Prime Minister Narendra Modi will on Friday launch a 100-day programme to promote micro, small and medium enterprises (MSMEs) through several measures including easy access to credit in 100 "aspirational" districts of the country.
"The programme is aimed at handholding the MSMEs, enabling them to get easy access to credit and helping them build linkages with the market. It will last 100 days in the 100 aspirational districts," Finance Ministry spokesperson D.S. Malik said on Wednesday.
Modi is likely to announce a host of measures to boost the MSME sector, including interest subsidy, as the sector has been struggling since demonetisation two years ago and the rollout of the Goods and Services Tax (GST) in July 2017.
The government plans to reach out to the small enterprises through credit and other support services, particularly in the 100 aspirational districts. These are backward districts in terms of health, education, infrastructure and deprivation.
"Several Union Ministers will participate in the mega programme and visit the aspirational districts to understand their challenges and oversee the support given to MSMEs," Malik said.
India's MSME sector comprises 633 lakh units, employing more than 11 crore people or 69 per cent of the total employment in the country. The sector accounts for around 30 per cent of the country's Gross Domestic Product.
It also accounts for 45 per cent of the total manufacturing and 40 per cent of the total exports.
The MSMEs, which largely operate in the informal sector, face infrastructural problems, lack market linkages and experience challenges in terms of institutional credit. However, they are the largest employer after agriculture, providing huge job opportunities at lower capital cost than large industries.
On September 25, the government had announced hassle-free online loans up to Rs 1 crore for MSMEs. Jaitley launched a common online platform for MSME credit that will enable businesses to get loans up to Rs 1 crore approved through a completely automated process within just 59 minutes.
(With inputs from agencies.)