Banks have sanctioned loans worth more than ₹35,000 crore under the Emergency Credit Line Guarantee Scheme (ECLGS) 5.0 for micro, small and medium enterprises (MSMEs), airlines and other businesses affected by the ongoing West Asia conflict, a senior government official said on Monday. 

Addressing an inter-ministerial briefing, Manoj Muttathil Ayyappan, Joint Secretary in the Department of Financial Services, said lenders had approved around 80,000 applications amounting to ₹35,194 crore as of May 29. Guarantees worth ₹15,720 crore have also been issued under the scheme.  

The ECLGS 5.0 scheme, approved by the Union Cabinet on May 5, aims to facilitate additional credit flow of ₹2.55 lakh crore, including ₹5,000 crore earmarked for airlines impacted by the geopolitical crisis in West Asia.  

"Since we have reached a good number, it is expected that the customers would benefit from the scheme," Ayyappan said, adding that the application process is fully digital and can be completed within five to seven days.  

He said the scheme has been designed to be liberal in nature to maximise participation and support affected businesses. "Only customers classified as SMA-2 as on March 31, 2026, have been kept outside the scheme," he said, adding that outreach programmes are being conducted nationwide to improve awareness and uptake.  

Under ECLGS 5.0, airlines can avail additional credit of up to 100% of their peak outstanding credit, subject to a cap of ₹1,500 crore. Eligible institutions can access up to 20% of their fund-based working capital limits, capped at ₹100 crore.  

The scheme seeks to provide timely liquidity support to businesses facing temporary cash flow disruptions due to the West Asia crisis while helping preserve jobs, maintain domestic production and ensure economic resilience.  

Banks are permitted to extend additional credit of up to 20% of existing working capital facilities under the programme.  

The scheme provides 100% credit guarantee coverage for MSMEs and 90% coverage for non-MSMEs through the National Credit Guarantee Trustee Company Ltd (NCGTC) against defaults arising from the additional credit extended by member lending institutions.  

The loan tenure for airlines has been fixed at seven years, including a two-year moratorium period, while MSMEs and non-MSMEs will receive loans with a five-year tenure, including a one-year moratorium.  

The government launched ECLGS 5.0 after MSMEs and airlines came under financial pressure following the escalation of the West Asia conflict in February. The original ECLGS programme was introduced in May 2020 to mitigate the economic impact of the Covid-19 pandemic.  

Vigilance, enforcement mechanisms in LPG sector

Meanwhile, Sujata Sharma, Joint Secretary in the Ministry of Petroleum and Natural Gas, said states and Union Territories have been asked to strengthen vigilance and enforcement mechanisms in the LPG sector.  

She said 10 FIRs related to LPG irregularities had been registered over the past three days, leading to the arrest of three individuals. Oil marketing companies also carried out surprise inspections at 460 LPG distributorships, with penalties imposed on 42 distributors.  

Sharma added that since March, around 8.56 lakh piped natural gas (PNG) connections have been activated, infrastructure has been created for an additional 2.96 lakh connections, and 8.78 lakh new consumers have been registered.  

Fertiliser stocks higher than conventional level of 33%

Separately, Aparna Sharma, Additional Secretary in the Department of Fertilisers, said fertiliser stocks for the upcoming Kharif season are currently maintained at 51% of requirements, significantly higher than the conventional level of 33%.  

She said domestic fertiliser production has reached 104.81 lakh metric tonnes so far, while imports of 27.62 lakh metric tonnes have arrived in the country, reflecting proactive inventory planning and logistics management by the government.