11

INTERNATIONAL SYMPOSIUM AND EXPO

ON

“COMPREHENSIVE ENTREPRENEURSHIP”

Policies & Schemes for MSME’s

22

MSMEs IN INDIA

• Over 26 million MSMEs

• Employ 60 million People

• Give 45% of Industrial Production ^

• Account for 40%+ of Exports ^^

NB: ^ 39% for MSEs / SSIs NB: ^ 39% for MSEs / SSIs ^^ 33% for MSEs / SSIs^^ 33% for MSEs / SSIs

3

MSME Classification in India

Manufacturing Enterprises*

Micro Rs. 25 Lakhs

Small Rs. 5 crore

Medium Rs. 10 Crore

Services Enterprises**

Micro Rs. 10 Lakhs

Small Rs. 2 Crore

Medium Rs. 5 crore

* Investment limit in plant and machinery.

** Investment limit in equipments.

44

PRODUCTS OF MSEsMore than 8000 products

Others36%

Chemical & Chemical

Products12%

Electrical

&Machinery Parts6%

Rubber &

Plastic

Products6%

Basic Metal Industry

10%

Metal Products8%

Food Products

22%

55

Institutional Support Structure for MSMEs in India

At Federal Level

1. Ministry of MSME

2. Development Commissioner (MSME)

3. National Small Industries Corporation(NSIC)

4. Khadi & Village Industries Commission(KVIC)

5. Coir Board

6. National Entrepreneurship Institutions

MSMEs

At State Level

1. Directorate of Industries

2. District Industries Centres

3. State Finance Corporation

4. State Industrial Development Corporation

5. Technical Consultancy Organisations

6. Entrepreneurship Development Institutions (EDIs)

Others

1. Industry Associations

2. NGOs

3. Banks/Financial Institutions

66

• 58 Development Institutes

• 18 Tool Rooms / Tech Centres

• 38 Khadi & Village Industries Training Centres

• 3 National Level Entrepreneurship Institutes

• 26 sponsored State Entrepreneurship Development Institutes

• 7 NSIC & 2 COIR Training Centres

Hundreds of other Institutions & Centres

180,000 trained each year – including Foreign Students

To be TREBLED under Skill Development mission

ENTREPRENEURSHIP & SKILL DEVELOPMENT

77

MSME Policy

• Legislation (MSMED Act, 2006)• Fiscal Support (Excise Duty Exemption)• Technology upgradation

- Credit Linked Capital Subsidy Scheme- Assistance for Bar coding - Assistance for ISO certification

• Credit Support - Earmarking of Bank Credit- Credit Guarantee Scheme- Credit linked subsidy schemes for employment

generation- Credit rating

88

MSME Policy (Contd.)

• Marketing Support - Purchase preference in Government procurement- Assistance for participation in trade fairs/ exhibitions

• Cluster interventions for focused development of MSMEs and Khadi, village & traditional industries

• Entrepreneurship and Skill Development Programmes- Entrepreneurship Development Institutes - Tool Rooms - MSME – Development Institutes

• Labour Laws- Simplified laws for MSEs

MAJOR SCHEMES

FOR

MSME’s SUPPORT

9

Credit Support1. Public sector banks advised to double the

flow of credit to MSMEs within 5 years (20% annual growth)

2. A minimum of 40% of bank credit earmarked for priority sector lending which includes loans to MSMEs

3. Specialised SME Bank branches in industrial clusters for smooth flow of credit to MSMEs

4. One Time Settlement (OTS) scheme for settling NPAs of MSMEs

5. Interest band prescribed10

1. Helps in accessing credits from banks & financial institutions, orders from foreign buyers

2. Helps in assessing their strengths and weaknesses.

3. Rating by one of the empanelled national or international Rating agencies.

4. Government subsidises 75% of the cost of Rating fee

5. Concessional credits from Banks/FIs to such rated units

Performance and Credit Rating Scheme

11

Credit Guarantee Fund for Small Enterprises

1.Credit Guarantee Fund Trust for MSMEs (CGFTSI) gives guarantee to its Member Lending Institutions for their collateral free loans to MSMEs up to INR 50 Lakhs.

2. Initial guarantee fee at specified rate (1.5% ) of the credit facility sanctioned shall be paid upfront and thereafter annual fee.

3.Provides comfort to the Banks and Financial Institutions.

12

Technological Support

1.Credit Linked Capital Subsidy Scheme for Technology Upgradation • Scheme meant to improve quality of products by technology

Upgradation.

• Investment upto INR 1 crore eligible for support with subsidy upto 15% on investment.

2.Technology Business Incubators for incubating new enterprises

3.Testing Centres for Quality Certification

4.Tool Rooms and Training Centres for skill upgradation

5. Incentive scheme for obtaining ISO Certification13

Marketing Assistance and Export Promotion

1.Support for participation in trade fairs and exhibitions – national as well as international

2.Training programmes on packaging for exports

3.Purchase preference in Government procurement

4.Market Development Assistance Scheme for publicity, market studies and adoption of modern market practices

14

Cluster Development Programme

technology upgradation & productivity improvement

energy conservation & pollution control

2. Rs 10 lakh assistance for capacity building activities without fixed assets

1. Grant upto 80% of Project cost with ceiling of Rs.10 crore to implementing agency for:

15

International Cooperation Programme

1. Provides exposure to MSMEs to the latest technologies, manufacturing practices prevalent in their fields in different countries.

2. Encourages their participation in international exhibitions for exports

16

A Premier Central Public Sector Enterprise of the

Ministry of MSME,

Government of India

NSIC

17

NSIC established in 1955 with the aim to:

“aid, counsel , assist, finance, protect and promote the interests of micro & small enterprises in India”

18

ORGANISATIONAL STRUCTURE

Branch &Other Offices

(105)

Head Office

NTSCs/NTSECs(8)

Foreign Office(1)

ZonalOffices

(10)

Software Technology

Parks(2)

19

NSIC’s schemes are classified as under:

Technology

Marketing

Credit

Support Services

20

MARKETING SUPPORT

1. Single Point Registration Scheme under Govt. Stores Purchase Programme

2. Consortia & Tender Marketing

3. Raw material Distribution

4. Exhibitions & Buyer Seller Meets

21

Single Point Registration Scheme of NSIC under Government Stores Purchase Programme

1. Introduced in May 1976. DGS&D appointed NSIC as agency for registration under this scheme.

2. Avoids multiplicity of registrations with various Government departments.

3. At par with those registered with DGS&D and no separate registration with DGS&D.

4. Capacity assessment of the units in terms of its quality and standards, volume of production and financial capability

22

1. Issue of tenders free of cost.

2. Exemption from payment of Earnest Money Deposit.

3. Waiver of Security Deposit up to the monetary limit for which the unit is registered with NSIC.

4. Price preference upto 15% over the quotations of the large scale industries – being modified.

Benefits of the SchemeBenefits of the Scheme

Single Point Registration Scheme of NSIC under Government Stores Purchase Programme

23

II. Consortia and Tender Marketing

1. NSIC submits bids on behalf of MSMEs against the tenders of Government Deptts/PSUs.

2. Orders are farmed out to MSMEs for execution.

3. Raw material assistance is granted to such units.

4. Bills are realized by NSIC for payment to supplier MSMEs.

5. Part payment upto 70% is made to supplier MSMEs before realization of bills 24

III. Exhibitions & Buyer Seller Meets

1. To help MSMEs to exhibit their products in national and International exhibitions

About 60 exhibitions organized/participated in a year.

Assistance granted as per Government rules

i) Upto 60% concession on stall rental.

ii) Upto 75% reimbursement in fare

iii) Freight reimbursement

(Total Assistance not to exceed Rs.150,000 )

25

2. Buyer Seller Meets organized between Govt. Deptts./ PSUs and MSMEs.

3. Vendor development of Micro and Small Enterprises for Govt. Deptts. / PSUs.

26

IV. Raw Material Distribution

1. NSIC distributes basic raw material like Aluminum, Copper, Iron & Steel, Wax, Zinc and coal at competitive rates to MSMEs.

2. Tie ups with bulk Raw material manufactures.

27

TECHNOLOGY SUPPORT

NSIC offers small units the following technology support services through its Technical Services Centres and Extension Centers:

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

28

Some of the 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.

Rajpura Domestic Electrical Appliances

Aligarh Lock cluster & Die and Tool making

29

Credit Support1. Tie-up made with various banks

(Axis Bank, Bank of Maharastra, Central bank of India, China Trust commercial Bank, HSBC, Karur Vysya Bank, Oriental Bank of Commerce, State Bank of Hyderabad, United Bank of India, UCO Bank, and YES Bank)

2. Helps in preparation of credit proposals of MSMEs and forwards to these banks & follows up for sanction

3. Raw Material provided on credit terms against Bank Guarantee and advance against bills under tender marketing

30

SUPPORT SERVICES

1. Performance and Credit Rating Scheme

2. International Cooperation

3. International Consultancies

4. Infomediary Services

5. Software Technology Parks

6. Incubation Centre for Small Enterprise Establishment

7. Exhibition Complex

8. Marketing Development cum Business Parks31

Performance and Credit Rating

1. Helps MSMEs in accessing credits from banks & financial institutions, orders from foreign buyers.

2. Helps in assessing their strengths and weaknesses.

3. Rating by one of the empanelled Rating agencies.

4. Government subsidises 75% of the cost of Rating fee upto maximum of Rs. 40,000/-

5. Concessional credits from Banks/FIs to such rated units. 32

International Co-operation

1. Exposes MSMEs to latest technologies & International products.

2. Enterprise to enterprise cooperation for technology transfers, joint ventures, business alliances & other forms of sustainable collaborations.

3. Financial assistance to delegates as per Government rules.

33

International Consultancy

Feasibility studiesPolicy & Institutional FrameworkEntrepreneurship DevelopmentSupply of small projects for MSMEsSetting up of Tool Room & Training

Centers

NSIC also undertakes International consultancies for

34

International Consultancy

Bangladesh for developing ICT strategiesMauritius – Policy frame work for SME

developmentSouth Africa – Policy Frame work for SME

development for Kwa Zulu Natal Province.Tanzania – Computer Centre

Recent consultancies undertaken for

35

Infomediary Services

1. Tender Information with email alerts

2. Global Trade Leads

3. Technology Search

4. Banner Display

5. E-Library

6. International MSE Development Web

Portal (www.nsicpartners.com)36

guest

37

NSIC’s Model of Incubation38

Innovative model Innovative model of Incubationof Incubation

• Employment generation using flexible, cost effective and replicable model.

• Optimal use of locally available resources.

• Integrated support by way of providing hands-on training on working projects

• To boost the development of small enterprises

39

Innovative model Innovative model of Incubationof Incubation

• Practical on-the-job training on low cost machines & equipments which are:-

– Easy to understand

– Easy to operate

– Easy to transfer

– Easy to maintain

40

Incubation of Entrepreneurs for Small Enterprise Establishment

1. Employment generation

2. integrated support

3. Practical training

4. Help in machinery identification

5. Help in marketing

6. Help in installation of the project.

41

42

Target Group : Aspiring Entrepreneurs

Unemployed youth

Unskilled manpower

Qualification: 10th standard (High School)

Duration : 3 Months

NSIC-Training cum Incubation Centres

43

Identification of candidates

– Advertisement in print & electronic media

– General Enterprise Tendency (GET) test using psychometric tools

– Interview and selection.

44

Other Incubation support services

Assistance in :

Preparation of project reports

Filing of Memorandum for start up enterprises for registration

Obtaining approvals from Government authorities such as pollution etc.

Credit facilitation through tie up with commercial banks

45

Assistance in:

Procurement of Machinery & equipments for selected project

Installation & Commissioning of Machinery & Equipment

Sourcing of raw materials

Marketing support through Government supply, participation in domestic as well as International Exhibitions.

Other Incubation support services Contd…Contd…

46

Conventional Trades like, Plumbing, Electrician, Sheet metal works, Welding, Fitter, Machinist, Turner, Draftsman, Diesel mechanic, Tools & die maker, Motor vehicle Mechanic, Book binder, Carpenter, Candle making, Spray Painting etc.

Suggested Projects for TICsSuggested Projects for TICs

4747

Electronics Courses like Mobile repairing, Radio and TV repair, Repairing of electrical gadgets ,Repair of refrigerator & AC, Electrical appliances repairing etc.

Suggested Projects for TICsSuggested Projects for TICs

Other Courses like Beauty parlour, Soft Other Courses like Beauty parlour, Soft toys making, Fashion designing, Embroidery toys making, Fashion designing, Embroidery & needle work, Boutique, Health & fitness & needle work, Boutique, Health & fitness centre, Watch & clock mechanic, Cookery centre, Watch & clock mechanic, Cookery etc. etc.

49

4848

• Each project capable of Each project capable of employing employing

-- 1 to 5 persons1 to 5 persons

• Average space requiredAverage space required -- 100 to 2000 sqr.ft.100 to 2000 sqr.ft.

• Average investment requiredAverage investment required -- INR 45000 to INR 45000 to 450000450000

• Average investment per Average investment per employmentemployment

-- INR 112500INR 112500

Salient feaures of Projects selected for IncubatorsSalient feaures of Projects selected for Incubators

48

4949

Better employability & mobilityBetter employability & mobility

Higher productivity, wages and less exploitationHigher productivity, wages and less exploitation

Identity, improved social status & prideIdentity, improved social status & pride

Easier to get loans for self-employment from various Easier to get loans for self-employment from various Banks/Micro Finance InstitutionsBanks/Micro Finance Institutions

A. Unemployed

Benefits of Technology Incubators

49

5050

Improved Quality & ProductivityImproved Quality & Productivity

Less downtimeLess downtime

Compliance with Quality Assurance systems like ISOCompliance with Quality Assurance systems like ISO

Availability of skilled workforce helps in getting export Availability of skilled workforce helps in getting export ordersorders

B. Employers

Contd…

Benefits of Technology Incubators

50

5151

Some examples of Some examples of ProjectsProjects

Light EngineeringLight Engineering

Barbed Wire MachineBarbed Wire Machine

Book Binding Book Binding

File FastenersFile Fasteners

M.S. Wire Drawing M.S. Wire Drawing

Paper Pins/Gem clips/Paper Pins/Gem clips/ Staple Pins manufactureStaple Pins manufacture Wood Screws & RivetsWood Screws & Rivets

Wire NailsWire Nails

Welded Wire MeshWelded Wire Mesh51

5252

Agro & Food ProcessingAgro & Food Processing

BiscuitBiscuit

Bakery PlantBakery Plant

Corn FlakesCorn Flakes

ConfectioneryConfectionery

Food & vegetable dehydrationFood & vegetable dehydration

Flour Mill Flour Mill

Ginger Garlic Paste Making Ginger Garlic Paste Making

Ice Cream Cone Ice Cream Cone Jam/Jelly MakingJam/Jelly Making NoodlesNoodles

52

5353

Oil ExtractionOil Extraction

Potato/Banana Wafers Potato/Banana Wafers

Pop Corn MakingPop Corn Making

Rice MillingRice Milling

Soya MilkSoya Milk

Spice GrindingSpice Grinding Tomato Puree/PasteTomato Puree/Paste

Agro & Food Agro & Food ProcessingProcessing

53

5454

Pharmaceutical & Pharmaceutical & ChemicalsChemicals

Pharmaceuticals Pharmaceuticals TabletsTablets

Detergent PowderDetergent PowderWax CandleWax Candle

54

5555

Textiles and GarmentsTextiles and Garments

Elastic TapeElastic Tape

Socks Manufacturing Socks Manufacturing

Men Shirts Men Shirts

ShirtsShirts & Trousers & Trousers\\

Men Trousers Men Trousers

Track SuitsTrack Suits Handkerchiefs & Handkerchiefs &

Under GarmentsUnder Garments Pillow CoverPillow Cover

Cotton BagsCotton Bags

Luggage Hand BagsLuggage Hand Bags

55

5656

Leather & Footwear ProductsLeather & Footwear Products

Ladies PursesLadies Purses

Leather Hand BagsLeather Hand Bags

Leather BeltsLeather Belts

Gents PursesGents Purses Ladies SandalsLadies Sandals

Shoe upper stitching Shoe upper stitching

Industrial GlovesIndustrial Gloves

Leather GarmentsLeather Garments

Wrist Watch StrapsWrist Watch Straps

56

5757

Plastic & RubberPlastic & Rubber

Blow MoldingBlow Molding

Plastic Shopping BagsPlastic Shopping Bags

ThermoformingThermoforming

Paper & Paper ProductsPaper & Paper Products

Paper Napkin Paper Napkin

Paper Cups and SaucersPaper Cups and Saucers

Toilet RollsToilet Rolls

57

5858

ServicesServices

Mobile repairingMobile repairing

Beauty parlourBeauty parlour

Soft toys makingSoft toys making

Fashion designingFashion designing

EmbroideryEmbroidery

BoutiqueBoutique

Health & fitness centre Health & fitness centre

58

5959

THANK YOUTHANK YOU