Views by SMERA on MSME Sector

"The budget has tried to address the structural challenges that continue to constrain the MSME sector particularly with respect to technological upgradation, logistics and the funding availability. MSMEs in sectors such as healthcare and textiles are expected to undergo technological upgradation and benefit from the ongoing and new programmes under "Mission Indradhanush" and the "National Technical Textile Mission" respectively. The medium sized enterprises will benefit from an export oriented scheme anchored by Exim Bank and SIDBI to provide equity and technical support for exports. Notably, the formulation of the National Logistics Policy and the proposed investments in warehouse infrastructure will facilitate the growth of MSMEs in the agro, food processing and transportation sector. Finally, the financing environment for the sector is sought to be strengthened through measures such as the availability of subordinate debt guaranteed by CGTSME which can be treated as quasi-equity and therefore, augment the borrowing capacity of MSMEs. Also, the permission given to NBFCs to lend against invoices in the TReDs platform and extension of the debt recast window will help to improve the MSMEs' liquidity position and their access to funds for fresh investments."

Source : Equity Bulls

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