Lok Sabha Question No. 810 (UNSTARRED), answered on 2019-11-21
Subject: Credit Guarantee Fund
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: Shrikant Eknath Shinde, Sambhajirao Mane Dhairyasheel, Rahul Gandhi, Sujay Radhakrishna Vikhepatil

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

## LOK SABHA UNSTARRED QUESTION NO. 810 TO BE ANSWERED ON: 21.11.2019

## CREDIT GUARANTEE FUND

## 810.

DR. SHRIKANT EKNATH SHINDE: SHRI DHAIRYASHEEL SAMBHAJIRAO MANE: SHRI RAHUL GANDHI: DR. SUJAY RADHAKRISHNA VIKHE PATIL:

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

- (a) whether  the  Government  proposes  to  set  up  a  Credit  Guarantee  Fund  for  encouraging startup companies in the country with a view to providing  funding facilities and if so, the details thereof;
- (b) the  number  of  companies  that  have  availed  the  scheme  so  far  and  the  details  of  the incentives being provided to the startup companies to overcome their initial hurdles;
- (c) whether the Government has conducted any survey to assess the adverse affects of angel tax on the Indian startup eco-system;
- (d) if  so, the details thereof and the steps taken by the Government to address the concerns of entrepreneurs and investors regarding angel tax;
- (e) whether  the  Ministry  has  taken  up  initiatives  to  encourage  Micro,  Small  and  Medium Enterprises (MSMEs) in aspirational districts, particularly Wayanad and if so, the details thereof; and
- (f) whether  collateral-free loan has  been made  available to  MSMEs  under  the  Credit Guarantee Trust Fund in aspirational districts, especially Wayanad and if so, the details thereof?

## ANSWER

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

- (a): National  Credit  Guarantee  Trustee  Company  Ltd. has  already  been  set up  by  the Department  of  Financial  Services,  Ministry  of  Finance,  Government  of  India  to  function  as  a common trustee company to manage and operate various credit guarantee trust funds. To meet the funding needs of Startups, Government of India has established Fund of Funds for Startups (FFS) under Startup India Programme.
- (b): Under  Startup  India  initiative,  all  applications  can  be  submitted  to  the  Department  for Promotion of Industry and Internal Trade. The incentives provided to Startups under Startup India initiative are as follows:
- i. Self-Certification under 6 Labour Laws & 3 Environmental Laws.
- ii. Relaxations in Public Procurement Norms.
- iii. Faster exit under the Bankruptcy Code.
- iv. Rebates on Patent & Trademark filing fees, support from facilitators and expedited examination of Patent application.
- v. Income Tax exemption under section 80 IAC.
- vi. Exemption  from  Income  Tax  on  investments  received  above  fair  market  value under clause (ii) of the proviso to clause (viib) of sub-section (2) of section 56 of the Income Tax Act.
- vii. Funding support under the Fund of Funds for Startups.
- viii. Guidance and facilitation support from Startup India Hub.

- (c): No Sir.
- (d): Does not arise in view of (c) above.

(e): Yes Sir.  Ministry of MSME has taken several initiatives to encourage Micro, Small and Medium Enterprises. This covers the Aspirational Districts across the Country including Wayanad in Kerala. These initiatives include the schemes/programmes  such  as  Prime  Minister's Employment Generation Programme (PMEGP), Scheme of Fund for Regeneration of Traditional Industries (SFURTI), A Scheme for Promoting Innovation, Rural Industry and Entrepreneurship (ASPIRE),  Credit  Guarantee  Scheme  (CGTMSE),  Credit  linked  Capital  Subsidy-Technology Upgradation Scheme (CLCS-TUS), Micro & Small Enterprises- Cluster Development Programme (MSE-CDP),  National  Scheduled  Caste  and  Scheduled  Tribe  Hub  (NSSH),  Procurement  and Marketing Schemes (PMS) etc. National Small Industries Corporation (NSIC) under the Ministry of  MSME also boost  and supports Micro, Small and  Medium  Enterprises  (MSMEs) Sector by providing  integrated  support  services  encompassing  marketing,  finance,  technology  and  other services.    Till  date,  1254  number  of  units  are  registered  under  Udyog  Aadhaar  Memorandum (UAM) in Wayanad District.

(f): Yes  Sir.  Collateral-free  loans  have  been  made  available  to  MSMEs  under  the  Credit Guarantee Scheme  in  Aspirational Districts  including Wayanad District. Credit Guarantee  Trust for  Micro  and  Small  Enterprises  (CGTMSE)  has  approved  4299  guarantees  amounting  to  Rs. 103.17 Crore (upto October 31, 2019)  in Waynad  District of Kerala since  the  inception of  the Scheme.

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