Ease of Doing Business for MSMEs: Finance Minister Nirmala Sitharaman in her budget speech on Tuesday said that the Rs 6,000- crore Raising and Accelerating MSME Performance (RAMP) programme for MSMEs will be rolled out in the coming five years. The minister said the programme would improve the competitiveness and productivity of MSMEs. The World Bank in June last year had approved $500 million for the programme to support the government to revitalize the MSMEs heavily impacted by the Covid crisis.
The World Bank, in a statement, last year had said that the programme targets improvements in the performance of 5,55,000 MSMEs and is expected to mobilize financing of $15.5 billion, as part of the government’s $3.4 billion MSME Competitiveness – A Post-COVID Resilience and Recovery Programme (MCRRP). As per the World Bank Programme appraisal document for the RAMP programme, over 40 per cent of MSMEs lack access to formal sources of finance.
“The announcement and allocation of Rs 6000 crore over five years for the RAMP programme is most required but the outlay is very meagre and requires detailing on eligibility conditions,” KE Raghunathan, Convenor, Consortium of Indian Associations told Financial Express Online.
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RAMP was the second intervention by the World Bank for the MSME sector. In June 2020, it had approved a $750 million MSME Emergency Response programme to support the increased flow of finance to MSMEs impacted by Covid. As of June 4, 2021, 5 million firms had accessed finance from the government programme, according to the World Bank.
“RAMP is an initiative to revitalize the MSME sector that has been heavily impacted by the Covid pandemic. While this is a positive measure taken by the government and will help MSMEs stand up and grow, I doubt if Rs 6,000 crore would be sufficient for this purpose,” Maneet Pal Singh, Partner, IP Pasricha & Co told Financial Express Online.