‘CLCSS should be extended to support MSEs’
   Date :15-Jul-2021

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Business Bureau :
 
With a severe labour shortage across the nation, micro and small enterprises (MSEs) have made automation and technology adoption their top priority with improved productivity and efficiency. “While it’s heartening to see the growth in Credit Linked Capital Subsidy Scheme (CLCSS), but for India to achieve target of 50% GDP from MSMEs in the next few years, the CLCSS which ended on March 31, 2021 should be extended further to benefit more MSEs,” said CA Julfesh Shah, Chairman of COSIA Vidarbha while addressing a webinar on MSMEs organised by Entrepreneurs Guild. CA Shah further said that all businesses supported in FY21 under technology upgradation scheme was highest in last 5 years and Gujarat, Maharashtra and Punjab were the states with the highest number of MSE beneficiaries under CLCSS. Overall, 45,214 MSE units were supported between FY17 and FY21 with Rs 3,139.21 crore of subsidy.
 
The number of MSE units supported under the Government’s pet scheme to facilitate technology upgradation hit all time high in FY21. According to the available data from the MSME Ministry, the total number of MSE units supported under CLCSS during FY21 stood at 15,188 in comparison to 4,011 units supported in FY17 followed by 4,081 in FY18, 14,155 in FY19, and 7,779 in FY20. Moreover, the amount of capital subsidy support was also highest in FY21 at Rs 1,100.87 crore vis-à-vis Rs 256.53 crore subsidy support in FY17, Rs 260.54 crore in FY18, Rs 980.44 crore in FY19, and Rs 540.83 in FY20, said Shah. The scheme intended to provide a capital subsidy of 15 per cent on institutional finance of up to Rs 1 crore availed by MSEs for upgradation of their plant and machinery with the latest technology. The Government had updated the scheme in 2019 to boost credit access to MSEs along with a 10% extra subsidy to SC/ST entrepreneurs beyond the existing 15% subsidy by offering a 10% extra subsidy to SC/ST entrepreneurs, he added.
 
CA Shah said that the scheme aims at facilitating technology up-gradation by providing 15 per cent upfront capital subsidy up to a maximum cap of Rs 15 lakh (i.e., maximum investment in approved machinery is Rs 1 crore) to MSE units including tiny, khadi, village and coir industrial units. The institutional finance availed by them for induction of state-of-the-art or near state-of-the-art technology for up-gradation of the present technology level to a substantially higher one involving improved productivity, quality, environmental condition including work environment. The scheme facilitates subsidy to 51 sub-sectors/products including khadi and village industries. At present, the scheme is being implemented by 12 nodal banks/agencies including SIDBI and NABARD.
 
Online application and tracking system has been introduced and the SME units need to upload their subsidy claim application though their PLIs.The scheme is linked with term loans availed by the MSEs from banks or financial institutions. Funds are then transferred by nodal agencies to the PLIs where account of MSE is operated, Shah concluded. N P Udeshi, Convenor made the introductory remarks. S H Singh, Deputy Convenor proposed the vote of thanks.