining small and informal.
