The associations of micro, small and medium-sized enterprises welcomed the introduction of the special program of capital grants linked to credit for the service sector.
The technology update program was launched on November 19 by the Minister of Union for MSMEs, Narayan Rane.
“The program will help meet the technology needs of service sector companies and provide non-sector SC-ST parliamentarians with a 25% capital grant for the purchase of facilities, machinery, and service equipment through Institutional Lending – Specific Limitations for Upgrading Technology “So an official statement.
One of the most pressing issues holding back the growth of MSMEs in India is the lack of modern technology and equipment, which according to industry officials and trade associations make small businesses unattractive in the export market.
“This is a welcome decision as MSMEs have been the hardest hit due to the pandemic. Currently, any program that inspires MSMEs to grow and use better technology is a step in the right direction. I am glad the government has revived. this, “Ramamurthy said. Member of the All India MSMEs Association Council (AICA), representing 170 MSMEs associations across the country.
The government terminated the loan-linked equity grant program to modernize technology that ran through March 2021.
The program provided a 15 percent capital grant for institutional financing of up to Rs 1 billion, benefiting MSMEs to upgrade their facilities and machinery with the latest technology.
The show was suspended shortly after its best performance in five years was posted.
The number of MSMEs that benefited from the technology upgrade program was higher in fiscal year 21. According to the data available in the MSMEs dashboard, a total of 15,213 MSMEs received support in FY 21, compared to 7,480 in the AF 20; 14,155 units in FY19; 4081 units in FY18, and 4011 MSMEs in FY17.
Additionally, capital grant support for fiscal year 21 was higher at $ 1,102.57 billion.
“This is a step in the right direction, as the program will help the MSMEs sector, which experienced a decline in domestic demand after the pandemic. This loan program will certainly help minimize the prevailing credit gap for the MSMEs sector, “said Yogesh Pawar, president of the Inspiring Entrepreneurs Unions Association.
An official from a Delhi-based MSMEs federation, who declined to be named, said: “Very few MSMEs in India can afford the new modern technologies because they are so expensive. The program is indispensable to equip small industries with the latest technologies. Technology because will help them survive in global markets.