Micro, Small and Medium Enterprises –
Promotional Agencies
Entrepreneurship Notes For B.Com, BBA and MBA
[Entrepreneurship Notes for NEP 2023 and CBCS Pattern]
Meaning of Micro, Small and Medium Enterprise (MSME)
The Government of India has enacted the Micro, Small
and Medium Enterprises Development (MSMED) Act, 2006 in terms of which the
definition of micro, small and medium enterprises is as under:
Enterprises engaged in the manufacture or production,
processing or preservation of goods as specified below:
1. A
micro enterprise is an enterprise where investment in plant and machinery does
not exceed Rs. 25 lakh;
2. A
small enterprise is an enterprise where the investment in plant and machinery
is more than Rs. 25 lakh but does not exceed Rs. 5 crore;
3. A
medium enterprise is an enterprise where the investment in plant and machinery
is more than Rs.5 crore but does not exceed Rs.10 crore.
Enterprises engaged in providing or rendering of services and
whose investment in equipment (original cost excluding land and building and
furniture, fittings and other items not directly related to the service
rendered or as may be notified under the MSMED Act, 2006 are specified below.
1. A
micro enterprise is an enterprise where the investment in equipment does not
exceed Rs. 10 lakh;
2. A
small enterprise is an enterprise where the investment in equipment is more
than Rs.10 lakh but does not exceed Rs. 2 crore;
3. A
medium enterprise is an enterprise where the investment in equipment is more
than Rs. 2 crore but does not exceed Rs. 5 crore.
Role of Micro, Small and Medium Enterprise in India
Micro, Small and Medium Enterprise in India
enjoy a distinct position in view of their contribution to the socio-economic
development of the country. The following points highlight their contribution.
(i) Micro, Small and Medium Enterprise in
India account for 95 per cent of the industrial units in the country. They
contribute almost 40 per cent of the gross industrial value added and 45 per
cent of the total exports (direct and indirect exports) from India.
(ii) Micro, Small and Medium Enterprise are
the second largest employers of human resources, after agriculture. They
generate more number of employment opportunities per unit of capital invested
compared to large industries. They are, therefore, considered to be more labour
intensive and less capital intensive. This is a boon for a labour surplus
country like India.
(iii) Micro, Small and Medium Enterprise in
our country supply an enormous variety of products which include mass
consumption goods, readymade garments, hosiery goods, stationery items, soaps
and detergents, domestic utensils, leather, plastic and rubber goods, processed
foods and vegetables, wood and steel furniture, paints, varnishes, safety
matches, etc. Among the sophisticated items manufactured are electric and
electronic goods like televisions, calculators, electro-medical equipment,
electronic teaching aids like overhead projectors, air conditioning equipment,
drugs and pharmaceuticals, agricultural tools and equipment and several other
engineering products. A special mention should be made of handlooms,
handicrafts and other products from traditional village industries in view of
their export value.
(iv) The contribution of Micro, Small and
Medium Enterprise to the balanced regional development of our country is
noteworthy. Small industries which produce simple products using simple
technologies and depend on locally available resources both material and labour
can be set up anywhere in the country. Since they can be widely spread without
any locational constraints, the benefits of industrialisation can be reaped by
every region. They, thus, contribute significantly to the balanced development
of the country.
(v) Micro, Small and Medium Enterprise provide
ample opportunity for entrepreneurship. The latent skills and talents of people
can be channelled into business ideas which can be converted into reality with
little capital investment and almost nil formalities to start a small business.
(vi) Micro, Small and Medium Enterprise also
enjoy the advantage of low cost of production. Locally available resources are
less expensive. Establishment and running costs of small industries are on the
lower side because of low overhead expenses. Infact, the low cost of production
which small industries enjoy is their competitive strength.
(vii) Due to the small size of the
organisations, quick and timely decisions can be taken without consulting many
people as it happens in large sized organisations. New business opportunities
can be captured at the right time.
(viii) Micro, Small and Medium Enterprise are
best suited for customised production. i.e. designing the product as per the
tastes/preferences/needs of individual customers, say for an example
tailor-made shirt or trouser. The recent trend in the market is to go in for
customized production of even non-traditional products such as computers and
other such products. They can produce according to the needs of the customers
as they use simple and flexible production techniques.
(ix) Last but not the least, Micro, Small and
Medium Enterprise have inherent strength of adaptability and a personal touch
and therefore maintain good personal relations with both customers and
employees. The government does not have to interfere in the functioning of a
small scale unit. Due to the small size of the organisation quick and timely
decision can be taken without consulting many people as in large sized
organisations. New business opportunities can be captured at the right time,
thus providing healthy competition to big business which is good for the economy.
Role of Micro, Small and Medium Enterprise in rural India
Traditionally, rural households in developing
countries have been viewed as exclusively engaged in agriculture. There is an
increasing evidence that rural households can have highly varied and multiple
sources of income and that, rural households can and do participate in a wide
range of nonagricultural activities such as wage employment and self-employment
in commerce, manufacturing and services, along with the traditional rural
activities of farming and agricultural labour. This can be largely attributed
to the policy initiatives taken by the Government of India, to encourage and
promote the setting up of agro-based rural industries.
The emphasis on village and small scale
industries has always been an integral part of India’s industrial strategy,
more so, after the second Five Year Plan. Cottage and rural industries play an
important role in providing employment opportunities in the rural areas,
especially for the traditional artisans and the weaker sections of society.
Development of rural and village industries can also prevent migration of rural
population to urban areas in search of employment. Village and small industries
are significant as producers of consumer goods and absorbers of surplus labour,
thereby addressing the problems of poverty and unemployment. These industries
contribute amply to other socio-economic aspects, such as reduction in income
inequalities, dispersed development of industries and linkage with other
sectors of the economy.
In fact promotion of small scale industries
and rural industrialisation has been considered by the Government of India as a
powerful instrument for realising the twin objectives of ‘accelerated
industrial growth and creating additional productive employment potential in
rural and backward areas.’ However, the potential of small industries is often
not realised fully, because of several problems related to size. We shall now
examine some of the major problems that small businesses whether in urban or in
rural areas are encountering in their day-to-day functioning.
Problems of Small Business
Small scale industries are at a distinct
disadvantage as compared to large scale industries. The scale of operations,
availability of finance, ability to use modern technology, procurement of raw
materials are some of these areas. This gives rise to several problems. Most of
these problems can be attributed to the small size of their business, which
prevents them from taking advantages, which accrue to large business organisations.
However, the problems faced are not similar to all the categories of small
businesses. For instance, in the case of small ancillary units, the major
problems include delayed payments, uncertainty of getting orders from the
parent units and frequent changes in production processes. The problems of
traditional small scale units include remote location with less developed
infrastructural facilities, lack of managerial talent, poor quality,
traditional technology and inadequate availability of finance. The problems of
exporting small scale units include lack of adequate data on foreign markets,
lack of market intelligence, exchange rate fluctuations, quality standards, and
pre-shipment finance. In general the small businesses are faced with the following
problems:
(i) Finance: One of the severe problems faced
by SSIs is that of non availability of adequate finance to carry out its
operations. Generally a small business begins with a small capital base. Many
of the units in the small sector lack the credit worthiness required to raise
as capital from the capital markets. As a result, they heavily depend on local
financial resources and are frequently the victims of exploitation by the money
lenders. These units frequently suffer from lack of adequate working capital,
either due to delayed payment of dues to them or locking up of their capital in
unsold stocks. Banks also do not lend money without adequate collateral
security or guarantees and margin money, which many of them are not in a
position to provide.
(ii) Raw materials: Another major problem of
small business is the procurement of raw materials. If the required materials
are not available, they have to compromise on the quality or have to pay a high
price to get good quality materials. Their bargaining power is relatively low
due to the small quantity of purchases made by them. Also, they cannot afford
to take the risk of buying in bulk as they have no facilities to store the
materials. Because of general scarcity of metals, chemicals and extractive raw
materials in the economy, the small scale sector suffers the most. This also
means a waste of production capacity for the economy and loss of further units.
(iii) Managerial skills: Small business is
generally promoted and operated by a single person, who may not possess all the
managerial skills required to run the business. Many of the small business
entrepreneurs possess sound technical knowledge but are less successful in
marketing the output. Moreover, they may not find enough time to take care of
all functional activities. At the same time they are not in a position to
afford professional managers.
(iv) Labour: Small business firms cannot
afford to pay higher salaries to the employees, which affects employee
willingness to work hard and produce more. Thus, productivity per employee is
relatively low and employee turn over is generally high. Because of lower
remuneration offered, attracting talented people is a major problem in small
business organisations. Unskilled workers join for low remuneration but
training them is a time consuming process. Also, unlike large organisations,
division of labour cannot be practised, which results in lack of specialisation
and concentration.
(v) Marketing: Marketing is one of the most
important activities as it generates revenue. Effective marketing of goods
requires a thorough understanding of the customer’s needs and requirements. In
most cases, marketing is a weaker area of small organisations. These
organisations have, therefore, to depend excessively on middlemen, who at times
exploit them by paying low price and delayed payments. Further, direct
marketing may not be feasible for small business firms as they lack the
necessary infrastructure.
(vi) Quality: Many small business
organisations do not adhere to desired standards of quality. Instead they
concentrate on cutting the cost and keeping the prices low. They do not have
adequate resources to invest in quality research and maintain the standards of
the industry, nor do they have the expertise to upgrade technology. In fact
maintaining quality is their weakest point, when competing in global markets.
(vii) Capacity utilisation: Due to lack of
marketing skills or lack of demand, many small business firms have to operate
below full capacity due to which their operating costs tend to increase.
Gradually this leads to sickness and closure of the business.
(viii) Technology: Use of outdated technology
is often stated as serious problem in the case of small industries, resulting
in low productivity and uneconomical production.
(ix) Sickness: Prevalence of sickness in small
industries has become a point of worry to both the policy makers and the
entrepreneurs. The causes of sickness are both internal and external. Internal
problems include lack of skilled and trained labour and managerial and
marketing skills. Some of the external problems include delayed payment,
shortage of working capital, inadequate loans and lack of demand for their
products.
(x) Global competition: Apart from the
problems stated above small businesses are not without fears, especially in the
present context of liberalisation, privatisation and globalisation (LPG)
policies being followed by several countries across the world. Remember, India
too has taken the LPG path since 1991. Let us look into the areas where small
businesses feel threatened with the onslaught of global competition.
(a) Competition is not only from medium and
large industries, but also from multinational companies which are giants in
terms of their size and business volumes. Opening up of trade results in cut
throat competition for small scale units.
(b) It is difficult to withstand the quality
standards, technological skills, financial creditworthiness, managerial and
marketing capabilities of the large industries and multinationals.
(c) There is limited access to markets of
developed countries due to the stringent requirements of quality certification
like ISO 9000.
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Also Read:6. MSME Promotional Agencies************************************Also Read (Dibrugarh University)
************************************
Problems and Prospects of Micro, Small and Medium Enterprise in Assam
Micro,
Small and Medium Enterprise have been suffering
from various problems which hamper its growth:
a) Inefficient manpower : Manpower plays an
important role in any industry. The inefficiency of manpower in Micro,
Small and Medium Enterprise due to
illiteracy, ignorance, lack of training facilities etc. affected the growth of
small- scale industries.
b) Lack of credit facility : Another major
problem of Micro, Small and Medium Enterprise
is the lack of credit facilities. Before nationalisation, commercial banks were
not interested in providing finance to this sector. This situation has been
changed after nationalisation of commercial banks but it is far from
satisfactory level.
c) Old and obsolete machineries : The Micro,
Small and Medium Enterprise are facing the
problem in production due to old and obsolete machineries. They are unable to
compete with the products of large- scale industries.
d) Lack of marketing facilities : The Micro,
Small and Medium Enterprise also facing the
problem of marketing their products. There is lack of organised marketing
facilities for these industries. They have to depend on the middlemen for
selling their products. In many cases the market for their products remains
untapped.
e) Old designs : The Micro,
Small and Medium Enterprise are continuing
with the age old designs. The products are unable to meet the modern demand.
Prospects of Micro, Small and Medium Enterprise: The small- scale industries play an
important role in the development of the economy. Even in developed countries,
they occupy an important place. In under-developed countries also, they make
great contributions towards economic development. The prospects of small- scale
industries in North- East Region may be discussed as under:
a) Labour intensive : The Micro,
Small and Medium Enterprise are labour
intensive. They will provide more employment opportunities as compared to
large- scale industries. It will help in solving the unemployment problem in
the region.
b) Low capital investment : Micro,
Small and Medium Enterprise need lower
capital investment as compared to large- scale industries. As capital is scarce
in this region, small- scale industries are most suitable for this region.
c) Quick return : In case of Micro,
Small and Medium Enterprise, there is less
time gap between capital investment and production of goods. Thus, it brings
quick return to the businessmen.
d) Reduction of pressure on land : People of this
region excessively depend on agriculture. The development of Micro,
Small and Medium Enterprise will help in
diverting the excess workforce to this sector.
e) Development of entrepreneurial skill : The
development of this sector will result in change of attitude of people of this
region. People will develop an entrepreneurial skill, which will help in
identifying new areas of investment. This will help in the economic development
of the region.
Salient features of Micro, Small and Medium Enterprises Development Act, 2006 are as follows (Role)
By enacting the Micro, Small and Medium
Enterprises Development Act, 2006, the Government has recently fulfilled one of
the needs felt and articulated by this segment for long. This Act seeks to
facilitate promotion and development and enhancing competitiveness of these
enterprises. It provides the first-ever legal framework for recognition of the
concept of “enterprise” (comprising both manufacturing and services) and
integrating the three tiers of these enterprises, namely, micro, small and
medium. Apart from clearer and more progressive classification of each category
of enterprises, particularly the small, the Act provides for a statutory
consultative mechanism at the national level with wide representation of all
sections of stakeholders, particularly the three classes of enterprises.
1. Section 7 of Act provides for the following
classification in respect of industries engaged in
production or manufacture of goods or rendering service enterprises:
|
Class
|
Manufacturing Enterprises – Investment in Plant & Machinery
|
Services Enterprises – Investment in Equipment
|
|
Micro
|
Less than Rs. 25 lacs
|
Less than Rs. 10 lacs
|
|
Small
|
Greater than Rs. 25 lacs but up to Rs. 5 Cr.
|
Greater than Rs. 10 lacs but upto Rs. 2 Cr
|
|
Medium
|
Greater than Rs. 5 Cr. but up to 10 Cr.
|
Greater than Rs. 2 Cr. but upto Rs. 5 Cr.
|
2. Filing of Memoranda by MSMEs: Process
of two-stage registration of Micro and Small Enterprises dispensed with and
replaced by filing of memoranda. 1. Filing of Memorandum optional for all Micro
and Small Enterprises. 2. Filing of Memorandum optional for Service Sector
Medium Enterprises. 3. Filing of memorandum mandatory for Manufacturing Sector
Medium Enterprises.
3. Constitution
of National Board: National Board for Micro, Small and Medium
Enterprises (MSME) to be headed by the Central Minister in-charge of MSMEs and
consisting of 46 members from among MPs and Representatives of Central
Ministries, State Governments, UT Administration, RBI, SIDBI, NABARD,
Associations of MSMEs including women etc.
Functions of the National Board: Examine the
factors affecting the promotion and development of MSMEs and review the
policies and programmes of the Central Government in this regard.
4. Advisory Committee Headed by
Central Government Secretary I/c of MSMEs and including not more than five
officers of the Central Government and not more than three representatives of
State Governments; and One representative each of the Associations of micro,
small and medium enterprises.
5. Functions of the Advisory Committee
Ø
To examine the matters referred to it by the
National Board;
Ø
To advise Central Government on matters relating
to classification of MSMEs, programmes, guidelines or instructions for the
promotion and development and enhancing the competitiveness of MSMEs.
Ø
To advise State Governments on matters
specified in the rules related to repeal of, “The Interest on Delayed Payments
to Small Scale and Ancillary Industrial Undertakings Act, 1993, including
anything done or any action taken under the Act so repealed
6. Promotional and Enabling Provisions Central
Government to notify programmes, guidelines or instructions for facilitating
the promotion and development and enhancing the competitiveness of MSMEs.
Central Government to administer the Fund or Funds for purpose mentioned in
Section 9 and coordinate and ensure timely utilization and release of sums with
such criteria, as may be prescribed.
7. Credit: The policies and practices in respect
of credit to the MSMEs shall be progressive and such as may be specified in the
guidelines or instructions issued by the Reserve Bank of India, with the aims
of:
Ø Ensuring
smooth credit flow to the MSMEs,
Ø Minimizing
sickness among them, and
Ø Ensuring
enhancement of their competitiveness
8. Procurement Policies: Central
Government or a State Government to notify preference policies in respect of
procurement of goods and services produced and provided by MSEs, by its
Ministries, departments or its aided institutions and public sector enterprises.
9. Provisions to Check Delayed Payments
Ø Provisions
related to delayed payments to micro and small enterprises (MSEs) strengthened.
Ø Period of
payment of MSEs by the buyers reduced to forty-five days.
Ø Rate of
interest on outstanding amount increased to three times the prevailing bank
rate or Reserve Bank of India compounded on monthly basis.
Ø Constitution
of MSE Facilitation Council(s) mandatory for State Government.
Ø Declaration
of payment outstanding to MSE supplier mandatory for buyers in their annual
statement of accounts.
Ø Interest
(paid or payable to supplier) disallowed for deduction for income tax purposes.
Ø No appeal
against order of Facilitation Council to be entertained by any Court without
deposit of 75% of the decreed amount payable by buyer.
Ø Appellate
Court may order payment of a part of the deposit to the supplier MSE
10. Facilitating Closure of Business: Central
Government may (within one year of the commencement of the Act) notify a scheme
for facilitating closure of business by a micro, small or medium enterprise. The
objectives of the rehabilitation policy are to give guidelines in the following
areas:
• Identifying the sickness at an early stage.
• Initiating remedial measures promptly with a
pro active approach
• Formulation and implementation of
rehabilitation package for potentially viable sick MSME units
Micro, Small and Medium Enterprises Development Organisation (MSME – DO)
This is the apex body for promotion and
development of micro, small and medium enterprises in India. On enactment of
the MSME Act 2006, MSME – DO came into being after revocation of the Small
Industries Development Organisation (SIDO). The MSME – DO is headed by the
Additional Secretary and Development commissioner under the Ministry of Micro,
Small and Medium Enterprises.
Functions: The major functions of the
organisation are:
a) To advice
the Government of India in formulation of national policy for promotion and
development of Micro, Small and Medium Enterprises.
b) To provide
techno-economic and managerial consultancy, common facilities and extension
services to the MSME sector.
c) Extending
facilities for technology upgradation, modernization, quality improvement and
meeting infrastructural needs of the MSME sector.
d) Making
available the economic information services needed for the MSME sector.
e) Developing
human resources through training and skill upgradation.
DISTRICT INDUSTRIES AND COMMERCE CENTRE (DI&CC)
The District Industries and Commerce
Centre (DI&CC) operate from the District head quarters of Assam. The
centres work in close association with the Commissioner of Industries and
Commerce, Guwahati. All the preliminary works relating to availing of the Govt.
policy supports by the entrepreneurs in the form of schemes and incentives are
done at the DI&CC level.
Functions
of DI&CC: The DI&CC words at the grass-root for promotion and
development of indigenous entrepreneurship in the state through policy supports
initiated by the central and the state Governments. The major functions include
the following:
1. To
facilitate the voluntary filling of Memorandum by the Micro and Small
Enterprises (MSEs) as per the Government of India’s MSME Development Act 2006.
2. To
facilitate the compulsory filling of Memorandum by the Manufacturing Sector
Medium Enterprises as per the Govt. of India’s MSME Development Act 2006.
3. To
facilitate pre registration of the enterprises to avail benefits under the
different schemes of assistance and supports under the central and the state
Governments.
4. To guide
the prospective entrepreneurs through appropriate counseling and suggestions in
staring their new enterprises.
5. To guide
the entrepreneurs through documentation and counseling in availing the Govt.
incentive and support facilities.
6. To facilitate organization of Entrepreneurship
Development Programmes (EDPs) by the NGOs through liaison.
7. To
organize screening committee (Task Force) meeting for selection of
beneficiaries for grant of Govt. incentives and supports.
8. To forward
and recommend the entrepreneurs’ applications for availing of Govt. incentive
and supports to the Commissioner of Industries and Commerce, Guwahati for
onward recommendations.
KHADI AND VILLAGE INDUSTRIES COMMISSION (KVIC)
It is a statutory body created by an
Act of Parliament in 1956 and became operative from April 1957 by taking over
the work of the erstwhile “All India Khadi and Village Industries Board” set up
in 1950. The Commission is engaged in the task of promoting and developing
Khadi and Village Industries (KVI) with a view to creating employment avenues
in the rural areas thereby strengthening the rural economy of India. It
functions under the administrative control of the Ministry of Micro Small and
Medium Enterprises, Govt. of India.
KVIC has its central office at Mumbai.
It has 36 State and Divisional offices, 6 Zonal offices, 15 Departmental and 23
Non-Departmental Training Centers and a number of accreted Training Centers in
addition to 13 Departmental Sales Outlets. The KVIC operates through 33 Boards
spread over in different states and union territories of the country, in
addition to thousands of institutions and co-operatives including DIC/DICCs.
Objectives:
The
broad objectives of the KVIC are of three-fold as under:
·
The social objective of providing employment;
·
The economic objective of producing saleable
articles, and
·
The wider objective of creating self-reliance
amongst the people and building up a strong rural community spirit.
Functions:
The
crucial functions which the KVIC performs towards attainment of its avowed
objectives are as follows:
1. Works
towards planning, promotion, organization and implementation of programmes for
the development of Khadi and other village industries in the rural areas of the
country in coordination with the other agencies engaged in rural development.
2. Works
towards building up of a reserve of raw materials and implements for supply to
producers, creation of common service facilities for processing of raw
materials as semi-finished goods and provision of facilities for marketing of
KVI products.
3. Organizes
training of artisans engaged in Khadi and Village Industries.
4. Encourages
and promotes research in the production techniques and equipments employed in
the KVI sector and provides facilities for study of the problems relating to
the same.
5. It also
encourages the use of non-conventional energy, bio-fertilizer and other organic
products.
6. Provides
financial assistance to institutions and persons who are engaged in the development
and operation of Khadi and Village Industries and guides them through the
supply of designs, prototypes and other technical information.
KHADI AND VILLAGE INDUSTRIES BOARD (KVIB)
It is a state level statutory body
formed by an Act of the concerned state legislature. In India, at present there
are 33 KVIBs in different States and Union Territories. The Assam Khadi and
Village Industries Board Act was passed in the year 1955. The basic objective
of the Board is to work towards organizing, developing and regulating the
village industries in the state.
Functions:
As
a statutory Body of the Govt. of Assam the KVIB is required to perform numerous
functions for promotion and development of Khadi and Village Industries in the
State. The most important functions of the Board as enumerated in the Assam
Khadi and Village Act, 1955 are listed below:
1. To start,
encourage, assist and carry on Khadi and Village Industries and to carry on
trade and business on such industries and to deal with matters incidental to such
trade or business.
2. To help
the people providing them with work in their homes and to give those monetary
help.
3. To
encourage establishment of Co-operative Societies for Khadi and Village
Industries.
4. To conduct
Training Centres and to train people with a view to equipping them with the
necessary knowledge for starting for carrying on KVIs.
5. To
manufacture tools and equipments required for carrying on KVIs.
6. To arrange
for supply of raw materials and tools & equipments for KVIs.
7. To sell
and arrange to sell the products of the KVIs.
8. To arrange
for publicity and popularizing of finished products of KVIs by opening stores,
shops, emporiums, organizing exhibitions or adopting other similar measures.
9. To undertake
and encourage research work in connection with KVIs and to carry on such
activities as per needs and circumstance.
10. To
sanction loans to individuals and institutions as per the limit set for the
purpose from time-to-time.
On the basis of the above board
outline of functions as assigned to the Board and stipulated in the Act, the
KVIB of Assam undertakes the following activities.
a) It works
as implementing agency of various Govt. schemes, including the Central
Government’s PMEGP scheme for the rural applicants.
b) It
organizes State and District level exhibitions on Khadi and Village Industries
Products.
c) It
organizes training of the artisans at the State and district levels.
d) Establishes
Emporiums for marketing of Khadi and Village Industries Products at different
places.
e) All units
assisted by the Board under different schemes are provided technical supports
as and when needed.
f) It helps
entrepreneurs in preparing their Project Reports.
************************************
Also Read:6. MSME Promotional Agencies************************************Also Read (Dibrugarh University)
************************************
NORTH EASTERN DEVELOPMENT FINANCE CORPORATION (NEDFi)
The North Eastern Development Finance
Corporation Ltd (NEDFi) is a Public Limited Company registered under the
Companies Act 1956 on 9th August,
1995. It is notified as a Public Financial Institution under Section 4A of the
said Act and was registered as an NBFC in 2002 with RBI. The shareholders of
the Corporation are IDBI, SBI, LICI, SIDBI, ICICI, IFCI, SUUTI, GIC and its
subsidiaries. The management of NEDFi has been entrusted upon the Board of
Directors comprising representatives from shareholder institutions, DoNER,
State Governments and eminent persons from the NE Region and outside having
wide experience in industry, economics, finance and management.
NEDFi provides financial assistance to micro,
small, medium and large enterprises for setting up industrial, infrastructure
and agri-allied projects in the North Eastern Region of India and also
Microfinance through MFI/NGOs. Besides financing, the Corporation offers
Consultancy & Advisory services to the state Governments, private sectors
and other agencies. NEDFi conduct sector or state specific studies under its
Techno-Economic Development Fund (TEDF) and is the designated nodal agency for
disbursal of Govt. of India incentives to the industries in the North-East
India under North–East Industrial and Investment Promotion Policy 2007 (NEIIPP
2007).
Objectives:
The
main objective of NEDFi is to provide finance and other facilities for
promotion, expansion and modernization of industrial and infrastructure
projects in the NE-region.
Functions:
The
NEDFi aims to be a dynamic and responsive organization catalyzing the economic
development of the North East India. It assists in the efficient formation of
fixed assets by identifying and nurturing eco-friendly and commercially viable
industrial and infrastructure projects in the region. Thus, the NEDFi prime
role is to enhance the wealth of the region and prosperity of its people. The
major functions of the NEDFi are as follows:
a) To provide
financial assistance to MSMEs for setting up industrial units, infrastructure
and agri-allied projects in the North Eastern Region of India.
b) To extend
Micro-Finance to Non-Government Organizations (NGOs) and voluntary Agencies
(Vas) with good track-records for on-lending to the needy who can take up
income generating activities for self-employment.
c) To offer
Consultancy and Advisory services to the state Governments private sectors and
other agencies.
d) To conduct
state specific studies under the state’s Techno-Economic Development Fund
(TEDF).
e) To serve
as a designated nodal agency for disbursement of the Government of India’s
incentives to industries in the N.E. Region under the “North East Industrial
and Investment Promotion Policy (NEIIPP) 2007” and also under the “Prime
Minister’s Employment Generation Programme (PMEGP)” scheme.
f) In
addition to the above, the NEDFi takes up promotional activities which include
NEDFi Haat, NEDFi Convention Centre, NEDFi Pavilion, etc.
IMPORTANT FINANCE SCHEMES OF THE NEDFI
The NEDFi finances a wide spectrum of
activities which include agro-processing, mining, shipping, leasing, transport,
tourism, information technology, medical & health services generation and
distribution of electricity, setting up and development of industrial estates
and other commercially viable infrastructure facilities. Some important
financing schemes of the NEDFi are highlighted below:
a) Rupee Term Loan Scheme (RTL): The scheme
aims to provide medium and long term financial assistance for setting up of new
projects, expansion, diversification or modernization of existing projects in
various manufacturing or services sector.
b) Equipment Finance Scheme: The scheme
grants financial assistance for acquiring specific machinery/equipment by
financially sound and profit making companies having good credit record.
c) Corporate Finance Scheme: the
objective of the scheme is to provide finance to meet normal capital
expenditure, working capital margin, shortfall in working capital, payment of
high cost debt and also for meeting the general corporate purpose like funding
of business acquisition, or for brand building, etc. where no tangible asset
creation may be envisaged.
d) Working Capital Term Loan Scheme: The aim of
the scheme is to provide one-time core working capital assistance to deserving
units in the form of working capital term loan.
NORTH EASTERN INDUSTRIAL AND TECHNICAL CONSULTANCY ORGANIZATION LIMITED (NEITCO)
The North Eastern Industrial and
Technical Consultancy Organization Limited (NEITCO) is a premier consultancy
organization setup in 1973 by the all India financial institutions,
nationalized banks and state development corporations under the aegis of the
Industrial Development Bank of India (IDBI) to cater to the consultancy needs
of the north eastern states of India. The co-promoters are ICICI, IFCI, IIBI, SBI,
UCO BANK, UBI, AIDC, MIDC and APIDFC. The NEITCO pioneer in systematic
entrepreneurship development movement in the entire North Eastern Region, has
been organizing and conducting Entrepreneurship Development Programmes (EDPs)
in the region since 1982 under the sponsorship of North Eastern Council (NEC),
IDBI, SIDBI, IFCI, ICICI, NABARD, SBI, Department of Science and Technology,
Govt. of India and state Governments of North Eastern Region. The organization
operates from its head office at Guwahati in addition to branch offices at
Shillong and Itanagar.
Functions:
The
NEITCO performs the following functions ‘to provide the quality, cost effective
and timely services’ to its clients.
1. Consultancy Service: the
consultancy services of the NEITCO are of the following types:
a) Technical
and management consultancy services to the entrepreneurs for developing project
profiles of numerous types of industries based on cement, textiles, food
processing, chemicals engineering, etc.
b) It carries
out Market Surveys, Diagnostic / Rehabilitation studies of sick industrial
units.
c) Evaluation-cum-impact
studies, Industrial potential Surveys and several specialized studies on
specific sector.
2.
Project
Implementation: The Project Division of the NEITCO implements
new industrial projects in addition to working for expansion of the existing
projects. In doing so, it arranges for technical know-how and other technical,
economic and managerial aspects.
3.
Entrepreneurship
Development: The NEITCO is the pioneer in systemic Entrepreneurship Development
Programme Movement in the North Eastern Region and has since conducted a large
number of Entrepreneurship Development Programmes (EDPs). It also collaborates
and develops networks with lending institutions in the country for a vibrant
learning environment.
4.
Rural
Development: The NEITCO also works to promote self-employment in rural areas
through a number of Vocational Training Programmes / Skill Development
Programmes with the help of the Department of Science and Technology,
Government of India.
Indian Institute of Entrepreneurship (IIE)
Indian Institute of Entrepreneurship (IIE) is an
autonomous organization under the Ministry of Skill Development &
Entrepreneurship. The main aim of the Institute is to provide training,
research and consultancy activities in Small and Micro Enterprises
(SME), with special focus on entrepreneurship development. The Indian
Institute of Entrepreneurship (IIE) registered under the Societies
Registration Act,1860 was established in the year 1993 in Guwahati by the
erstwhile Ministry of Industry (now the Ministry of Micro, Small and Medium
Enterprises), Government of India. The Institute began operating from April
1994 with the North East Council (NEC), Governments of Assam, Arunachal Pradesh
and Nagaland and SIDBI as its other
stakeholders. IIE has been transferred to the Ministry of Skill Development &
Entrepreneurship on 22nd May’2015.
The head quarter of IIE is situated in Guwahati.
OBJECTIVES OF IIE
a) To promote
and develop entrepreneurship.
b) To conduct
research and provide consultancy for entrepreneurship development.
c) To
coordinate and collaborate with other organizations in undertaking training,
research and other activities to increase outreach of the institute.
d) To provide
consultancy and monitoring service to MSMEs/ potential entrepreneurs and
enhancing employability of participants.
e) To promote
greater use of information technology in the activities/ functions of the IIE.
f) To comply
with statutory responsibility.
FUNCTIONS OF IIE
a) Designing
and organising training activities for different target group and undertaking research
in the relevant to entrepreneurship.
b) Improving
the efficiency, effectiveness and delivery of the change agents and development
practitioners i.e. trainers, support organizations engaged in enterprise
building. etc.
Indian Institute of Entrepreneurship (IIE) - Guwahati
The Indian
Institute of Entrepreneurship (IIE) was established in the year 1993 in
Guwahati by the erstwhile Ministry of Industry (now the Ministry of Micro,
Small and Medium Enterprises), Government of India as an autonomous national
institute with an aim to undertake training, research and consultancy
activities in small and micro enterprises focusing on entrepreneurship
development.
The institute
began operating from April 1994 with the North East Council (NEC), Governments
of Assam, Arunachal Pradesh and Nagaland and SIDBI as its other stakeholders.
It is also An ISO 9001:2008 Certified Organisation.
Objectives:
a) To promote and develop entrepreneurship.
b) To conduct research and provide consultancy
for entrepreneurship development.
c) To coordinate and collaborate with other
organizations in undertaking training, research and other activities to
increase outreach of the institute.
d) To provide consultancy and monitoring service
to MSMEs/ potential entrepreneurs and enhancing employability of participants.
e) To promote greater use of information
technology in the activities/ functions of the IIE.
f) To comply with statutory responsibility.
Functions:
a) Designing and organising training activities
for different target group and undertaking research in the relevant to
entrepreneurship.
b) Improving the efficiency, effectiveness and
delivery of the change agents and development practitioners i.e. trainers,
support organizations engaged in enterprise building. etc.
c) Provide consultancy service to the prospective
and existing entrepreneurs.
d) Increasing the outreach of activities of the
institute through collaborative activities and increasing their effectiveness
through use of different tools of information technology.
Collaborations: Indian Institute of Entrepreneurship
(IIE) signed a Memorandum of Understanding, signed initially for three years,
with Arunachal University of Studies, Namsai, Arunachal Pradesh on 5th March,
2014 at IIE campus, Guwahati, Assam to promote and develop entrepreneurial
environment. The Arunachal University of Studies is authorised to establish and
approve new Skill Knowledge Providers (SKP) for facilitating joint
certification with IIE.
NATIONAL SMALL INDUSTRIES CORPORATION (NSIC)
The National Small Industries
Corporation (NSIC) was set up by the Government of India in 1955 with the aim
of promoting, aiding and fostering the growth and development of the MSMEs in
the country. Over a period of close to six decades of transition, growth and
development, the NSIC has proved its strength within the country and abroad by
promoting modernization, up gradation of technology, quality consciousness,
strengthening linkages with large and medium enterprises and enhancing
export-projects and products from small industries. The NSIC operates through
country wide network of 123 offices and Technical Centres. In addition to this,
The NSIC has 48 Training cum-Incubation Centres with a large professional
manpower; the NSIC provides a package of services as per the need of MSME
sector.
NSIC
IN THE NORTH – EAST INDIA
The present North Eastern Region of
India comprises of eight states including Sikkim. The abundance of natural
resources like cane, bamboo, silk and cotton has yielded a fine heritage of handicrafts
and handloom products of daily use. From the ancient times these products have
catered the rather than commercial uses.
Apart from other activities, the NSIC
undertakes the task of promoting and marketing of these unique products in the
country and abroad through its strong network in and around the country as well
as abroad, by imparting training to the traditional artisans to improve their
technology and productivity and subsequently displaying the products by
organizing / participating in different trade fairs and exhibitions.
To create awareness amongst the
unemployed youths and budding entrepreneurs of the North East, the NSIC imparts
need based training both within and outside the region from time-to-time. The
training programmes include the trades like TV & Mobile Repairing, Computer
Hardware Maintenance, Electrical Goods Repairing, Leather Footwear, Machinist,
Two-wheeler & Four-wheeler Repairing, Fashion technology, Beautician
Programme, Electrician, Export Linkage and Export Management, Food Processing
Technology, Hospitality and Tourism Management, Catering and Banking
Technology, and Advance Welding.
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