FIRST EVER COMPREHENSIVE
POLICY PACKAGE FOR SSI
SSI
GEARED UP TO MEET WTO CHALLENGES
SPECIAL
PACKAGE FOR TINY SECTOR
TECHNOLOGY
UPGRADATION
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Three Years of Government
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The Ministry of Small
Scale Industries is the nodal Ministry for formulation, promotion,
development and protection of small-scale industries. It also
monitors the implementation of these policies.
Major Policy Initiatives
A separate Ministry
for Small Scale Industries & Agro and Rural Industries was
set up on August 14, 1999 to focus concerted efforts on the problems
of small and tiny enterprises. Investment limit for the SSI sector
in plant and machinery was reduced from Rs. 3 crore to Rs. 1 crore.
Comprehensive
Policy Package
A Group of Ministers
on SSI was constituted under the Chairmanship of Shri L.K. Advani,
the Union Minister for Home Affairs, to promote and strengthen
the SSI sector in the context of dismantling of Quantitative Restrictions.
Based on the recommendations of the Group of Ministers, a comprehensive
policy package was announced for the SSI sector on August 30,
2000 by the Prime Minister at the first ever National Conference
on SSI organised by the Ministry of SSI & ARI. The policy
package aimed at enhancing competitiveness of SSIs both globally
and domestically by providing easier access to credit, infrastructure
support, marketing avenues etc. Out of action points emerging
from the comprehensive policy package, action has been completed
on 27 points.
Technology Upgradation
To meet the urgent
need of technology upgradation, the Government has announced a
capital subsidy of 12 per cent for investment in technology in
select sector and setting up of an Inter-Ministerial Committee
of Experts to define the scope of technology upgradation and sectorial
priorities. To encourage total quality management, the Government
has decided to continue, for the next six years, granting Rs.
75,000 to each small-scale unit that obtains ISO 9000 certification.
Upto April, 2002, the credit linked capital subsidy amounting
to Rs. 25.95 lakh has been distributed by SIDBI. The Ministry
has formulated a comprehensive plan for preparing Small Scale
Industries for e-commerce with appropriate infrastructure support.
It has also sought to strengthen the IT support to Small Scale
Industry through the development of a ‘Master Website' on small
industries comprising information on policies and procedures,
technology, products etc., with hyperlinks to States and countries.
Credit Guarantee
Scheme
The Credit Guarantee
Fund Trust for small industries was set up with an initial corpus
of Rs. 125 crore contributed during 2000-01 by the Government
of India and SIDBI in the ratio 4:1. The corpus has been enhanced
during 2001-02 to Rs. 250 crore with additional contributions
made by Government of India and SIDBI in the above ratio. The
cumulative number of proposals received upto June, 2002 were 6,766,
out of which 4,954 proposals were approved for aggregate loan
amount of Rs. 51.38 crore.
In the National Equity
Fund Scheme, the project cost limit has been revised from Rs 25
lakh to Rs.50 lakh. The soft loan will be retained at 25 per cent
of the project cost subject to a maximum of Rs.10 lakh per project.
Assistance under the NEF will be provided at a service charge
of 5 per cent per annum.
Initiatives for North-Eastern
region
The Government has
announced a number of initiatives for the development of SSIs
in the North-Eastern region at the national convention on SSIs
on August 30, 2001. A task force comprising all North-Eastern
State Ministers in-charge of SSIs has been set up specifically
for that region.
Exemption of Duty
on Bicycle Parts
The Government has
announced certain exemption/relaxation of duty on bicycle parts
and accessories at the 3rd SSI Convention with a theme
‘Toys’ on August 28, 2002. Relief in sales tax on electronic toys
will be considered after VAT system becomes operational in all
States.
Marketing Development Assistance
Scheme
SSIs face problems
in marketing of their products. To help SSIs in marketing their
products a new SSI Marketing Development Assistance (MDA)
scheme has been launched to assist SSIs exporters to participate
in international exhibitions and fairs. Sub contracting and acnillarisation
is being encouraged through setting up sub-contracting exchanges
and vendor development programmes.
Access to SSI Information
Steps taken to improve
access to SSI information included comprehensive knowledge portal
launched for SSIs on August 30, 2001 (www.smallindustryindia.com)
and (www.laghu-udyog.com).
Various field offices under SIDO have set up their own websites.
Special Package
for Tiny Sector
The Government has
decided to raise the limit for composite loans from Rs.10 lakh
to Rs.25 lakh. Entrepreneurs will now be able to secure term loans
and working capital from the same agency.
The National Small
Industries Corporation will continue to give composite loan up
to Rs.25 lakh to the tiny sector and continue to charge one per
cent concessional interest rate. And 20 per cent of the projected
annual turnover of tiny units would qualify for working capital
loan.
Under the Integrated
Infrastructure Development (IID) Scheme, 50 per cent of the plots
will be earmarked for the tiny sector as against 40 per cent done
earlier.
Sixty three IID centers
are at various stages of implementation. In these IID Centres,
7,754 plots are proposed to be created for tiny sector.
