Sitharaman urges SIDBI to support MSMEs through risk-sharing role

Union Finance Minister Nirmala Sitharaman on Monday said the Small Industries Development Bank of India (SIDBI) should evolve into a “market-maker” and risk-sharing partner for micro, small and medium enterprises (MSMEs) and the broader startup ecosystem, while asserting that India’s economy remains robust despite global uncertainties and external pressures.Addressing the 37th Foundation Day event of SIDBI in Mumbai, Sitharaman highlighted the crucial role of MSMEs and startups in driving India’s economic growth and called for stronger institutional support to improve credit access, innovation financing and entrepreneurship development.

VIDEO | Mumbai: Finance Minister Nirmala Sitharaman (@nsitharaman) attends the 37th foundation event of Small Industries Development Bank of India (SIDBI).

(Full video available on PTI Videos - https://t.co/n147TvrpG7) pic.twitter.com/FuByeuaU4K

— Press Trust of India (@PTI_News) May 25, 2026

She said SIDBI should move beyond being merely a refinancing institution and become an active partner in strengthening the MSME and startup ecosystem through greater risk participation and market development initiatives.The Finance Minister also pushed back against what she described as a “pessimistic and cynical narrative” surrounding India’s economic progress, saying such fearmongering unfairly ignores the achievements and contributions of ordinary Indians.“It is not right to decry our own achievements amid challenges posed by the West Asia crisis,” Sitharaman said, adding that attempts to create negativity around the economy were inaccurate and harmful to public confidence.
Sitharaman maintained that India continues to remain one of the world’s fastest-growing major economies despite heightened geopolitical tensions and global economic uncertainty.

#WATCH | Mumbai | At Small Industries Development Bank of India (SIDBI) event, Union Finance Minister Nirmala Sitharaman says, "Since 1990, SIDBI has been working as a premier financial institution for the promotion, financing, and development of MSMEs. It is a unique… pic.twitter.com/2R0PIODiSV

— ANI (@ANI) May 25, 2026

Citing economic indicators, she said gross GST collections during 2025-26 crossed Rs22 lakh crore, registering an 8.3% year-on-year increase despite tax rationalisation measures introduced in September 2025.She also pointed to rising tractor, passenger vehicle, two-wheeler and three-wheeler sales, growth in life insurance premiums, declining non-performing assets in public sector banks and broad-based credit expansion as signs of sustained economic momentum.
Sitharaman noted, retail credit growth stood at 18.1%, agriculture lending rose 15.5%, while MSME credit expanded 18.2% during the fiscal year, reflecting continued demand and banking sector support across key segments of the economy.Sitharaman said most of India’s economic challenges stem from external factors, particularly pressures linked to imports of gold, fuel and fertilisers.“Challenges are more external — foreign exchange is needed for gold, fuel and fertiliser imports,” she said.On fuel pricing, Sitharaman disclosed that the government’s decision to reduce excise duties on petrol and diesel would lead to a revenue impact of nearly Rs1 lakh crore.She said the duty cuts were aimed at providing relief to consumers and businesses amid volatile global energy markets and the continuing crisis in West Asia.

#WATCH | Mumbai | Union Finance Minister Nirmala Sitharaman says, "The government is estimated to take a revenue impact of over Rs one lakh crore in 2026 after the central excise duty cut on petrol & diesel. To shield citizens from a steep rise in global crude prices, the central… pic.twitter.com/tvytC8YpAe

— ANI (@ANI) May 25, 2026

The remarks came even as oil marketing companies raised fuel prices for the fourth time in 10 days on Monday. Since May 15, cumulative increases in petrol and diesel prices have reached nearly Rs7.5 per litre.Sitharaman also urged public sector undertakings to ensure timely payments to MSMEs and strictly comply with the mandated 45-day payment timeline, stressing that delayed payments adversely affect the liquidity and operations of small businesses.Sitharaman said strengthening MSMEs, startups and domestic manufacturing capacities would remain central to India’s long-term economic growth strategy.