Rajasthan govt approves financial assistance of Rs 100 crore for MSMEs

To give a boost to small units in Rajasthan, the state government has approved financial assistance of Rs 100 crore for the Laghu Udyog Protsahan Yojana, or the small industries promotion scheme.

This scheme was announced in the state Budget 2022-23 to promote micro, small, and medium enterprises (MSMEs), and give loans on easy terms for small businesses and investors.

For this, a provision of Rs 150 crore was made. The scheme will remain effective till March 2024.

Loans under this scheme are being given for manufacturing, services, and business other enterprises through financial institutions such as nationalised commercial banks, private-sector banks, scheduled small finance banks, regional rural banks, Rajasthan Financial Corporation, and urban cooperative banks.

In this scheme, a loan up to Rs 10 crore is given for new manufacturing and services enterprises and Rs 1 crore for units going for expansion, diversification, or modernisation.

They will be composite loans, term loans, and working capital loans (including the cash credit limit).

According to RBI guidelines, collateral security will not be needed for loans up to Rs 10 lakh.

Applications for loans of more than Rs 10 lakh will be forwarded to the bank after the District Level Task Force Committee has scrutinised them.

The state government also provides interest subsidies on these loans.

Rajasthan’s “first Rajasthan MSME Policy-2022” was released recently. It will give pace to industrial development in the state and will increase employment for craftsmen and artisans.

More than 90 per cent of the enterprises in the state fall in the MSME category. These are spread across sub-sectors like carpet manufacturing, textiles, mining, agro, metal craft, and footwear.

“To support large manufacturers and harness the potential of the MSME sector, effective measures are required to ensure their sustainable development in Rajasthan. Through this policy, the state government desires to usher in an era of growth for its MSMEs,” a state government official said.

The official said the policy aimed to enhance the contribution of MSMEs to the state’s GDP.