The Cabinet has approved a budget of USD 808 million for the Raising and Accelerating MSME Performance programme.

The Union Cabinet, chaired by Prime Minister Narendra Modi, today approved a World Bank-funded program on "Raising and Accelerating MSME Performance" for USD 808 million (Rs 6,062.45 crore) (RAMP). RAMP is a new program that will begin in FY 2022-23.

Expenditure: The scheme's overall outlay is Rs.6,062.45 crore (USD 808 million), with Rs.3750 crore (USD 500 million) coming from a World Bank loan and the balance of Rs.2312.45 crore (USD 308 million) coming from the Indian government (GoI).

Point-by-point details: "Raising and Accelerating MSME Performance" (RAMP) is a World Bank-supported Central Sector Scheme that supports the Ministry of Micro, Small, and Medium Enterprises' Corona Virus Disease 2019 (COVID) Resilience and Recovery Interventions (MoMSME).

The initiative aims to improve market and credit access, build institutions and governance at the federal and state levels, improve federal-state connections and collaborations, resolve late payments, and help MSMEs go green.

The RAMP initiative will strive to scale up implementation capacity and MSME coverage in States, in addition to strengthening the MoMSME's capability at the national level.

Major Impact, including potential for job creation and a number of beneficiaries: The RAMP program will address general and COVID-related difficulties in the MSME sector by enhancing the impact of existing MSME initiatives, particularly on the competitiveness front. Furthermore, the program will strengthen the underserved areas of capacity building, mentoring, skill development, quality enhancement, technical advancement, digitization, outreach, and marketing promotion, among others.

RAMP will be a job enabler, market promoter, financial facilitator, and help vulnerable sectors and greening programs through greater partnership with States.

In states where the presence of MSMEs is minimal, the program will result in greater formalization due to the greater impact of the RAMP-administered programs. These States' SIPs would serve as a road map for the development of a stronger MSME sector. RAMP will support the Atma Nirbhar Bharat mission by fostering innovation and improving industry standards and practices, as well as providing the necessary technical inputs to MSMEs to help them become more competitive and self-reliant, increase exports, reduce imports, and promote domestic manufacturing. 

RAMP would thus be a: "Policy Provider," enabling the delivery of more effective and cost-efficient MSME interventions to increase competitiveness and company sustainability, through enhanced capability for evidence-based policy and program design.

"Knowledge Provider" by benchmarking, sharing, and demonstrating best practices/success stories based on international experiences, and "Technology Provider" by providing access to high-end technology resulting in MSMEs' digital and technological transformation through state-of-the-art Artificial Intelligence, Data Analytics, Internet of Things (IoT), Machine Learning, and other technologies.

All 63 million businesses that qualify as MSMEs will profit directly or indirectly from the RAMP initiative, which has an influence across the country. However, a total of 5,55,000 MSMEs are targeted for improved performance, with an extension of the target market to include services and an increase of roughly 70,500 women MSMEs expected.

Following the early missions and studies, the program has selected two results areas: (1) Strengthening Institutions and Governance of the MSME Program, and (2) Support to Market Access, Firm Capabilities, and Access to Finance. Funds would flow into the Ministry's budget through RAMP, based on Disbursement Linked Indicators (DLIs), to support continuing MoMSME programs aimed at strengthening market access and competitiveness.

The World Bank will make funding available to RAMP only if the following Disbursement Linked Indicators are met:

• Implementing the National MSME Reform Agenda
• Accelerating MSME Sector Centre-State collaboration
• Enhancing the effectiveness of the Technology Upgradation Scheme (CLCS-TUS) Strengthening Receivable Financing Market for MSMEs
• Enhancing Effectiveness of Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE)
• "Greening and Gender" delivery
• Reducing the incidence of delayed payments

The creation of Strategic Investment Plans (SIPs), to which all states/UTs will be invited, is an important component of RAMP. The SIPs would comprise an outreach plan for identifying and mobilizing MSMEs under RAMP, identifying major bottlenecks and gaps, setting milestones, and projecting the required expenditures for interventions in priority sectors such as renewable energy, rural and non-farm businesses, wholesale and retail trade, village and cottage industries, and women entrepreneurs, among others.

An apex National MSME Council, led by the Minister for MSME, with representation from several Ministries and a secretariat, will be in charge of overall monitoring and policy oversight of RAMP. RAMP will be overseen by a program committee chaired by the Secretary of MoMSME, which will keep track of the program's specific deliverables. Furthermore, program management units at the national and state levels, comprised of professionals and experts competitively selected from the industry, would support MoMSME and States in implementing, monitoring, and evaluating the RAMP program on a day-to-day basis.

Covered States/Districts: All States/UTs will be invited to create SIPs, and applications submitted under SIPs will be funded depending on their evaluations. The funding would be based on objective selection criteria, and the SIPs would go through a rigorous process set up by MoMSME to be evaluated and approved.