The Union Cabinet on Tuesday approved a Rs 10,000 crore commitment from the Centre to set up the SME Growth Fund. The decision was taken at a meeting chaired by Prime Minister Narendra Modi.The fund will provide long-term equity to small and medium enterprises that are ready to scale up. It was announced in the Union Budget 2026-27 as part of a package giving the MSME sector equity, liquidity and professional support.The government said most existing equity funds focus on early-stage firms and micro enterprises. That leaves a gap for growth capital for small and medium firms, which the new fund will fill.Most of the money will go to manufacturing-focused SMEs. The fund will also back firms in services, technology and innovation-driven sectors, including units in industrial clusters in Tier II and Tier III cities.Information and Broadcasting Minister Ashwini Vaishnaw said the fund would help build champion Indian companies that can compete globally, in line with the Viksit Bharat 2047 goal. The money will be routed through an Alternative Investment Fund.