Consider the following statements with reference to India: 1. According to the 'Micro Small and Medium enterprises Development (MSMED) Act, 2006, the 'medium enterprises' are those with investments in plant and machinery between Rs. 15 crore and Rs. 25 crore. 2. All bank loans to the Micro, Small and Medium Enterprises qualify under the Priority sector. Which of the statements given above is/are correct?

QUESTION

Medium

Economy

Prelims 2023

Consider the following statements with reference to India:

According to the 'Micro Small and Medium enterprises Development (MSMED) Act, 2006, the 'medium enterprises' are those with investments in plant and machinery between Rs. 15 crore and Rs. 25 crore.
All bank loans to the Micro, Small and Medium Enterprises qualify under the Priority sector.

Which of the statements given above is/are correct?

Select an option to attempt

Explanation

Statement 1 is incorrect: As per the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, Medium Enterprises are those for which the investments in Plant and Machinery are not more than Rs. 50 crore of and turnover not more than Rs. 250 crore.
Statement 2 is correct: All bank loans to MSMEs that meet the criteria outlined in the Master Direction on “Priority Sector Lending (PSL) – Targets and Classification” dated September 4, 2020 are eligible to be classified as priority sector lending.

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