Uptick in MSME loans in UPUP industrial sector

Virendra Singh Rawat

The Micro, Small and Medium Enterprises (MSME) sector, which contributes 60 percent to Uttar Pradesh’s annual industrial output, clocked working capital and other loans worth more than Rs 6.5 trillion since 2017.

Moreover, the sector generated job and self employment opportunities to nearly 25 million youth.

According to the state government, MSME loans stood at roughly Rs 46,600 crore, Rs 57,800 crore, Rs 71,000 crore, Rs 73,800 crore, Rs 83,000 crore and Rs 1.5 trillion respectively in the financial years 2017-18, 2018-19, 2019-20, 2020-21, 2021-22 and 2022-23.

In the first nine months (Apr-Dec) of the current financial year 2023-24, the MSME sector loans were to the tune of Rs 1.73 trillion, which marks a jump of 172 percent compared to the full financial year target of about Rs one trillion.

UP is home to 9 million MSMEs. Now, the Yogi Adityanath government, which came to power in March 2017, is catalysing the sector for jobs and equitable socioeconomic growth to bolster its ‘Make in UP’ and $trillion economy goals.

The state has initiated an array of schemes to promote the MSMEs and make them globally competitive. While annual MSME exports are currently to the tune of Rs 1.5 trillion, the Yogi regime is targetting to double shipments to Rs 3 trillion in the coming 2-3 years.

To revive the sector, the UP government in 2018 launched One District One Product (ODOP) scheme to promote traditional handicrafts and indigenous industries.

UP is acclaimed for an array of traditional industries such as Varanasi for Banarasi silk sari, Bhadohi (carpet), Lucknow (chikan), Kanpur (leather goods), Agra (leather footwear), Aligarh (lock), Moradabad (brassware), Meerut (sports goods), Saharanpur (wooden products) etc.

However, they were losing market share owing to growing competition, working capital woes, lack of marketing support etc. In this context, ODOP was conceptualised to address such challenges and make them competitive for the local and offshore markets.

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