MSME Ministry Allocates ₹13,554 Crore for PMEGP Expansion Over Five Years

The Ministry of Micro, Small, and Medium Enterprises (MSME) has been implementing the Prime Minister’s Employment Generation Programme (PMEGP), a credit-linked subsidy scheme, since 2008-09. Aimed at generating employment opportunities across the country, including Uttarakhand, the programme facilitates the establishment of microenterprises in the non-farm sector. The Khadi and Village Industries Commission (KVIC) acts as the national nodal agency for the scheme.

PMEGP provides Margin Money (MM) subsidies to beneficiaries, covering 25% of the project cost in rural areas and 15% in urban areas for General Category applicants. For Special Categories, including Scheduled Castes, Scheduled Tribes, Other Backward Classes (OBCs), Minorities, Women, Ex-Servicemen, Physically Handicapped, Transgender Persons, and Beneficiaries from the Northeastern Region, Hill and Border Areas, and Aspirational Districts, the subsidies are higher—35% in rural areas and 25% in urban locations.

The programme supports projects with maximum costs of ₹50 lakh for manufacturing and ₹20 lakh for service sectors. Since 2018-19, enterprises established under PMEGP or the MUDRA scheme can apply for a second loan to expand or upgrade their operations. Under this provision, the maximum project cost is ₹1 crore for the manufacturing sector and ₹25 lakh for the service sector, with subsidies of 15% (20% for beneficiaries in Northeastern and Hill areas).

As a centrally funded initiative, PMEGP does not allocate budgets on a state-wise basis. Instead, funds are distributed based on demand and the loans sanctioned by financial institutions. For the five-year period from 2021-22 to 2025-26, the government has approved an outlay of ₹13,554.42 crore for the scheme.

In Uttarakhand, 430 beneficiaries have received subsidies totalling ₹12.01 crore during the current fiscal year, 2024-25. However, 77 subsidy claims amounting to ₹8.08 crore remain pending in the state.

This programme continues to empower individuals and foster economic growth by enabling the creation of microenterprises and supporting existing small businesses in their expansion efforts.