ADB to support India’s small businesses

MANILA - The Asian Development Bank said Friday that it was providing up to $300 million in financing to help India develop and expand its micro-, small and medium-sized businesses.

The Manila-based bank said its board of directors approved a loan of $50 million and a partial credit guarantee of up to $250 million for the project.

The bank said micro-, small and medium-sized enterprises provide livelihoods to an estimated 65 million people in India, many of them women living in slums and other poor communities.

Industry is the second-largest employment sector in the country after agriculture.

The bank said the loan would go to the state-owned Small Industries Development Bank of India to fund enterprises that have become too large to tap traditional microfinancing but are still unable to access conventional bank funds.

The credit guarantee allows public-sector commercial banks to source medium- to long-term funds from international capital markets for lending to existing smaller-business clients.

The project was expected to benefit around 30,000 businesses and create at least 7,500 new jobs. It would also help develop domestic capital markets by exposing India’s banks to international markets, the bank said.