NEW DELHI, DEC 29, 2013: THE Micro, Small and Medium Enterprises (MSME) sector is a vibrant sector which nurtures entrepreneurial talent besides providing employment to millions of people across the country. The sector contributes significantly to balanced and inclusive growth of the economy through mobilization of capital and entrepreneurial skills. MSMEs are important for helping the country achieve 8% plus growth of the economy with enhanced equity in distribution of income and therefore, are considered as engine of growth in the economic development of the country. For the promotion and development of this sector, the Ministry of Micro, Small and Medium Enterprises (MSME) has been implementing various programmes and schemes. The major achievements so far, during 2013-14 are as follows:

Procurement Policy

The Government of India notified Public Procurement Policy for MSEs, vide Order dated 23.3.2012 (effective from 1st April, 2012), for goods produced and services rendered by Micro & Small Enterprises ( MSEs ). The policy mandates that all the Central Ministries / Departments / CPSUs shall procure minimum of 20% of their annual value of goods / services required by them from Micro and Small Enterprises. Further, policy has earmarked a sub-target of 4% procurement out of this 20% from MSEs owned by SC / ST Entrepreneurs.

The policy has been circulated to all the Central Ministries / Departments / CPSUs for successful and effective implementation and the policy along with other related documents is available on the office website. All the Chief Ministers of State Governments have also been requested by the then Minister for MSME, to formulate similar policy for Micro and Small Enterprises in their States as per the provisions in MSMED Act, 2006. Queries / doubts raised by the Ministries / Departments / CPSUs for implementation of the policy are clarified from time to time. According to available data, 32 CPSUs have made procurement, more than 20% from MSEs in 2012-13.

For developing MSEs Vendors, all the Ministries / Departments / CPSUs have been requested to organize Vendor Development Programmes (VDP) and buyer-seller meets between MSE- suppliers and government- procuring agencies. In 2012-13, 51 CPSUs organised 299 VDPs for MSEs . The Office of Development Commissioner (MSME) through its field offices i.e. Micro, Small and Medium Enterprises – Development Institutes has planned for the year 2013-14 to organize over 50 National Vendor Development Programmes and 350 State Vendor Development Programmes throughout the country in order to develop MSE vendors with a budget allocation of Rs 5.00 crore for 2013-14.

MSE- Cluster Development Programme

The Ministry of MSME has adopted the cluster approach for holistic development of micro and small enterprises in a cost effective manner. Soft Interventions(such as diagnostic study, capacity building, marketing development, export promotion, skill development, technology upgradation , organizing workshops , seminars, training, study visits, exposure visits, etc.) , Hard intervention (setting up of common Facility Centres ) and infrastructure upgradation (create/ upgrade infrastructural facilities in the existing industrial/ clusters of MSEs ).

A total of 848 interventions in various clusters spread over 28 States and one UTs in country have so far been taken under the programme for Diagnostic study, soft and hard interventions. The efforts under the scheme are focused on covering of more and more clusters from all States / UTs . So far sanctions of Rs . 18.30 crore have been issued till 30th November, 2013 during the current financial year under MSE-CDP. To ensure transparency and speedy implementation of MSE-CDP, online application system has been started from 1st April 2012.

National Manufacturing Competitiveness Programme

The National Manufacturing Competitiveness Programme (NMCP) for the MSMEs , aims at enhancing the competitiveness of enterprise in this sector. There are various components of the NMCP, which have been approved and are available for MSMEs . These are:-

++ Lean Manufacturing Competitiveness Scheme (LMCS) for MSMEs

++ Design Clinics Scheme for design expertise to MSMEs manufacturing sector

++ Marketing Assistance and Technology Upgradation Scheme for MSMEs

++ Enabling manufacturing sector to be competitive through Quality Management Standards (QMS) and Quality Technology Tools (QTS).

++ Technology of Quality Upgradation Support for MSMEs

++ Promotion of Information and Communication Technology (ICT) in MSME sector.

++ Building Awareness on Intellectual Rights for MSMEs

++ Scheme for Providing Support for “Entrepreneurial and Managerial Developments of SMEs through Incubators”.

Credit Guarantee Scheme

The Government is implementing the Credit Guarantee Fund Scheme for Micro and Small Enterprises with the objective of facilitating flow of credit to the MSEs , particularly to micro enterprises by providing guarantee cover for loans upto Rs.100 lakh without collateral / third party guarantees. For making the scheme more attractive to both lenders as well as borrowers, several modifications have been undertaken which, inter alia , include: (a) enhancement in the loan limit to Rs.100 lakh ; (b) enhancement of guarantee cover from 75% to 85% for loans upto Rs . 5 lakh ; (c) enhancement of guarantee cover from 75% to 80% for MSEs owned/operated by women and for loans in North Eastern Region (NER); (d) reduction in one-time guarantee fee from 1.5% to 1% and annual service charges from 0.75% to 0.5% for loans upto Rs . 5 lakh and (e) reduction in one-time guarantee fee for NER 1.5% to 0.75% etc.

As on 30 th November, 2013 , cumulatively, 13 ,13,751 proposals have been approved for guarantee cover for a total sanctioned loan amount of Rs . 64452.61 crore .

Credit Linked Capital Subsidy (CLCS) Scheme for Micro and Small Enterprises

The scheme was launched in October-2000 and revised from 29.9.2005. The revised scheme aims at facilitating technology up-gradation of Micro and Small Enterprises ( MSEs ) by providing 15% capital subsidy (limited to maximum Rs . 15 lakhs ) for purchase of Plant & Machinery. Maximum limit of eligible loan for calculation of subsidy under the scheme is Rs . 100/- lakhs . Presently, 48 well established and improved technologies/sub sectors have been approved under the Scheme.

The CLCS Scheme is implemented through 10 nodal banks/agencies including SIDBI, NABARD.

Marketing Assistance Scheme

The main objectives of Marketing Assistance Scheme are to enhance the marketing competitiveness of the micro, small and medium enterprises to provide them a platform for interaction with the individual / institutional buyers, to update them with prevalent market scenario and to provide them a forum for redressing their problems. The National Small Industries Corporation Ltd. (NSIC), a public sector undertaking under the administrative control of this Ministry, acts as a facilitator to promote marketing efforts and enhance the competency of the  MSMEs for capturing the new market opportunities by way of organizing / participating in various domestic & international exhibitions/trade fairs, buyers-seller meets, intensive campaigns/seminars and other marketing promotion activities.

An amount of Rs.19.25 crore has been allocated in the Budget estimates for 2013-14 for this activity which is targeted to support participation in international and domestic exhibitions/trade fairs and buyer-seller meets and marketing campaigns.

Performance and Credit Rating Scheme

The National Small Industries Corporation Ltd. (NSIC), a public sector undertaking under the Ministry of MSME has been implementing “Performance & Credit Rating Scheme” for micro and small enterprises ( MSEs ) on behalf of the Government. The scheme is being operated through seven accredited rating agencies i.e. CRISIL, SMERA, ONICRA, CARE, FITCH, ICRA and M/s Brickworks. The scheme is aimed to create awareness amongst micro, small & medium enterprises about the strengths and weakness of their existing operations and to provide them an opportunity to enhance their organizational strengths and credit worthiness. The rating under the scheme serves as a trusted third party opinion on the capabilities and creditworthiness of the micro, small & medium enterprises. An independent rating by an accredited rating agency has a good acceptance from the Banks/Financial Institutions, Customers/Buyers and Vendors. Under this Scheme, rating fee to be paid by the micro, small & medium enterprises is subsidized for the first year only and that is subject to maximum of 75% of the fee or Rs . 40000/-, whichever is less.

BE for 2013-14 is Rs . 70.00 crore and it is targeted to support rating of 20000 MSEs during the year.

International Cooperation Scheme

International Cooperation(IC) Scheme is being implemented by the Ministry of MSME since 1996. Technology infusion and /or upgradation of Indian micro, small and medium enterprises ( MSMEs ), their modernization and promotion of their exports are the important objectives of the scheme.

The Scheme encompasses the following activities:

(i) Deputation of MSME business delegations to other countries for exploring new areas of technology infusion/ upgradation , facilitating joint ventures, improving market of MSMEs products, foreign collaborations, etc.

(ii) Participation by Indian MSMEs in international exhibitions, trade fairs and buyer-seller meets in foreign countries as well as in India, in which there is international participation.

(iii) Holding international conferences and seminars on topics and themes of interest to the MSMEs .

BE for 2013-14 is Rs . 5.00 crore and it is expected that 400 entrepreneurs would be facilitated to participate in 40 international events.

Assistance to Training Institutions

Under the scheme assistance is provided to existing and new training Institutions for establishment of Entrepreneurship Development Institute (EDI) and strengthening of their training infrastructure on a matching basis. Ministry  provides assistance  on a matching basis, not exceeding 50 percent of the project cost or  Rs . 150 lakh whichever is less (90 percent or Rs 270 lakh of the project cost whichever is less, for State level EDIs in Union Territories of Andaman & Nicobar and Lakshadweep Islands) excluding cost of land and working capital. The balance 50 percent of the matching contribution (10 percent for State level EDIs in Union Territories of Andaman & Nicobar and Lakshadweep Islands) should come from the concerned Institute, State/UT Government, public funded institution(s), NGOs/Trusts/ Banks/Companies/ Societies/ Voluntary organizations etc.

Udyami Helpline

A ‘Udyami Helpline' (a Call Centre for MSMEs ) with toll-free number 1800-180-6763 is in operation to provide information, support, guidance and assistance to first generation entrepreneurs as well as other existing entrepreneurs to guide them regarding various promotional schemes of the Government, procedural formalities required for setting up and running of the enterprise and help them in accessing Bank credit etc. The Udyami Helpline has become a useful tool for entrepreneurs and general public to gather information about various schemes of the Ministry.