New Delhi, Feb. 21: The government is planning to evolve a mutual credit guarantee scheme for lending institutions to fund first generation entrepreneurs in the small-scale sector.
S. K. Tuteja, secretary in the ministry of small scale industries, said the launch of this scheme would enable FIs to hedge their risks while giving loans to first generation entrepreneurs. He said that the scheme would be operated through industry associations.
Addressing Indiasoft 2003 conference organised by the Electronic and Computer Software Export Promotion Council, Tuteja said Sidbi had also created such a fund. But there was a need to multiply such examples.
He further stated that against the backdrop of the fluctuating dollar, it is necessary for Indian companies to go in for some mechanism to hedge their risk by taking positions on the euro. There should also be a concerted effort to move towards a mix of currencies to absorb the shock if any one currency fluctuates on high band, he added.
Tuteja said the government would consider modifications that are required to enable the Indian companies to access the mix of currencies in the global market.