Govt’s special focus on SC/ST entrepreneurs: Additional subsidy to boost tech adoption, production

By: |
Published: September 9, 2019 1:22:31 PM

The government will also provide 10 per cent extra subsidy to SC/ST entrepreneurs apart from the existing 15 per cent subsidy to all MSMEs on credit of up to Rs 1 crore for purchasing plant and machinery.

Under the Standup India scheme, the government has Special Credit Linked Capital Subsidy Scheme for MSEs under National SC/ST Hub.

The government, which recently launched the updated credit link capital subsidy scheme (CLCSS) for micro, small and medium enterprises (MSME) to boost their access to credit, will also provide 10 per cent extra subsidy to SC/ST entrepreneurs apart from the existing 15 per cent subsidy to all MSMEs on credit of up to Rs 1 crore for purchasing plant and machinery with an aim to facilitate technology upgradation among them. “In our National SC/ST Hub, there is a subsidy of 15 per cent up to a loan of Rs 1 crore for technology upgradation in CLCSS but we are also offering a 10 per cent extra subsidy that will be given to SC/ST entrepreneurs,” MSME Secretary Dr Arun Kumar Panda said during the relaunch of the scheme.

Under the Standup India scheme, the government has Special Credit Linked Capital Subsidy Scheme for micro and small enterprises under the National SC/ST Hub that offers 25 per cent subsidy to SC/ST units for buying plant and machinery. “Out of the 25 per cent, 15 per cent is given by DC MSME and 10 per cent by the SC/ST Hub. However, there has hardly been any disbursement to SC/ST entrepreneurs because of lack of credit demand from such SMEs that have been using rudimentary technologies to do business based in non-industrialised areas,” a government official told Financial Express Online.

Also read: Delayed MSME payments: Nitin Gadkari says not enough complaints filed, need more filings to take action

The update in the revised CLCSS scheme has been the 10 per cent additional subsidy and a few cosmetic changes. There is no other major change in it. To encourage SC/ST entrepreneurs with increased production through the use of better technology and latest machines, the additional subsidy has been announced, according to the official.

The National SC/ST Hub was launched by Prime Minister Modi in October 2016 to offer professional support to SC/ST entrepreneurs and comply with the Central Government Public Procurement Policy for Micro and Small Enterprises. The annual goods procurement by central public sector enterprises from MSMEs stood at Rs 24226.51 crore in FY18 that included procurement share by SC/ST MSEs worth Rs 442.52 crore, according to the MSME Ministry data released in January this year.

MSME Minister Nitin Gadkari during the relaunch said that the CLCSS scheme is critical in order to increase the share of MSMEs in India’s GDP from 29 per cent to 50 per cent along with exports contribution from 40 per cent to 50 per cent in five years.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.