Union Cabinet clears credit guarantee scheme for aviation, MSMEs

Union Cabinet has approved 10 major decisions worth Rs 1,52,000 crore, including initiatives for cotton productivity, sugarcane FRP, Emergency Credit Line Guarantee Scheme to address issues arising out of the West Asia conflict. Union Minister of Information and Broadcasting Ashwini Vaishnav on Tuesday informed media in New Delhi. he said that Cabinet approves two new semiconductor units worth Rs 3,936 crore under India Semiconductor Mission. According to Vaishnav, the Emergency Credit Line Guarantee Scheme (ECLGS) 5.0, will offer 100 per cent guarantee coverage for MSMEs and 90 per cent for non-MSMEs and airlines through the National Credit Guarantee Trustee Company Limited (NCGTC) to lending institutions.Loans for MSMEs and other businesses will have a tenure of five years, including a one-year moratorium, while airline loans will have a seven-year tenure with a two-year moratorium, he said.

VIDEO | Delhi: Union Minister Ashwini Vaishnaw says, "Cabinet approved 10 major decisions worth Rs 1,52,000 crore, including initiatives for cotton productivity, sugarcane FRP, Emergency Credit Line Guarantee Scheme to address issues arising out of the West Asia conflict."

(Full… pic.twitter.com/Aa5qjAFBHz

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The Cabinet Committee on Economic Affairs also approved a fair and remunerative price of Rs365 per quintal for sugarcane for the 2026–27 season at a basic recovery rate of 10.25 per cent, according to a separate statement. Farmers will receive a premium of Rs3.56 per quintal for every 0.1 per cent increase in recovery above this level, with a corresponding reduction for lower recovery.   The government has decided that no deduction will be made for mills where recovery is below 9.5 per cent, with such farmers to be paid Rs338.3 per quintal. 
The approved FRP is about 100.5 per cent higher than the estimated cost of production of Rs182 per quintal and is 2.81 per cent higher than the ongoing 2025–26 season. The decision is expected to benefit about 5 crore sugarcane farmers and around 5 lakh workers in sugar mills and related sectors.