Question

Why does small scale industry needs government support?

Answer 1

Small businesses contribute tremendously to the economy and are often termed as engines of job creation. They account for a huge chunk of the workforce in India. It becomes imperative for the government to support and provide the necessary resources to help them grow and sustain themselves. With this perspective, the government of India provides various opportunities through its ministries, bodies and programmes. Few of these are listed below.

Public Sector Banks: Banks are the most accessible source for financial support for SMEs. They offer a range of services and schemes including loans and credit facilities for various business needs. Some of these cover: Working capital finance available to all segments of industries and services; Corporate term loans for new ventures and also for expansion or renovation of existing businesses; Term finance and Deferred payment guarantee for capital expenditure or acquisition of fixed assets.