The 2018-19 Budget has given a big thrust to Micro, Small and Medium Enterprises (MSMEs) sector to boost employment and economic growth. The budgetary allocation has gone up from Rs. 6481.96 crore in 2017-18 to Rs.6552.61 crore in 2018-19. The allocation for individual Schemes (apart from CGTMSE) has gone up by 59%, from Rs.3680 crore in 2017-18 to Rs. 5852.61 crore in 2018-19.
The allocation for National Manufacturing Competitiveness Program has gone up from Rs. 506 crore in 2017-18 to Rs. 1006 crore in 2018-19. This scheme will help technology up-gradation in the MSME sector.
Allocation under Prime Minister Employment Generation Programme has gone up from Rs. 1024.49 crore in BE 2017-18 to Rs. 1,800 crore in BE 2018-19 for generating self employment opportunities through establishment of about 88,000 micro enterprises in the non-farm sector, providing employment to around 7 lakh people.
The Credit Guarantee Fund has already been enhanced from Rs.2500 crore to Rs. 7500 cr. This enhancement along with other structural reforms in the Scheme will boost credit growth and employment generation in the MSE sector in a very big way.
There has been more than a threefold increase in the allocation for setting up of the state-of-the-art Technology Centres from Rs.150 crore in BE 2017-18 to Rs. 550 crore in BE 2018-19.
Allocation under Khadi Grant has been enhanced significantly from Rs.265.10 crore in BE 2017-18 to Rs. 415 crore in BE 2018-19. A new scheme of Solar Charkha Mission has also been proposed to harness non-conventional solar energy to further employment generation.
Under Scheme for Fund for Regeneration of Traditional Industries (SFURTI), the budgetary allocation has increased from Rs.10 crore in BE 2017-18 to Rs. 125 crore in BE 2018-19. This will give an unprecedented boost to employment generation in the traditional and rural industries.
The allocation under ASPIRE (A Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship) has been raised from Rs. 50 crore in BE 2017-18 to Rs. 232 crore in BE 2018-19 with an aim to set up 100 livelihood business incubators and 20 technology business incubators. This will accelerate entrepreneurship and employment generation.
The allocation for National SC/ST Hub has been raised from Rs. 60 crore to Rs 93.96 crore with a view to giving an impetus to the growth of the business of SC/ST entrepreneurs. The overall allocations for the north-eastern region, for SC/ST components under various schemes have also witnessed significant increase.
There have also been other announcements which would give a boost to the MSME Sector.
- Extension of reduced rate of 25 percent currently available for companies with turnover of less than 50 crore to companies reporting turnover up to Rs. 250 crore in Financial Year 2016-17, to benefit micro, small and medium enterprises.
- Contribution of 8.33% of Employee Provident Fund (EPF) for new employees by the Government for three years.
- Contribution of 12% to EPF for new employees for three years by the Government in sectors employing large number of people like textile, leather and footwear.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)