To provide financial relief to MSMEs as well as the hospitality sector, the Budget FY23 envisages to extend the Emergency Credit Line Guarantee Scheme (ECLGS) up to March 2023.
Besides, ECLGS will be extended up to March 2023 and its guarantee cover will be expanded by Rs 50,000 crore to total cover of Rs 5 lakh crore.
Notably, the additional amount is being earmarked exclusively for the hospitality and related enterprises.
In her Budget speech to Parliament, Finance Minister Nirmala Sitharaman said: “Emergency Credit Line Guarantee Scheme (ECLGS) has provided much-needed additional credit to more than 130 lakh MSMEs.”
“This has helped them mitigate the adverse impact of the pandemic. The hospitality and related services, especially those by micro and small enterprises, are yet to regain their pre-pandemic level of business.”
Furthermore, ‘Credit Guarantee Trust’ for micro and small enterprises (CGTMSE) scheme will be revamped with required infusion of funds.
“This will facilitate additional credit of Rs 2 lakh crore for Micro and Small Enterprises and expand employment opportunities,” the Finance Minister said.
Further, Sitharaman announced the rolling out of ‘Raising and Accelerating MSME Performance’ (RAMP) programme with outlay of Rs 6,000 crore over 5 years. This will help the MSME sector become more resilient, competitive and efficient, she said.
Additionally, the Finance Minister proposed that ‘Udyam, e-Shram, NCS and ASEEM’ portals be interlinked. “Their scope will be widened. They will now perform as portals with live, organic databases, providing ‘G2C’, ‘B2C’ and ‘B2B’ services,” she said.
“These services will relate to credit facilitation, skilling, and recruitment with an aim to further formalise the economy and enhance entrepreneurial opportunities for all.”
In addition, Sitharaman proposed rationalisation of customs duties to protect the MSME sector. Specifically, the duty on umbrellas has been proposed to be raised to 20 per cent.
The customs duty exemption given to steel scrap last year is being extended for another year to provide relief to MSME secondary steel producers.
On the other hand, exemption is also being rationalised on implements and tools for agri-sector which are manufactured in India.
Similarly, certain anti-dumping and CVD on stainless steel and coated steel flat products, bars of alloy steel and high-speed steel are being revoked in larger public interest considering prevailing high prices of metals