Assuring all help to micro, small, and medium enterprises (MSMEs), Prime Minister Manmohan Singh on Friday said the Centre would double credit flow to the crucial sector, which provides employment to around six crore people, contributes over 45 per cent of the total manufactured output and 40 per cent of exports earnings.
“Credit is the lifeline of any business. The government is committed to doubling the flow of credit to MSMEs in five years. Loans outstanding to this sector from the public sector banks have registered a growth of close to 25 per cent during one year. I would urge other banks also to ensure higher flow of funds to these enterprises,” Dr. Singh said while addressing the MSMEs national awards function here.
He pointed out that greater availability of credit can contribute to the faster modernisation and expansion of these enterprises and help augment their productivity and competitiveness. He urged MSMEs to also explore new and emerging sources of finance such as venture capital and private equity.
The Prime Minister announced that he has issued directions for the constitution of a task force to look into the difficulties of MSMEs and recommend steps within next three months.
The global economic slowdown has had an adverse impact on the growth of the Indian economy, where the MSME sector has also been affected. The Government was aware of their concerns and the two stimulus packages have been of some help to MSMEs, Dr. Singh said.
The Centre is taking all steps to enable entrepreneurs in the MSME sector to get one-stop access to facilities for capacity-building and skill development, credit, marketing support, and quality technology, he said.
“This would enable them to execute their projects speedily and achieve better results. To this end, 2000 clusters have been identified across the country and specific interventions are being carried out in 500 of them to start with,” Dr. Singh said, lauding efforts to revive the Khadi sector through a comprehensive reforms programme being launched with assistance from the Asian Development Bank.
Earlier, Minister of State for MSMEs Dinsha Patel said the Government has set a target to provide employment opportunities to 37 lakh people under the Prime Minister’s Employment Generation Programme by 2011-12.
Several new components like design development clinic, marketing assistance for SME, and technology upgradation activities would be added to the National Manufacturing Competitiveness Programme (NMCP), Mr. Patel said.