Finance minister Nirmala Sitharaman yesterday launched the most awaited scheme to help micro, small and medium enterprises (MSMEs) which could be future champions with good export potential under the title, the “Ubharte Sitaare“.
FM Sitharaman said though the scheme was announced in her FY21 budget but because of the pandemic, implementation got delayed. “Some developed countries liked Germany have already tried this. They have identified champion sectors and tried to support them and handhold them, give them the necessary technology, and fund infusion through which it made a league of a difference for many of these champion sectors.
For Ubharte Sitaare, largely the same principle is being followed. In a state like Uttar Pradesh with highest number of MSMEs, a project which was tailor made for MSMEs to identify champions among them and to also support them, the state justifies the launch of the scheme,” she added.
Under the scheme, an identified company is supported even if it is currently underperforming or may be unable to tap its latent potential to grow. The programme diagnoses such challenges and provides support through a mix of structured support covering equity, debt and technical assistance.
The objectives of the programme are to enhance India’s competitiveness in select sectors through finance and extensive handholding support; identify and nurture companies having differentiated technology, products or processes, and enhance their export business; assist units with export potential, which are unable to scale up their operations for want of finance.
Eligible companies can be supported by both financial and advisory services by way of equity / equity-like instruments, term loans for modernisation, technology or capacity upgradation; and technical assistance for product adaptation, market development activities and viability studies.
Companies will be selected for support based on their unique value proposition in technology, products or processes that match global requirements. small and mid-sized companies with ability to penetrate global markets, with an annual turnover of up to approx. ₹500 crore; companies with a good business model, strong management capabilities, and focus on product quality.