Indian government to create Rs 2500-crore Corpus for Micro Small & Medium Units

The Indian government in end March 2011 announced its decision to create Rs 2500-crore corpus for technology modernisation of the micro, small and medium units by 2012. Currently only the textile sector get to avail benefits under the Technology Upgradation Fund Scheme (TUFS) wherein the units get 5 per cent subsidy on loans, for upgrading technology, from the government. The Ministry of Micro, Small and Medium Enterprises (MSME) emphasised on the need to couple upgraded technology with adequate and timely credit. The need for robust infrastructure, innovation, marketing initiatives and skill development programmes for the growth of small and medium units was felt.

The MSMEs account for 45 per cent of the country's manufacturing output and 40 per cent of exports. The sector employs 50 million people in 26 million units producing over 6000 products.