Uttar Pradesh is the most populated state of India with over 200 million inhabitants. During the British rule, Uttar Pradesh was known as the United province of Agra and Oudh, it was renamed in the year 1950. Lucknow is its capital. The state has eighteen divisions and consists of 75 districts. Uttar Pradesh is the fourth largest state of India with an area of 240,928-kilometre square. In terms of economy, the state ranks fifth and contributes Rs. 17.94 lakh crore in the gross domestic product of the country. It is the leading state having the largest number of micro, small and medium enterprises. Presently there are approximately 44 lakh micro small and medium units that are operating. Still, the rate of unemployment and sick industries are very high.
Uttar Pradesh ranks 35th in terms of the Human Development Index. To overcome this problem and flourish the micro small and medium enterprise a loan worth Rs. 42,700 crore has been sanctioned by the government of Uttar Pradesh in the financial year 2020-21 to provide aid to the micro small and medium sector. Such a huge amount has been sanctioned for the first time in history in a year. This initiative by the government has opened a window of opportunities for many over 13 lakh micro small and medium enterprises to benefit from this, and in the private sector, it has also generated more than 65 lakh direct and indirect employment opportunities.
Mr Navneet Sehgal the additional chief secretary of micro small and medium enterprises recently reviewed the scenario of the sub committee of state-level bankers committee (SLBC) and edicted for disposal of pending application as soon as possible for acceptance and distribution at bank-level under numerous government schemes. These schemes would include Mukhyamantri Yuva swarozgar Yojana, Prime Minister Employment generation programme etc.
Did you know about 14 % of India’s micro small and medium enterprises sector is operational in Uttar Pradesh? So as the benefit of this decision reaches to each and every entrepreneur of Uttar Pradesh the Secretary of Union Ministry of Finance Mr Amit Agarwal has suggested that all commercial and National Bank for Agriculture and Rural Development (NABARD) should take all imperative steps. He also added that NBC’s (Non-Banking Companies) would also be included in the meeting, so they can also share their suggestions for improvement and enlighten about the progress too. Earlier the micro small and medium enterprise sector had to face an intense problem of inadequate finance.
The cost of even starting a small business can be daunting even if you have a splendid idea or an innovative product. Many entrepreneurs looked forward for help from lending institutions but many of these institutions are not interested in lending to small scale businesses as they find it much risky to lend them as compared to large companies. Therefore these lending institutions preferred to lend to big companies. Even if provided loans they came with Complex documentation, extensive Collateral, high rate of interest, short repayment tenure etc. This made the entrepreneurs to squash their dreams due to lack of credit but not anymore as the government of Uttar Pradesh is all set to help you.
This decision of the state government would undoubtedly help the MSMEs and would also increase the contribution towards the Gross Domestic Product of the country.
By Vanshika Tandon