Govt eyes covid-era credit scheme to help firms again

The scheme will expand cluster-based financing to support emerging manufacturing hubs

- Dhirendra Kumar

A move aimed at pushing manufacturing and exports, the Centre is exploring introducing an expanded version of the Emergency Credit Line Guarantee Scheme (ECLGS)—extending the pandemic-induced scheme amid the current uncertain global climate.

The proposal is part of a broader effort to ease financing for manufacturers, particularly those aligned with the Atmanirbhar Bharat scheme, four people familiar with the matter told Mint.

The plan includes enhancing credit flow to the collateral-free Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), that will offer bespoke loans for units approved under the production linked incentive (PLI) scheme.

It will also expand cluster-based financing to support emerging manufacturing hubs.

The idea is to support not only large manufacturers but also small businesses that face funding constraints in an uncertain global economic environment.