DARE - Because Entrepreneurs Do

The Union Budget 2011 by our Finance Minister Pranab Mukherjee has raised allocations for the MSME sector implying some good news for the medium, small and micro enterprises.

Virbhadra Singh, the Union Cabinet Minister for MSME welcomed the Budget proposals for 2011-12. The Minister said that the Budget for the Micro, Small and Medium Enterprises Sector will spur growth and development. The Budget allocation for the Ministry has been increased from Rs. 2400 crore to Rs. 2700 crore which is 12.5% higher than the previous year's outlay.

SIDBI has been allocated an amount of Rs.5000 crore, which is a 20% increment over what had been allocated to SIDBI last year. OS Vinod, Chief General Manager, SIDBI expressed his happiness over the SME expectations being fairly met by the budget. "While everyone including MSME sector has huge expectations from the budget, FM has tried to meet the expectations and the 20% increase is good enough, and will help SIDBI re-finance the banks for SME lending, with increments.", said Vinod.

Additionally SIDBI has been entrusted with two funds for development of priority sectors. India Micro Finance Equity Fund has been created to provide equity support to the Micro Finance Institutions, with Rs. 100 crore.

Another fund with a corpus of Rs.500 crore has been named as Women's Self Help Group Development Fund which will help support and provide funding to the women's self help groups all across India.

While the amount sanctioned for the various funds is good enough, one point to be noted is that there has been no mention of Credit Guarantee Scheme for colletaral free lending to entrepreneurs, in  the budget. Vinod gave the budget 6-7 points as an SME-friendly budget.