Emergency Credit Line Guarantee Scheme extended till March 2023

Union Finance Minister Nirmala Sitharaman on Tuesday announced the extension of the Emergency Credit Line Guarantee Scheme (ECLGS) till March 2023, and said that the cover will now be expanded by Rs 50,000 crores to a total cover of Rs 5 lakh crores.

This additional amount has been earmarked exclusively for the hospitality and related sectors and to make the MSME (Micro, Small and Medium Enterprises) sector more resilient, she informed.

"Emergency Credit Line Guarantee, which has provided additional credit to MSMEs, extended till March '23 Guarantee cover to be expanded by Rs 50,000 crore to a total cover of Rs 5 lakh crores," Sitharaman said.

"Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) to be revamped with required fund infusion Will facilitate additional credit of Rs 2 lakh crore for Micro and Small Enterprises and expand job opportunities," she added.

Centre had announced the Emergency Credit Line Guarantee Scheme as part of the Aatma Nirbhar Bharat Package with the objective to help MSMEs and business enterprises to meet their operational liabilities and resume business in view of the distress caused by the COVID-19 crisis by providing Lending Institutions 100 per cent guarantee against any losses suffered by them due to non-repayment by borrowers.

The Finance Minister noted that the ECLGS has provided much-needed additional credit to more than 130 lakh MSMEs, and has helped them mitigate the adverse impact of the pandemic.

The proposal has been made considering the aspect that the hospitality and related services, especially those by micro and small enterprises, are yet to regain their pre-pandemic level of business. The Finance Minister also made several other proposals relating to the MSME sector.

"The additional credit through revamped Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) scheme will facilitate additional credit of Rs 2 lakh crore for Micro and Small Enterprises and expand employment opportunities, Sitharaman stated.

Further, she announced the rolling out of Raising and Accelerating MSME Performance (RAMP) programme with an outlay of Rs 6,000 crore over five years. "This will help the MSME sector become more resilient, competitive and efficient," she said.

The Finance Minister also proposed that Udyam, e-Shram, NCS and ASEEM portals will be interlinked. "Their scope will be widened. They will now perform as portals with live, organic databases, providing G2C, B2C and B2B services. These services will relate to credit facilitation, skilling, and recruitment with an aim to further formalize the economy and enhance entrepreneurial opportunities for all," Sitharaman said.

In furtherance of rationalizing various duties, the Finance Minister proposed that the duty on umbrellas is to be raised to 20 per cent. Exemption to parts of umbrellas will be withdrawn.

"Exemption is also being rationalized on implements and tools for agri-sector which are manufactured in India. Customs duty exemption given to steel scrap last year is being extended for another year to provide relief to MSME secondary steel producers," she said.

"Certain Anti-dumping and CVD on stainless steel and coated steel flat products, bars of alloy steel and high-speed steel are being revoked in larger public interest considering prevailing high prices of metals," she added.

( With inputs from ANI )