Small MSMEs May Face Challenges Post New Regulations

Small MSMEs may face challenges post-new regulations. The government is going to introduce new safety regulations for machinery and electrical equipment in August 2025. This can lead to challenges among the small MSMEs. The main reason is that the safety standards will be international. Many MSMEs cannot afford the financial, technical, and infrastructural requirements needed to maintain in the case. Let us have a look at the impact that small MSMEs will have after the new policy.

What Impact Will Small MSMEs Have After New Regulations?

Small MSMEs are going to have a huge impact from the August 2025 new safety regulations. Chief Economist, Infomerics Ratings shared the details recently. According to them, small MSMEs might face challenges due to a lack of financial, technical, and infrastructural support. According to the new safety regulations, the companies have to strictly comply with international safety measures. It is necessary as the government is supporting and planning the import of quality products. Thus, the level of safety measures becomes important for maintaining the quality of imports in the country.

The regulations are implemented on more than 50,000 machinery. Thus, the manufacturers coming under these categories will have difficulty. The small manufacturers don’t have enough resources to carry on manufacturing from the base level on their own. Thus, they take the support of imports or other cheaper sources. The Ministry of Heavy Industry introduced these regulations on 28 August 2024. There are currently three types of safety standards.

The first one is Type A. It is applied to all the machineries. Its major purpose is safe design and risk assessment. It complies with IS 16819:2018-ISO 12100:2010. The second level of safety regulation is Type B. It is a generic safety standard covering safety on another level. It also includes electric safety for different types of machinery including emergency switch off. The third one comes as Type C. It is machine-specific. The MSMEs have to go through all these three stages step by step. However, it is a big task for the small MSMEs to achieve in one year.

As we mentioned earlier, these barriers will cost a huge amount for the companies on a small scale. There will be a compliance cost of Rs. 50,000 to Rs. 50 Lakhs. The compliance cost depends on the type of machinery. Many believe that the government should not impose these regulations now. The industry is not ready for such regulations all of a sudden. Stay tuned for more information.