The share of Micro, Small and Medium Enterprises (MSME) is expected to increase up to 50% in India's total exports by the end of 12th Plan (2012-2017) from 36% now on account of increasing demand from the western and emerging markets. The US and Europe which together account for 60% of the country's total exports.
MSME’s Minister K H Muniyappa said that adequate credit is paramount to the success of micro and small units and the government is implementing the Credit Guarantee Scheme to ensure better flow of credit to these enterprises by minimizing risk perception of banks/financial institutions in lending without collateral security.
Further, the scheme provides guarantee cover of up to 85% on collateral free credit facility to new and existing units for loans up to Rs 100 lakh. By adding further, the minister said, till April 2013, more than 11 lakh proposals have been approved under the scheme providing guarantee cover for total sanctioned amount of Rs 54,322 crore.
Moreover, the government has set up a six-member inter-ministerial committee under the chairmanship of Finance Secretary R S Gujral which will suggest measures to boost the MSME exports. The sector contributes around 8% of the country's GDP, 45% of the manufactured output and provides employment to over 8 crore persons engaged in over 3.6 crore units, producing more than 6,000 products.