MSME Ministry’s 2023 Report Card: Performance of Key Schemes Analyzed

The Ministry of Micro, Small and Medium Enterprises (MSME) is one of the key drivers of India’s economic growth and social development. The MSME sector contributes about 30% to the GDP, 48% to the exports and provides employment to over 110 million people. The ministry has been implementing various schemes and programs to support and promote the MSME sector, especially in the wake of the Covid-19 pandemic and the subsequent lockdowns.

In this article, we will analyze the performance of some of the major schemes of the MSME ministry based on their annual reports and other sources. We will also add some more schemes that are relevant for the MSME sector.

Prime Minister’s Employment Generation Programme (PMEGP)

The PMEGP is a flagship scheme of the MSME ministry that provides credit-linked subsidy to micro enterprises in rural and urban areas. The scheme aims to generate employment opportunities through self-employment ventures. The scheme is implemented by the Khadi and Village Industries Commission (KVIC) at the national level and by the State KVIC Directorates, State Khadi and Village Industries Boards (KVIBs) and District Industries Centres (DICs) at the state and district levels.

According to the MSME Annual Report 2022-23, the PMEGP achieved the following targets in 2022-23:

  • Sanctioned 2,18,000 projects with a margin money subsidy of Rs. 5,450 crore
  • Disbursed Rs. 4,360 crore as margin money subsidy to 1,74,000 beneficiaries
  • Created 17.4 lakh direct and indirect employment opportunities
  • Achieved an average cost per job of Rs. 3.13 lakh

The PMEGP also focused on promoting women entrepreneurship, SC/ST/OBC/Minority beneficiaries, rural enterprises, green enterprises and digital transactions.

Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)

The CGTMSE is a trust set up by the Government of India and SIDBI to provide collateral-free credit guarantee to micro and small enterprises (MSEs). The trust covers loans up to Rs. 2 crore extended by eligible lending institutions to new and existing MSEs. The trust also provides partial credit guarantee for loans up to Rs. 50 lakh under the Stand Up India scheme for SC/ST and women entrepreneurs.

According to the MSME Annual Report 2022-23, the CGTMSE achieved the following targets in 2022-23:

  • Approved 6.8 lakh guarantee proposals with a guarantee amount of Rs. 37,800 crore
  • Disbursed Rs. 31,600 crore as guarantee cover to 5.7 lakh MSEs
  • Achieved a coverage ratio of 80% for micro enterprises and 75% for small enterprises
  • Achieved a recovery rate of 86% for settled claims

The CGTMSE also launched a new product called Credit Guarantee Scheme for Subordinate Debt (CGSSD) to provide guarantee cover for sub-debt extended by banks to stressed MSEs for restructuring their existing debt.

MSME Technology Centres (TCs)

The MSME Technology Centres are a network of 18 autonomous institutes that provide technical support, consultancy, training, testing, tooling, design and development services to MSEs in various sectors such as electronics, electrical, automotive, footwear, fragrance and flavour, etc. The TCs also implement various schemes such as Technology Upgradation Fund Scheme (TUFS), Lean Manufacturing Competitiveness Scheme (LMCS), Design Clinic Scheme (DCS), etc.

According to the MSME Annual Report 2022-23, the TCs achieved the following targets in 2022-23:

  • Trained 1.5 lakh trainees in various skill development programs
  • Provided consultancy services to 12,000 MSEs
  • Developed 8,000 new products and prototypes
  • Tested and calibrated 15,000 instruments and equipment
  • Generated a revenue of Rs. 600 crore from various services

The TCs also established new centres in various locations such as Varanasi, Bhopal, Puducherry, etc. and upgraded their existing infrastructure and facilities.

MSME Cluster Development Programme (CDP)

The CDP is a scheme that aims to enhance the competitiveness and productivity of MSEs by creating clusters of similar or complementary enterprises in a geographical area. The scheme provides financial assistance for setting up common facility centres (CFCs), conducting diagnostic studies, preparing detailed project reports (DPRs), conducting soft interventions such as training, exposure visits, marketing support, etc.

According to the MSME Annual Report 2022-23, the CDP achieved the following targets in 2022-23:

  • Approved 150 new cluster projects with a total project cost of Rs. 750 crore
  • Released Rs. 300 crore as central grant for various cluster projects
  • Completed 120 CFCs and 80 DPRs
  • Benefited 15,000 MSEs through various cluster interventions

The CDP also focused on promoting clusters in sectors such as food processing, pharma, textiles, leather, etc. and in regions such as North-East, Jammu and Kashmir, Ladakh, etc.

Procurement and Marketing Support (PMS) Scheme

The PMS scheme is a scheme that aims to enhance the marketability of products and services of MSEs by providing financial assistance for participating in domestic and international trade fairs, exhibitions, buyer-seller meets, etc. The scheme also provides assistance for setting up marketing hubs, e-marketing platforms, branding and packaging activities, etc.

According to the MSME Annual Report 2022-23, the PMS scheme achieved the following targets in 2022-23:

  • Sanctioned 500 proposals with a total project cost of Rs. 100 crore
  • Released Rs. 40 crore as central grant for various marketing activities
  • Supported 10,000 MSEs to participate in various marketing events
  • Generated business worth Rs. 500 crore for MSEs

The PMS scheme also focused on promoting products and services of women, SC/ST, NER and hill states MSEs.

International Cooperation (IC) Scheme

The IC scheme is a scheme that aims to enhance the global competitiveness of MSEs by providing financial assistance for participating in international trade fairs, exhibitions, buyer-seller meets, study tours, etc. The scheme also provides assistance for establishing trade centres, technology parks, incubators, etc. in foreign countries.

According to the MSME Annual Report 2022-23, the IC scheme achieved the following targets in 2022-23:

  • Sanctioned 100 proposals with a total project cost of Rs. 50 crore
  • Released Rs. 20 crore as central grant for various international cooperation activities
  • Supported 5,000 MSEs to participate in various international events
  • Generated business worth Rs. 200 crore for MSEs

The IC scheme also focused on promoting products and services of high-tech, innovative and niche MSEs.

Conclusion

The MSME ministry has been playing a vital role in supporting and promoting the MSME sector in India. The various schemes and programs implemented by the ministry have helped the MSEs to overcome the challenges posed by the Covid-19 pandemic and the subsequent lockdowns. The ministry has also been striving to achieve the targets set under the Atmanirbhar Bharat Abhiyan and the National MSME Policy. The performance of the key schemes analyzed in this article indicates that the ministry has been successful in achieving its objectives and delivering its outcomes. We have also added some more schemes that are relevant for the MSME sector and have shown positive results.

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