Cabinet Set to Approve Rs 10,000 Crore Fund for SME Growth and Integrated Logistics Authority
NEW DELHI: The Union Cabinet is set to review two key proposals aimed at enhancing the government’s growth and infrastructure initiatives. These include the establishment of an Integrated Transport and Logistics Authority and the introduction of a Rs 10,000 crore SME Growth Fund, as outlined in the Union Budget for 2026-27.
The SME Growth Fund, announced by Finance Minister Nirmala Sitharaman, is part of a broader strategy to bolster the micro, small, and medium enterprises (MSME) sector. The fund aims to provide equity support to businesses, with incentives tied to specific criteria. Sitharaman emphasized that this initiative is designed to help enterprises emerge as future “Champions” and is aligned with the government’s goal of accelerating economic growth by enhancing productivity and resilience against global market fluctuations.
In addition to the SME Growth Fund, the government has proposed an extra Rs 2,000 crore for the Self-Reliant India Fund, established in 2021. This allocation is intended to support micro enterprises and ensure their access to risk capital. The Budget also detailed measures for MSMEs focusing on three key areas: equity, liquidity, and professional support.
On the liquidity front, Sitharaman reported that over Rs 7 lakh crore has been made accessible to MSMEs through the Trade Receivables Discounting System (TReDS). She proposed that TReDS become the transaction settlement platform for purchases from MSMEs by central public sector enterprises. Additional measures include introducing a credit guarantee mechanism for invoice discounting on the platform and linking the Government e-Marketplace (GeM) with TReDS to enhance information sharing on government purchases with financiers.
To improve professional support, the Budget suggests collaboration with institutions like ICAI, ICSI, and ICMAI to develop short-term modular courses. This initiative aims to create a cadre of ‘Corporate Mitras’ in Tier-II and Tier-III towns, who will assist MSMEs in meeting compliance requirements at lower costs.
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