Budget proposes Rs 5,000 cr for small units

The government on Monday proposed to give Rs 5,000 crore (Rs 50 billion) to Small Industries Development Bank of India for funding micro and small enterprises.

Finance Minister Pranab Mukherjee said Rs 4,000 crore (Rs 40 billion) was provided to SIDBI, last year, for refinancing incremental lending by banks to micro and small enterprises.

"For the year 2011-12, I propose to provide Rs 5,000 crore to SIDBI for the same purpose out of the shortfall of banks on priority sector lending targets," he said.

He added micro and small enterprises play a crucial role in furthering the objective of equitable and inclusive growth.

The 26-million micro, small and medium sector contribute 8 per cent of the country's GDP, 45 per cent of the manufactured output, and 40 per cent of its exports.