A PRESENTATION ON SCHEMES PROGRAMMES OF MINISTRY

A PRESENTATION ON SCHEMES / PROGRAMMES OF MINISTRY OF MSME in Uttar Pradesh 1

Growth of MSEs in Uttar Pradesh Year / Stat. 2004 -05 No. Of units 1938524 2005 -06 2006 -07 Growth rate (%) 2027020 2116791 28. 98 Employment 1219059 1267525 1319395 26. 67 Investment 21858 23407 24852 47. 34 40513 46927 55153 117. 26 (Rs. Cr. ) Production (Rs. Cr. ) 2

IMPORTANT SCHEMES • Credit Guarantee Scheme • Credit Linked Capital Subsidy Scheme • ISO-9000/14001 /HACCP Assistance • Integrated Infrastructural Development • Micro and Small Enterprises Cluster Development Programme • Technology Development Centres 3

Credit Guarantee Fund Scheme for Micro and Small Enterprises Launched on 30 August 2000 and became operational with effect from 1 January, 2001 • • Operated by the CGTMSE • Provides guarantees to MLIs for loans sanctioned without collateral and/or third party guarantee up to Rs. 50 lakh • Guarantee cover upto 80% 4

Proposals approved for U. P. under CGS 2005 -06 Proposals Approved Loan Amount (In lakh) 2006 -07 2007 -08 1055 1109 1539 2672. 30 3636. 91 5166. 15 5

Credit Linked Capital Subsidy Scheme (CLCSS) • Technology upgradation of MSEs • Nodal Agencies & PLIs--- SIDBI, NABARD, SBI, Canara Bank, BOB, PNB, BOI, Andhra Bank, SBBJ, , etc. • Provide 15% capital subsidy for improved technology --- loan up to Rs. 100 lakh • Coverage : - 48 products/sub-sectors 6

Units Assisted (as on 31 March 2008) Units assisted Amount reimbursed (Rs. Cr. ) 6600 229 180 4. 11 All India UP 7

ISO-9000/14001 /HACCP Scheme • Reimbursement to the extent of 75% of the expenditure (max. Rs. 75000) • All MSEs that have filed EM eligible • All India : Units Assisted : 17067 Amount Disbursed : Rs. 84. 99 Cr. . No. Of beneficiaries in U P 1318 8

Integrated Infrastructural Development (IID) Scheme Provide developed sites with basic infrastructural facilities like power, water, drainage, roads, common facilities, etc • • Project cost --Rs. 5 crore • Central Government provides 40 percent grant up to a maximum of Rs. 2 Cr. 9

Integrated Infrastructural Development (IID) Scheme (Contd. ) • 106 projects sanctioned • Scheme also provides for upgradation of infrastructure in old industrial estates • Subsumed in MSE-CDP 10

IID Centres in Uttar Pradesh IID Centre Implementing Agency Project Cost (in Cr. ) GOI Grant (in Cr. ) Status 1 Bhadohi BIDA 5. 94 2. 00 Completed 2 Banther (Unnao) UPSIDC 5. 50 1. 83 Completed 3. Kosi-Kalan (Mathura) UPSIDC 7. 00 1. 62 Completed 4. Etah UPSIDC 5. 15 1. 79 Completed 5 Kursi Rd. (Barabanki) UPSIDC 5. 06 1. 22 Completed 6 Baghpat UPSIDC 5. 48 1. 30 Completed 7 Masoori (Ghaziabad) UPSIDC 5. 09 1. 25 Completed 8 Ram Nagar (Chandouli) UPSIDC 5. 67 1. 17 Under progress 11 S No.

Micro and Small enterprises Cluster Development Programme (MSE-CDP) • Includes diagnostic study, trust building, development of skills, marketing & export, technology upgradation of enterprises, formation of consortia, setting up CFCs, etc. • 386 clusters taken up for development • Guidelines revised in March 2006 to i) Raise the project cost to Rs 10 Cr. and GOI assistance up to 80% ii) Introduce PPP mode iii) Enable State Governments/Agencies/SPVs to implement projects iv) Enable assistance for infrastructure upgradation 12 • Special measures for women-owned enterprises

Clusters Assisted Uttar Pradesh in the Last 2 Years Implementing Agency Clusters Amount taken for soft Sanctioned interventions (2007 -08) Government of U. P Clusters taken Amount for diagnostic sanctioned studies (2007 -08) 09 47 (2007 -08) MSME-DI Kanpur MSME-DI Allahabad MSME-DI Agra MSME TDC Firizabad NIESBUD NIMSME CIPET Lucknow 19. 35 (Amount sanctioned in 2006 -07) Under Process 06 02 9. 40 6. 28 05 0 2. 50 - - - 03 01 1. 50 2. 25 - 07 22 03 15. 75 37. 12 5. 06 13

MSME Technology Developmentt Centres in U P -Assistance to MSEs in product and process development -Testing, calibration and common facility services -Skill development training programmes -Consultancy services Name of Research Number of persons Number of units Institute PPDC, Agra CDGI, Ferozabad FFDC, Kannauj PPDC, Meerut CFTI Agra trained in 2007 -08 913 146 2225 665 3079 benefited 1274 542 1015 506 462 14

NATIONAL MANUFACTURING COMPETITIVENESS PROGRAMME (NMCP) • Formulation of NMCP announced in 2005 -06 Budget, to support MSMEs • Its Role is to : Ø Ensure MSME Sector Grows at a Healthy Rate Ø Draft ‘National Strategy for Manufacturing’ • Ten Schemes drawn up under NMCP at Rs. 956 crore • Implementation of Schemes to be in PPP Mode • Programme deals with Firm-Level Competitiveness, addressing issues of Competitiveness against Global Challenges 15

NATIONAL MANUFACTURING COMPETITIVENESS PROGRAMME - COMPONENTS Full Name of the Scheme Short Name • Marketing Support/Assistance to MSMEs • Support for Entrepreneurial and Managerial Development of MSMEs • BAR CODE INCUBATORS Enabling manufacturing sector to be competitive through quality management standard and quality technology tools QMS/QTT • National Campaign for Investment in Intellectual Property IPR • National Programme on Application on Lean Manufacturing LEAN • Mini Tool Rooms proposed to be set up by Ministry of MSME MTR • Promotion of ICT in Indian Manufacturing Sector • Technology and Quality Upgradation support for MSMEs TECH UP • Design Clinic Scheme to bring design expertise to the Manufacturing sector • ICT DESIGN Marketing Assistance/SMEs and technology upgradation activities - Ministry of SSI in co-operation with TIFAC/CSIR C WATCH 16

NMCP – New Activities (Over next 4 years) Rs. Crore No Name of the Component 4 years Total Project Cost GOI Share 2008 -09 GOI Share (RE) 1 BAR CODE 1. 50 0. 20 2 INCUBATORS 79. 45 66. 50 8. 00 3 QMS / QTT 50. 00 40. 00 7. 00 4 IPR 55. 00 50. 00 8. 00 5 LEAN 280. 80 246. 00 20. 00 6 MTR 210. 00 135. 00 20. 00 7 ICT 207. 00 104. 00 6. 00 100. 00 6. 00 Opt. I * Opt. II 8 TECH UP 93. 50 78. 60 10. 00 9 DESIGN 50. 00 41. 00 5. 00 10 C WATCH 53. 00 26. 50 4. 00 973. 25 745. 10 88. 20 TOTAL 17 * Option I is kept on hold with TPC Rs. 1080. 25 cr, GOI Share Rs. 789. 10 cr and RE Rs. 88. 20 cr.

STATUS OF NMCP SCHEMES S. No. EFC Clearance RE 2007 - 08 BE 2008 - 09 Operational from 01/6/07 0. 1 0. 20 ii Incubators (79. 45) 0. 1 8. 00 iii QMS / QTT (50) 0. 1 7. 00 iv IPR (55) 0. 1 8. 00 v Lean (280. 80) 0. 1 20. 00 vi MTR (210) 0. 1 20. 00 0. 1 6. 00 0. 1 10. 00 ix Design (50) 0. 1 5. 00 x C Watch (53) 0. 1 4. 00 i Name of Scheme (Cost of Scheme) Bar Coding (1. 5) vii ICT (100) viii TECH UP (93. 50) Rs. in Crore 18 Total 01. 0 88. 20

TECHNOLOGY STRATEGY: Upcoming BAR CODE • Existing MDA Scheme modified to popularize Bar Coding • Bar Coding an effective Tool to improve marketability • Reimbursement allowed : ØOne Time Registration Fee Ø 75% of Annual Fee for 1 st 3 years (Bar Code Certificate) • 1400 SMEs to be Benefitted during 11 th FY Plan 19

1/2 TECHNOLOGY STRATEGY: Upcoming INCUBATORS • Object : ØAssist Incubation of Innovative Ideas ØEncourage Ideas to Become SMEs • Total Project cost – Rs. 79. 45 cr ØGOI Share – Rs. 66. 50 cr Ø 2008 -09 BE – Rs. 8. 00 cr 20

2/2 TECHNOLOGY STRATEGY: Upcoming INCUBATORS • 100 BIs to be Located in R&D Institutes @ 25 p. a • Govt. Grant (Max. 85%) = Rs. 4 to 8 lakhs per Idea • Each BI to Assist 10 Ideas / Units • R&D Institutions and BIs to Suggest & Nurture • Can also be Dovetailed with other Schemes • Tie Up ‘Successes’ with VC / Angel Funds • Publicity & Proposals Essential for Success 21

Mini Tool Rooms • Establishment of MTRs in. PPP mode • Model 1: pvt enterprise led-viability gap funding – 40% • Model 2: pvt enterprise +State Govt-viability gap funding-40% • Model 3: state govt. entity(land+bldg~6 cr) +Centre — 9 cr • T. A. s----RFPs to issue • Go. I allocation-Rs 135 ---establish min. 15 MTRs 22

1/3 TECHNOLOGY STRATEGY: Upcoming QUALITY MGT. SYSTEMS / TOOLS ( QMS / QTT ) • MSME’s ISO Reimbursement Scheme Successful • QMS: ISO-22000 (Food), ISO-18000 (Health) etc. • QTT: Introduce proven Tools like 6 -Sigma, 5 -S, Kaizen, TPM, TQM etc. • Total Project cost – Rs. 50. 00 cr (Go. I = 80%) Ø 2008 -09 BE – Rs. 7. 00 cr • EFC has Cleared. Guidelines being Finalized 23

Schemes of NSIC • Marketing Support • NSIC’s Single Point Registration Scheme (SPRS) • Technology Support • Training Programmes 24

MARKETING SUPPORT 1. Single Point Registration Scheme (SPRS) under Govt. Stores Purchase Programme 2. Consortia & Tender Marketing 3. Raw material Distribution 4. Exhibitions & Buyer Seller Meets 25

Consortia and Tender Marketing 1. NSIC submits bids on behalf of MSEs against the tenders of Government Deptts/PSUs. 2. Orders are farmed out to MSEs for execution. 3. Raw material assistance is granted to such units. 4. Bills are realized by NSIC for payment to supplier MSEs. 5. Part payment upto 70% is made to supplier MSEs before realization of bills 26

Raw Material Distribution 1. NSIC distributes basic raw materials like Aluminum, Copper and Iron & Steel to MSEs in relatively smaller quantities and at competitive rates 2. Tie ups with bulk Raw material manufactures e. g NALCO, BALCO, IOC, SAIL, RINL, Hindustan Zinc Ltd. , Hindustan Copper Ltd etc. 27

Exhibitions & Buyer Seller Meets 1. To help MSEs to exhibit their products in national and International exhibitions § About 60 exhibitions organised/participated in a year. § Assiatance granted as per Government rules i) Upto 60% concession on stall rental. ii) Upto 75% reimbursement in fare upto Rs. 40, 000/-. iii) Freight reimbursement upto Rs. 15, 000/- (Total Assistance not to exceed Rs. 1. 25 lac) 28

4. Buyer Seller Meets organized between Govt. Deptts. / PSUs and MSEs. 5. Vendor development of Micro and Small Enterprises for Govt. Deptts. / PSUs. 29

TECHNOLOGY SUPPORT NSIC offers small units the following technology support services through its Technical Services Centres and Extension Centres: • • • Material equipment testing facilities through accredited laboratories Training on Product design through CAD Common facility support in machining through CNC. Energy and environment services at selected centres Testing facility for electrical equipments Classroom and practical training for skill upgradation 30

TRAINING PROGRAMMES - Training Courses conducted by NSIC Technical Services Centres Chennai Footwear Manufacturing, Electrical Gadgets Maintenance, Motor Rewinding etc. Howrah Refrigeration & AC repair, Welding, Fitter, Automobile repairing, Material Testing etc. Hyderabad Electronic assembly line, PC Hardware Maintenance, High end software development courses, New Delhi CAD/CAM, CNC operations, Material testing, Draftsman, Machinist, Turner, S/W courses etc. Rajkot Energy Audit, Diesel Engine Testing, CNC milling, Office Automation etc. 31

Credit Support 1. Tie-ups with various banks for sanction of loans (United Bank of India, UCO Bank, Oriental Bank of Commerce, Bank of Maharashtra, Central Bank of India, HSBC, AXIS Bank and YES Bank) 2. Help provided in preparation of credit proposals of MSEs for onward submission to banks for sanction of loan 3. Raw Material provided on easy credit terms against Bank Guarantee and advance against bills under tender marketing 32

Coverage under KVI sector ---UP • X Plan • 50 regd instns of KVIC/B • 15. 06 lakh jobs (3. 43 lakh in Khadi & 11. 03 lakh in VI) • Production : Rs 7572. 87 cr • 9062 projects assisted & 2. 62 lakh jobs created under REGP 33

KVI sector in UP • REGP: 1243 projects+ 31, 000 jobs (07 -Feb 08) • ISEC –Subsidy –Rs 4. 74 crore (06 -07) • Marketing Rebate –Rs 31. 10 crore (06 -07) • PRODIP-57 projects (since 02) • SFURTI-13 clusters (4 Khadi+ 9 VI) 34

Merger of PMRY and REGP to form PMEGP • PMRY (introduced in 1993) extended to cover rural areas in 1994 -95. No more exclusivity of PMRY. There is overlap with REGP. • Subsidy levels too low in PMRY – illustrated in separate slide/s. • Higher unit cost of projects permissible under REGP (Rs. 25 lakh as against Rs. 5 lakh under PMRY, that too from 2007 -08) • Many States have schemes with more attractive benefits/assistance/interventions – Some examples • Bangla Swanirbhar Karma Sansthan Prakalpa (West Bengal) • Sri Vajpayee Bankable Yojana (Gujarat) • Chief Minister’s Rozgar Yojana (Uttar Pradesh) • Recovery rates of Bank loans are much lower in PMRY (32 -38%) as compared to REGP (68 to 88%) 35 35

Merger of PMRY and REGP to form PMEGP Salient Modifications • Scheme Design – ‘apriori’ allocation of targets of margin money subsidy amongst marginalised sections of beneficiaries. – Higher subsidy to lowest cost range of projects/units to marginalised sections. – Earmarking higher proportion of projects for marginalised sections of beneficiaries. – Projects costing above Rs. 5 lakh can be set up in urban areas. 36 36

Merger of PMRY and REGP to form PMEGP Salient Modifications (…contd. ) Scheme Design (…contd. ) Subsidy as per cent of project cost to various categories of beneficiaries in manufacturing sector. Category of Beneficiary Existing PMEGP PMRY* (max. amount) REGP Project cost ranges General 12500 25% 20% 10% SC/ST 12500 30% 40% 30% 15% OBC 12500 25% 30% 25% 10% Upto Rs. 2 Above Rs. 2 lakh Above Rs. 5 lakh and upto Rs. 5 and upto Rs. 25 lakh *Rs. 15000/- per entrepreneurs for NER, HP, UA and J&K. 37 37

Merger of PMRY and REGP to form PMEGP Salient Modifications (…contd. ) • Implementation & Monitoring – Involvement of Gram Panchayats in publicity and identification of beneficiaries at the grass root level. – Provision for availing the services of NGOs/Voluntary Organisations for improved targetting and selection of beneficiaries. – Updating of Project Profiles in consultation with senior officers of participating Banks. – Enlarging the scope of Entrepreneurship Development Programme. – Making the District Level Selection Committee collectively responsible for ensuring proper selection of beneficiaries. 38 38

Merger of PMRY and REGP to form PMEGP Salient Modifications (…contd. ) • Implementation & Monitoring – Putting in place a uniform verification and reporting process of units set up. – Aggressive publicity of CGTMSME amongst Banks, beneficiaries and State Government agencies. – Providing more attractive marketing linkages by tying up the units with exhibitions/fairs at District/Zonal/State/National level. – Working out MIS and tracking system of monitoring the application of beneficiaries, employment actually generated and performance of the units. – Monthly/Quarterly/Half Yearly Reviews of performance at operational/Ministry level, with participation by Planning Commission in the monitoring at Ministry level. – Targets to be allotted to States/DICs (like in PMRY) - 40%, and KVIC (as in REGP) – 60%. 39 39

KVIC - XI Plan New Schemes Workshed Scheme for Khadi Artisans Objectives: • To provide Worksheds to Khadi artisans for better work environment • 38, 000 khadi artisans proposed to be covered during the XI Plan. • A maximum assistance of Rs. 25, 000 (per unit) is proposed Total Plan Outlay - Rs. 127 crore • Government Grant - Rs. 95 crore • Rs. 25 crore earmarked in BE 2008 -09 Approval of Finance Ministry being obtained. Guidelines are under preparation 40 40

KVIC - XI Plan New Schemes Strengthening of infrastructure of existing weak Khadi Institutions and assistance for marketing infrastructure Objectives: • To assist 200 weak khadi institutions and 30 marketing outlets for renovation and creating other marketing infrastructure • To provide higher levels of wages to artisans and upliftment of the Below Poverty Line (BPL) families in backward districts through Khadi activities Total Plan Outlay - Rs. 27. 50 crore Government Grant – Rs. 26. 025 crore • Token provision of Rs. 1. 00 crore earmarked in BE 2008 -09. SFC Note circulated. 41 41

KVIC - XI Plan New Schemes Scheme for Enhancing Productivity & Competitiveness of Khadi Industries and Artisans Objective: • To assist 200 khadi institutions (including 50 new institutions managed by SC/ST) towards enhancing their productivity and competitiveness. • To improve the productivity of the sector through replacement of charkhas / looms, to add value to khadi products by encouraging conversion from fabric to readymade garments and to make the khadi industry competitive with more market driven, profitable production and higher wages to artisans Total Plan Outlay - Rs. 90 crore • Government Grant – Rs. 83. 25 crore • Rs. 10 crore earmarked in BE 2008 -09. EFC has approved and recommended the scheme. 42 42

THANK YOU 43