Cabinet OKs INR 100 bln to set up SME growth fund for equity investment
This story was originally published at 15:42 IST on 6 October 2026
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--Cabinet allocates INR 100 bln for SME growth fund
NEW DELHI – The Cabinet Committee on Economic Affairs Tuesday approved the establishment of small and medium enterprises growth fund for direct equity investments in such enterprises, with an investment of INR 100 billion. With this, the government aims to support the entry of small and medium enterprises into international markets, integration into global value chains, and stronger export competitiveness, Information and Broadcasting Minister Ashwini Vaishnaw said.
"Under the initiative, the Government of India will provide an aggregate commitment of Rs.10,000 crore (INR 100 billion) to the Alternative Investment Fund (AIF) established under the SGF framework," finance ministry said in a press release. The small and medium enterprises growth fund will address the challenge of growth capital shortage and will provide long-term equity capital to high-potential small and medium enterprises, he said during a media briefing. The funds will enable enterprises to scale operations, expand manufacturing capacity, and adopt advanced techologies.
"The majority of the fund's allocation will go towards manufacturing-focused small and medium enterprises," Vaishnaw said. It will also support enterprises across services, technology, innovation-driven sectors, and strategic value chains.
The government has commitment the fund to build globally competitive enterprises and advance Viksit Bharat 2047 as announced in Union Budget 2026-27. Fund will also consider small and medium enterprises' operating in industrial clusters in Tier-II and Tier-III cities. "Investments across industrial clusters, including those in Tier-II and Tier-III cities, will support balanced regional industrial development, reinforce local supply chains, and generate high-quality employment opportunities," the ministry said. End
Reported by Shweta
Edited by Akul Nishant Akhoury
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