MSMEs and self employment sectors provide jobs and livelihood for maximum number of people in the Indian economy. Strengthening these two sectors is very important for growth of the economy and job creation.
Allocation for MSMEs
The finance minister while speaking on his plan for MSMEs said
The medium small and micro enterprises are major engine for growth and employment. I have provided rupees 3794 crores to the MSME sector for credit support , capital and interest subsidy on innovations. Mass formalisation of business of MSME is taking place in the country after demonetisation and introduction of GST. This is generating an enormous amount of financial information and database of the MSME business and finances. This database will be used for financing the MSMEs and the requirement of working capital.
The finance minister said that it was proposed to take the public sector banks to operate the TReDS system and link it with GSTN . Online loan sanction facilities for MSMEs will be revamped for prompt decision making by the banks he said. Government will soon announce. He also said that the government was looking into measures needed for addressing non performing assets and stressed accounts in MSME sector.
The finance minister has retained 25% corporate tax for MSMEs that were announced last year. He also stated that the NBFC(non banking financial companies) had stepped up lending for MSMEs after demonetisation. He also said that growth of fin-tech would aid MSME sector.
While speaking on MUDRA yojana the finance minister said :
MUDRA yojana launched in April 2015 has led to sanction of loans of rupees 4.6 lakh crores of credit to some 10.38 crore MUDRA loans. 76% of loan accounts are of women and more than 50% of them belong to SC, ST and OBCs. It is proposed to set up a target of rupees 3 lakh crore for lending in 2018-19.
The strengthening of MUDRA loans scheme will further help marginalised sections and entrepreneurs to avail loans from the banks for self employment and business expansion purposes. Thus, the focus on job creation has been given adequate attention by the finance minister in his budget presentation.