Watch: Budget 2024 | What’s in it for MSMEs and manufacturing sector?
The MSMEs and labour-intensive manufacturing sector have a reason to cheer as the budget presented by the Finance Minister on Tuesday has a special focus on these units. The sector is going through a crisis phase for multiple reasons. The export market is just reviving for sectors such as textiles, and MSMEs in the manufacturing space have been asking for various support measures.
The incentives announced for new jobs are expected to bring down the labour cost by 2% or so. Changes in customs duty for copper and ferrous scrap will give a 10%–12% cost advantage across the supply chain, say foundry owners. The government has proposed a credit guarantee scheme to facilitate term loans to MSMEs for the purchase of machinery and equipment without collateral or a third-party guarantee. The limit of Mudra loans will be enhanced to ₹20 lakh from the current ₹10 lakh, and MSMEs will get access to credit during the stress period through a guarantee from a government promoted fund.
