New Delhi: The politically sensitive small and medium enterprises (SMEs) and agriculture sectors will be the top priority of the new Narendra Modi government in the coming days. The Centre plans to further push credit growth to small industries in an attempt to boost economic growth and create jobs.
Small industries were badly hit by demonetisation and in the initial rollout of the Goods and Services Tax (GST). The government is keen to restart the growth cycle in small industries as it is one of the major sources of jobs in the country. During the bitterly-fought Lok Sabha poll campaign, the government was severely criticised by the Opposition for job losses in the SME sector and over farmers’ distress.
The Centre plans to provide Rs 1 lakh crore in loans only through the Credit Guarantee Scheme to raise the flow of credit to the SME sector, which is largely ignored by banks. The government may also start work on a new scheme to encourage entrepreneurship among the youth. In its manifesto, the BJP promised a scheme to provide collateral-free credit up to Rs 50 lakhs for entrepreneurs, wherein the government will guarantee 50 per cent of the loan amount for female entrepreneurs and 25 per cent of the loan amount for male entrepreneurs. Prime Minister Narendra Modi has in the past talked about the need for the youth to become “job creators instead of job seekers”. A top government source said: “Work on that scheme is likely to start soon.”
The BJP had also promised to start a scheme on the lines of Kisan Credit Cards for merchants, who will be given merchant credit cards. To give a stimulus to the economy, the government plans capital investment of Rs 100 lakh crores in the infrastructure sector to make India a $5 trillion economy by 2025.
For farmers, the BJP in its manifesto had promised a new pension scheme for all small and marginal farmers in the country to ensure that they get social security on reaching the age of 60. The BJP has already launched the Pradhan Mantri Kisan Samman Nidhi Yojana, where Rs 6,000 per year is transferred into the accounts of farmers with upto two hectares of land. The BJP in its manifesto had talked of providing new short-term agricultural loans upto Rs 1 lakh at a zero per cent interest rate for one to five years. It had said that the government was committed to making an investment of Rs 25 lakh crores to improve the farm sector’s productivity and bring one crore hectares of agricultural land under micro-irrigation. The Narendra Modi government, is its first term, had also promised to double the income of farmers by 2022.