Kerala gives $190 million aid to Covid-hit micro & medium industries

• Shubham
• 28 June, 2021

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By: Shubham Ghosh

THE government of Kerala has come up with a relief package for micro, small and medium enterprises (MSMEs) worth Rs 1,416 crore ($190 million) with the goal of helping them overcome the challenges posed by the Covid-19 pandemic.

State Industries Minister P Rajeev announced at a webinar that his department held in state capital Thiruvananthapuram on the occasion of the World MSME Day on Sunday (27) that the aid could be availed between July and December. He said a budgetary allocation of Rs 139 crore (around $19 million) would be used for subsiding the interest on loans to provide the aid.

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More subsidies for industrially backward districts
The support under the relief package includes India’s only Left-ruled state giving 50 per cent of the interest for loans taken by the MSMEs and increasing subsidy support for new enterprises from Rs 20 lakh ($26,934) to Rs 30 lakh ($40,401). For enterprises in industrially backward districts like Kasaragod, Wayanad and Pathanamthitta, the subsidy would be Rs 40 lakh. Relief will also be provided in interest rates and rentals to industries that operate under the Kerala Industrial Infrastructure Development Corporation and Kerala State Industrial Development Corporation.

Nano enterprise units, which have capital investment up to Rs 10 lakh ($1,3467), will also be given interest rate subsidy. Previously, subsidy was only for units that had a capital investment of up to Rs 5 lakh ($6,733). Those who took loans from bodies like Kerala State Industrial Development Corporation and could not pay back in times of the pandemic lockdown will not be labelled as ‘bad debt’. The state industrial development corporation announced special loan packages for industries in the pandemic-related health sector.

In May last year, too, the government of Kerala approved a special package of Rs 3,434 crore ($462 million) for the revival of the MSME sector hit by the pandemic.