Lok Sabha Question No. 697 (UNSTARRED), answered on 2020-09-17
Subject: Reduction of funds under ASPIRE
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: S. Jothimani

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 697

TO BE ANSWERED ON 17.09.2020

## REDUCTION OF FUNDS UNDER ASPIRE

## 697. MS. S. JOTHIMANI:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

(a) the reasons for reduction in allocations under A Scheme for Promotion of Innovation, Rural Industries  and  Entrepreneurship  (ASPIRE)  and  the  credit  support  programme  by  86%  in  the Budget; and

(b) the steps taken to promote the MSME industries in Karur, Tamil Nadu during the last five years?

## ANSWER

## MINISTER OF MICRO,SMALL AND MEDIUM ENTERPRISES (SHRI NITIN GADKARI)

(a): Under  A  Scheme  for  Promotion  of  Innovation,  Rural  Industries  and  Entrepreneurship (ASPIRE),  assistance  is  provided  for  setting  up  of  Livelihood  Business  Incubators  (LBIs)  and Technology  Business  Incubators  (TBIs)  to  promote  livelihood  based  enterprises  and  innovation, besides setting up a Rs.310 crore  Fund of Funds (FoF) under Small Industries Development Bank of  India  (SIDBI)  for  investment  in  agro-rural  focused  Start-ups  and  early  stage  enterprises  in MSME sector. In 2018-19, under ASPIRE, Rs. 224 crore was allocated at RE stage, of which Rs. 210 crore was for SIDBI as the last installment for FoF corpus, while Rs.14 crore was allocated for setting up LBIs and TBIs.  In 2020-21, the BE allocation is Rs.30 crore only for setting up LBIs and TBIs. Hence, the reduction of 86% in budget allocation from the year 2018-19 to 2020-21 is on account of the fact that there is no further requirement of funds for SIDBI as FoF as the corpus with approved amount has already been set up. The funds allocated for LBI/TBI have actually increased from Rs.14 crore in 2018-19 to Rs.30 crore in 2020-21.

Under Credit Guarantee Trust Fund for Micro and Small Enterprises (CGT-MSE), there is a total  corpus of Rs.7,500 crore with GoI contribution of Rs.7000 crore and SIDBI contribution of Rs.500  crore  to  provide  guarantee  on  credit  facilities  extended  to  eligible  borrowers  in  MSME, without  collateral  guarantee.  Since  the  corpus  has  reached  the  upper  ceiling  of  GoI  contribution with  the  release  of  Rs.555.16  crore  in  2019-20,  the  allocation  in  2020-21  has  been  reduced  to Rs.100  crore,  as  a  reserve  amount  in  case  there  is  an  upward  revision  in  the  ceiling  of  GoI contribution in the corpus of the fund.

(b): Following steps have been taken to promote MSME industries in Karur, Tamil Nadu, during the last 5 years.

(i)  Under  Prime  Minister's  Employment  Generation  Programme  (PMEGP),  loan  is  being provided by Banks and financial assistance in the form of Margin Money subsidy is provided by the GoI to new entrepreneurs for setting up micro enterprises in non-farm sector. The details of the micro-units assisted under PMEGP in Karur District of Tamil Nadu during last five years and the current year is as follows:

| Year                       |   No. of micro units assisted under PMEGP |   Margin Money Subsidy disbursed (Rs. in lakh) |   Estimated Employment generated |
|----------------------------|-------------------------------------------|------------------------------------------------|----------------------------------|
| 2015-16                    |                                        21 |                                          86.83 |                              323 |
| 2016-17                    |                                        98 |                                         432.95 |                             1080 |
| 2017-18                    |                                        85 |                                         403.08 |                              680 |
| 2018-19                    |                                       176 |                                         902.52 |                             1416 |
| 2019-20                    |                                       104 |                                         560.37 |                              832 |
| 2020-21 (as on 11.09.2020) |                                        22 |                                         106.59 |                              176 |

- (ii) Under Coir Vikas Yojna for the training and welfare of coir artisans, 4 number of awareness camps have been held in Karur, Tamil Nadu for training total 450 coir artisans over the past 5 years. Besides, 1 Entrepreneurship Development Programme has been organized for training of 60 coir entrepreneurs. Alongside, 32 coir fibre extraction units, 14 curled coir units, 14 coir pith block units and 12 coir spinning units are functioning in and around Karur district, out of which 20 units (12 coir fibre extraction units, 4 coir pith block units and 4 coir spinning units) have been registered with Coir Board under Coir  Industrial Registration Act, 2008. Coir Board has also issued Export Registration Certificate to 6 coir exporters which has helped them to avail 1-2 % export incentive.
- (iii)      In  addition,  Government  of  India  has  recently  taken  number  of special  initiatives  under AtmaNirbhar  Bharat  to  support  MSME  sector  in  the  entire  country,  including  Karur,  Tamil Nadu. These include Rs. 20,000 crore Subordinate Debt scheme for MSMEs, Rs.3 lakh crore Collateral  free  Automatic  Loans  scheme  for  businesses  including  MSMEs,  Rs.  50,000  crore equity  infusion  through  MSME  Fund  of  Funds,  implementation  of  new  revised  criteria  for classification of MSMEs, enhanced process of MSME registration through 'Udyam Registration' and  ban on global tenders for procurement up to Rs.200 crore.

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