Ubharte Sitaare Fund

The Indian exporters, specifically the MSMEs, are recently gifted with the new Ubharte Sitaare Programme. The launching of the programme and the basics of the Ubharte Sitaare Fund are explained in the present article.

Background of Ubharte Sitaare Programme-

For the very first time, during Budget 2021, Finance Minister, Smt. Nirmala Sitharam announced the Ubharte Sitaare Programme (i.e., USP). As per the announcement, the programme basically aims to eradicate the constraints faced by the small and mid-sized companies in realizing their export ambitions. The said programme will be anchored by India Exim Bank along with SIDBI. Acting further, an Alternative Investment Fund, launched ‘Ubharte Sitaare Fund’, was successfully registered with the Securities and Exchange Board of India (SEBI) in July 2021. Here, India Exim Bank and SIDBI have contributed INR 40 Crore each. The total corpus of the fund is INR 250 Crore.

Launching of Ubharte Sitaare Fund-

Recently, on 21

• The companies having adequate technology, product or process will first be identified.
• The identified company will be supported via a mixture of equity; debt and technical assistance.
• Importantly, the support can also be extended to the underperforming companies having good export potential.

The objective behind the Ubharte Sitaare Programme-

The basic objective behind the introduction of the programme is listed hereunder-

1. To boost India’s competitiveness in selected sectors via finance and wide handholding support.
2. To support the units, who are unable to scale up their export operations due to lack of finance, having export potentials.
3. To identify and encourage the companies to have differentiated products, processes, or technology. Also, to enhance their export business.
4. To help the existing exporters to widen up their products and also target new export market.
5. To identify and ease various challenges, which hinder the exports, which are faced by the successful companies.

Nature of assistance available under the Ubharte Sitaare Programme-

Eligible companies will be supported by both financial as well as advisory services in the following manner-

1. Equity or equity-like instruments.
2. Term loans for technology or capacity up-gradation; modernization; research & development and balancing of production facilities by investing in any of the following activities-
   1. Tools, jigs, and fixtures;
   2. Testing and quality control equipment;
   3. Land and building;
   4. Machinery and equipment.
3. Technical assistance for-
   1. Product adaptation as well as improvement,
   2. Market development activities (including overseas travel for product or market development),
   3. Studies relating to sectors or regulations or markets or Techno-Economic Viability.

Eligibility criteria under Ubharte Sitaare Programme-

The eligibility criteria of the programme are highlighted hereunder-

1. The company should have a unique value proposition in process, products or technology. Notably, the same should match the global requirements.
2. The company (small and mid-sized) should have the ability to enter global markets. Such a company should have an annual turnover of up to INR 500 Crore.
3. The company should be fundamentally strong. Further, it should have adequate financials as well as outward orientation.
4. The company should be having-
   1. A good business model,
   2. Strong management capabilities, and
   3. Focus on the quality of a product.
5. Some of the suggestive sectors are-
   1. Aerospace,
   2. Automobiles and auto components,
   3. Chemicals,
   4. Capital Goods,
   5. IT & ITeS,
   6. Food Processing,
   7. Defense,
   8. Pharmaceuticals,
   9. Machinery,
   10. Textiles, and
   11. Precision engineering.