Credit and finance for MSMEs: The latest data on the underspending of schemes shared by the MSME ministry showed that funds allocated under various schemes of the ministry for the financial year 2021-22 had remained underutilized. According to the information on underspending shared by the minister of state for MSMEs Bhanu Pratap Singh Verma in a written reply to a question in the Lok Sabha recently, funds under as many as 18 schemes stood underutilised.
“The reasons for underutilization of funds are the Covid pandemic, exercise for Standing Finance Committee (SFC)/Expenditure Finance Committee (EFC) for the 15th finance cycle, non-receipt of viable proposals, unspent balance lying with implementing agencies and non-participation in various national/international events/programmes due to pandemic,” the minister said.
Among the schemes with the highest underutilisation rate in FY22 were Cluster Development Programme, Promotional Services Institutions & Programmes, Infrastructure Support to MSME Testing Centres/ MSME Testing Stations/ MSME Development Institutes/ MSME Workshops, National Scheduled Cast/Scheduled Tribe Hub Centre, Capital Outlay on Public Works, etc.
Here are the 18 schemes with underutilised funds in FY22:
Nonetheless, schemes with the highest allocation in FY22 were the Fund of Funds, Infrastructure Development and Capacity Building scheme, Credit Linked Capital Subsidy and Technology Upgradation Scheme, Cluster Development Programme, National Scheduled Cast/Scheduled Tribe Hub Centre, etc.
Verma said that post-pandemic sincere efforts are being made for complete utilization of the allocated budget by giving wide publicity of schemes and initiatives through conclaves, conferences, social media etc. “Ministry has also adopted a monitoring mechanism for timely release and utilization of funds through regular periodic reviews.”
In FY21 as well, funds allocated to seven schemes were underutilized. These included Procurement and Marketing Support scheme, International Cooperation Scheme, Promotional Services Institutions & Programmes, Cluster Development Programme, Tool Rooms & Tech Institutions, Infrastructure Support to MSME Testing Centres/ MSME Testing Stations/ MSME Development Institutes/ MSME Workshops, and Database Research Evaluation and Other Office Support Programme Research.