Post lockdown, UP infused Rs 26,000 cr working capital to one million MSMEs

State seeks to benefit 2 million MSMEs, create eight million jobs in current fiscal

In order to accelerate the process of getting the covid-19 hit economy back on track, the Uttar Pradesh government facilitated working capital loans to the tune of Rs 26,000 crore to almost a million micro, small and medium enterprises (MSME) in the post-lockdown period.

The beneficiary MSMEs comprised about 435,000 existing and 540,000 new units across different industry segments, which were provided bank financing totalling Rs 10,727 crore and Rs 15,246 crore respectively under various central and state government schemes.

“To boost the economic activities in the state, we are striving to provide funding to the MSMEs through commercial banks under the Aatmanirbhar Bharat economic package of the Centre,” UP additional chief secretary, MSME and export promotion, Navneet Sehgal said here.

He further claimed the infusion of Rs 26,000 crore worth of capital in the state MSME sector had created around 2 million fresh employment opportunities for the youth. “The state government is targetting to provide institutional credit to 2 million MSMEs in the current financial year 2020-21 and to generate 8 million employment opportunities.”

At the same time, the Yogi Adityanath government has facilitated loans worth Rs 15,000 crore to the MSME units under its flagship one district, one product (ODOP) scheme over the past three years, benefitting more than 3,000 enterprises/self help groups.

The ODOP scheme was launched in 2018 to promote UP’s traditional and indigenous industries under the MSME umbrella by providing the institutional support of funding, training, marketing support etc. Recently, the World Bank had also evinced interest to provide financial and institutional support to some projects under the ODOP scheme.

The World Bank has proposed to collaborate with UP under two different programmes. Besides, there is a proposal to develop the value chain of 14 agricultural and food processing products related to ODOP with the aim of promoting entrepreneurship through integrated cluster development.

The government is targetting to augment MSME exports in the next three years to touch the ambitious mark of Rs 3 trillion. During the previous 2018-19 and 2019-20 fiscal years, the MSME exports from the state were to the tune of Rs 1.14 trillion and Rs 1.20 trillion respectively.

The state is planning to conduct a study of leading industrialised states viz. Andhra Pradesh, Tamil Nadu and Gujarat to cut the per unit production cost of UP MSMEs for increasing their competitiveness.

To give impetus to the MSME exports, UP is already hammering out a new export promotion policy, which is likely to be put before the cabinet soon for approval. In the backdrop of the global companies looking to shift their production based out of China following the covid-19 outbreak and the US-China trade war, the state is looking to woo the multinational companies to set up plants in the industrial enclaves of UP.