India Approves ₹10,000 Crore Fund for Manufacturing, Tech SMEs
The Indian government has approved a ₹10,000 crore (approximately $1.2 billion) SME Growth Fund to provide growth credit capital to small and medium enterprises in manufacturing and technology sectors.
The Union Cabinet has approved the establishment of a ₹10,000 crore (approximately $1.2 billion) SME Growth Fund (SGF) to offer growth credit capital to small and medium enterprises (SMEs).
Announced in the Budget 2026-27, the fund is intended to invest in high-potential SMEs across manufacturing, services, technology, and innovation-driven sectors, with a majority of the allocation directed towards manufacturing enterprises. The initiative aims to broaden access to equity and liquidity for SMEs.
This fund is designed to fill a gap in growth capital for SMEs, as many existing funds focus on early-stage or micro-enterprises. The SGF will channel government capital into alternative investment funds that will subsequently invest in promising Indian businesses.
The SGF forms part of a broader government push to support the MSME sector. It will also support SMEs in industrial clusters in Tier II and Tier III cities, aiming to strengthen local supply chains and create jobs. The government has also proposed further measures, including enhancements to the Trade Receivables e-Discounting System (TReDS) and credit guarantee mechanisms.