3.7. Steps Taken for Promotion and Development of MSMEs

Realizing the importance of the MSME sector, the government has undertaken a number of schemes/programmes like the Prime Minister’s Employment Generation Programme (PMEGP), Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE), Credit Linked Capital Subsidy Scheme (CLCSS) for Technology Upgradation, Scheme of Fund for Regeneration of Traditional Industries (SFURTI), and Micro and Small Enterprises Cluster Development Programme (MSECDP) for the establishment of new enterprises and development of existing ones. Some of the new initiatives undertaken by the government for the promotion and development of MSMEs, are as follows:

♤ Udyog Aadhar Memorandum (UAM): The UAM scheme (2015) is a pathbreaking step to promote ease of doing business for MSMEs. Under the scheme, MSME entrepreneurs just need to file an online entrepreneurs’ memorandum to instantly get a unique Udyog Aadhaar Number (UAN).

♤ Employment Exchange for Industries: To facilitate match-making between prospective job seekers and employers an employment exchange for industries was launched in June 2015 in line with Digital India.

♤ Framework for Revival and Rehabilitation of MSMEs: Under this framework, banks have to constitute a Committee for Distressed MSME enterprises at zonal or district level to prepare a Corrective Action Plan (CAP) for these units.

♤ A scheme for Promoting Innovation and Rural Entrepreneurs (ASPIRE): ASPIRE was launched with the objective of setting up a network of technology centres and incubation centres to accelerate entrepreneurship and promote start-ups for innovation and entrepreneurship in rural and agricultural industry

♤ The India Aspiration Fund has also been set up under the Small Industries Development Bank of India (SIDBI) for venture capital financing of newly set-up or expanding units in the MSME sector.

♤ SIDBI Make in India Loan for Small Enterprises (SMILE) has been launched to offer quasi- equity and term-based short-term loans to Indian SMEs with less stringent rules and regulations and a special focus on 25 thrust sectors of Make in India.

♤ Micro Units Development Refinance Agency (MUDRA) Bank has been set up to provide development and refinance to commercial banks/ NBFCs/cooperative banks for loans given to micro-units. MUDRA Bank would follow a credit-plus approach while also providing financial literacy and addressing skill gaps, information gaps, etc.

♤ Startup India campaign is based on an action plan aimed at promoting bank financing for start-up ventures to boost entrepreneurship and encourage start ups with jobs creation, with focus on MSME sector.