 "MSMEs")
Signalling an uptick in institutional loans to small businesses, micro, small, and medium enterprises (MSMEs) saw their credit line jump 80 per cent to Rs 1.5 trillion in 2022-23.
This is against the credit disbursement of nearly Rs 83,000 crore in 2021-22.
UP has about nine million MSMEs -- the largest among all states in India -- across its 75 districts.
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At the UP Global Investors Summit (GIS) 2023, the state got investment proposals of about Rs 35 trillion, of which the MSME sector accounted for Rs 1.6 trillion, spanning 9,000 projects.
Meanwhile, other sectors, comprising education, housing, personal loans, and automobiles, have been laggards in sourcing commercial bank loans. They account for about Rs 11,000 crore against the annual target of Rs 28,000 crore.
The growing loan appetite of MSMEs has reinforced the stated commitment of the state government to catalyse the sector for faster growth and attain the $1 trillion economy target for UP. The government is pushing its flagship “One District One Product” (ODOP) scheme to re-energise indigenous handicrafts and industries.
MSMEs contribute roughly 60 per cent to UP’s annual industrial output. According to Chief Minister Yogi Adityanath, the broad-based MSME push through the ODOP scheme and other policies has turned UP’s youth from jobseekers to job creators.
“Prior to 2017, the unemployment rate in UP was about 18 per cent, which has declined to merely 2.9 per cent since the state government has revived the MSME sector,” he recently said.
For promoting institutional credit to the sector, the state has been organising special loan melas, especially in industrial clusters and hubs.
The government has rolled out financial incentives, including stamp duty waiver. For example, women-run ventures in the Purvanchal and Bundelkhand regions are entitled to 100 per cent stamp duty waiver, while the applicable subsidy in other areas is 75 per cent.
