Subsidy Schemes

To promote the development of the industrial sector, especially MSME sector, the government has introduced various schemes that provide financial subsidy to the eligible enterprises. Some of these subsidy schemes are specifically for certain industrial sectors, while some of them like CLCSS are available for a wide range of industries.

Some of the major subsidy schemes of the government and public institutions are provided below. These can be categorized as follows:

 

Subsidy Schemes for Specific Industries

 

Textile Industry - Technology Upgradation Fund Scheme (TUFS)

Ministry of Textiles introduced the Technology upgradation fund scheme (TUFS) for textiles and jute industry in April 1999 to facilitate induction of state-of-the- art technology by the textile units.The benefits under the scheme include:

5% interest reimbursement of the normal interest charged by the lending agency on RTL, or

5% exchange fluctuation (interest & repayment) from the base rate on FCL, or

15% credit linked capital subsidy for SSI sector, or

20% credit linked capital subsidy for powerloom sector (An option for ‘front ended’ subsidy provided w.e.f. 1st October, 2005), or

5% interest reimbursement plus 10% capital subsidy for specified processing machinery.

IDBI, SIDBI and IFCI were the nodal agencies for Non-SSI textile sector, SSI textile sector and Jute sector respectively. However, w.e.f. 1st October, 2005, 13 additional nodal banks have been appointed under TUFS for determining eligibility & releasing the subsidy for the cases financed by them.

Food Processing Industry - Scheme for Technology Upgradation/ Establishment/ Modernization for Food Processing Industries

This Scheme covers the following activities: Setting up/expansion/modernization of food processing industries covering all segments viz fruits & vegetable, milk product, meat, poultry, fishery, oil seeds and such other agri-horticultural sectors leading to value addition and shelf life enhancement including food flavours and colours, oleoresins, spices, coconut, mushroom, hops. The assistance is in the form of grant subject to 25% of the plant & machinery and technical civil work subject to a maximum of Rs. 50 lakh in General Areas and 33.33% upto Rs. 75 lakh in Difficult Areas.

Leather Industry – Integrated Development of Leather Sector (IDLS)

The scheme is aimed at enabling existing tanneries, footwear, footwear components and leather products units to upgrade leading to productivity gains, right-sizing of capacity, cost cutting, design and development simultaneously encouraging entrepreneurs to diversify and set up new units

The financial assistance under the Scheme will be investment grant to the extent of 30% of cost of plant and machinery for SSI and 20% of cost of plant and machinery for other units (i.e. non small scale units) subject to ceiling of Rs.50 lakh for technology up gradation /modernization and/or expansion and setting up a new unit. The rate of assistance would be @ 20% for all units (both SSI and Non-SSI) above Rs.50 lakhs subject to ceiling of Rs.2 crore.

The nodal agency for release of assistance, monitoring and interface and coordination with FIs, Banks and the Government is SIDBI.

Extension of Financial Assistance to Coir units in the Brown Fibre sector

The Coir Board runs a scheme for financial assistance to the coir units in the brown fibre sector. The rate of financial assistance under the scheme is 25% of the cost of equipments and infrastructural facilities subject to certain ceiling limits based on the type of unit.

Credit Linked Capital Subsidy Scheme for Technology Upgradation (CLCSS)

The Scheme was launched in October, 2000 and revised w.e.f. 29.09.2005. The revised scheme aims at facilitating Technology Upgradation of Micro and Small Enterprises by providing 15% capital subsidy (12% prior to 2005) on institutional finance availed by them for induction of well established and improved technology in approved sub-sectors/products. The admissible capital subsidy under the revised scheme is calculated with reference to purchase price of Plant and Machinery. Maximum limit of eligible loan for calculation of subsidy under the revised scheme is also been raised Rs. 40 lakhs to Rs. 100 lakh w.e.f. 29-09.2005.

The Small Industries Development Bank of India (SIDBI) and the National Bank for Agriculture and Rural Development (NABARD) will continue to act as the Nodal Agencies for the implementation of this scheme.

Credit Link Capital Subsidy Scheme for Technology Upgradation

Summary of the Scheme : -

     The Scheme was launched in October, 2000 and revised w.e.f. 29.09.2005. The revised scheme aims at facilitating Technology Upgradation of Micro and Small Enterprises by providing 15% capital subsidy (12% prior to 2005) on institutional finance availed by them for induction of well established and improved technology in approved sub-sectors/products. The admissible capital subsidy under the revised scheme is calculated with reference to purchase price of Plant and Machinery. Maximum limit of eligible loan for calculation of subsidy under the revised scheme is also been raised Rs. 40 lakhs to Rs. 100 lakh w.e.f. 29-09.2005.    

    The scheme has been continues 10th five year plan to 11th five year plan. Under the scheme approximately 7396 units have availed subsidy of Rs. 315.21 crore upto August, 2009.   Read more...

OM regarding submission of claim under CLCSS.

List of Beneficiaries Bank-Wise

S.No

Name of Bank Related Link

1. Canara Bank http://www.canarabank.com/english/scripts/prioritycredit.aspx

2. NABARD http://www.nabard.org/nonfarm_sector/clcss.asp3. SIDBI http://www.sidbi.com/governmentclcss.asp4. Bank of Baroda http://www.bankofbaroda.com/bbs/clcss.asp

5. Punjab National Bank

http://www.pnbindia.in/En/ui/Home.aspx

6. The Tamilnadu Industrial Investment Corporation Ltd.

http://www.tiic.org/incentives.html

7. Andhra Bank http://andhrabank.in/english/clcss.aspx

Acceptance of claims for subsidy under CLCSS by Nodal Banks for the year 2013-14.

Beneficiary Unit transfers its loan liability/account from the Bank which provided subsidy to it under CLCSSto another bank. 

First supplement of techonology approved in 6th TSC on 10[1].08.2006

Continuation of Credited Linked Capital Subsidy Scheme (CLCSS) during XI Plan.

Suggested Proforma for consideration of products/Sub-sectors/Technologies under CLCSS.

Second supplement of techonology approved in 7th TSC on 13-07-2009

Third supplement of technology approved in 8th TSC on 1.6.2010

Fourth supplement of technology approved on 10-08-2011

Fifth supplement of technology approved on 23-01-2012

Office Memorandum Regarding Eligibility Criteria for Micro & Small Enterprises on 15-02-2013 

Quality Upgradation/Environment management for small scale sector through incentive for ISO 9000 /ISO 14001 /HACCP Certifications

In order to enhance the competitive strength of the small scale sector, the Government introduced an incentive scheme for their technological upgradation/quality improvement and environment management. The scheme provides incentive to those small scale/ ancillary undertaking who have acquired ISO 9000/ISO 14001/HACCP certifications. The scheme for ISO 9000 reimbursement in operation since March, 1994 has now been enlarged so as to include reimbursement of expenses for acquiring ISO 14001 certification also.

The Scheme envisages reimbursement of charges of acquiring ISO-9000/ISO-14001/HACCP certifications to the extent of 75% of the expenditure subject to a maximum of Rs. 75,000/- in each case. The Scheme is valid upto 31st March 2012.

Quality Upgradation/Environment management for small scale sector through incentive for ISO 9000 /ISO 14001 /HACCP

Certifications

Download Form | ISO 9000 / ISO 14001  | Emerging Trends

 | ISO Application Status

The Small Scale Sector has emerged as dynamic and vibrant sector of Indian Economy and it has been making significant contribution to industrial production, export and employment generation. The process of economic liberalization and market reforms has opened up the Indian small scale sector to the global competition. In order to enhance the competitive strength of the small scale sector, the Government introduced an incentive scheme for their technological upgradation/quality improvement and environment management. The scheme provides incentive to those small scale/ ancillary undertaking who have acquired ISO 9000/ISO 14001/HACCP certifications. The scheme for ISO 9000 reimbursement in operation since March, 1994 has now been enlarged so as to include reimbursement of expenses for acquiring ISO 14001 certification also vide this Office Administrative Order No.41(8)/ISO/Electx./2002 dt. 28th October, 2002. Upto 31st march 2009, 18778 Micro & Small units have been benefited from the scheme.

The Salient features of the Scheme

i. The Scheme envisages reimbursement of charges of acquiring ISO-9000/ISO-14001/HACCP certifications to the extent of 75% of the expenditure subject to a maximum of Rs. 75,000/- in each case. The Scheme is valid upto 31st March'2012.

ii. The Permanent Registered Small Scale/ancillary/Tiny/Small Scale Service Business Enterprises (SSSBE) units are eligible to avail the Incentive Scheme.

iii. The Scheme is applicable to those SSI/ancillary/Tiny/SSSBE units who have already acquired ISO-9000/ISO-14001/HACCP certification.

iv. It is an all India Scheme administered by Development Commissioner (MSME), Ministry of SSI, Govt. of India. With effect from 30.8.2006 procedure of the Screening Committee to decide the reimbursement has been discontinued and the Screening Committee has been dismantled to reduce delay in the sanctioning of reimbursement to the applicants.

v. The Scheme shall provide one time reimbursement only against a Entreperneurship Memorandum Number. The amount of incentive/subsidy/grant already availed for acquiring ISO 9000 or ISO 14001/HACCP Certification under any Central Govt. (including DC(MSME) Incentive Scheme)/State Govt. /Financial Institution shall be adjusted against the entitlement of reimbursement.

It means the total entitlement of reimbursement of acquiring one or more than on certifications shall be up to the maximum limit of Rs. 75,000/- only. In case a unit has received reimbursement/subsidy/grant from Central Govt./State Govt./Financial Institution against any one of the certifications for an amount less than maximum limit of Rs. 75,000/-, the unit shall be eligible to receive the balance amount only.

vi.  (a) Only one time reimbursement is allowed against a E.M.Number for acquiring ISO-9000/ISO-14001/HACCP certification; irrespective of the fact whether the concerned SSI has one or more than one Unit(s) within the same premises/location or outside .

 (b) In case an ISO-9000/ISO-14001/HACCP certificate is obtained jointly by SSI units (even having a separate Permanent E.M.Number) under the corporate/group of Industries category, the total reimbursement shall be limited to 75% of the total expenditure incurred by the concerned units or Rs. 75,000/- whichever is less; and each SSI unit shall get the amount on pro-rata basis.

Guidelines for filling Application Format

The Formats of the Application & the required documents together with "Check list" are enclosed. Small & Micro units with EM No. are required to submit their Applicaton duly completed (with enclosures) to their local Director, MSME-DI addresses given in following websites :

Website www.dcmsme.gov.in

Note:

1. Application should be submitted complete in all respects alongwith the required documents securely tagged & numbered, failing which the application will not be considered.2. For any further guidance/details, the enquiries may be sent to 

Sri Pabitra SarkarJoint Development Commissioner(Tel): 23062694(Fax) 23061972Email : psarkar@dcmsme.gov.inO/o DC(MSME) Nirman BhawanNew Delhi - 110108

Application for the Reimbursement of Certification Charges for acquiring ISO-9000 & ISO 14001 Certification

MARKET DEVELOPMENT ASSISTANCE SCHEME FOR MICRO, SMALL & MEDIUM ENTERPRISES 

The scheme offers funding for:

   1. Participation by manufacturing Small & Micro Enterprises in International Trade Fairs/ Exhibitions under MSME India stall.

   2. Sector specific market studies by Industry Associations/ Export Promotion Councils/ Federation of Indian Export Organisation.

   3. Initiating/ contesting anti-dumping cases by MSME Associations and   4. Reimbursement of 75% of one time registration fee (w.e.f. Ist January 2002)(Under MDA Scheme)

and 75% of annual fees (recurring) (w.e.f. Ist June 2007)(Under NMCP Scheme) paid to GSI (Formerly EAN India) by Small & Micro units for the first three years for bar code.

Objective:

   (i). To encourage Small & Micro exporters in their efforts at tapping and developing overseas markets.   (ii). To increase participation of representatives of small/ micro manufacturing enterprises under

MSME India stall at International Trade Fairs/ Exhibitions.   (iii). To enhance export from the small/ micro manufacturing enterprises   (iv). To popularise the adoption of Bar Coding on a large scale.

(1) Participation by manufacturing Small & Micro Enterprises in International Trade Fairs/ Exhibitions under MSME India stall

1.1 Eligibility criteria

 (i). Unit having valid permanent registration with Directorate of Industries/ District Industries Centre. (ii). The selection of small/ micro manufacturing units would be done by MSME-DIs as per display

product profile, theme of the fair and space availability. (iii). Micro & Small manufacturing enterprise can avail this facility only once a year (iv). Only one person of the participating unit would be eligible for subsidy on air fare. (v). The participating units under MSME India stall at International Trade Fairs/ Exhibitions has to pay

50% of space rental charges of booked space (min. 6 sq.mts.) by enterprises of General categories through MSME-DIs by a DD favouring PAO (MSME), New Delhi at least one month advance of the commencement of the event. In addition to this, selected units can book more space in multiple of 1x3 sq.mts. on pro-rata basis and make payment accordingly. However, Women, SC&ST entrepreneurs & entrepreneurs from North Eastern Region require to pay 50% of space rental charges as security deposit which will be refunded to them after participation in the fair. In the event of non-participation, the security deposit will be forfeited in all cases.

 (vi). The representatives of the participating units are required to carry and manage the samples (to and fro including custom clearance etc.) for display under MSME India stall at the International Trade Fairs/ Exhibitions.

 1.2 Permissible subsidy:

 (i). The Govt. of India will reimburse 75% of air fare by economy class and 50% space rental charges for Micro & Small manufacturing enterprises of General category entrepreneurs.

 (ii). For Women/SC/ST Entrepreneurs & Entrepreneurs from North Eastern Region Govt. of India will reimburse 100% of space rent and economy class air fare.

 (iii). The total subsidy on air fare & space rental charges will be restricted to Rs.1.25 lakhs per unit.1.3 Other conditions:

 (i). Assistance shall be available for travel by one permanent employee/ Director/ partner/ proprietor of the MSE unit in economy class.

 (ii). Space allocation will be made by O/o DC (MSME) at its discretion and the decision will be final and binding.

 (iii). The offer is available on first come first served basis till space is available.1.4 Procedure for availing Financial Assistance/Reimbursement of Expenses:

1.4.1 The application must reach to the Office of DC (MSME) through concerned MSME-DIs at least one month in advance of the commencement of the event. The application must be accompanied by:

 (i). Copy of the valid MSME registration issued by concerned GM (DIC)/ Director of Industries. (ii). Demand Draft in favour of PAO (MSME), New Delhi for 50% rental charges of the booked space. (iii). Details of one or two participating representatives of the unit with photo copy of their valid passport. (iv). Proof of ownership of the unit as SC/ST/Women.1.4.2 On the completion of the event, the participating unit must submit a claim for payment enclosing the following:

 (i). Pre-receipted bill in duplicate. (ii). Photocopy of passport indicating therein entries regarding departure from and arrival in India and

also the country visited. (iii). Original air ticket used during the journey. In case original air ticket is lost, a copy of the same

along-with a certificate indicating details of travel from the concerned airline may be furnished. (iv). Participated units should furnish feedback report like business generated with value including

confirmed orders obtained etc. (v). Claim form must be submitted within one month of return to India on completion of activity.

 (vi). No refund/ adjustment of rental charges will be made by O/o DC (MSME).LIST OF INTERNATIONAL TRADE FAIRS/EXHIBITIONS TO BE PARTICIPATED BY DC (MSME) DURING THE YEAR 2012-13

S.No. Name of Event and Organisation Country Period Product

1. India Pavilion at ACHEMA 2012, by EEPC

Frankfurt, Germany

18-22 June,12 Chemical, Environmental protection, etc. product.

2. The India Show (M-Tech 2012) by EEPC

Tokyo, Japan 18-22 June,12 Engineering Items

3. SAITEX International Fair by ITPO

Johannesburg, South Africa

15-17th July,12 Multi Product

4. House & Gift Fair by ITPO Sao Paulo, Brazil 25-28th August,12

Handicrafts & Giftware

5. The India Show 2012 by EEPC

Brno, Czech Republic

10-14th Sept,12 Engineering Item

6. India Pavilion at Automechanica by EEPC

Frankfurt, Germany

11-16th Sept,12 Automotive industry

7. MICAM-The Shoe Event by CLE

Milan, Italy 16-19th Sept,12 Footwear

8. Ambient by FIEO Ukraine 9-12 Oct,12 Multi Product9. Musaid International

Trade Fair by ITPOIstanbul, Turkey 11-14 Oct,12 Multi Product

10. Australian International Sourcing Fair by ITPO

Sydney, Australia 13-15 Nov,12 Textile Garments & Accessories.

11. Indian Pavilion at Euromold, 2012 by EEPC

Frankfurt, Germany

Nov,12 Mould making, tool, etc.

12. AFL- Artiganio by ITPO Milan, Italy 1-9 Dec,12 Handicrafts Item

13. Indian Pavilion by EEPC Chile 3-5th Dec,12 Multi Products Engineering Items.

* For participation in the above fairs, please follow the revised guidelines (to be issued shortly) and be in touch with concerned MSME-DIs (Field offices of this office) for submitting the application along with requisite documents.

FINANCIAL ASSISTANCE ON BAR CODE

    The Ministry of Micro, Small and Medium Enterprises (MSME), Govt. of India recognizes the contribution of Micro & Small Enterprises (MSEs) in growth of Indian economy, export promotion and employment generation. In order to enhance the marketing competitiveness of MSEs in domestic as well as international market, Office of Development Commissioner (MSME), Ministry of MSME, provides the financial assistance for reimbursement of 75% of one-time registration fee (Under SSI-MDA Scheme) w.e.f. 1st January,2002 and 75% of annual recurring fee for first three years (Under NMCP Scheme) w.e.f. 1st June,2007 paid by MSEs to GS1 India for using of Bar Coding. The work of reimbursement has been decentralised and transferred to field offices i.e. MSME-DIs w.e.f. 1st April,2009 with a view to

ensure speedy & timely and extensive implementation of the scheme 

    Bar codes are the series of black lines and white spaces printed on product packages or attached as tags which you would have noticed on consumer products. Information on a product or a consignment like its item code or serial number, expiry date, consignor/ consignee etc., can be represented through such bar codes. When these bar codes are scanned using a scanner, it enables instantaneous data capture with 100% accuracy and at great speeds. 

    Bar Coding can have a significant impact on the success of any enterprise/ company and organisation. Timely and accurate capture of product information and its communication electronically across the Supply Chain ahead of physical product flow is critical to lowering inventory costs, in accurate sales forecasting & dynamic production scheduling and in product track and trace. 

    Bar Coding not only facilitates the exchange of information between buyers and sellers, but also provides the potential for better visibility and sharing of information across an entire Supply Chain.Other benefits are-

(i) Automated data capture with 100% accuracy,(ii) Real time stock management of raw materials and finished goods(iii) Fast and error free data recording on product/ consignment movement(iv) Easy integration with existing software, if any(v) In compliance with growing requirements of leading national markets(vi) In line with requirements of international retailers &(vii) Also gives international look and feel.

    GS1 India, an autonomous body under Ministry of Commerce & Industry, Government of India is a solution provider for registration for use of Bar Coding. To become a subscriber of GS1 India, all one has to do is fill up the subscription enquiry or registration form and make the necessary payments as registration fee. Details about registration with GS1 India for use of Bar Coding are available on their website www.gs1india.org 

1.Detail Guidelines about the Scheme   2.Guidelines for Financial Assistance   3.Application Form

ubsidy Schemes of NSIC

 

Raw Material Assistance

Raw Material Assistance Scheme aims at helping Small Scale Industries/Enterprises by way of financing the purchase of Raw Material (both indigenous & imported). This gives an opportunity to SSI to focus better on manufacturing quality products. The benefits of the scheme include: 

Financial Assistance for procurement of Raw Material upto 90 days.

SSI helped to avail Economics of Purchases like bulk purchase; cash discount etc

NSIC takes care of all the procedures, documentation & issue of Letter of credit in case of imports.

For more details, click here.

Marketing Assistance

Under the Scheme, marketing support is provided to Micro, Small & Medium Enterprises through National Small Industries Corporation (NSIC) to enhance competitiveness and marketability of their products, through following activities:

Organizing International Technology Exhibitions in Foreign Countries by NSIC and participation in International Exhibitions/Trade Fairs

Organizing Domestic Exhibitions and Participation in Exhibitions/ Trade Fairs in India

Support for Co-sponsoring of Exhibitions organized by other organisations/ industry associations/agencies

Buyer-Seller Meets

Intensive Campaigns and Marketing Promotion Events

Other Support Activities

To know about the scale of assistance under each activity and other details on the scheme, click here.

 

Performance and Credit Rating

A scheme for performance and credit rating for SSIs has been formulated in consultation with Indian Banks’ Association (IBA) and Rating Agencies. NSIC has been appointed the nodal agency for implementation of this scheme through empanelled agencies.Reimbursement of Performance and Rating Fee under this scheme is as below:

Turn Over of SSI Reimbursement of Fee through NSIC

Upto Rs 50 Lacs 75% of the fee or Rs 25000/- (Whichever is less)

Above Rs 50 to 200 lacs 75% of the fee or Rs 30000/- (Whichever is less)

More than Rs 200 lacs 75% of the fee or Rs 40000/- (Whichever is less)

 

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