MSMEs have been waiting for government subsidies for more than a year

Micro, Small and Medium Enterprises (MSMEs) in Tamil Nadu, which have applied to District Industries Centers (DICs) for government subsidies, have been waiting for more than a year to get the benefit.

In Coimbatore district, the units that applied for subsidy under self-employment schemes till the end of 2023 have only received the subsidy. In Tiruppur district, applications received up to April 2024 received the subsidy.

“We estimate that nearly ₹100 crore worth of subsidy is yet to be paid in Coimbatore district,” said J. James, president of the Tamil Nadu Association of Cottage and Tiny Enterprises. It takes DIC officials six months or more to review and approve applications. While the amount is yet to be released for applications approved two years ago, there are applications awaiting approval at the district level, he said.

Official sources said that allocations for backward districts have increased at one point. However, it is Chennai, Tiruvallur, Kanchipuram, Coimbatore which require additional allocation due to industrial base in these districts. Further, the Tamil Nadu government is yet to announce the redefinition of MSME as announced by the Union government. If that happens, the amount required for subsidies will increase, they said.

The amount remaining in the districts is now used to pay fees for pending applications. But what the state needs is a higher allocation for subsidies to small and medium enterprises, officials said.

Tamil Nadu provides capital subsidies under five state government and two central government self-employment schemes in addition to the NEED scheme and interest subsidy schemes. If the government gives about ₹300 crore, the subsidy arrears can be cleared, they added.

S. Vasudevan of the Tamil Nadu Small and Tiny Industries Association (TANSTIA) said the state government should increase the budgetary allocation for the SME sector to ₹3,000 per year from the current ₹1,800.

Published – 20 Jun 2026 20:25 IST