Textile, leather, engineering clusters take maximum loan sanctions under ECLGS scheme

Textile, engineering, leather and infrastructure clusters of Tirupur, Coimbatore, Kanpur and Durgapur have emerged as the torch bearers for government’s initiative to improve investment climate in the country amidst the Covid 19 pandemic.

These industrial clusters have become the first among others to promise revival of the economy by putting in additional investments into their respective businesses taking advantage of the Rs 3 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) announced by the government for meeting the liquidity needs of the sector in the present crisis.

Of the Rs 599.12 crore loans disbursed by public sector banks to the micro small and medium enterprises (MSMEs) under the scheme, the four industrial clusters have taken the lions share of the money at about Rs 360 crore. Among the four, with Rs 143.76 crore sanctioned to 1,758 accounts, the engineering industrial cluster of Coimbatore has taken the maximum sanctions from banks.

In a tweet, the office of Finance Minister Nirmala Sitharaman said, “As of June 8 2020, #PSBs have sanctioned loans worth Rs 1,109.03 cr for #MSME hubs in 12 States under the 100% Emergency Credit Line Guarantee Scheme, of which Rs 599.12 cr has already been disbursed to 17,904 accounts.”

In terms of sanctions, gems and jewellery cluster of Surat, and industrial clusters at Tumkur in Karnataka, Rajkot, Durg in Chhattisgarh, Medak in Telangana, Kanpur, Coimbatore, Tirupur have also emerged as destinations that have most accounts and amounts for getting bank money under ECLGS.

Surprisingly, the industrial cluster of Jalandhar has maximum 3,388 accounts that had got loan sanctions from banks but the amount is a meagre Rs 25 lakh. On the other hand, with over 2,000 accounts, Durgapur has taken a lions share of bank loan sanctions at over Rs 61 crore.

The clusters in Nashik, Nagpur, Tumkur, Surat, Rajkot, Durg, Rourkela, Medak , Aligarh are other centres that have got major portion of bank loans under the scheme. As most of these are industrial clusters, the indications suggest that businesses here are looking to come out from the present crisis and grow.

The ECLGS scheme is the biggest fiscal component of the Rs 20-lakh crore 'Aatmanirbhar Bharat' package announced by the finance minister last month..