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Government Assistance to Small Industries and Small Units

The government of India's thrust has been in promoting and developing the small unit sectors, with more emphasis on rural industries and cottage industries. Both central and state government are actively participating in developing self employment opportunities in rural sectors by providing assistance in financing, training, infra structure, raw material and technology. The various policy of government emphasis on rural sectors using local manpower and locally available raw materials which are transformed into action through various departments, agencies, corporation etc,. All of this act keeping in view promotion of small scale and rural industries. Some of the support for these industries is:
  1. Institutional Support
    1. National Bank for Agriculture and Rural Development (NABARD) this institution was setup in 1982 to integrate and promote rural activities. It has adopted multi purpose strategies in promoting rural business enterprises in the country. Apart from agriculture it supports other industries viz., small industries, rural artisans, rural industries and cottage industry. NABARD organizes training offers counseling and give development programmes for rural entrepreneurs.
    2. The Rural Small Business Development Centre (RSBDC) a centre sponsored by NABARD for small and medium enterprises which is setup by world association. The main aim of RSBDC is to work for socially and economically disadvantaged individuals and groups. They organize many programmes on skill up gradation, rural entrepreneurship, awareness, counseling and training. Through these various programmes several rural unemployed youth and young women learn different trades and reap good benefits.
    3. National Small Industries Corporation (NSIC) The NSIC was set up in 1955 to promote and aid small business focusing on commercial aspects.
      • Supply imported goods and machines on hire-purchase terms
      • Procure supply imported indigenous raw material
      • Developing the small business by exporting their products
      • Mentoring services
      • Awareness on technical up gradation
      • Establishing and developing software parks
A new scheme called performance and credit rating for small units has been introduced by NSIC this ensures the more their credit rating the more their financial assistance for their investment and capital requirement.
  1. Small Industries Development Bank of India(SIDBI) This is an Apex bank to provide direct and indirect financial support under various schemes to meet credit requirements of small business organizations.
  2. The National Commission for Enterprises in The Unorganised Sector (NCEUS) it was formed in September 2004 with main objectives being.
    • Measures to Improve productivity of small scale industries in the informal sector
    • To generate a sustainable employment opportunity in the rural sector
    • To enhance the competition of the small scale sector in global environment
    • To develop link between small sector and other sectors like credit, infrastructure, technology, raw material and arrange suitable up gradation for skill development
    • Potential for public and private partnership in imparting the skills for informal sector
    • Providing micro-finance for informal sector
    • Provision of social security for informal sector.
  3. Rural and Women Entrepreneurship Development(RWED) the RWED
    Aim at promoting a conductive business environment and also to encourage and support the women entrepreneur's initiatives. It also provides training manual for these women entrepreneurs and renders advisory services.
  4. World Association for Small and Medium Enterprises(WASME) this is a only international body that is non-governmental organization of micro, small and medium business units in India which set up International committee for rural industries with an aim to develop action plan model for sustained growth of rural industries. Apart from these there are many schemes initiated by government of India viz,. IRDP - integrated Rural Development Programme, PMRY-Prime Minister Rojgar Yogna, TRYSEM- Training of Rural Youth for Self Employment, DWCRA- Development of Women and Children in Rural Areas and JRY- Jawahar Rojgar Yogna. Finally there are schemes for specific group of industries such has khadi, handloom and handicrafts.
  5. Scheme of Fund For Re-generation of Traditional Industries From the year 2005 the government established this fund of Rs.100 crores to make these traditional industries more productive and to facilitate their sustainable development. This was implemented by Ministry of Agro and Rural industries in collaboration with state governments. The objectives of the schemes are to develop a cluster or group of traditional industries in various parts of India. To improve traditional skills, technology and to develop market intelligence.
  6. The District Industries Centre (DIC) on May 1st this program was launched with a view to provide integrated administrative framework for the district level. This provides support and service to the entrepreneurs to set up small and village industries. These centers identify suitable schemes, credit facility, machinery and equipment, raw material and other services possible. DIC's try to change the attitude of the small scale business people and all other connected with economic development of rural areas. Thus it emerges as an focal point for the development of rural economic and industrial growth at district level.
  1. Incentives
    The government of India emphasizes on the economic and industrial development of backward, tribal and hilly areas of the country. Several committees have been set up to identify the criteria for backward areas and suggest schemes those are needed. These backward program and schemes vary from state-to-state. They together represent a cumulative package of benefits and incentives to attract industries in backward areas. Some common benefits offered are:
    Land, Power, Water, Sales Tax, finance, octroi, raw material, industrial estates, Tax holiday. To sum up the small scale industry receives various forms of benefits from government of India. Though special attention is given to backward areas there is still a small amount of imbalance in economic growth. These are due to the lack of poor infrastructure in these areas.

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