"Role of Specialized Institutions in Development of SSI "

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Presented By :

Mohd Alam & Md Abu Shaham

Initially SSI were classified into two categories- those using power with less than 50 employees and those not using power with the employee strength being more than 50 but less than 100.

An industrial unit can be categorized as a small- scale unit if it fulfils the capital investment limit fixed by the Government of India for the small-scale sector. Investment –

Upto 5 crores (production) upto 2 crores (services)

Employee – Less than 200

Products – Mostly unbranded

WHAT IS SSI?

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SSI in INDIA

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Contributes almost 40% of the gross industrial value added in the Indian economy.

Employment generation next only to agriculture.

Contribution to exports

Importance of SSI

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Employment

Rural development

Reduces inequality of

income

Operational flexibility

Assists large scale

industries

Foreign exchange

Types of SSI

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SSI

Traditional Modern

Khadi

Handlooms

Sericulture

Cottage

Ancillaries

Tiny/Small /Medium Enterprises

Small-Scale Service and Business Enterprises

Government initiatives

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Exemption for excise duty limit raised from

Rs. 50 lakhs to Rs. 1 crore

The composite loans limit raised from Rs.

10 lakhs to Rs.25 lakhs

The Nayak Committee's recommendations

regarding working capital

Types of Specialized Institution:

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1)All India Institutions:

Small Scale Industries BoardMinistry of Small Scale Industries• Small Industry Development Organisation

(SIDO)National Small Industries Corporation (NSIC)

LimitedThe Khadi and Village Industries Commission

(KVIC)Coir BoardTraining Institutes

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2 )State Level Institutions:

State Industrial Development Corporations (SIDCs)

State Directorate of Industries (SDIs) District Industries Centres (DICs)

3)Fund-Based Institutions :

Small Industries Development Bank of India (SIDBI) Commercial Banks State Financial Corporations (SFCs)

ALL INDIA INSTITUTIONS

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THE KHADI AND VILLAGE INDUSTRIES COMMISSION (KVIC) :

The Khadi and Village Industries Commission (KVIC) is a statutory body created by an Act of Parliament in April 1957

The KVIC is supposed to do the planning, promotion, organization and implementation of programs for the development of khadi and other village industries in the rural areas.

NATIONAL SMALL INDUSTRIESCORPORATION (NSIC):

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NSIC , Ltd. was set up in 1955 with a view to promoting, aiding and fostering the growth of small scale industries in the country with focus on commercial aspects of these functions .

a) Composite Term Loan Schemeb) Equipment leasingc) Working Capital Financed) Raw Material Assistancee) Marketing Support programf) Technology Up gradation

COIR BOARD:

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Coir Board is a statutory body established

by the Government of India under a legislation enacted by the Parliament namely Coir Industry Act 1953 for the promotion and development of Coir Industry in India as a whole.

State Level Institutions

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• They act as a catalyst for promotion of investment and industrial development in the respective States.

State Industrial Development Corporations (SIDCs)

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• They have been set up with the aim of promoting industrial development in the respective States and providing financial assistance to small entrepreneurs.

• They are also involved in setting up of medium and large industrial projects in the joint sector/assisted sector in collaboration with private entrepreneurs or wholly-owned subsidiaries.

E.g. Tamil Nadu Industrial Development Corporation Ltd. (TIDCO)

ROLE OF DIC:

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Technical support for preparation of Project Report. 

Information on sources of machinery & Equipment.

Priority in Power supply/ Telephone connection.

Promotion of new Industrial Estates/ Growth Centers.

 Land/ Shed in Industrial Estate.  Approval of Project Reports of special

types.  Promotion of Electronic Industries.

FUND-BASED INSTITUTIONS:

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Government of India recognized the need for a focused credit policy for SSIs in the early days of promotion of SSIs and RBI has been instrumental in devising a multi-stage approach/financial system for credit dispensation to different sectors of the economy, for example, agriculture, industry, exports, SSIs etc. This section focuses on the role of SIDBI, SFCs and commercial banks in granting credit to small scale and tiny sector

State Financial Corporations (SFCs)

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This plays a crucial role in the development of small and medium enterprises in the concerned States.

SFCs have been set up with the objective of catalyzing higher investment, generating greater employment and widening the ownership base of industries.

There are 18 SFCs in the country.Eg : Tamil Nadu Industrial Investment

Corporation Limited.Rajasthan Finance Corporation (RFC)

Small Industries Development Bank of India (SIDBI)

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• Set up by the Government of India in April 1990, as a wholly owned subsidiary of IDBI.

• It is the principal financial institution for promotion, financing and development of small scale industries in the economy.

• It aims to empower the Micro, Small and Medium Enterprises (MSME) sector with a view to contributing to the process of economic growth, employment generation and balanced regional development.

Thank You

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