A Rs 2,500 crore technology upgradation fund will be created next year to help the country's micro, small and medium enterprises (MSME) acquire new technology.
"The technology upgradation fund of Rs 2,500 crore will certainly be created next year when the 12th Five-Year Plan starts," Ministry of MSMEs Secretary Uday Kumar Verma told reporters today.
"This (technology upgradation fund) will help the MSME sector to acquire and upgrade technology," he said on the sidelines of the 59th Indian Foundry Congress here today.
Stating that bringing new technology was a costly proposition for the MSME sector, he said a solution has to be found on how new technology could be provided to this sector.
"(This includes) whether government will import the technology and then give it to MSME sector at a subsidised rate," he said, adding that the new fund for technology upgradation would be helpful for the entire MSME sector, having various verticals like foundry, light engineering, etc.
The 26 million MSMEs in the country account for 45% of manufacturing output.
A Task Force headed by T K A Nair, the Principal Secretary to the Prime Minister for MSMEs, had made a wide range of recommendations on marketing innovation, labour issues and technology upgradation to spur the growth of the MSME sector.
"One of the recommendations of the task force was to constitute a fund having a corpus of Rs 2,500 for upgradation of the technology of the MSME sector. The Ministry of MSMEs submitted the proposal to the Planning Commission and it is examining the proposal," he said.
Asked about the cluster development programme, he said the government will now stay away from maintaining critical infrastructure like common facility centres for the MSME sector.
"Now the government will not run common facility centres including lab or machinery, etc, for clusters... The special purpose vehicles formed by about 20-30 industrial units will run them and whatever surplus they have they will share it... the government will just facilitate cluster development programmes," he said.
The country has over 350 such clusters in various industry verticals. The government provides financial aid for setting up common facility centres and industrial infrastructure development.
Verma also stressed upon giving fiscal incentives to the MSME sector in the upcoming Manufacturing Policy. "To make MSME sector, which accounts for 45% of country's manufacturing), competitive, fiscal incentives could be given to them to make them more competitive," he said.