Union Budget: Govt extends Emergency Credit Line Guarantee Scheme to March 2023, expands guarantee cover by Rs50,000cr

1 Feb 2022 , 04:32 PM

During the Union Budget 2022 speech, Finance Minister Nirmala Sitharaman announced that the Emergency Credit Line Guarantee Scheme (ECLGS) will be extended up to March 2023 and its guarantee cover will be expanded by Rs50,000cr. The total cover will now be Rs5 lakh cr under the scheme.

The Finance Minister noted that the 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 proposal has been made considering the aspect that the hospitality and related services, especially those by micro and small enterprises, are yet to regain their pre-pandemic level of business.

The Finance Minister also made several other proposals relating to the MSME sector.

The Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) Scheme will be revamped with a required infusion of funds. This will facilitate additional credit of Rs2 lakh cr for Micro and Small Enterprises and expand employment opportunities, the Finance Minister stated.

The Finance Minister announced the rolling out of Raising and Accelerating MSME Performance (RAMP) programme with an outlay of Rs6,000cr over 5 years. This will help the MSME sector become more resilient, competitive and efficient.

Further, the FM proposed that Udyam, e-Shram, NCS and ASEEM portals will be interlinked. Their scope will be widened. They will now perform as portals with live, organic databases, providing G2C, B2C and B2B services. These services will relate to credit facilitation, skilling, and recruitment to further formalize the economy and enhance entrepreneurial opportunities for all.

In furtherance of rationalizing various duties, the Finance Minister proposed that the duty on umbrellas is being raised to 20 per cent. Exemption to parts of umbrellas is withdrawn. The exemption is also being rationalized on implements and tools for the agri-sector which are manufactured in India.

Customs duty exemption given to steel scrap last year is being extended for another year to provide relief to MSME secondary steel producers. Certain Antidumping 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.