- As part of the Aatmanirbhar package Government had announced its plans for Rs three lakh Cr as additional credit to MSMEs and small businesses
- Such enterprises were to be eligible to receive up to 20 per cent of their existing borrowing as additional loans
The interventions by Government for MSMEs, have been gaining rapid traction. Under the emergency credit line backed by a Government guarantee, banks from public and private sectors have so far already sanctioned loans worth over Rs 79,000 crore as of 20 June 2020. More than Rs 35,000 crore has already been disbursed.
“As part of the Aatmanirbhar package Government had announced its plans for Rs three lakh Crore as additional credit to MSMEs and small businesses. Such enterprises were to be eligible to receive up to 20 per cent of their existing borrowing as additional loans at interest rates which were capped,” read an official press note issued by the ministry of finance.
Separate scheme to address delayed payments
Union Minister for MSME and Road Transport and Highways, Nitin Gadkari had recently said that the government was working on a separate scheme to address delayed payments issues of MSMEs. A dedicated fund was in works for payments to MSMEs.
While commenting on delayed payments to MSMEs, Gadkari had said that all efforts should be made to make payments immediately and all Government Departments have been given such directions.
The top lenders under the Scheme are SBI, HDFC Bank, Bank of Baroda, PNB & Canara Bank. This, as per the ministry has helped 19 lakh MSMEs & other businesses restart their businesses post the lockdown.
MSMEs at a glance
MSME’s form an integral part of electronics manufacturing sector in India. A couple of years back, the Ministry of MSME had pointed out that there are about 30 million SME manufacturing units in India, which contributed about 45 to 47 per cent of India’s industrial output, 42 per cent of the country’s total exports, adding up to 37 per cent of our GDP, while employing over 60 million, which is over 66 per cent of the 80 million people employed within the Indian manufacturing sector.
Industry or the manufacturing sector employs about 22 per cent of the country’s total workforce, the size of which is estimated to be between 430 to 470 million. The SME sector creates more than 1.3 million jobs every year and produces more than 8,000 quality products for the domestic and international markets.