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The Prime Minister Dr. Manmohan Singh presented the National Awards to the successful Micro, Small and Medium Enterprises (MSME) as also to the Banks for excellence in MSE/micro lending in New Delhi on 30th August, 2008.. Spelling out the positive contribution of the MSME sector towards employment generation, the Prime Minister said in his speech that this sector provides employment to over 42 million people. It contributes about 45% of the total manufacturing output and nearly 40% of India's exports. It is the capacity of this sector to generate economic activity at the local level that prompted Gandhiji to give the pride of place to Khadi, he added.

Congratulating the award winning entrepreneurs, he said that in addition to its role in employment creation the MSME sector also provides vital components and accessories for the large manufacturing sector. In this way it contributes significantly to the process of rapid industrialization.

Dr. Manmohan Singh said that India is estimated to have the capacity to create 500 million skilled and trained technicians by the year 2020 and claim a fourth of the global workforce. Education and skill development can be India’s global opportunity. He said that he had written to the chief ministers to consider opening up the buildings of educational institutions of the high school level and above after class hours for those agencies who are engaged in skill development for the youth. Hailing the banks for providing affordable and timely credit to the MSME sector, the Prime Minister said, “The target we set in 2005 was to double the flow of bank credit to this sector in five years. I am happy to note that the credit flow has more than doubled from Rs.67,000 crore to Rs. 1,48,000 crore since 2005.”

Speaking on this occasion, Shri Mahabir Prasad, Union Minister of MSME said, during 2007-08, MSME sector recorded a growth rate of 13% which is 3% more than the overall growth rate of the whole industrial sector. Shri Prasad said during the year 2007-08, 1.8 lakh people were imparted the skill development trainings by various organizations under his ministry which is approximately double than that of the previous year. Referring to Prime Minister’s initiative on the Skill Development Mission, he said that the Ministry of MSME was committed to implement the same. Shri Prasad said, “It is our endeavour to achieve a target of 5 lakh persons per year by the end of 11th Five Year Plan under skill development programme.” He said, 37 lakh new employment opportunities would be created under the newly launched Prime Minister’s Employment Generation Programme (PMEGP) in rural and urban areas of the country for establishing micro enterprises with the assistance of R.4735 crore from the Government of India and this would lead to an investment of about Rs.15,000 crore.

Praising the role of banks in making the credit available to MSMEs, Shri Prasad said that the public sector banks achieved 40% increase in loan disbursement against the target of 20% per annum during 2007-08. 

The National Award Function was organized by the four important organizations under the Ministry of MSME, namely, Office of the Development Commissioner (MSME), National Small Industries Corporation (NSIC), Khadi and Village Industries Commission (KVIC) and Coir Board. The First National Awards and Special Awards for women, SC/ST and North East Region categories consisted of rupee one lakh in cash, a certificate and a trophy. The Second National Awards carried a cash prize of seventy five thousand rupees, a certificate and a trophy while the Third National Award carried rupees fifty thousand in cash, a certificate and a trophy. 

Total 80 awards were presented in various categories. Shri Mahabir Prasad and the Secretary, Ministry of Micro, Small and Medium Enterprises, Shri Dinesh Rai also presented some of the awards. 

 

The Government, in association with the Confederation of Indian Industries (CII) has undertaken an initiative to promote Rural Business Hubs (RBH), first of its kind, based on Public-Private-Partnership (PPP) model to facilitate direct business linkage between industry and the rural community. CII and the Khadi & Village Industries Commission (KVIC) under the Ministry of Micro, Small & Medium Enterprises are converging their efforts under the RBH initiative of the Ministry of Panchayati Raj. A Memorandum of Cooperation between the Ministry of Panchayati Raj and KVIC and a Memorandum of Understanding between CII and KVIC were signed in New Delhi on 4th August 2008, in the presence of the Minister for Micro, Small & Medium Enterprises, Shri Mahabir Prasad, Minister for Panchayati Raj, Shri Mani Shankar Aiyar and DG, CII Shri Chandrajit Banerjee. 

The objective of this joint working include generating rural employment, higher and sustained income for rural producers by better marketing of products through convergence of Schemes and efforts of KVIC and Panchayats. 

Under this initiative, Panchayats and KVIC/KVIB will jointly identy potential projects that can be supported under KVIC schemes and also extend marketing support through the corporate members of industry working on the RBH initiative. KVIC will also extend its Rural Industries Consultancy Services (RICS) to potential beneficiaries for project formulation and linkages with banks. Such proposals will be processed through the fast track system. Wherever required, skill development/skill upgradation training will be provided to the potential beneficiaries by KVIC through accredited training agencies. Cell for Skill Development of CII will support Skill Development requirements for SMEs. Ministry of Panchayati Raj will facilitate the Panchayats to set up Common Facility Centers and other minor infrastructure by converging resources from various Schemes.  Panchayats will also provide backward linkages in terms of identifying genuine beneficiaries for the KVIC Schemes.

 

The Minister for Micro, Small & Medium Enterprises, Shri Mahabir Prasad has said that the Government is proposing to provide Rs.84 crore as assistance for 200 institutions for replacement of Charkhas and looms and for making the Khadi industry more competitive and profitable. Speaking at the inaugural session of the third meeting of the National Khadi & Village Industries Board (NKVIB) on 16th July, 2008 in New Delhi. He said his ministry planning to include 45 institutions managed by persons belonging to SC/STs under this scheme with a view to promote inclusive growth. He said this scheme will make the Khadi Industry more market driven and provide higher wages to artisans. 

The Minister said for Khadi artisans, the Government had introduced a pilot scheme of ‘Workshed for Khadi artisans’ under which we are going to provide worksheds to 38,000 Khadi artisans, at a maximum cost of Rs.25,000 per unit. Through this scheme, he said, the Government is hopeful of providing the spinners in particular, a better working environment, which will improve their productivity and income. 

Spelling out the Government’s steps to make Khadi sector more competitive in this era of globalization, Shri Mahabir Prasad said his ministry has recognize the need for modern marketing strategies in the sector and is formulating a new scheme on marketing development assistance to Khadi institutions. He said the new scheme is expected to provide assistance towards renovation, computerization, marketing infrastructure, quality improvement of products, better packaging of Khadi products etc. 

The Minister said his ministry is planning to strengthen Rural Employment Generation Programme by bringing in wide spread improvement in the scheme. He said in the rural areas, the women are becoming co-partners of men in earning of livelihood. Hence, it is our endeavour to formulate new schemes for implementation, keeping in view their social environment. He said he will request banks particularly those operating in the far flung areas to cooperate in the implementation of Khadi schemes, which are related to increase in employment opportunities. 

The day long meeting discussed among other things agenda items relating to improving the marketability of Khadi Village Industry products, role of science and technology in the changing market scenario, streamlining of Khadi sector, export performance of KVICs, pereformance of various schemes in NER etc. 

Chairperson of KVIC, Smt. Kumud Joshi and senior officials of the ministry and Members of the National Khadi and Village Industries Board attended the meeting.

The union Micro, Small & Medium Enterprises Minister Shri Mahabir Prasad has urged Small Industries Development Bank of India (SIDBI) to spread its network to meet the requirement of Micro, Small & Medium Enterprises of backward places of our country. He said this while chairing the Fifth Meeting of the National Board for Micro, Small & Medium Enterprises (NBMSME) in New Delhi on 27th June, 2008. Shri Prasad said, with the objective of augmenting credit flow to MSMEs, SIDBI along with some leading public and private sector banks as well as certain foreign banks, set up SME Rating Agency of India Ltd. (SMERA), which is the country’s first and only rating agency exclusively for this sector in India. The main agenda for the fifth meeting of the NBMSME were: Role of SIDBI; Status of Credit Flow to Micro and Small Enterprises; Securitisation And Reconstruction Of Financial Assets And Enforcement Of Security Interest Act 2002; Bank Service Charges; One-time Settlement Scheme and Exemption from service tax to MSEs providing business auxiliary services.

Various State Ministers, representatives of MSME Associations and Trade Unions, from all over the country and senior officials of various ministries from the central as well as the state governments participated in the daylong deliberations. Some MSME associations alleged that the banks were recovering loans from small borrowers by resorting to harsh means under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002. Sharing the concerns of the Members, the Minister said the Working Group on ‘rehabilitation of sick SMEs’ set up by the Reserve Bank of India under the chairmanship of CMD, Punjab National Bank also considered this issue under the Act.  The Minister further stated that the Working Group in its report has made certain important recommendations, which is presently under the consideration of RBI.  

Shri Prasad said that some representations were received from MSME Associations regarding One-time Settlement Scheme, which had been taken up with the Finance Ministry. 

It was revealed in the meeting that SMERA has entered into MoU with 22 banks and institutions to rate their MSME clients and has completed 1758 ratings by May 2008. SMERA has also completed risk profiling of nine MSME clusters. SIDBI offers an interest rate reduction of upto one per cent depending upon the ratings obtained from SMERA. 

Shri Dinesh Rai, Secretary, Ministry of Micro, Small & Medium Enterprises, Dr. Syeda Hameed, Member Planning Commission and Shri Jawhar Sircar, Addl. Secretary and Development Commissioner also participated in the Meeting.

The first India-Tunisia Joint Committee meeting was held in New Delhi on April 8,2008 under the Chairmanship of Shri Dinesh Rai, Secretary, Ministry of Micro, Small & Medium Enterprises. The Tunisian delegation was led by Mr. Mohamed Agrebi, Director General Incharge of the Promotion of SMEs in the Tunisian Ministry of Industry, Energy and SMEs.

The meeting was convened in order to operationalise the Cooperation Agreement in the field of Small and Medium-sized Enterprises signed between India and Tunisia last year.

The Tunisian side evinced keen interest in various MSMEs in India, especially sharing of experience and technology in the field of Garment and Textiles, Electro-mechanical Industries, Food Processing Industries and Information Technology. Besides, cooperation in the area of incubators and BPO, Technical support to SMEs, Institutional mechanism for providing credit to SMEs etc. were also discussed.

The Indian side identified various possible areas of cooperation with Tunisia. These are:

i)        Capacity building for formulation of industrial development policy and institutional framework for SMEs in Tunisia based on local resources.

ii)        Industrial potential surveys and feasibility studies to identify thrust areas and opportunities for MSMEs in Tunisia.

iii)     Entrepreneurship development/skill upgradation training

iv)     Setting up of Vocational Training Centres, etc. 

Shri Dinesh Rai, Secretary, MSME asked the Tunisian delegation to take the benefit of the emerging MSME Sector in India. Shri Pravir Kumar, Joint Secretary, Ministry of MSME explained the present scenario of MSME Sector in India to the Tunisian delegation through a presentation. Shri H.P. Kumar, CMD, NSIC also spoke on this occasion. 

Representatives of various Ministries and Institutions also attended the meeting.

 

A four-member Namibian Parliamentary Standing Committee Delegation led by Hon Peya Mushelenga called on Shri Dinesh Rai, Secretary, Ministry of Micro, Small & Medium Enterprises (MSME) in New Delhi on 8th May, 2008. Welcoming the delegation, Secretary, Micro, Small & Medium Enterprises Shri Rai explained the various facets of the MSME sector in India.

Giving details about the present scenario of MSME sector in India Shri Rai said that it was estimated that in terms of value, the sector accounted for about 40% of the manufacturing output and around 40% of the total export of the country.  Further, in recent years the MSME sector has consistently registered higher growth rate compared to the overall industrial sector. The major advantage of the sector is its employment potential at low capital cost. Shri Rai further said that the basic focus, of late, has been to make collateral-free credit available to the potential entrepreneurs as also to encourage private participation in MSME sector. 

The Namibian side evinced keen interest in Indian MSME sector, especially in the field of precious stones and gems and jewellery. Shri Jawhar Sircar, Addl.Secretary and Development Commissioner and other senior officials of the ministry were also present on this occasion.

 

The Government has taken various steps for promotion of micro and small enterprises in the country, particularly the first generation entrepreneurs through Entrepreneurship Development Programmes. This was stated by Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises (MSME) while chairing the Fourth Meeting of the National Board for Micro, Small & Medium Enterprises (NBMSME) in New Delhi on 12th March, 2008. The main agenda for the fourth meeting of the NBMSME was Establishing of Entrepreneurship Development Institutes by State Governments and issues of concern for MSMEs.   Shri Prasad said, Entrepreneurship Development is one of the key elements for promotion of micro, small & medium enterprises and is a major means for inclusive growth. The Minister said, to undertake and facilitate this task on a regular basis, the Ministry of Micro, Small & Medium Enterprises has set up three national level Entrepreneurship Development Institutes (EDIs). Besides, the Ministry has also been implementing an important scheme, viz., Scheme for Assistance for Strengthening of Training Infrastructure and new Entrepreneurship Development Institutes.  Under this scheme a maximum of one crore rupees assistance is given to new Entrepreneurship Development Institutes as also to existing institutes. Expressing satisfaction that the General Budget 2008-09 has made a provision of Rs.2,000 crore Risk Capital Fund for Small Industries Development Bank of India (SIDBI), the Minister said that some more proposals would be taken up during the budget discussions. 

Some of the Members raised the issue of extending collateral free loans upto Rs.5,00,000 to the MSME Sector (both manufacturing and services enterprises) to which Shri Prasad said the Reserve Bank of India (RBI) had already issued a circular on 21st September 2007 to all scheduled commercial banks that they should extend collateral free loans up to Rs.5,00,000 to the units of MSME Sector as defined under MSMED Act 2006. RBI advised all scheduled commercial banks to issue necessary instructions to the branches/controlling offices in this regard, the Minister added. Some of the Members raised the issue of steel price hike, which was affecting the micro and small industries. The Minister assured the Members that the issue would be taken up at the appropriate level.  

Representatives of MSME Associations and Trade Unions, from all over the country and senior officials of various ministries from the central as well as the state governments participated in the daylong deliberations.

 

Shri Mahabir Prasad, Minister of Micro, Small and Medium Enterprises launched Rajiv Gandhi Udyami Mitra Yojana here today in New Delhi on February 7, 2008.  The scheme aims to provide handholding assistance to first generation entrepreneurs through lead agencies or Udyami Mitra, who shall provide guidance to the potential entrepreneurs and help them in completion of various tasks and formalities necessary for the establishment of the enterprise.

Launching the scheme, the Minister said that the Ministry was running many schemes for development of Micro, Small & Medium Enterprises, under which entrepreneurship and skill development training programmes were organised and technical assistance, marketing assistance and financial assistance were being provided.  He said, our further endeavour should be that new enterprises established under these schemes run successfully and play meaningful role in economic development and prosperity of the country.  The Minister said, "the youth population of our country was maximum in the world today.  If we can give employment to this young labour force of ours, none can stop India from becoming a superpower in the world.  For this purpose we need to train the youth thereby converting them into entrepreneurs." He further stated, "we can generate employment opportunities in every part of the country as well as achieve inclusive growth, taking along all sections of the society only through micro and small enterprises. This is our main aim in the 11th Five Year Plan."

Under the newly launched Rajiv Gandh Udyami Mitra Yojana, the selected lead agencies i.e. Udyami Mitras would provide guidance and assistance to the potential entrepreneurs registered with them, in preparation of project report, arranging finance, selection of technology, marketing tie-ups with buyers, installation of plant and machinery as well as obtaining various approvals, clearances and NOCs etc.  Udyami Mitras are expected to be the friend, philosopher and guide of the new entrepreneurs, assisting them in the establishment and successful running of the enterprise.  For providing this handholding assistance to the new entrepreneurs, the Udyami Mitras shall be paid handholding charges under the scheme, including nominal contribution of the concerned entrepreneur.  However, the beneficiaries belonging to SC/ST/physically handicapped/women and beneficiaries from North Eastern Region will not be required to pay any contribution for the establishment of service enterprises of micro manufacturing enterprise.

The scheme is expected to fill a critical void between the entrepreneurship development training and the actual establishment of enterprises, as even after undergoing the EDP training, the entrepreneurs face difficulties in availing full benefits under various schemes and complying with various formalities. Rajiv Gandhi Udyami Mitra Yojana is expected to provide an integrated and end-to-end support for creation of new micro and small enterprises.

The launch of the scheme was followed by a National Workshop on the modalities of the scheme which was attended by representatives of various State Governments, industry associations and other organizations involved in the training as well as promotion and development of industries.

At the instance of the  Ministry of Micro, Small & Medium Enterprises, the Reserve Bank of India has set up a Working Group on Rehabilitation of sick Small and Medium Enterprises under the chairmanship of CMD, Punjab National Bank. This was stated by Shri Mahabir Prasad, Union Minister for Micro, Small & Medium Enterprises while addressing the Members of the Parliamentary Consultative Committee attached to his Ministry in New Delhi on 6.1.08. He informed that this Group so far held meetings with various stakeholders including commercial banks/financial institutions, MSME Associations, State Governments, MSME entrepreneurs, etc. Further, in association with the MSME Association, the Group is in the process of collecting information from sick MSMEs to gain useful insight at the grassroots level. The report is being finalised.

The agenda for today’s meeting was “Sickness in the micro and small enterprises (MSE) sector”.

Shri Prasad said, as per analysis by the Reserve Bank of India recently on the position up to March 2007, the number of sick micro and small enterprises was 1.14 lakh in the country, which shows that in comparison to the year 2006 there has been a decrease in the number of sick units in the year 2007. The banks assume an important role in overcoming the problem of sickness in micro and small enterprises.

Shri Prasad informed that the Reserve Bank of India took significant steps recently related to sickness. These mainly include: (i) issuing guidelines to all the public sector banks on One-Time Settlement (OTS) Scheme for small and medium enterprise accounts, (ii) issuing detailed guidelines regarding debt restructuring mechanism for all eligible small and medium enterprises, (iii) implementing a simplified one-time settlement scheme for small borrowers whose principal amount is up to Rs.25,000/- so that borrowers become eligible for fresh loans, etc. The Minister also informed that the Reserve Bank of India had also at its Regional Offices constituted Empowered Committees to review the progress in rehabilitation of sick small and medium units, which would prove to be useful in overcoming the problem of sickness. Cautioning the banks, the Minister said, “it has been noticed that more often than not the benefit of loan goes to rich entrepreneurs.  This trend has to be reversed. 

Some of the Members were of the view that apart from agriculture, micro and small enterprises generate employment in the rural areas. Hence, the sickness of these sectors should be addressed effectively.

 

A Group of Ministers has been formed to review the existing Cluster Development Programmes of different ministries of the Government. This was stated by Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises while inaugurating the National Workshop on Micro, Small & Medium Enterprises Cluster Development in New Delhi on 28th January, 2008.

The Minister said that the Government extended financial assistance to the tune of Rs. 61 crore for the development of 156 clusters under the Micro & Small Enterprises Cluster Development Programmes (MSECDP). Besides, diagnostic study of 172 clusters has been undertaken to understand the problems of these clusters and address them. Under
MSECDP, the Government provides 90 per cent financial assistance as a soft intervention for enhancing the productivity of a cluster, whereas for establishment of Common Facility Centre, the Central Government provides a maximum of 70 per cent assistance as a hard intervention. The rest of the amount is provided by the beneficiaries of the cluster and the State Government.

Under SFURTI, 124 Clusters have been approved for khadi, coir and village industry sectors. Under this scheme, for the development of each cluster an amount of Rs. 85 lakh  to Rs. 1,10,000  will be spent.

The National Resource Centre for Cluster Development (NRCD) of National Institute for Micro, Small & Medium Enterprises (formerly known as NISIET) under the Ministry of Micro, Small & Medium Enterprises has organised this two-day national workshop on MSME Cluster Development on 28-29 January 2008 in New Delhi.

The objective of the workshop is to bring together various organisations/institutions concerned with cluster development so as to synergise the efforts and add further momentum to cluster development in the country. For this purpose, policy makers, planners, implementers and field experts are being invited to share their experiences and to evolve new strategies for development of MSMEs through cluster development.

The themes selected for discussion are a) Policy Implications for Cluster Development b) Clusters: Employment Generation and Poverty Reduction c) Business Development Services d) Investment Promotion and Technology Transfer e) Cluster Financing and Development f) Infrastructure Development and Common Facilities g) Cluster Development Implementation Strategy and h) Future Directions.

 

The Minister for Micro, Small & Medium Enterprises, Shri Mahabir Prasad has set 31st March 2008 as the deadline for implementing various schemes under the Khadi & Village Industries Commission (KVIC). Presiding over the Second Meeting of National Khadi & Village Industries Board (NKVIB) in New Delhi on 16.1.08. Shri Prasad said that the Government was making special attempts for the development of khadi sector in the 11th Plan as compared to the 10th Plan. He said, “Workshed for Spinners, Enhancing the Productivity and Marketing in a holistic and planned manner for selected 200 institutions in which we are including 50 institutions that are managed by persons belonging to Scheduled Castes and Scheduled Tribes, to institute a nursing fund to support around 200 institutions which have become financially weak and modernisation of around 30 Sales Outlets are some examples.” He said, he had instructed the Ministry and KVIC to ensure that these schemes get implemented positively by 31.03.2008. The Minister said he expected full cooperation from the Ministry of Finance, Banks and Planning Commission continuously in these efforts.           

The principle issues identified for special discussion in the Second Meeting of NKVIB were Scheme of Fund for Regeneration of Traditional Industries (SFURTI) and Rural Employment Generation Programme (REGP). 

SFURTI was launched to develop around 100 clusters in khadi, village industries and coir sectors with a total plan allocation of Rs. 97.25 crore. Release of funds under this scheme is cluster specific. The Government of India releases funds to the Nodal Agencies i.e. KVIC and Coir Board who are responsible for holding and disbursement of funds to the approved Implementing Agencies and monitoring of the scheme. These funds are released by them to the Implementing Agencies as per their requirement. Khadi, village and coir industries including leather and pottery are covered under SFURTI.  122 traditional industry clusters from khadi, village and coir sectors covering all the States/UTs have been approved for their development under SFURTI. 

Earlier, the Chairperson of KVIC, Smt. Kumud Joshi said KVIC could not sustain by merely selling ideas and ideals and that it was high time to take a hard look at the marketing strategy. She also informed that there was a tremendous demand for e-charkas, which had caught on the imagination of the teeming millions of our country.  Some of the members suggested that the banks should be more forthcoming in giving collateral free loans to the micro & small entrepreneurs. Members from across the country attended the daylong deliberation. 

The first meeting of NKVIB held in New Delhi on 8 June 2007deliberated on various subjects like new schemes approved by the Government, ensuring remunerating wages, convergence with like minded originations, rebate system, opening of SC/STs new institution and clusters and export of Khadi through various exhibitions and outlets abroad etc. 

 

Shri E. Kareem, Minister for Industries, Government of Kerala called on the Union Minister for Micro, Small & Medium Enterpriese (MSME) Shri Mahabir Prasad here on 8th January 2008. Both the Ministers discussed issues relating to the scheme for ‘One Time Settlement’ and also the establishment of Tool Rooms in Kollam and Calicut. Shri Mahabir Prasad praised Kerala’s effort in Cluster Development and assured all possible help from the Ministry of MSME in establishing Tool Rooms as proposed by the State Government.

Dr. Chandrapal, Secretary MSME, Shri Jawhar Sircar, Addl. Secretary & Development Commissioner, Shri Pravir Kumar, Joint Secretary and Shri Sesh Kumar Pulipaka, Joint Secretary among others were also present on this occasion.

 

The Reserve Bank of India has constituted a Working Group on the rehabilitation of sick micro & small industries under the Chairmanship of CMD, Punjab National Bank. This information was given by Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises (MSME) while chairing the Third Meeting of the National Board of Micro, Small & Medium Enterprises in New Delhi on 13th December 2007.  The Minister said Secretary, MSME had written to more than 40 MSME organisations to let the Government know about at least 100 such sick units, which became sick primarily because of credit related problems. 

The main agenda of the third meeting was ‘Marketing Efforts of National Small Industries Corporation’ (NSIC). Outlining the performance of NSIC, the Minister said, during the last three years NSIC took certain steps  to help the micro & small entrepreneurs in a big way. For this, a number of new schemes were launched like distribution of steel, copper etc. providing financial assistance in collaboration with banks, providing export credit insurance with the help of ECGC, helping new entrepreneurs through incubators, implementing Performance and Credit Rating Scheme, signing of MoUs with small scale entrepreneurs’ organisations etc. As a result of which NSIC made profit in the last two years. Shri Prasad further informed that NSIC gave dividend to the Government during 2006-07. 

The second meeting of the National Board of Micro, Small & Medium Enterprises was held in New Delhi on 18th September, 2007  under the chairmanship of the Minister of Micro, Small & Medium Enterprises, Shri Mahabir Prasad. The main topic of the agenda for the Second Meeting was  related to consideration of a draft Procurement Preference Policy for Micro and Small Enterprises. 

Representatives of MSME Associations and Trade Unions, from all over the country and senior officials of various ministries from the central as well as the state governments participated in the daylong deliberations.


President Smt. Pratibha Devisingh Patil, has urged the Government and Khadi and Village Industries Commission (KVIC) to pay special attention to see that artisans can get finance easily and through the nearest banks. The requirements of the needy to get proper benefits through loans and grants should also be kept in mind. The President was inaugurating the concluding session of KVIC’s Golden Jubilee Celebration function in New Delhi on 19.11.07.

She said, the Khadi and village industries while retaining the intrinsic beauty of their products, will survive in the long run, if they take into account the changes occurring in the world in terms of market, technology and customer preferences. Blending khadi with other fibres such as silk, wool etc. will give it a new image and open further market. Khadi could also be given a new look, where necessary, so as to attract the younger generation. There is now a growing preference for natural products and khadi has an inherent advantage, in that it is eco-friendly and can be marketed as such. There is also a need for paying attention to standardization of khadi and village industries products.

Stating that there is a need to set up more employment generation units especially for women the President said, one of the main objectives of promotion of khadi and village industries is to create employment opportunities in rural areas and urban slums for improving the quality of life.

The President dedicated to the nation an electronic charkha which will not only produce yarn but also generate power to light a lamp and play a transistor radio in remote villages.

The Finance Minister Shri P. Chidambaram, who was the Guest of Honor urged in his speech to set aside a small amount of the budget of every Indian to buy at least a khadi product every month to help not only the poor artisans but also to contribute to the employment generation as well. He also released two Commemorative coins of Rs. 5 and Rs. 50.

The Union Micro, Small and Medium Enterprises Minister Shri Mahabir Prasad said in his speech that the total value of production in KVI sector amounted to Rs. 14,029 crore in 2006-07 and KVIC has helped to generate an estimated additional employment opportunity to 88.92 lakh persons so far. He however said that looking to the mass unemployment scenario, much more efforts have to be taken to double the employment opportunities in the XIth Five Year Plan and we have to gear ourselves for accepting this challenge.

The Governor of Maharashtra, Shri S.M. Krishna and the Chairperson of KVIC Ms. Kumud Joshi also spoke on this occasion.

There has been no interference on the part of the Government, especially the Ministry of Micro, Small & Medium Enterprises  in the day to day work of Khadi & Village Industries Commission (KVIC), for that matter any organisation under it, as this will  impede the smooth functioning of that organisation. This was stated by Shri Mahabir Prasad, Union Minister for Micro, Small & Medium Enterprises at the closing ceremony of the Golden Jubilee Celebration function of KVIC in New Delhi on 20.11.07. 

Shri Prasad said the Government has given priority to addressing infrastructure and basic needs of rural people through creation of sustainable employment opportunities, exploitation of local resources, increasing production and offering opportunities to all for employment in the service of the community. KVIC as a part of its commitment to rural industrialization has been assessing rural resources, augmenting deficient resources and formulating plans, programs and schemes for the most effective and balanced utilisation of these parameters and determining priorities, the Minister added. 

Shri Prasad further stated that from a highly centralised urban planning system, the Indian economy is gradually moving towards the rural sector and it is here that the KVIC concerns itself with the building of a long term strategic vision of the future rural strategy and decide on priorities of the rural sector. KVIC has been working out sectoral strategy for providing promotional stimulus to the rural economy to grow in the desired direction. Shri Prasad said, KVIC plays an integrative role in the development of a holistic approach – to the areas of human and economic development in the rural sector. He said, keeping in view its social objectives KVIC has embarked upon convergence programme with various professional agencies  like IIT, NID, NIFT, IIP etc.

Recalling the mission undertaken by Mahatma Gandhi, Shri Prasad said, “Let us take the mission of  Pandit Nehru, Indira Gandhi and Sonia Gandhi  to every household of our country”. He also urged the people to emulate Khadi in true spirit.

Shri Prasad released “Commemorative Postal Inland Letters and Post Cards” at the function. 

Union Minister of State for Labour & Employment (Independent Charge) Shri Oscar Fernandes and Chairman, Department Related Parliamentary Standing Committee on Industry, Shri Santosh Bagrodia presented Awards to 34 persons in various categories – Best Spinners, Best Weavers, Best Bankers, Best REGP Units and Science & Technology Innovators. 


 

Khadi has been the mainstay of rural employment generation as also the mantra to uplift the poor masses. This was stated by Shri Mahabir Prasad, Union Minister for Micro, Small & Medium Enterprises, while inaugurating the Khadi & Village Industries Commission (KVIC) pavilion, at the 27th India International Trade Fair in New Delhi on 15.11.07. Elaborating on the performance of  KVIC Shri Prasad said, during the Tenth Plan, 1,21,961 units were established under Rural Employment Generation Programme to which margin money assistance of Rs.1452 crore was released by the Government  through KVIC to the beneficiaries.  An estimated 25.25 lakh additional employment opportunities have been generated during the Tenth Plan.  He said, there was an urgent need for substantially enhancing the wages of Spinners and Weavers from the present level.   

Earlier, Shri Prasad inaugurated National Small Industries Corporation Ltd. (NSIC) pavilion – ‘Techmart’ and MSME pavilion – ‘MSME Expo - 2007’ under the Ministry of Micro, Small & Medium Enterprises.  

The major attraction of first ever MSME Expo is ‘Hall of Excellence’ which is displaying an array of high quality and sophisticated products manufactured in the MSME sector.  More than 100 participants from all over the country are displaying their products in the Expo, which include Engineering products, Electrical and Electronic goods, Glass and Ceramics, Handicrafts, Imitation Jewellery, Readymade and Embroidered Garments, Cosmetics and Herbals, Carpets and Shawls, Soft toys, Pickles, Spices and Condiments, Leather and Footwears, Hospital Equipment and Medical Rehabilitation Goods, Stainless Kitchenware and Tableware, Bamboo based Toys and Ready-to-eat Foods etc. 

NSIC is also organizing “Techmart India 2007”, the  15th International Technology Fair coinciding with India International Trade Fair 2007. This annual event is a centre stage for keeping abreast with latest technology development in the Indian MSME sector. The event will assist MSME Sector in marketing their products and services and also help large companies and buyers in identifying MSMEs, which can become their ancillaries, partners in joint ventures and sub-contracting. 

This year a new dimension of sectoral approach has been added to the display profile of the exhibition and emphasis is laid on sector specific products and technologies like low cost building material, auto components, information technology, light engineering and machines tools, textiles, coir etc.

A new initiative has been taken by NSIC by providing special enclosure of “Working Techmart” where stand-alone technologies for entrepreneurs are on display besides live cluster demonstration of units from North Eastern States.  During Techmart India 2007, a seminar on NSIC support services for Micro, Small & Medium Enterprises will also be organised.   A South African delegation visited  Techmart today. 

Shri Mahabir Prasad also inaugurated the Coir Board pavilion and went round various stalls to have a glimpse of innovative coir products.    

 

South Africa has evinced keen interest in enhancing cooperation in the Micro, Small and Medium Enterprises (MSME) Sector. A South African delegation led by Deputy Minister of Trade & Industry H.E Ms. Eizabeht Thabethe called on Shri Mahabir Prasad, Union Minister for MSME in New Delhi on 14.11.07. Ms. Eizabeht Thabethe said that her country look forward to draw inspiration from the specialized and focused endeavour of India in the MSME sector. Ms. Eizabeht Thabethe  recalled fondly the  contribution of Mahatma Gandhi towards South Africa and said, “Gandhiji came to our country as a lawyer and went back as a great leader.”

Earlier, welcoming the South African Minister Shri Mahabir Prasad said, India share a common history, culture and economy with South Africa and unemployment scenario in both the countries are somewhat similar. India will be too glad to offer help to South Africa in the MSME sector. Both the countries could explore the possibilities of identifying the specific areas of cooperation, Shri Prasad added. Shri Prasad invited the South African delegation to visit the pavilions under the Ministry of MSME at the India International Trade Fair, 2007.


The National Commission for Enterprises in the Unorganised Sector (NCEUS), under the Ministry of Micro, Small and Medium Enterprises presented two reports to the Prime Minister, Dr. Manmohan Singh on 5th November, 2007. The two reports are on the ‘Financing of Enterprises in the Unorganised Sector’ and on ‘Creation of a National Fund for the Unorganised Sector’ (NAFUS). The recommendation on the creation of a National Fund follows from the first report. Dr. Sengupta submitted the reports to Shri Mahabir Prasad, Union Minister for Micro, Small and Medium Enterprises also on 5.11.07.        


Addressing a Press Conference here on 6.11.07, Dr. Arjun Sengupta, Chairman, NCEUS said that the report on ‘Financing of Enterprises in the Unorganised Sector’ deals with financing of the enterprises in the non-farm unorganised sector. It examines in depth the status of financing of the sector and deals with deficiencies in institutional infrastructure and constraints in financing this sector. The Report, besides giving its recommendation on financing has also made a recommendation for the creation of NAFUS. The second Report submitted to the Prime Minister deals in details with the recommendation of creation of NAFUS. The Report on NAFUS gives the rationale, organizational model, functions and sources of financing of the Fund. The mandate for the creation of this Fund derives from the National Common Minimum Programme of the UPA Government.

Giving the details of the proposed Fund, Dr. Sengupta said, the National Fund proposed by the Commission is envisaged as a statutory body funded by the Central Government and Financial Institutions that will primarily focus on non-farm micro enterprises with investment of less than Rs. Five lakh. The Commission’s report reveals that this segment constitutes 94 per cent of all small enterprises estimated at 58 million in 2007 with a total employment of 104 million. Dr. Sengaupta further said that this Fund would be created on the pattern of NABARD and exclusively meant for meeting the financing and promotional assistance gaps in the development of the Non Farm Unorganised Sector. Being a statutory body it would leverage funds from the market and national and international institutions to meet its objectives, he added. 

The Union Minister of Micro, Small & Medium Enterprises Shri Mahabir Prasad has said that among the several policy initiatives that India has undertaken in the last decade of the last century, Cluster Development appears to be an attractive and efficacious one. “After a certain amount of experimentation on the degree and type of intervention that government could undertake or encourage, we veered towards certain successful models”, the Minister said. Shri Prasad was speaking at the Asia-Europe Ministerial Meeting (ASEM) on Small & Medium Enterprises in Beijing  on 31 October, 2007. 

Shri Prasad said the model of Cluster Development that “we have undertaken entails a whole range of schemes, which means that those Ministries, Departments or Agencies that are well versed in a particular subject will be assisting those SME clusters that operate in their domain.” Giving specific examples he said clusters of handmade textiles would be looked after by the specialized agency meant for such textile enterprises; clusters of food units would be serviced by the Ministry of Food Processing Industries and so on. In all, the government identified more than 3000 SME clusters of artisan-specific, village and small enterprises in India and took up 1150 such clusters for intervention and improvement, he added. Shri Prasad also informed that India had undertaken a programme for ‘Twinning’ of Indian SME clusters with similar SME clusters in Italy. India also had a record of disseminating technology amongst certain developing countries in Africa and Asia and this new programme of cluster development could also be included by in such efforts. 

He further stated that India would also like to learn from other Asian and European countries about their experience in cluster development so that “we may improve our methods and imbibe the best practices in the world.” 

Pointing out that Micro, Small & Medium Enterprises sector  has been an integral part of the industrial resurgence of India, Shri Prasad said that the credit policy helped in linking the Indian MSMEs with almost 55000 bank branches and have given loan (outstanding) of over US$ 55 billion. In 2006-07, advances to MSMEs from the public sector banks in India have registered a record growth of over 27 per cent. He further informed that the number of SMEs in India is estimated to be around 13 million while the estimated employment provided by this sector is over 31 million. The export from the SME sector is estimated at US $ 50 billion in 2005-06.  Further, the SME sector accounts for about 45 per cent of the manufacturing output and over 40 per cent of the national exports of the country.  

Accounting for more than 95% of all enterprises in most of Asia-Europe Meeting (ASEM) countries, SMEs act as a main driving force of technological innovation, expanding employment and boosting economic growth. ASEM members pay great attention to SMEs development.  In the Hanoi Declaration on closer ASEM Economic Partnership adopted at Fifth ASEM Summit, ASEM members have strong political will to promote SMEs cooperation under the ASEM framework. 

Against this background, China hosted the ASEM SMEs Ministerial Meeting, which aims at deepening dialogue among governmental agencies of ASEM members in charge of SMEs, discussing policies and measures for better adapting to globalisation, creating sound SMEs social service policy and supporting system, improving SMEs capacity of innovation and competitiveness, enhancing cooperation among SMEs in ASEM members, strengthening regional cooperation of industrial clusters, and expanding mutual investment areas.

 

Dr. Chandrapal, Secretary, Ministry of Micro, Small & Medium Enterprises said that the Government would set up a committee to look into reasons behind sick industries in Micro, Small & Medium Enterprises sector and suggest ways to revive them. He was inaugurating the National Conference on Employment through Entrepreneurship Development and launching the Entrepreneurship Development Scheme of the Ministry of Micro, Small & Medium Enterprises in New Delhi on 16.10.07.  

 

He further stated that among one crore small and medium enterprises units in the country, 8 lakh were sick and unviable. Dr. Chandrapal said the Ministry of Micro, Small & Medium Enterprises was taking a number of steps to help the teeming millions of our country as also to help the sick micro & small industries.

 

 

Mr. Hartmut Schauerte, Parliamentary Secretary of State in the German Federal Ministry of Economics & Technology called on Dr. Chandrapal, Secretary, Ministry of Micro, Small and Medium Enterprises in New Delhi on 8.10.07. 

Mr. Hartmut Schauerte evinced keen interest in Indian Micro, Small & Medium Enterprises (MSME) sector, especially cluster development programme. He said Germany could set up Information Centres on small and medium businesses in the line of their centres already opened in China, Indonesia and Singapore. Mr. Hartmut Schauerte said that his country could help India in upgrading technologies in the MSME sector. Appreciating the Rule of Law in India Mr. Hartmut Schauerte said Germany was uninhibitedly keen to bring advanced technology here as there was no threat to Intellectual Property Right violation. 

Welcoming the proposal, Dr. Chandrapal, Secretary MSME said, the Government had taken a number of steps to boost the MSME sector in recent months, including the enactment of the Micro, Small & Medium Enterprises Development Act, 2006. Explaining the provisions of the Act, Dr. Chandrapal said it aims at facilitating the promotion and development of small and medium enterprises in a competitive way. It seeks to empower the Central Government to notify programmes, guidelines or instructions for facilitating the promotion and growth of small and medium enterprises. One of its primary objectives is to make provisions for ensuring timely and smooth flow of credit to small and medium enterprises, especially the unemployed youth of our country.   

Citing specific example of Indo-German collaboration, Dr. Chandrapal said the Indo-German Tool Rooms set up in Ahmedabad, Indore and Aurangabad are still among the best in India. These Tool Rooms were established by the Government in technical collaboration with the Government of Federal Republic of Germany to fulfil the tooling and training needs of the Small Scale Industries in the field of Tool Design, Manufacture and training of technical personnel in these fields. He, however, said that India was now keen to have the next generation technology.  

Shri Jawhar Sircar, Addl. Secretary and Development Commissioner, MSME, Shri Sesh Kumar Pulipaka, Joint Secretary, MSME, were also present on this occasion.

The Khadi & Village Industries Commission (KVIC), under the Ministry of Micro, Small & Medium Enterprises launched Gandhi Jayanti Special Sales Rebate Campaign in New Delhi on 3rd October 2007. Smt. Sheila Dikshit, Chief Minister of Delhi was the Chief Guest at the Special Rebate launch programme.  Ms. Kumud Joshi, Chairperson, KVIC presided over the function. Up to 30 per cent rebate has been declared  on all khadi and polyvastra products. Every year on the occasion of Gandhi Jayanti, Special Sales Rebate Campaign is undertaken by KVIC. 

The second meeting of the National Board of Micro, Small & Medium Enterprises was held in New Delhi on 18th September, 2007  under the chairmanship of the Minister of Micro, Small & Medium Enterprises, Shri Mahabir Prasad. The main topic of the agenda related to the consideration of a draft Procurement Preference Policy for Micro and Small Enterprises. Currently, the Government of India implements a non-statutory executive policy which extends price preference of 15 per cent and certain other facilities including reserving 358 products manufactured by Micro and Small Enterprises. A proposal to have a statutory Government of India policy was discussed by Ministers from State Governments, Member Planning Commission Mrs. Syeda Hameed, Dr. M.K. Pandhe, President of Centre for Indian Trade Unions (CITU), representatives of MSME Associations from all over the country and Secretaries to the Government of India from the Departments of Commerce and Labour & Employment Ministries. 


The proposal involved making 20 per cent of the purchases by Ministries, Departments and CPSUs, etc., of the Government of India from the products and services provided by MSE mandatory. The proposal also includes provision of 22.5 per cent reservation for the products manufactured and services rendered by MSEs owned or managed by SCs/STs and 10 per cent from those owned/managed by women entrepreneurs. It makes it mandatory for the Central Ministries/Departments and CPSUs to mention the percentage of purchases effected from Micro and Small Enterprises in their Annual Reports to be laid in Parliament. 

During the meeting, several important suggestions were received from the Members. The Minister of MSME decided that these suggestions received from the Members of the National Board and the special invitees would be considered by the Ministry of MSME before finalizing a draft policy, which would then be circulated for consultations with other Ministries before finalisation.
 

Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises presided over the first meeting of the Governing Council of National Institute for Micro, Small & Medium Enterprises (NIMSME), an organization under the Ministry of Micro, Small & Medium Enterprises (MSME) on 5th September, 2007 in New Delhi.

The Members, among other things discussed the Budget Estimates of 2007-08, which had already been submitted to the Ministry. Besides, various other items of the agenda like appointment of Statutory Auditors, Amendments to the Memorandum of Association of NISIET as suggested by the Ministry etc. were also discussed.

Dr. Chandrapal, Secretary, Ministry of Micro, Small & Medium Enterprises, Shri Jawhar Sircar, AS & DC, MSME, Shri Pravir Kumar, Joint Secretary, MSME, Shri Sesh Kumar Pulipaka, Joint Secretary, MSME and Dr. Chukka Kondaiah, Principal Director, NIMSME  among others attended the meeting.

 

 

Prime Minister Dr. Manmohan Singh presented National Awards to the Micro Small and Medium Entrepreneurs in New Delhi on 30th August, 2007.  The Awards were in three categories: a) Outstanding Entrepreneurs of Micro & Small Enterprises, Khadi and Village Industries and Coir Industries; b) Special Awards to Women and SC/ST Entrepreneurs and c) Banks for Excellence in Small Enterprises Lending.  Total 111 entrepreneurs got awards in various categories. 14 entrepreneurs received awards from the Prime Minister, while Shri Mahabir Prasad, Union Minister for Micro, Small & Medium Enterprises presented awards to the rest of the awardees. 

 

Presenting the awards Prime Minister Dr. Manmohan Singh said, “Gone are the days when the business limelight was reserved almost entirely for the captains in the corporate sector and SMEs remained in the shadows. India’s SME business leaders now stand proudly on their own feet.”  

Appreciating the commitment and persistent endeavour of the small entrepreneurs, the Prime Minister commented, “Nowhere is this spirit of enterprise, this willingness to take risk and an eagerness to strike out on one’s own to seek a fortune more in evidence than in our small and medium enterprises sector. It is this animal spirit which makes the SME sector the most dynamic in our economy and worthy of our support and encouragement.” 

Recognizing the importance of providing social security to the unorganized workers as also to the workers of the SME Sector, Dr. Manmohan Singh said, “Our Government recognizes the importance of extending social security to workers in the micro and small enterprises sector. As a first step in this direction, we have declared our intention to provide an old age pension to all citizens above the age of 65 and living below the poverty line. We will also provide life and disability cover to one earning member in each family so that they and their families can get over the consequences of injury or death. We are also working on a health insurance model so that our poor do not have to bear the high cost of medical care. I am sure these initiatives will benefit all workers in the SME sector in particular. Through these three initiatives, we intend to ensure a minimum level of social safety for all of them.“ 

Earlier, Shri Mahabir Prasad, Minister for Micro, Small and Medium Enterprises thanked the Prime Minister and said that the path shown by him for the Micro, Small and Medium Enterprises Sector during the National Convention in 2004 proved to be helpful in achieving financial and physical targets during the Tenth Plan. This Sector helped in creating about 63 lakhs additional job opportunities during the Tenth Plan, which was far more than the target of 44 lakhs, the Minister added. He also thanked Dr. Manmohan Singh for important decisions taken by him from time to time for the development of this sector. “This Ministry is committed to work in achieving the ‘inclusive growth’ advocated by you for the Eleventh Plan”, Shri Prasad assured.   

A new website of the merged Ministry of Micro, Small and Medium Enterprises (www.msme.gov.in ) was also launched by Shri Mahabir Prasad on this occasion.

National Small Industries Corporation Ltd. (NSIC), a public sector unit of the Ministry of Micro, Small & Medium Enterprises (MSME) presented  a Dividend Cheque of Rs.56.90 lakhs for the year 2006-07 to the Minister for Micro, Small & Medium Enterprises, Shri Mahabir Prasad at the function. The Dividend cheque was  presented to Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises by Chairman & Managing Director, NSIC Shri H.P. Kumar. NSIC was incurring loss for the past several years.  After a long gap of more than a decade NSIC posted a profit of Rs. 1.25 crore in the year 2005-06.  In the year 2006-07 NSIC's profit increased to Rs.2.84 crore.  NSIC's Board of Directors, which met on 29.8.2007, decided to declare a Dividend of 20% on its profit during the year 2006-07.  The day is also being celebrated  as MSME Day. 

The Union Minister for Micro, Small & Medium Enterprises Shri Mahabir Prasad inaugurated Coir Board’s new Display and Information Centre here today.  Inaugurating the Centre Shri Prasad said, highly labour intensive and export oriented coir industry was providing livelihood to about half a million poor village artisans, predominately women. Since the raw material used in the industry being the coconut husk, which is considered as a waste after taking the coconut nut, the coir industry epitomizes the concept of  ‘wealth out of waste’. Considering the increasing national significance of this traditional industry, the Government included coir in the National Common Minimum Programme, the Minister added.

 

Ministry of  Small Scale Industries ( now renamed as Ministry of Micro,  Small  & Medium Enterprises) has been chosen for Indira Gandhi Raj Bhasha Award, - Second Prize for the year 2005-06.  The prize distribution ceremony was held on 14th September, 2007 at New Delhi.  Ministry of Small Scale Industries was awarded the same prize earlier also for the year 2003-04.  It may be mentioned that the Minister Shri Mahabir Prasad is regarded as a committed supporter of Hindi language and takes keen interest in the promotion of Hindi as not only the National Language but also as the language of the masses. He delivers all his speeches in Hindi only and encourages use of Hindi in office work. .

National Small Industries Corporation Ltd. (NSIC), a public sector unit of Ministry of Micro, Small & Medium Enterprises (MSME) has declared a Dividend of Rs.56.90 lakhs for the year 2006-07.  It may be noted that NSIC was running in losses for the past several years.  After a long gap of more than a decade NSIC posted a profit of Rs. 1.25 crore in the year 2005-06.  In the year 2006-07 NSIC's profit has increased to Rs. 2.84 crore.  NSIC's Board of Directors which met on 29.8.2007 decided to declare a Dividend of 20% on its profit during the year 2006-07.  The Dividend cheque was presented to Shri Mahabir Prasad, Minister for Micro, Small & Medium Enterprises by Chairman & Managing Director, NSIC Shri H.P. Kumar on 30.8.2007, also celebrated as MSME Day.   

 

The Union Minister for Micro, Small and Medium Enterprises, Shri Mahabir Prasad has said that Khadi will have to match the standards of the new products that are available in the market.  He said that competition in the market increased tremendously as a result of marketing and technological developments due to globalisation.  He said that special attention should be given to specific technological requirements so that the standards of the KVI products were improved to make them face the competition in the market.  Shri Prasad was inaugurating the first meeting of the National Khadi and Village Industries Board (NKVIB) in New Delhi on June 8, 2007. 

Elaborating on the performance of Khadi and Village Industries Commission  (KVIC) Shri Prasad said, during the Tenth Plan, 1,21,961 units were established under Rural Employment Generation Programme to which margin money assistance of Rs.1452 crore was released by the Government  through KVIC to the beneficiaries.  An estimated 25.25 lakh additional employment opportunities have been generated during the Tenth Plan.  He said, there was an urgent need for substantially enhancing the wages of Spinners and Weavers from the present level.   

Earlier the Chairperson of KVIC, Smt. Kumud Joshi said, through KVI activities, 20 lakh additional employment could be created within 4 to 5 years at low capital investment.  She said a proposal had already been submitted to the Government for additional fund requirement.  She said an amount of Rs.3,475 crore was required for generating the additional employment and strengthening existing infrastructure.   

The day long meeting of NKVIB deliberated on various subjects like new schemes approved by the Government, ensuring remunerating wages, convergence with like minded originations, rebate system, opening of SC/STs new institution and clusters and export of Khadi through various exhibitions and outlets abroad etc.  Members from all over the country attended the meeting.

The first meeting of the National Board for Micro, Small and Medium Enterprises (NBMSME) chaired by Shri Mahabir Prasad, Union Minister for Micro, Small and Medium Enterprises has stressed the need for coordinated all round development of Micro, Small and Medium Enterprises (MSMEs) in New Delhi on June 20, 2007.  It was attended among others, by the Ministers having control of the Department of MSME from Uttar Pradesh, Bihar, Gujarat and Tamil Nadu, Senior Officers of Government of India, representatives from RBI and various MSME Associations and leaders of Central Trade Union Organisations.  NBMSME has been constituted in accordance with Section 3 of The Micro, Small and Medium Enterprises Development (MSMED) Act, 2006.  

The participants congratulated the Minister for bringing out the MSMED Act, 2006 which would go a long way in the promotion and development of this sector. 

Earlier, in his opening remarks, Shri Mahabir Prasad pointed out that in the last three years the number of manufacturing and service enterprises grown by nine lakh to more than one crore and twenty eight lakh employing more than three crore and thirteen lakh people.  This depicts an average annual growth rate of 4 per cent in number and 4.57 per cent in employment next only to agriculture.  He told that the mirco enterprises were the nursery providing a base for the entrepreneurs to take off about 99.6 per cent of the total enterprises or micro enterprises and their importance in economy was immense. 

He added that recognising that delivery of credit continued to be a serious problem for this sector, Government announced a ‘Policy Package for Stepping up Credit to Small and Medium Enterprises (SMEs)’.  In this package, the public sector banks have been advised to fix their targets of credit delivery to SMEs in order to achieve a minimum 20 per cent year-on-year growth, with the objective of doubling the annual flow of credit to the sector within five years.  Availability of adequate credit on affordable terms is vital for the MSMEs to modernize and become competitive. 

Dr. Syeda Hameed, Vice-Chairperson of the Board stressed the need for the greater role of the Government for uplift of artisans and women owned enterprises.

The Micro, Small and Medium Enterprises Minister Shri Mahabir Prasad has urged the banks to come forward in providing loans to the unemployed youth of the country without collateral. He said since the Government in the Ministry of Micro, Small and Medium Enterprises vouches for the entrepreneur, there should not be any problem on the part of the banks to provide loans to these entrepreneurs. He was speaking at the Parliamentary Consultative Committee meeting attached to the Ministry of Micro, Small & Medium Enterprises in New Delhi on July 4, 2007. The Minister said the Credit Guarantee Fund Scheme for Small Industries (CGFSI) was launched by the Government  to make available collateral-free credit to the micro and small enterprise sector. Both the existing and the new enterprises are eligible to be covered under the scheme. The Ministry of Micro, Small & Medium Enterprises and Small Industries Development Bank of India (SIDBI), established a Trust named Credit Guarantee Fund Trust for Small Industries (CGTSI) to implement the Credit Guarantee Fund Scheme for Small Industries. The scheme was formally launched on August 30, 2000 and is in operation with effect from 1st January 2000.  The corpus of CGTSI is being contributed by the Government and SIDBI in the proportion of 4:1 respectively and have contributed Rs.1346.54 crore to the corpus of the Trust up to May 31, 2007. Based on the future requirement, the corpus is likely to be raised to Rs.2500 crore. 

The Minister explained various achievements of the Coir Board to the Members. He said development of “Pithplus”, for  composting coir pith, “Coirret”, for speeding up the retting process, coir plywood, “Anugraha”, the compact metallic loom for weaving coir geotextiles, Anupam loom with inbuilt provision for providing training in weaving to woman artisans are a few of the achievements of the Board.  The Minister said in the 11th Plan a new scheme has been announced for modernization and technological upgradation of coir industries. The aim of the scheme is to create additional employment of 1.76 lakh at a cost of Rs.1654 crore. 

Shri A.C.Jose, Chairman Coir Board said that the Board had been implementing the Coir Board Coir Workers’ Group Personal Accident Insurance Scheme for the benefit of coir workers in the country. The scheme came into effect on 1st December 1998. The scheme provides for compensation up to a maximum amount of Rs.50,000/-. 

Some of the Members congratulated the Minister for the research and development work undertaken by the Coir Board. They however felt that the research findings need to be popularized among the masses and all the stakeholders should benefit from it. They also hailed the Minister for the new upgradation and rejuvenation programme for the coir industry in the 11th Plan.

The Government has reiterated the need to implement Pradhan Mantri Rozgar Yojana (PMRY) in letter and spirit and urged the banks to offer collateral-free loans to the unemployed youths of the country.  A review meeting on PMRY under the chairmanship of Dr. Chandrapal, Secretary, Ministry of Micro, Small and Medium Enterprises held in New Delhi on July 16, 2007 emphasized the need to enhance the target under the PMRY scheme as also various other centrally sponsored schemes being implemented throughout the country.  The meeting was attended among others by the representatives of the concerned Departments of various States and Union Territories as also by nationalized banks.  

Revised guidelines issued for the implementation of PMRY and suggestions/clarifications received from State Governments in respect of different parameters of revised guidelines were discussed in the meeting.   Various parameters have been liberalized in the revised guidelines of PMRY.  Besides, recovery of loan under PMRY, record maintenance in rural/urban areas, verification of units, utilization certificates were also discussed.  Certain operational guidelines have also been included for effective implementation of revised PMRY.  Some of them are: (i) No collateral shall be insisted for PMRY loans upto Rs. 5 lakhs. (ii) Of the total target of each State/UT , women beneficiaries should constitute at least 30 per cent. (iii) Assistance to SC/ST and Minority beneficiaries should be targeted in such a manner that they are benefited at least in proportion to their population in each District/State; and (iv) preference may be given to develop clusters specializing in specific products at the time of selection of PMRY beneficiaries, etc.

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