New Labour Codes May Disproportionately Impact MSMEs

The new labour codes in India might make things harder for small businesses, called MSMEs.

These businesses don't have big teams to handle rules and payments.

The new codes say that wages include basic pay and some allowances, which means they have to pay more for things like provident fund and gratuity.

Big companies can handle these changes more easily, but small businesses might struggle.

The government is asking for feedback on the rules and plans to make them official next year.

There are about 74 million small businesses in India, and almost all of them are very small.