SME Growth Fund (SGF) and Integrated Transport & Logistics Authority (ITLA)

Source: NIE | Indian Express
Subject: Economy & Infrastructure

Context:

• The Union Cabinet approved a ₹10,000-crore SME Growth Fund (SGF), announced in the Union Budget 2026–27, to address the shortage of long-term equity capital for growth-stage SMEs.
• The Cabinet also approved an Integrated Transport & Logistics Authority (ITLA) to address fragmented planning and implementation across India’s transport infrastructure.

SME Growth Fund (SGF)

• The SGF aims to provide patient growth equity capital to viable and scalable SMEs that require long-term risk capital for expansion.
• The government will commit ₹10,000 crore through an Alternative Investment Fund (AIF) structure, which can help mobilise institutional capital.
• The fund will primarily target high-potential, growth-stage SMEs, with a majority allocation for small and medium manufacturing enterprises.
• The fund will focus on industrial clusters, including those located in Tier-II and Tier-III cities.
• The SGF will support expansion of manufacturing capacity, adoption of advanced technologies, strategic investments and acquisitions, entry into international markets and integration with global value chains.
• Greater availability of equity capital can reduce excessive dependence on debt financing and allow SMEs to invest in technology, skills and productive capacity.
• The fund is also expected to strengthen domestic supply chains, increase domestic value addition, improve export competitiveness and generate quality employment.

Integrated Transport & Logistics Authority (ITLA)

• ITLA will be established as a Special Purpose Vehicle (SPV)-based apex institution for coordinated transport and logistics planning.
• The authority seeks to address coordination gaps arising from the involvement of multiple ministries and agencies in roads, railways, ports, shipping, aviation, waterways and urban mobility.
• Its functions will include integrated transport planning, research and policy support, project appraisal, infrastructure monitoring and impact assessment.
• ITLA will promote multimodal connectivity and greater coordination among different transport modes and agencies.
• The initiative is expected to improve infrastructure efficiency, sustainability, project planning and implementation, and the overall logistics ecosystem.
• ITLA is linked to multimodal connectivity, logistics efficiency, infrastructure governance, PM Gati Shakti and integrated spatial planning.