To promote micro, small and medium enterprises (MSME) in the country, there is a need to increase the loan limit under the Mudra scheme to Rs 20 lakh in the upcoming budget along with giving tax incentives. Also, there is a need to facilitate easy access to raw materials through producer cooperatives to cut costs and better marketing of products. Experts have said this in their suggestion before the budget. Finance Minister Nirmala Sitharaman will present the budget for 2024-25 in the Lok Sabha on July 23. On expectations from the budget, Naveen Saini, Chief Business Officer (Retail and MSME), Arka Fincap, said that the government will likely continue its agenda of providing a strong foundation for MSMEs, promoting their growth.

This is the demand

He said, “To achieve this, they should consider increasing the loan limit under the Pradhan Mantri Mudra Yojana (PMMY) from Rs 10 lakh to Rs 20 lakh and increasing the credit guarantee cover for loans considered unsecured for MSMEs from Rs 2 crore to Rs 5 crore.” Saini said, “These measures will provide MSMEs greater access to the necessary financial resources, allowing them to grow and contribute significantly to the economy.”

MSMEs are the backbone of our economy

Lakshmi Venkataraman Venkatesan, founder and managing trustee of Bhartiya Yuva Shakti Trust (BYST), said, “MSMEs are the backbone of our economy. In such a situation, it is important for the government to introduce supportive policies for this sector. This includes easy access to finance through PMEGP (Prime Minister Employment Generation Program), CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) and Pradhan Mantri Mudra Yojana, especially for women.” He said, “Apart from this, tax incentives are needed for those manufacturing units whose annual turnover is less than Rs 1 crore. Also, there is a need to facilitate easy access to raw materials through producer cooperatives to cut costs and better market their products.”

The budget will provide a strong foundation

Venkatesan said, “I hope this budget will reflect the needs and aspirations of our MSMEs and provide a strong foundation for a prosperous future.” Amit Prasad, founder and CEO of Satnav Technologies, said that MSMEs who are focused on generating IPR (intellectual property rights) do not have any formal financing process to grow internationally. He said, “Focusing on IPR based entities and giving them the target of developing new business can prove to be a significant step for our country.”