Kerala announces Rs 1416 crore COVID-19 package to support MSMEs

The Kerala government has announced a support package of Rs 1,416 crore for micro, small and medium enterprises (MSMEs) amid the COVID-19 pandemic-induced economic crisis. The announcement was made on June 27 at a webinar that was conducted as part of the World MSME Day by the Department of Industries and Commerce, Kerala. P Rajeev, Minister for Industries and Law, said that the scheme was introduced to support enterprises that are struggling due to COVID-19 regulations and a lockdown and also said that the government aims to help them back on their feet.

The support includes the government providing 50% of the interest for loans taken by MSMEs and increasing subsidy support for new enterprises from Rs 20 lakh to Rs 30 lakh. For enterprises in the industrially backward districts of Kasaragod, Wayanad and Pathanamthitta, the subsidy would be Rs 40 lakh. The support also includes more relief in interest rates and in rentals for industries that function under the Kerala Industrial Infrastructure Development Corporation (KINFRA) and Kerala State Industrial Development Corporation (KSIDC).

Apart from that, nano enterprise units, which have capital investment upto Rs 10 lakh, will be provided with interest rate subsidy. Earlier subsidy was only for units that had a capital investment of upto Rs 5 lakh. Those who took a loan from KSIDC and were not able to pay back during the lockdown will not be marked as 'bad debt'.

The minister said that the scheme will be available from July to December 2021. Major loan schemes were also announced by the minister to help MSMEs. He said that in the first phase, the KSIIDC will provide loans worth Rs 100 crore at 5% interest rate for 150 new entrepreneurs. The minister also said in the webinar that the first Pinarayi Vijayan government helped with the establishment of 68,000 new MSMEs that provided employment to around 2.42 lakh people.

round 2.42 lakh people.