Finance Minister Nirmala Sitharaman Announces Big Support for Small Businesses in India
On Tuesday, Finance Minister Nirmala Sitharaman announced several measures to support the micro, small, and medium enterprise (MSME) sector during the Union Budget 2024-25 presentation in Parliament.
Key Initiatives for MSMEs
Sitharaman revealed a Credit Guarantee scheme of Rs 100 crore for MSMEs, which will help them purchase machinery and equipment without collateral. This scheme will operate by pooling credit risks and providing guarantee cover up to Rs 100 crore.
The government has also doubled the MUDRA loan limit in the Tarun category from Rs 10 lakh to Rs 20 lakh. Additionally, the turnover threshold for mandatory onboarding on the TReDS platform has been reduced from Rs 500 crore to Rs 250 crore, bringing more companies onto the platform.
Expansion of SIDBI Branches
The Small Industrial Development Bank of India (SIDBI) will expand its branches to cover 168 out of 242 MSME clusters within three years. This expansion aims to better serve the MSME sector.
Development of E-commerce Export Hubs
New e-commerce export hubs will be developed to help traditional artisans and MSMEs launch their products in international markets. These hubs will be set up in public-private partnership (PPP) mode and will provide trade and export-related services under one roof.
Additional Measures
The budget also includes financial support for setting up 50 multi-product food irradiation units and 100 food quality and safety testing labs with NABL accreditation. Twelve industrial parks will be sanctioned under the National Industrial Corridor Programme, and rental housing for industrial workers will be facilitated through PPP mode.
Sitharaman emphasized that these measures aim to bolster various sectors, including manufacturing, services, urban development, energy security, and infrastructure, to drive economic growth and development.
Doubts Revealed
Finance Minister -: The Finance Minister is a person in the government who is responsible for managing the country’s money and economy. In India, this person is Nirmala Sitharaman.
Nirmala Sitharaman -: Nirmala Sitharaman is the current Finance Minister of India. She is in charge of the country’s financial and economic policies.
MSME -: MSME stands for Micro, Small, and Medium Enterprises. These are small businesses that are very important for the economy because they create jobs and produce goods and services.
Union Budget -: The Union Budget is a plan made by the government of India every year. It shows how the government will earn and spend money in the coming year.
Credit Guarantee scheme -: A Credit Guarantee scheme is a program where the government promises to repay loans if small businesses can’t. This helps banks feel safer about lending money to small businesses.
MUDRA loan -: MUDRA loan is a type of loan given to small businesses in India to help them grow. MUDRA stands for Micro Units Development and Refinance Agency.
SIDBI -: SIDBI stands for Small Industrial Development Bank of India. It is a bank that helps small businesses by giving them loans and other financial services.
e-commerce export hubs -: E-commerce export hubs are places where products sold online are collected and sent to other countries. This helps small businesses sell their products worldwide.
industrial parks -: Industrial parks are areas set up by the government where many factories and businesses can be built. These parks have good facilities like roads, electricity, and water to help businesses operate smoothly.
