CCEA approves CLCSS for Micro & Small Enterprises

22 Feb '08

2 min read

The Government approved continuation of the Credit Linked Capital Subsidy Scheme (CLCSS) for Micro & Small Enterprises during 11th Plan. The Cabinet Committee on Economic Affairs (CCEA) gave its approval here.

The Ministry of Micro, Small & Medium Enterprises has been operating for technology upgradation of Small Scale Industries under which 15% capital subsidy on the Institutional Finance was provided in specified sub-sectors/products for induction of well established and improved technologies approved under the scheme.

The validity of this scheme was upto 31.03.2007 i.e. the end of X Five Year Plan. During initial period of five years, very few units could take advantage of the scheme, therefore, the scheme was modified and made more attractive by increasing the rate of subsidy from 12% to 15% and raising the ceiling of loan from Rs.40 lakh to Rs. 1.00 crore in September, 2005. The period of validity which was expiring on 30 September, 2005 was also extended upto 31.03.2007.

Consequently, the Scheme became popular among Micro and Small Enterprises with about 2400 units availing financial assistance (term loan) of Rs.727 crore (approx.) from the financial institutions and utilising a subsidy of Rs.80 crore (approx.) under the Scheme in a period of one-and-a-half years of its operation. In addition, about 2400 more units have already obtained financial assistance of about Rs.833 crore and are awaiting subsidy clearance of about Rs.115 crore.

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