The government on Tuesday announced an Emergency Credit Line Guarantee Scheme (ECLGS) with an outlay of Rs 18,100 crore to provide relief for MSMEs and airlines impacted by the West Asia conflict.
The scheme — expected to help in providing additional credit flow of Rs 2.55 lakh crore, including Rs 5,000 crore for airlines — was approved by the Union Cabinet on Tuesday.
Briefing the media on the Cabinet decisions, Information and Broadcasting Minister Ashwini Vaishnaw said the ECLGS 5.0, having an outlay of Rs 18,100 crore, would help airlines as well as MSMEs impacted by the West Asia crisis.
“The scheme has been brought to address the stress in MSME and airline sectors due to the West Asia conflict,” he said.
According to the minister, passenger airlines would be eligible for up to 100 per cent of peak credit up to Rs 1,500 crore while institutions can access up to 20 per cent of fund-based working capital up to Rs 100 crore.
In an official release, the government said the scheme aims to enable businesses to tide over the challenges arising from the West Asia conflict.
“Additionally, this is expected to help businesses maintain their operations, protect jobs, and sustain supply chains. The proposed credit guarantee scheme is a major step to help businesses, particularly MSMEs and airline sector, to ensure their additional working capital needs are catered by the banks and financial institutions,” it said.
By providing timely liquidity, the government said the scheme would sustain the businesses and prevent job losses. It will also promote uninterrupted domestic production and maintain the resilience of the ecosystem.
