MSME-DI, Mumbai For MSME Development

1. Presentation onMSME-DI, Mumbai&Policy Initiatives & Schemes of Govt. of India for Development of MSMEs

2. MSME-DI, Mumbai For MSME Development

3. MSME-DI, MUMBAI is the field Office of the Ministry of MSME, Government of India in the state of Maharashtra for promotion and development of MSMEs by extending various policy promotional measures through programmes and schemes

4. Jurisdiction MSME-DI, Mumbai • Ahmednagar • Aurangabad • Beed • Dhule • Hingoli • Jalgaon • Jalna • Kolhapur • Latur • Mumbai • Nanded • Nandurbar • Nashik • Osmanabad • Parbhani • Pune • Raigad • Ratnagiri • Satara • Sangli • Sindhudurg • Solapur • Thane • MSME-DI Nagpur: • Akola • Amravati • Nagpur • Bhandara • Gondia • Wardha • Chandrapur • Yavatmal • Buldhana • Washim • Gadchiroli

5. Services rendered...

6. Services rendered Major Services Provided • Consultancy • Providing Economic Information • Entrepreneurship / Skill Development • Marketing Assistance • Technology & Quality Upgradation • Assistance for Export Promotion • Common Facility Services • Cluster Development

7. Management Consultancy • Management Trainings • Seminars & Workshops • Feasibility Studies • Guidance for Improvement of Management • Capability Consultancy • Technical Consultancy • Product Selection • Project Report • Selection of Raw Material • Selection of Machinery • Selection of Technology

8. Economic Information Services • Industrial Potential Survey • Feasibility Report • Industrial Profile of State & Districts • Collection & Dissemination of Statistics of MSMEs • Advice on policy issues

9. Entrepreneurship/Skill Development Programmes includes • Motivation & Guidance • Product selection • Training Programmes & Motivation Campaigns • Special Programmes for Women & Economically / Socially Backward Class • Preparation of Project Profiles / Reports

10. Marketing Assistance • Buyer Seller Meets • Vendor Development Programmes • Exhibitions • Seminars • Ancillary Development • Participation in International Trade Fairs • Special Global Vendor Development Programme • Market Development Assistance

11. Technology & Quality Upgradation • Technology Resource Programmes for Upgradation of Technology • Pollution Control & ODS Phase Out • Meetings with Foreign Delegations for Technology Transfer • Programmes on ISO 9000 & TQM, Standardization etc • Guidance on Incentives

12. Assistance forExport Promotion • Export Market Information • Export Management Programmes • Packaging for Export • Seminar on Bar Coding

13. Common Facility Services • Workshop Facilities • Services for Industrial Designing • Product Development • Free Library Facility

14. Number – 26.1 Million MSMEs Employ 59.5 Million People Give 45% of Industrial Production * Account for 40%+ of Exports # Contribute 8% to GDP Exports: Rs. 177 Bn USD Production: Rs. 5.9 lakh cr. ($ 140 Bn) No. of Items Mfg. in MSME : 8000 No. of Women Entrepreneurs : 7.4% INDIAN MSMEs - STRENGTHS * 30% for MSEs / SSIs # 33% for MSEs / SSIs

15. Policy initiatives • Enactment of Micro Small & Medium Enterprises Development Act 2008. - Constitution of a Consultative Body with wide representation of stakeholder, viz. National Advisory Board for Policy related interventions. - Setting up of Advisory Committee to examine the matters referred by National Board. - Promotion & enabling provisions – Credit, Procurement Policies for goods by Ministries, Departments & PSUs. - Provision for Delayed Payment Act – Constitution of MSE Facilitation Council, mandatory for State Governments. - Classification of MSMEs. - Process of two stage registration of Micro & Small Enterprises dispensed with & replaced with filing of Memoranda. - Filing of Memoranda optional for all Micro & Small Enterprises. - Filing of Memoranda Mandatory for Manufacturing Sector. - Facilitating Closure of Business.

16. Micro, Small & Medium Enterprises Development Act – 2006 Classification of Enterprises Concept of ‘Enterprises’ as against ‘Industries’ Enterprises classified broadly into : i) Enterprises engaged in the manufacture / production of goods pertaining to any industry; & ii) Enterprises engaged in providing / rendering services

17. Classification of Enterprises MANUFACTURING ENTERPRISES Manufacturing Enterprisesdefined in terms of investment in plant & machinery and further classified into : - Micro Enterprises - Investment upto Rs.25 Lakh - Small Enterprises- Investment above Rs.25 Lakh to Rs. 5.0 Crores - Medium Enterprise- Investment above Rs.5 crore & up to Rs.10 Crores

18. Classification of Enterprises • SERVICE ENTERPRISES • Service Enterprises defined in terms of investment in equipment and further classified into : • Micro Enterprises - Investment upto Rs.10 Lakh • Small Enterprises - Investment above Rs.10 Lakh & upto 2 Crores • Medium Enterprise- Investment above 2 Crores upto 5 crores

19. SCHEMES & PROGRAMMES

20. Credit Linked Capital Subsidy Scheme (CLCSS) for Technology Upgradation of the Micro and Small Enterprises (MSEs)

21. Credit Linked Capital Subsidy Scheme (CLCSS) Objective: To facilitate technology upgradation by providing upfront capital subsidy to micro and small enterprises, khadi, village and coir industrial units, for induction of well established and improved technologies in the specified sub-sectors/products approved under the scheme.

22. Features i. Technology upgradation under the scheme would mean significant improvement in the present technology level to a substantially higher one involving improved productivity and improvement in the quality of the products. This will also include installation of improved packaging techniques, anti-pollution measures, energy conservation machinery, on-line quality control equipments and in house testing facilities. II. 48 sub sectors have been approved under this scheme. III. Financial assistance of 15% subsidy subject to ceiling of purchase price of plant and  machinery of rs.100 lakhs where term loans have been sanctioned by Primeary lending institutions (PLIs) on or after 29.09.2005. IV. The Scheme has been extended up to 11th Plan (2007-2012)

23. Micro & Small Cluster Development Programme (MSE-CDP) • Objectives • Cluster approach is key strategy for enhancing productivity/competitiveness of small enterprises; • Facilitate economies of scale in terms of deployment of resources; • For integrated and focused development of micro and small enterprises

24. WHAT IS CLUSTER Concentration of units producing same/similar products (or engaged in same line of industrial activity) located within a defined geographical area, such as mohalla, taluk or tehsil having Common challenges, bottlenecks and opportunities

25. SCOPE OF THE SCHEME - Diagnostic Study– all aspects to suggest emphasis for development - Forming Associations - Trust building & Developing Identity - Workshops, Seminars, Awareness Campaign, Training and Study visits - Common Purchase, lower Costs - Re-sourcing of better technology - Technology transfer through training/ demonstrations - Apportion different aspects of production among units – specialization - Setting up of Common Facility Centre (CFC), Mini Tool Room, Testing Lab, Design Centre, Common Raw Material Bank - Common/complementary sales and branding - Easier Credit – use of Micro Finance/Credit Guarantee - Handholding support in general

26. MSE- Cluster Development Programme • MSE-CDP Covers the following broad activities. Soft Interventions : • A) Diagnostic Study – emphasis on all aspect of overall development of the cluster. • B) Forming Associations – Trust Building & Developing identity. • C) Workshops / Seminars / Awareness Campaigns / Training & Study Visit • D) Common Purchase at lower cost. • E) Re-sourcing of better technologies • F) Technology Transfer through Training / Demonstrations. • G) Apportion different aspects of productions amongst units leading to specialization. • H) Common / Complimentary Sales & Branding • I) Easier Credit – Use of Micro Finance / Credit Guarantee. • J) Hand holding support in general.

27. MSE- Cluster Development Programme Hard Interventions • Technical Interventions – Directed towards creation of fixed assets towards assisting technological improvements, quality standardization & testing facilities etc in the form of common facility centre, common tool room, common testing, ETP etc. • Development / Upgradation of physical infrastructure – for new clusters / industrial estates. • Women Clusters – Assistance available to Association of Women Entrepreneurs for establishing exhibition centres for display and sale of products of women owned micro and small enterprises

28. MSE-Cluster Development Programme • Implementing Agencies • In addition to Special Purpose Vehicles (SPVs) of Cluster beneficiaries, institutions / agencies of the following categories will also act as implementing agencies. • A) State Government (DICs, Other Autonomous Bodies) • B) Central Government (MSME-DIs etc) • C) Other National / International Agencies (Societies / NGOs etc) • In case the implementing agencies is not the State Govt. or its organisation the agency will also need to necessary come through the State Government. • For select interventions business development service providers can be engaged (for identifying technology gaps, developing markets and export linkages)

29. FUNDING PATTERN: CFC • Special Purpose Vehicle (SPV), i.e., Society/ Trust/ Co. to be formed by cluster beneficiaries before seeking funds for Common Facility Centre (CFC), • For CFC, GoI support is : • Cost of Project and Govt of India Assistance: Diagnostic Study - Maximum cost Rs. 2.50 lakhs. Soft Interventions - Maximum cost of project Rs. 25.00 lakh, with GoI contribution of 75% (90% for Special Category States and for clusters with more than 50% women/micro/village/SC/ST units). Hard interventions i.e setting up of CFCs – maximum eligible project cost of Rs. 15.00 crore with GoI contribution of 70% (90% for Special Category States and for clusters with more than 50% women/micro/village/SC/ST units) . • Cluster beneficiaries’ share should not be less than 10% of the total cost of CFC, including the cost of land and building. • State Government contribution will be considered as the viability gap funding.

30. Credit Guarantee Fund Trust for Micro and Small Enterprises(CGTMSE) Objective : To make available collateral-free credit to the micro and small enterprise sector. Both the existing and the new enterprises are eligible to be covered under the scheme.

31. CGTMSE- Features • Lender should extend credit without obtaining any Collateral Security / Third Party Guarantee • Credit facilities extended jointly by two or more banks / institutions to a single borrower, shall not be eligible for guarantee cover {Enterprises assisted by State Level Institutions / NSIC / NEDFi can seek credit facilities from Banks} • Interest Rate levied should be in accordance with Government / Reserve Bank of India guidelines / not more than 3% of lending Bank’s PLR • Credit facility upto Rs.100 lakh sanctioned to MSEs (both manufacturing and service enterprises under the ambit of MSEs as per RBI guidelines on “Lending to Priority Sector” excluding retail trade) • Both Fund & Non-fund based Credit facilities viz., term loan, working capital, composite credit, LCs, Guarantees, etc.

32. ISO Reimbursement Scheme Objectives: 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. Features: • The scheme provides reimbursement of 75% of the expenses up to a maximum of Rs.75,000/- to each unit as one time Reimbursement. • Applicable only to those Micro & Small Enterprises who have already acquired ISO 9000/ISO 14001/HACCP certifications and have submitted Entrepreneurship Memorandum (Part – 2). • The scheme has been extended upto 31st March, 2012.

33. Scheme for Capacity Building Objective of the Scheme : To strengthen the role and efficiency of Associations in Micro & Small Enterprises. Scheme involves : Financial Assistance for the Secretarial & Advisory / Extension Services to a maximum of Rs.5 Lakhs. • Phase I • Computer and its peripherals including software Rs.4,00,000/- • Furniture and Office Equipments, eg. Fax etc Rs.1,50,000/- • Photocopier Machine & its Accessories Rs.2,00,000/- • Phase II • Consumables per annum Rs.1,00,000/- • Training of the Staff Rs. 50,000/- • Expenses of Travel etc. Rs. 50,000/- • Contingent & Other Offices Expenses Rs. 50,000/- • Rs.10,00,000/-

34. MDA Scheme • Participation in selected International Exhibition / Fairs purely a promotional scheme to give an exposure to MSE Units. • The Govt. of India will reimburse 75% of airfare by economy class, subjected to Rs.40,000/- (Rs.60,000/- for Latin American countries) for small manufacturing enterprises and 90% with corresponding absolute ceiling for micro manufacturing enterprises. • 50% subsidy on space rent. • Subsidy of Rs.15,000/- per participation for shipping cost. • The total subsidy on Airfare, Space Rent & Shipping will be restricted to Rs.1.5 lakh for micro manufacturing units or actual whichever is less. The facility can be availed once in a year. • Only one person from the unit can be eligible to participate. • In addition, the scheme also provides for financial assistance of Rs.2 Lakh for commissioning specific market studies & assistance for initiating / anti-dumping cases is available to SSI Associations limited to 50% of the total cost upto Rs.1.0 Lakh, whichever is less.

35. Credit Rating Scheme of NSIC NSIC has been appointed the nodal agency for implementation of this scheme through empanelled agencies.. Benefits of Performance and Credit Rating • An independent, trusted third party opinion on capabilities and credit-worthiness of MSMEs • Availability of credit at attractive interest • Recognition in global trade • Prompt sanctions of Credit from Banks and Financial Institutions • Subsidized rating fee structure for SSIs • Facilitate vendors/buyers in capability and capacity assessment of SSIs • Enable MSMEs to ascertain the strengths and weaknesses of their existing operations and take corrective measures. Benefits to Banks and Financial Institutions • Availability of an independent evaluation of the strength and weaknesses of an MSME unit seeking credit and thereby enabling banks and financial institutions manage their credit risk

36. Credit Rating Scheme of NSIC • Salient Features • A combination of credit and performance factors including operations, finance, business and management risk • Uniform Rating Scale for all empanelled rating agencies. • MSMEs have the liberty to choose among the empanelled Rating Agencies. • Turn-Over based Fee structure • Partial Reimbursement of Rating Fee through NSIC • Empanelled Agencies (Click on the names for contact details and rating fee) • CARE • CRISIL • FITCH • ICRA • ONICRA • SMERA • Dun & Bradstreet(D&B) • (Empanelment of  D&B under this scheme was valid upto 31.03.2009. Thereafter rating is being done by SMERA as "NSIC-D&B-SMERA Rating") • BRICKWORK RATINGS (BWR)

37. National Manufacturing Competitiveness Programme (NMCP) Objective To support the manufacturing sector, particularly Micro, Small and medium Enterprises (MSMEs) in their Endeavour to become competitive in global market.

38. Features • Formulation of NMCP announced in 2005-06 Budget • It is to support MSMEs and : • Ensure MSME Sector Grows at a Healthy Rate • Draft ‘National Strategy for Manufacturing’ • 10 Schemes drawn up under NMCP at Rs. 973 crore • Implementation of Schemes to be in PPP Mode • Programme deals with Firm-Level Competitiveness, addressing issues of Competitiveness against Global Challenges

39. NATIONAL MANUFACTURING COMPETITIVENESS PROGRAMME - COMPONENTS Full Name of the Scheme Short Name • MarketingSupport/Assistance to MSMEs BAR CODE • Support for Entrepreneurial and Managerial Dev INCUBATOS • Enabling Manufacturing Sector to be competitive thru Quality Mgt. Standard & Quality Tech. Tools QMS/QTT • National Campaign for Investment in Intellectual Property IPR • National Programme on Application on Lean Mnf. LEAN • Mini Tool Rooms proposed to be set up by Min. of MSME MTR • Promotion of ICT in Indian Manufacturing Sector ICT • Technology & Quality Upgradation Support TECH UP • Design Clinic Scheme for design expertise to Mnf. sector DESIGN • Marketing Assistance/SMEs and Technology Upgradation Activities - Ministry of SSI in co-operation with TIFAC/CSIR MARKETING

40. 10 Components of NMCP

41. Lean Manufacturing Scheme (LMS) for MSMEs (100 mini clusters)

42. Lean Manufacturing Scheme (LMS) for MSMEs (100 mini clusters) Total Project Cost : Rs.30.57 Crores with GOI Contribution of Rs.26.3 Crores) Activity Fund GoI Private Contribution Contribution • Awareness Programme Rs.50.00 Lakh Full Nil • ii) Lean Implementation Rs.23.50 Lakh Rs.18.80 Lakh Rs.4.7 Lakh • (Consultation Fee) (80%) (20%) Implementing Agency : National Productivity Council Intended Output : Increase in Productivity by 20% Time Frame : One Year Implementation in each Unit.

43. Design Clinics Scheme for Design Expertise to MSME Mfg. Sector

44. Design Clinics Scheme for Design Expertise to MSME Mfg. Sector Total Project Cost : Rs.73.58 Crores with GOI Contribution of Rs.49.08 Crores) Activity Fund GoI Private Contribution Contribution • Seminars Rs.0.60 Lakh Full Nil • Workshops Rs.4.0 Lakh Rs.3.0 Lakh(75%) Rs.1.0 lakh(25%) • Student Project Rs.2.0 Lakh Rs.1.5 Lakh (75%) Rs.0.50 lakh(25%) • Individual Projects Rs.15.0 Lakh Rs.9.00 Lakh(60%) Rs.06.00 Lakh (40%) • (upto 3 MSMEs) • v) Group of 4 MSMEs Rs.25.0 Lakh Rs.15.0 Lakh(60%) Rs.10.00Lakh(40%) • or more Implementing Agency : National Institute of Design (NID) Intended Output : Improved / New Products with better customer preference Time Frame : Design Projects of 4 to 6 months

45. Marketing Assistance & Technology Upgradation Scheme for MSME

46. Marketing Assistance & Technology Upgradation Scheme for MSME Total Project Cost : Rs.23.00 Crores with GOI Contribution of Rs.18.608 Crores) Activity Fund GoI Private Contribution Contribution • Technology Upgradation in Packaging • Awareness Prog. on • Packaging Rs.0.50 lakh Rs.0.40 lakh(80%) Rs.0.10 lakh(20%) • Cluster based studies on Rs.10.0 lakh Rs.8.0 lakh(80%) Rs.2.0 lakh(20%) • Packaging • c) Unit based intervention Rs.0.90 lakh Rs.0.72 lakh(80%) Rs.0.18 lakh)(20%) Implementing Agency : Expert Agency such as IIP Intended Output : Adoption of New packaging techniques for better sale / export Time Frame : 4 to 6 months in each group of 10 units.

47. Marketing Assistance & Technology Upgradation Scheme for MSME Contd… Activity Fund GoI Private Contribution Contribution ii) Skill Development / Rs.6.0 lakh Rs.4.8.lakh(80%) Rs.1.2 lakh (20%) Upgradation iii)Competition Studies Rs.8.0 lakh Rs.6.4 lakh(80%) Rs.1.6 lakh(20%) iv)Sp.Comp. of NE Region Rs.6.0 lakh per Rs.4.8 lakh(80%) Rs.1.2 lakh (20%) Exhibition v) State/Dist Exhibition Rs.3.0 lakh Rs.2.4 lakh(80%) Rs.0.6 lakh(20%) vi) Corporate Governance Rs.0.90 lakh Rs.0.45 lakh(50%) Rs.0.45lakh(50%) vii)Marketing Hub Rs.42.5 lakh Rs.41 lakh Rs.1.5 lakh (30+5+7.5) viii)Reimbursement to Rs.1.0 lakh max Rs.1.0 lakh -- ISO 18000/22000/27000 (max.)(75%) Implementing Agency : for Activity No II & III Expert Agencies for Activity No IV to VI MSME-DIs for Activity No. VII MSME-Dis with CPWD Activity No. VIII – MSME-DIs Intended Output : knowledge of modern techniques, Exposure to outside fairs, adoption of company structure, Display of Products of MSMEs, Quality Assurance etc.

48. Enabling manufacturing sector to be competitive through Quality Management Standards (QMS & QTT)

49. Enabling manufacturing sector to be competitive through Quality Management Standards (QMS & QTT) Total Project Cost : Rs.50.00 crores with GOI contribution of 41.1 Crores) Activity Fund GoI Private Contribution Contribution • Introduction of Courses Rs.425 lakh Full Nil • in 1800 ITIs/Tech. Instt. per year • Awareness programmes Rs.1.25 lakh Rs.0.79 lakh(63%) Rs.0.46 lakh(37%) • per programme • iii) Competition Watch Rs.60.0 lakh for Rs.38.00 lakh / yr Rs.22 lakh (36.6%) • two sectors (63.4%) • a) Product Professional Rs.5.0 lakh Rs.2.5 lakh(50%) Rs.2.5 lakh(50%) • Study • b)Technical exposure Rs.10.0 lakh Rs.7.5 lakh(75%) Rs.2.5 lakh(25%) • visit by representatives • c) Procurement of samples Rs.5.0 lakh Rs.2.5 lakh(50%) Rs.2.5 lakh(50%) • d) Product development Rs.8.0 lakh Rs.5 lakh(62.5%) Rs.3.0 lakh(37.5%) • e) Popularization of Rs.2.0 lakh Rs.1.5 lakh (75%) Rs.0.5lakh(25%) • improved version • Implementation of Rs.2.5 lakh / unit Rs.1.56 lakh Rs.0.94 lakh(37.5%) • QMS / QTT 62.5% • International Study Rs.2.5 lakh/Unit Rs.1.56 lakh Rs.0.94 lakh(37.5%) • Missions 62.5%

50. Enabling manufacturing sector to be competitive through Quality Management Standards (QMS & QTT) Contd.. Implementing Agency : Expert Professional Agency Intended Output : Adoption of courses in ITI & Polytechnics, Awareness on QMS/QTT, Knowledge of quality products and adoption by MSMEs, Study of best practices and adoption of the same.