Home india-news West Bengal biggest beneficiary of Centre’s loan facility, says official | Latest News India

West Bengal biggest beneficiary of Centre’s loan facility, says official | Latest News India

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West Bengal biggest beneficiary of Centre’s loan facility, says official | Latest News India

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West Bengal has emerged as the biggest beneficiary of Centre’s collateral-free easy loan facility with over two million micro, small and medium enterprises of the states availing the Emergency Line Credit Guarantee Scheme (ECLGS), 17.65% of the total 11.4 million recipients across the country.

Prime Minister Narendra Modi and West Bengal chief minister Mamata Banerjee. (PTI)
Prime Minister Narendra Modi and West Bengal chief minister Mamata Banerjee. (PTI)

The other four significant beneficiaries are Maharashtra, Odisha, Tamil Nadu and Karnataka, in that order, said a government official who asked not to be named. Launched as part of the economic stimulus package in 2020, ECLGS aimed to protect small businesses from the devastating impact of the Covid pandemic.

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“Out of the total 1,13,75,919 MSME beneficiaries across the country as on March 7, over 8.56% ECLGS recipients belonged to Maharashtra, followed by Odisha (8.15%), Tamil Nadu (7.69%) and Karnataka (7.67%),” he said.

Benefits were also availed by MSMEs located in smallest states, hill areas and union territories, he said: 2,111 MSMEs (or 0.02%) availed this facility in Andaman & Nicobar; 8,180 units benefited in Sikkim; 3,149 in Dadra and Nagar Haveli and Daman & Diu; 12,083 in Goa ; 826 in Ladakh ; 374 in Lakshadweep ; 9658 in Manipur; 3461 in Mizoram; 7319 in Nagaland ; and 34451 in Jammu & Kashmir .

“The number of beneficiaries is more important for this scheme as compared to the amount because most of these units needed very small sums as working capital to continue their operations. Overall, a total 2,42,768.62 crore worth of guarantees were given for MSMEs across the country under the scheme as on March 7, 2024,” the official cited in the first instance added, citing government data.

A micro unit is an enterprise where investments in plant and machinery do not exceed 1 crore, and turnover does not exceed 5 crore. In case of a small enterprise, investment in plant and machinery should not exceed 10 crore and turnover must not exceed 50 crore. Medium enterprises are those where investments do not exceed 50 crore and turnover does not exceed 250 crore.

Overall, ECLGS benefited almost 12 million businesses (including 11.4 million MSMEs) and professionals with total guarantee amount of more than 3.68 lakh crore (including 2.43 lakh crore to MSMEs) as on March 7, according to the data.

“In value terms, (the more) industrialised states topped the list with total amount exceeding 3.68 lakh crore,” the official said. Maharashtra emerged as the number one beneficiary with guarantees worth 34,107.53 crore, followed by Tamil Nadu ( 27,141.49 crore) and Gujarat ( 24,493.95 crore).

A total 7.89 lakh MSMEs availed the scheme in Uttar Pradesh with total guarantee worth 17,110.84 crore. About 8.73 lakh units of Karnataka also received 16,057.20 crore, and over two million MSMEs of West Bengal received guarantees of 13,745.71 crore, data said.

ECLGS was one of the key components of the 20.97 lakh crore economic stimulus package under the ‘Atmanirbhar Bharat Abhiyan’ launched in May 23, 2020 that offered additional working capital finance in the form of a term loan to MSMEs and professionals. Under the Scheme, 100% guarantee coverage was provided to the lending institutions providing credit facility to eligible borrowers in the form of a Guaranteed Emergency Credit Line (GECL) facility.

Initially, its corpus was 3 lakh crore, which was raised to 4.5 lakh crore in June 2021 after the second wave of the pandemic hit the economy. Later, on August 17, 2022, the government enhanced the limit of the scheme to 5 Lakh crore, earmarking the additional 50,000 crore for enterprises in hospitality and related sectors, the worst hit by the pandemic.


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