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Cabinet approves World Bank-assisted Rs 6,000 crore scheme for MSME sector

To be launched in collaboration with states

Covid-19 pandemic has badly hit the MSME segment in India | Representative image / Reuters (File) Representative image / Reuters

The Union cabinet approved a Rs 6,000 crore scheme to ramp up the MSME sector, affected by the pandemic. The World Bank-assisted scheme will aim to make the MSME sector industries competitive, and address the gaps in capacity building, skill development, technological upgradation, marketing and promotion.

The scheme will be launched in collaboration with states so that it creates more jobs, makes available finances to the industry and help it turn green.

“In states where the presence of MSMEs is on the lower side, the programme will usher in larger formalisation, resulting from the higher impact of the schemes covered under RAMP (Raising and Accelerating MSME Performance). The programme aims at improving access to market and credit, strengthening institutions and governance at the Centre and states, improving Centre-state linkages and partnerships, addressing issues of delayed payments and greening of MSMEs,” the cabinet statement said.

The government said the RAMP programme will directly or indirectly benefit all 63 million enterprises that qualify as MSMEs. However, a total of 5,55,000 MSMEs are specifically targetted for enhanced performance. In addition, expansion of target market to include service sectors and increase of about 70,500 women MSMEs is envisaged.

The programme has identified two results areas: strengthening institutions and governance of the MSME programme, and support to market access and finance.

The total outlay for the scheme is Rs.6,062.45 crore or $808 million, out of which Rs.3750 crore or $500 million would be a loan from the World Bank and the remaining Rs. 2,312.45 crore or $308 million would be funded by the Centre. 

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