Prime Minister Narendra Modi announced a ₹10,000 crore SME Growth Fund to bolster small and medium enterprises, fostering modernisation, international trade, and regional growth across India.
Prime Minister Narendra Modi said on Tuesday that the Cabinet’s approval of a ₹10,000 crore SME Growth Fund marks a significant push for India’s micro, small and medium-sized enterprises, casting the initiative as part of a wider effort to build the country’s next generation of business leaders. In a post on X, Modi said the fund would give smaller firms a platform to expand, modernise and move into overseas markets, while also linking them more closely with global supply chains.
According to the official statement cited by the government and reported by The Economic Times, the fund is intended to supply long-term growth capital to high-potential small and medium enterprises that have already shown commercial viability and the capacity to scale. The money is expected to support businesses that want to invest in advanced technology, increase manufacturing output, make strategic acquisitions and strengthen their position in international trade. The government has said the scheme is meant to fill a persistent gap in risk capital, even as earlier measures have improved access to credit.
The Financial Express reported that the scheme forms part of the government’s broader “Creating Champion MSMEs” strategy, which was outlined in the Budget for 2026-27. Under that plan, the fund will be structured through an alternative investment fund, with the central government committing the full ₹10,000 crore. Most of the allocation will go towards manufacturing-focused enterprises, although firms in services, technology and innovation are also expected to benefit. The government has also said it will look to support companies based in industrial clusters in Tier-II and Tier-III cities, a move officials say could help spread industrial growth more evenly across the country.
The policy case for the fund is not only about financing, but also about industrial upgrading. News outlets including Asianet News and Nation Press reported that the initiative is designed to help businesses adopt newer production methods, improve productivity and become more competitive in export markets. The government believes that by backing firms with credible growth prospects, the scheme can nurture a stronger pipeline of Indian companies capable of becoming sector leaders. It also expects the programme to reinforce local supply chains, create higher-quality jobs and give the MSME sector a bigger role in manufacturing output, exports and innovation.
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