New Delhi: The government proposed to increase allocation for the Micro, Small and Medium Enterprises (MSMEs) sector on 26 Februray by over Rs600 crore to Rs2,400 crore for 2010-11.
MSMEs, which employs about 60 million people and contributes about 40% to India’s overall exports, were badly hit by the global slump in demand.
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“I propose to raise the allocation for this sector from Rs1,794 crore to Rs2,400 crore for the year 2010-11, finance minister Pranab Mukherjee said while presenting Budget 2010-11.
Prime Minister Manmohan Singh in 2009 had constituted a high level task force to suggest an action plan to help the MSME sector ride out of the global slowdown.
The report of the task force was submitted to the Prime Minister last month. The report, among other things, has recommended extension of the stimulus package specific to the sector for one more year, besides calling for an easy procurement policy and creating a separate fund for the industry.
Mukherjee said that “a high level council on small and medium enterprises will monitor the implementation of the recommendation and the agenda for action.”
The MSME Ministry had sought Rs5,000-Rs5,500 crore over the next three years to implement the recommendations of the task force.
There are 26 million MSMEs in the country, contributing about 45% to India’s total manufactured output.