Government to soon clear Rs 10,000 crore ‘Fund of Funds’ for MSMEs with high credit rating: Nitin Gadkari

NEW DELHI: A Rs 10,000 crore “Fund of Funds” will soon be authorised by the federal government to purchase up to 15 per cent fairness in MSMEs with high credit ranking that need to record on inventory exchanges and lift cash from the capital markets, Union Minister Nitin Gadkari mentioned on Wednesday. Gadkari additionally mentioned a separate scheme was being formulated for in accordance credit ranking to MSMEs based mostly on their annual turnover, exports and GST funds, and that the National Small Industries Corporation or one other authorities physique will management the Fund of Funds.
He mentioned the federal government desires the Fund’s corpus to be utilised by micro, small and medium enterprises (MSMEs) having AAA ranking. The AAA ranking implies high credit worthiness.

“We have submitted a proposal for a Fund of Funds of Rs 10,000 crore which has been approved by the Finance Ministry. It is going to be placed before the Cabinet and will soon be cleared,” mentioned the minister for MSMEs.

Gadkari mentioned up to 15 per cent of the quantity an AAA-rated MSME raises from the capital market can be contributed by the federal government by the Fund as fairness.

The minister mentioned he was anticipating Cabinet clearance for the Fund soon and can implement it instantly upon approval.

Interacting with members from the PHD Chamber of Commerce and Industry by way of video convention, Gadkari exhorted India Inc to additionally take into account the monetary situation of the federal government and banks whereas inserting forth their calls for, amid the coronavirus-induced financial disaster.

“The government is also facing a financial crisis. Some state governments do not have enough money to pay salaries to staff next month. The situation of banks is also challenging in terms of their survival,” mentioned the minister, emphasising the necessity to strike an equilibrium to guarantee everybody’s survival.

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