The second largest sector in terms of employing people, the Manufacturing sector, Micro, Small and Medium Enterprises (MSME) is being pushed forward for development under the recent government initiative in Aatma Nirbhar Bharat Abhiyaan and Union Budget 2021-2022. The sector employs about 11 crore people, second only to agriculture. The RBI governor Shaktikanta Das said the sector was rendered especially vulnerable by the pandemic, necessitating concerted efforts to combat the stress and focus
on revival of the sector.
The government introduced two major schemes: the Emergency Credit Line Guarantee Scheme (ECLGS) and the Credit Guarantee Scheme for Subordinate Debt (CGSSD). These have been duly supported by various monetary and regulatory measures by the RBI in the form of interest rate cuts, higher structural and durable liquidity, moratorium on debt servicing, asset classification standstill, loan restructuring package and CRR exemptions on credit disbursed to new MSME borrowers.
"These measures will not only help in ameliorating stress in the sector but also open new opportunities," said RBI Governor Shaktikanta Das.
“Going forward, the RBI stands ready to support the Small Industries Development Bank of India (SIDBI) for greater credit penetration to the MSME sector”. He said digital capabilities have the potential to raise productivity in agriculture, manufacturing and businesses as well as improve the delivery of public services like healthcare and education. "In the financial sector, this could lead to higher financial inclusion, lesser information asymmetry and reduced credit risk."