NEW DELHI: The next set of stimulus measures from the government will have a clear focus on concerns of SME segments that have been hit hard due to Covid-19 outbreak and resultant nationwide lockdown.
Sources in the government said that the Finance Ministry has suggested the PMO to set up a dedicated fund for micro, small and medium enterprises that could be used to provide both interest-free loans to identified industries as well as capital support required to bring enterprises back in business after the lockdown.
The MSME fund may also be used to provide interest subvention on loans taken by the sector to reduce their burden and allow some of these labour-intensive segments to operate smoothly.
One of the biggest challenge facing the MSMEs due to the lockdown is of eroding cash flow. Longer duration of lockdown will only add to their problems with few enterprises facing an imminent shutdown.
Sources said that the size and funding of the proposed MSME fund is yet to be worked out pending approval from the PMO, but it would substantially big to accommodate large number of enterprise that operate in the segment.
IANS