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Punit.K.DwivediPunit.K.Dwivedi Bankatlal Badruka College forBankatlal Badruka College forInformation TechnologyInformation Technology 22

What is SIDBIWhat is SIDBI??

Is an apex financial institution in the field of rural

development.

Is Small Industries Development Bank of India.

Was setup under the SIDBI Act-1989 and

commenced operation from April,1990.

Has more than 80 XBO.

Was de-linked from IDBI to provide functionalautonomy and operational flexibility in year

2000.

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What is Rural IndustryWhat is Rural Industry??

Means different types of village and smallindustries.

Means industry appropriate for the rural areas

as pointed by census records. Ice-cream ,bread,biscuits,pickles & chutney,rice-

milling,confectionery,poultry feed,potmanufacturing,cottage industry,Khandsari

udyog, Mat weaving, bamboo basket, ropemaking,khadi udyog,handlooms,artisan,sericulture,poultry farm,sheep farm,fisheries etc.

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SMALLSMALL MakesMakes BIGBIG DifferenceDifference

Small industries contributes more than

45% share in industrial production.

Share in services is more than 65%.

80% share in employment generation.

More than 35% share in Indias export.

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What is Industrial Sickness ?What is Industrial Sickness ?

An industrial unit is considered sickwhen its

financial position is not satisfactory and it

becomesw

orse year after year. It incurs losses and its capital reserves may be

stretched-out in course of time.

When its current liabilities are more than

current assets, the organization may not be in a

position to pay its liabilities.

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Causes of Industrial SicknessCauses of Industrial Sickness*Finance Constraints.

1) Weak equity base

2) Absence of financial planning and budgeting.

3) Inefficient WC

4) Inappropriate utilization and diversion of fund.

5) Absence of costing and pricing

*Production Constraints.

1) Wrong selection of site

2) Inappropriate P&MInappropriate P&M

3) Poor R&D

4) Inadequate material control

5) Lack of quality control

6) Poor maintenance

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Causes of Industrial SicknessCauses of Industrial Sickness*Marketing Constraints.

1) Inaccurate demand forecasting

2) Wrong product mix

3) Lack of market research

4) Bad sales promotion

5) Depends on few buyers

*Personnel Constraints.

1) Bad wages & salary admn.

2) Bad labor relations

3) Bad T&D

4) Bad manpower planning

*Management Constraint.

1) Problems of corporate level

2) Problems of business level

3) Problems of bottom level.

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Promotion,

Financing &Development of Small Scale Industries &

To

SIDBI Set up on April 2, 1990for

Co-ordinate the functions of institutionsserving the Small Industries.

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Indirect

AssistanceDirect

Assistance

Through

more

than 910PLIs with

65,000 +

branches

Through

network of

SIDBIsmore than

59 offices

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Audited Financial Result For Year 2007-08

2008 2007

Total Income 1638cr. 1187cr.

Total Expenditure (-) 1292cr. 728cr.

Profit Before tax (=) 336cr. 449cr.

Tax,FBT&Dfrd Tax (-) 138cr. 151cr.

Net Profit 198cr. 298cr.

EPS Rs.4.41 Rs.6.63

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Direct

Credit

SchemeTechnology

Upgrad.

VentureCapital

Indl./ Mktg

Infrastr.FactoringBills

Finance

Export

Finance

Fast Track

Finance

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Punit.K.DwivediPunit.K.DwivediBankatlal Badruka College forBankatlal Badruka College for

Information TechnologyInformation Technology 1212

SIDBI Nodal Agency for GovernmentSIDBI Nodal Agency for Government

SchemesSchemes National Equity Fund

Integrated Infrastructural Development Scheme

Technology Development & Modernisation Fund

Scheme

Technology Upgradation Fund Scheme for Textiles and

Jute Industries

Tannery Modernisation Fund

Credit Linked Capital Subsidy Scheme

Credit Guarantee Fund Scheme for Small Industries

(through separate Trust)

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YEAR CREDIT TOINDUSTRY

CREDIT TO

SSI"s

% SHARE OF

SSI's

1991

1992

19931994

1995

1996

1997

1998

1999

61,576

65,240

78,66280,482

1,02,953

1,24,937

1,38,548

1,61,038

1,78,799

17,118

17,830

20,02622,620

27,612

31,726

34,113

43,508

48,483

14.72

14.47

13.1713.75

13.05

12.49

12.25

13.43

17.88

TOTAL BANK CREDITTOTAL BANK CREDIT

Rs. In croresRs. In crores

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ASSISTANCE BY SIDBI TO SSI'SASSISTANCE BY SIDBI TO SSI'S

Rs. In CroresRs. In Crores

YEAR SANCTIONED DISBURSMENT

1990-91

1991-92

1992-931993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2408.7

2846.0

2909.23356.3

4706.3

6065.6

6485.3

7484.2

8879.0

10265.0

10821.0

1838.5

2027.4

2146.32672.7

3389.8

4800.8

4584.7

5240.7

6285.2

6964.2

6441.0

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CreditLinked CapitalSubsidy forCreditLinked CapitalSubsidy forT

ech Upgradatio

no

fSSIT

ech Upgradatio

no

fSSI

New or Existing SSI units

To facilitate technology upgradation in

specified products/ sub sectors

15% capital subsidy from GoI on the loan

amount (eligible loan ceiling Rs.100 lakh)

SIDBI is the nodal agency

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Receivables Finance SchemeReceivables Finance Scheme

Eligibility for SSIs

Should be in existence for minimum 2 years.

Should have made profits / declared

dividends during past 2 years

Not in default to Banks / FIs

Limit based on credit sales to purchaserduring past year / projected growth in sales

for the current year

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Receivables Finance SchemeReceivables Finance Scheme

Eligibility for large purchasers

Minimum sales of Rs.15 crore

Minimum net worth of Rs.3 croreNot in default to Banks / FIs

Limit based on credit purchases from SSIs

during past year / projected growth in sales for

the current year

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Equity type assistance SchemesEquity type assistance Schemes-- National Equity fundNational Equity fund

To meet gap in equity

For setting up new projects, expansion,

modernisation, diversification of smallscale units, service enterprises

Project cost up to Rs. 50 lakh

Min. promoters contribution 10%

Soft loan 25% of PC max. of Rs. 10 lakh

Service charges 5% p.a. on soft loan

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Developmental programsDevelopmental programs Focus AreasFocus Areas

Entrepreneurship Development Programmes

Supported 1,709 EDPs, comprising 779 programmes for rural youth, 331

for women and 599 for other target groups

Human Resource Development Organised 240 SIMAPS and 1074 STUPs benefiting over 20000

participants

Technology upgradation

25 clusters for upgradation adopted Set up TBSE being converted to Technology Bank

Pioneering initiatives taken in clusters include Mutual Credit Guarantee

Fund (MCGF) Programme.

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Focus Areas (Contd..)Focus Areas (Contd..)

Emphasis on environment management, quality management

Conduct of over 88 awareness programmes on environment and

quality management

Constitution of Expert Group to advise on environment related issues

Support for conducting workshops for specific industrial sectors to

enable them to appreciate the concept of cleaner production.

Research and Information Dissemination

Book on Technology for SSIs

WTO related studies

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MutualCredit Guarantee FundMutualCredit Guarantee Fund

(MCGF)(MCGF)

MCGF is a Corpus mutually created by agroup of potential borrowers and matching

contribution by SIDBI. MCGF stands as a guarantee for loans given

to each and every contributor to MCGF.

MCGF operates on the principle that not all

members will require loan at the same timeand only a small percentage of borrowersmight default.

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Mutual Credit Guarantee FundMutual Credit Guarantee Fund

MCGF is managed and operationalised by

a Legal Entity of the contributors to MCGF

This corpus is placed with a lending agency and

used as a security for leveraging funds for

contributors. Thus, MCGF enables small units to avail bank

loans without normal collateral requirements.

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SIDBI Updates..SIDBI Updates..

Cisco announced that it is collaborating withSmall Industries Development Bank of Indiaand Tiruchirappalli Regional EngineeringCollege- Science and Technology

Entrepreneurs Park to promote informationand communications technology ICTentrepreneurship and innovation in thecountry.

Small Industries Development Bank of India(SIDBI) has signed a loan agreement with JapanInternational Cooperative Agency (JICA) for 30billion yen (Rs.1, 500 crore).

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ContCont

The loan will be used by SIDBI for financing themicro small and medium enterprises (MSMEs)for energy saving and environmental-friendly

projects. The other projects include Chennai Metro

project, Hyderabad outer ring road project(phase 2) and Capacity development for forestmanagement and personnel training project.

Annual Award-2008 at Tehran, Iran. Sidbi hasbeen awarded as specific Plaque of Merit

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Punit.K.DwivediPunit.K.Dwivedi 2626Bankatlal Badruka College forBankatlal Badruka College for

Information TechnologyInformation Technology

VISIT SIDBI WEBSITE ATVISIT SIDBI WEBSITE AT

www.sidbi.comwww.sidbi.com

I am doing my Ph.D onI am doing my Ph.D on

Role Of SIDBI In Rural IndustrializationRole Of SIDBI In Rural Industrialization

Please feel free to Contact me for further details at:Please feel free to Contact me for further details at:

[email protected]@gmail.com

[email protected]@yahoo.co.in

MobileMobile: 09908024591: 09908024591

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