10. MSE-Cluster Development Programme (MSE-CDP)
The Programme is being implemented for holistic and integrated development of micro and small enterprises in clusters through Soft Interventions (such as diagnostic study, capacity building, marketing development, export promotion, skill development, technology upgradation, organizing workshops, seminars,
training, study visits, exposure visits, etc.), Hard Interventions (setting up of
Common Facility Centres) and Infrastructure Upgradation (create/upgrade
infrastructural facilities in the new/existing industrial areas/clusters of MSEs). The
guidelines of the MSE-Cluster Development Programme have been
comprehensively modified in February 2010 to provide higher support to the MSEs. The scope of the scheme includes:
(i) Preparation of Diagnostic Study Report with Government of India (GoI)
grant of maximum Rs.2.50 lakh (Rs.1 lakh for field offices of the Ministry of
MSME). (ii) Soft Interventions like training, exposure, technology upgradation, brand
equity, business development, etc. with GoI grant of 75% of the sanctioned
amount of the maximum project cost of Rs. 25 lakh per cluster. For NE &
Hill States, Clusters with more than 50% (a) micro/ village, (b) women
owned, (c) SC/ST units, the GoI grant will be 90%. (iii) Detailed Project Report (DPR) with GoI grant of maximum Rs. 5 lakh for preparation of a technical feasible and financially viable project report. (iv) Hard Interventions in the form of tangible assets like Common Facility
Centre having machinery and equipment for critical processes, research
and development, testing, etc. for all the units of the cluster with GoI grant upto 90% of the cost of project of maximum Rs. 15 crore. (v) Infrastructure Development with GoI grant of upto 80% of the cost of project of Rs. 10 crore, excluding cost of land. (vi) Exhibition Centres by Associations of Women Entrepreneurs of women
owned micro and small enterprises with GoI assistance @ 40% of the
project cost. Over 460 clusters have been undertaken for various cluster development
interventions (i.e., diagnostic study, soft interventions, and hard interventions) and
126 proposals (including 28 for upgradation of existing industrial estates) have
been taken up for infrastructure development under the scheme. 11. Credit Linked Capital Subsidy Scheme To make the Credit Linked Capital Subsidy Scheme (CLCSS) more
attractive, the following amendments were made with effect from September 29, 2005: (a) the ceiling on loans has been raised from Rs.40 lakh to Rs.1 crore; (b)
the rate of subsidy has been raised from 12 per cent to 15 per cent; (c) the
admissible capital subsidy has now been based on the purchase price of plant and machinery, instead of the term loan disbursed to the beneficiary unit; and (d)
the practice of categorisation of MSEs in different slabs on the basis of their present investment for determining the eligible subsidy has been dispensed with. Further, the ambit of Scheme was enlarged in 2009-10 to include 201 new
technologies, including 179 technologies relating to Pharmaceutical sector. The
coverage under the Scheme has shown considerable increase and up to October 2010, 10,952 MSEs have benefited under the Scheme with the total subsidy
sanctioned amounting to Rs.514.13 crore. 12. Entrepreneurship and Skill Development
In line with the overall target set by the Prime Minister’s National Council on Skill
Development, the Ministry has taken up skill development as a high priority area. Under the Entrepreneurship/Skill Development Programmes conducted by
various organisations of the Ministry of MSME, about 3.5 lakh persons were
trained during 2009-10 which is an increase of more than 33% over previous year. To further expand the coverage of training programmes, a new component under
the scheme of ‘Assistance to Training Institutions’ has been added to, inter-alia, provide assistance to the training institutions/centres established by Partner
Institutions (PIs) of National Level Entrepreneurship Development Institutes (EDIs) and franchisees of National Small Industries Development Corporation (NSIC). Further, the Ministry of MSME provides all such trainings to disadvantaged
sections of the society like the trainings for SCs/STs, free of cost. A number of
programmes are also being organised for women and other weaker sections of
the society free of cost, besides providing a monthly stipend of Rs.500/- per month during the entire period of training.
13. Rajiv Gandhi Udyami Mitra Yojana The scheme aims to promote and support establishment of new micro and small enterprises through handholding of potential first generation entrepreneurs, who
have already successfully completed Entrepreneurship Development Programme
(EDP)/Skill Development Programme (SDP)/Entrepreneurship-cum-Skill
Development Programme (ESDP) of at least two weeks’ duration, or have
undergone vocational training from ITIs. One of the main objectives of
handholding is to guide and facilitate the potential entrepreneurs in dealing with
various procedural and legal hurdles and completion of various formalities which
are required for setting up and running of enterprise successfully and to save
them from harassment at the hands of various regulatory agencies for want of required compliances. It will not only increase the proportion of potential entrepreneurs trained under various EDPs/SDPs/ESDPs/Vocational Training (VT)
in setting up their enterprises, more importantly, it will also enhance
survival/success rate of newly set up enterprises. As a component of this scheme, the Ministry has recently launched a MSME Call
Centre (known as ‘Udyami Helpline’) with a toll-free number 1800-180-6763. The Udyami Helpline, inter-alia, provides basic information on how to set up an
enterprise, various schemes being implemented for the promotion of MSMEs, accessing loans from banks and further contacts for obtaining detailed information. 14. Performance and Credit Rating Scheme To sensitize the MSE sector on the need for credit rating and encourage the MSEs to maintain good financial track record enabling them to earn higher rating
for their credit requirements, the Government in April 2005 launched the
‘Performance and Credit Rating Scheme’. The implementation of the scheme is
through National Small Industries Corporation Ltd. (NSIC). Reputed Rating
Agencies have been empanelled by NSIC from which the MSEs can select the
one to be engaged by it for obtaining the rating. The Ministry of
MSME subsidises the cost of rating by sharing 75% of the fee charged by the Rating Agency, subject to a ceiling of Rs.40,000. 15. National Small Industries Corporation Limited
To provide an opportunity for first generation entrepreneurs to acquire skills for enterprise building and to incubate them to become successful small business owners, NSIC has set up 47 Training-cum-Incubator Centres (TICs) under PPP mode. NSIC has also launched a B2B Web portal to provide marketing facilities
to national and international MSMEs for business to business relationship. The MSME Info Call Centre of NSIC has been made functional to provide information
about the schemes and activities being implemented for the benefits of MSMEs. Further, NSIC has established a Marketing Intelligence Cell in May 2010, which
shall provide database and information support to the MSMEs on marketing of
their products/ services. 16. Khadi Reform Development Programme (KRDP)
In order to revitalize and reform the traditional khadi sector with enhanced
sustainability of khadi, increased artisans welfare, increased incomes and
employment opportunities for spinners and weavers with lesser dependence on Government grants, a Khadi Reform Development Programme was formulated by
the Ministry of MSME in consultation with Khadi and Village Industries Commission (KVIC), Asian Development Bank (ADB), Department of Economic Affairs (DEA) and Price Waterhouse Coopers (PWC). This programme is proposed to be implemented in 300 selected khadi institutions willing to undertake
the identified reforms. The DEA has arranged a sum of US$ 150 million
equivalent to Rs.717 crore (approx.) from ADB to be given to KVIC as grant in
four tranches over a period of 36 months. After completion of procedural
formalities, and signing of necessary agreement and announcement by ADB, the
first tranche of Rs.96 crore was released to KVIC in February 2010. The second
tranche of Rs.192 crore has been earmarked in BE 2010-11.
17. Market Development Assistance (MDA) Scheme The scheme has been introduced w.e.f. 01.04.2010 and envisages financial assistance @ 20% on value of production of khadi and polyvastra which will be
shared among artisans, producing institutions and selling institutions in the ratio
25:30:45. The scheme has been introduced on the basis of recommendations of several committees constituted during the past few decades and after running
several pilot projects in the past. The need had arisen because Khadi production
so far was not based on market demand or performance and the rebate system
did not benefit the spinners and weavers. Also KVIC was constrained to devote most of its resources for administration of rebate; to the detriment of its remaining
responsibilities regarding development of the sector. MDA seeks to rectify this
imbalance and provide flexibility/freedom to the khadi institutions to take
innovative measures to improve its marketing infrastructure such as renovation of outlets, training sales persons, computerization of sales, design improvement, publicity, discount to customers, improved equipments of production, training of artisans and capacity building so that khadi can attract more customers not just
because of discount, but because of its quality design and appeal. Most
importantly, for the first time a definite share of 25% of MDA has been earmarked
for spinners and weavers which will give them a prominent role in the entire khadi chain of activities. An amount of Rs.345.05 crore has been earmarked to be
incurred during 2010-11 and 2011-12 as MDA. 18. Workshed Scheme for Khadi Artisans Under this scheme, assistance is provided for construction of Worksheds for Khadi artisans for better work environment. Around 38,000 worksheds are
targetted to be constructed between 2008-09 and 2011-2012 at a total cost of
Rs.127 crore approximately, involving financial assistance of Rs.95 crore as grant
to KVIC from Government of India’s budgetary sources. Financial assistance for establishment of workshed has been provided to 5,951 artisans in 2009-10. In BE
2010-11, an amount of Rs.20 crore has been earmarked for assisting
10,000 artisans under this scheme. 19. Scheme for Enhancing Productivity and Competitiveness of Khadi Industry and Artisans The scheme aims to provide financial assistance to 200 of the ‘A+’ and ‘A’ category khadi institutions of which 50 institutions would be those which are managed exclusively by beneficiaries belonging to Scheduled Castes/Scheduled
Tribes to make them competitive with more market driven and profitable
production by replacement of obsolete and old machinery and equipment. The
total cost of the scheme is Rs.84 crore involving financial assistance of Rs.71.14
crore as grants to KVIC from Government of India’s budgetary sources between
2008-09 and 2011 -2012. 20 khadi institutions were assisted with financial assistance of Rs.2.23 crore under this scheme in 2009- 10. An amount of Rs.21 crore has been earmarked in BE 2010-11 for assisting
60 khadi institutions under this scheme. 20. Scheme for Rejuvenation, Modernisation and Technological Upgradation of
Coir Industry
Under the scheme, assistance is provided to spinners and tiny household sector
for replacement of outdated ratts/looms and for constructing worksheds so as to
increase production and earnings of workers. In 2009-10, 296 spinning units and
410 tiny household units have been assisted under this scheme and a target for assisting 320 spinning units and 880 household units has been fixed for 2010-11 with the budget allocation of Rs.21 crore. During 2010-11 (upto September 2010), Rs. 4.88 crore has been released by the Ministry. 21. Scheme of Fund for Regeneration of Traditional Industries (SFURTI)
This Scheme was launched in 2005 for regeneration of traditional industries,
identified clusters in khadi, village industries and coir
sectors with a view to make these industries more productive and competitive and
increase the employment opportunities in rural and semi-urban areas. The
objective of the Scheme is to establish a regenerated, holistic, sustainable and
replicable model of integrated cluster-based development of traditional industries
in khadi, village and coir sectors. So far 105 clusters (Khadi – 29, Village
Industries – 50 and Coir - 26) have been taken up under SFURTI and production has been
started in 72 clusters. Cluster interventions will be completed in remaining 33
clusters providing employment to around 16,000 rural artisans in 2010-11. 22. Mahatma Gandhi Institute for Rural Industrialization (MGIRI)
A national level institute named MGIRI has been established at Wardha, Maharashtra as a society under Societies Registration Act, 1860 by revamping
Jamnalal Bajaj Central Research Institute in association with IIT, Delhi for strengthening the R&D activities in khadi and village industry sectors. The main
objectives of the institute are as under:
To accelerate rural industrialization for sustainable village economy so that
KVI sector co-exists with the main stream. Attract professionals and experts to Gram Swaraj. Empower traditional artisans.
Innovation through pilot study/field trials. R&D for alternative technology using local resources. During 2010-11, it is proposed to initiate action on handholding support to 68 model enterprises in bio-processing, chemical, energy, rural crafts and solar garments sets and 21 machines/processes/services would be improved.
23. National Board for MSMEs The Government has set up for the first time, a statutory National Board for Micro, Small and Medium Enterprises so as to bring together the representatives of
different sub-sectors of MSMEs, along with policy-makers, bankers, trade unions and others in order to move towards cohesive development of the sector. The
deliberations and directions of the National Board will go a long way to guide and
develop enterprises in this sector to become more competitive and self-reliant. 24. Fiscal Benefits The Government has worked towards enhancing the level of fiscal incentives available for micro and small enterprises. Under the General Excise Exemption Scheme, exemption limit has been raised from Rs.1 crore to Rs.1.5 crore (in
2007-08 budget) and the turnover eligibility limit to avail the exemption benefits has been enhanced from Rs.3 crore to Rs.4 crore (in 2005-06 budget). Further, with effect from 1
st April 2005, small service providers having a turnover of up to Rs.4 lakh has been exempted from service tax. This exemption limit has been
gradually raised to Rs.10 lakh in the subsequent budgets. In order to encourage
small and medium enterprises to invest and grow, the surcharge on all firms and
companies with a taxable income of Rs.1 crore or less has been removed with
effect from 1
st April 2007. The turnover limit for tax audit and for the purpose of
presumptive taxation of small businesses has been enhanced to Rs.60 lakh with
effect from 1
st April 2010. To ease the cash flow position for small scale manufacturers, they have been permitted to take full credit of Central Excise duty
paid on capital goods in a single installment in the year of their receipt. Further,
they have also been permitted to pay Central Excise duty on a quarterly basis
rather than monthly basis.
The Programme is being implemented for holistic and integrated development of micro and small enterprises in clusters through Soft Interventions (such as diagnostic study, capacity building, marketing development, export promotion, skill development, technology upgradation, organizing workshops, seminars,
training, study visits, exposure visits, etc.), Hard Interventions (setting up of
Common Facility Centres) and Infrastructure Upgradation (create/upgrade
infrastructural facilities in the new/existing industrial areas/clusters of MSEs). The
guidelines of the MSE-Cluster Development Programme have been
comprehensively modified in February 2010 to provide higher support to the MSEs. The scope of the scheme includes:
(i) Preparation of Diagnostic Study Report with Government of India (GoI)
grant of maximum Rs.2.50 lakh (Rs.1 lakh for field offices of the Ministry of
MSME). (ii) Soft Interventions like training, exposure, technology upgradation, brand
equity, business development, etc. with GoI grant of 75% of the sanctioned
amount of the maximum project cost of Rs. 25 lakh per cluster. For NE &
Hill States, Clusters with more than 50% (a) micro/ village, (b) women
owned, (c) SC/ST units, the GoI grant will be 90%. (iii) Detailed Project Report (DPR) with GoI grant of maximum Rs. 5 lakh for preparation of a technical feasible and financially viable project report. (iv) Hard Interventions in the form of tangible assets like Common Facility
Centre having machinery and equipment for critical processes, research
and development, testing, etc. for all the units of the cluster with GoI grant upto 90% of the cost of project of maximum Rs. 15 crore. (v) Infrastructure Development with GoI grant of upto 80% of the cost of project of Rs. 10 crore, excluding cost of land. (vi) Exhibition Centres by Associations of Women Entrepreneurs of women
owned micro and small enterprises with GoI assistance @ 40% of the
project cost. Over 460 clusters have been undertaken for various cluster development
interventions (i.e., diagnostic study, soft interventions, and hard interventions) and
126 proposals (including 28 for upgradation of existing industrial estates) have
been taken up for infrastructure development under the scheme. 11. Credit Linked Capital Subsidy Scheme To make the Credit Linked Capital Subsidy Scheme (CLCSS) more
attractive, the following amendments were made with effect from September 29, 2005: (a) the ceiling on loans has been raised from Rs.40 lakh to Rs.1 crore; (b)
the rate of subsidy has been raised from 12 per cent to 15 per cent; (c) the
admissible capital subsidy has now been based on the purchase price of plant and machinery, instead of the term loan disbursed to the beneficiary unit; and (d)
the practice of categorisation of MSEs in different slabs on the basis of their present investment for determining the eligible subsidy has been dispensed with. Further, the ambit of Scheme was enlarged in 2009-10 to include 201 new
technologies, including 179 technologies relating to Pharmaceutical sector. The
coverage under the Scheme has shown considerable increase and up to October 2010, 10,952 MSEs have benefited under the Scheme with the total subsidy
sanctioned amounting to Rs.514.13 crore. 12. Entrepreneurship and Skill Development
In line with the overall target set by the Prime Minister’s National Council on Skill
Development, the Ministry has taken up skill development as a high priority area. Under the Entrepreneurship/Skill Development Programmes conducted by
various organisations of the Ministry of MSME, about 3.5 lakh persons were
trained during 2009-10 which is an increase of more than 33% over previous year. To further expand the coverage of training programmes, a new component under
the scheme of ‘Assistance to Training Institutions’ has been added to, inter-alia, provide assistance to the training institutions/centres established by Partner
Institutions (PIs) of National Level Entrepreneurship Development Institutes (EDIs) and franchisees of National Small Industries Development Corporation (NSIC). Further, the Ministry of MSME provides all such trainings to disadvantaged
sections of the society like the trainings for SCs/STs, free of cost. A number of
programmes are also being organised for women and other weaker sections of
the society free of cost, besides providing a monthly stipend of Rs.500/- per month during the entire period of training.
13. Rajiv Gandhi Udyami Mitra Yojana The scheme aims to promote and support establishment of new micro and small enterprises through handholding of potential first generation entrepreneurs, who
have already successfully completed Entrepreneurship Development Programme
(EDP)/Skill Development Programme (SDP)/Entrepreneurship-cum-Skill
Development Programme (ESDP) of at least two weeks’ duration, or have
undergone vocational training from ITIs. One of the main objectives of
handholding is to guide and facilitate the potential entrepreneurs in dealing with
various procedural and legal hurdles and completion of various formalities which
are required for setting up and running of enterprise successfully and to save
them from harassment at the hands of various regulatory agencies for want of required compliances. It will not only increase the proportion of potential entrepreneurs trained under various EDPs/SDPs/ESDPs/Vocational Training (VT)
in setting up their enterprises, more importantly, it will also enhance
survival/success rate of newly set up enterprises. As a component of this scheme, the Ministry has recently launched a MSME Call
Centre (known as ‘Udyami Helpline’) with a toll-free number 1800-180-6763. The Udyami Helpline, inter-alia, provides basic information on how to set up an
enterprise, various schemes being implemented for the promotion of MSMEs, accessing loans from banks and further contacts for obtaining detailed information. 14. Performance and Credit Rating Scheme To sensitize the MSE sector on the need for credit rating and encourage the MSEs to maintain good financial track record enabling them to earn higher rating
for their credit requirements, the Government in April 2005 launched the
‘Performance and Credit Rating Scheme’. The implementation of the scheme is
through National Small Industries Corporation Ltd. (NSIC). Reputed Rating
Agencies have been empanelled by NSIC from which the MSEs can select the
one to be engaged by it for obtaining the rating. The Ministry of
MSME subsidises the cost of rating by sharing 75% of the fee charged by the Rating Agency, subject to a ceiling of Rs.40,000. 15. National Small Industries Corporation Limited
To provide an opportunity for first generation entrepreneurs to acquire skills for enterprise building and to incubate them to become successful small business owners, NSIC has set up 47 Training-cum-Incubator Centres (TICs) under PPP mode. NSIC has also launched a B2B Web portal to provide marketing facilities
to national and international MSMEs for business to business relationship. The MSME Info Call Centre of NSIC has been made functional to provide information
about the schemes and activities being implemented for the benefits of MSMEs. Further, NSIC has established a Marketing Intelligence Cell in May 2010, which
shall provide database and information support to the MSMEs on marketing of
their products/ services. 16. Khadi Reform Development Programme (KRDP)
In order to revitalize and reform the traditional khadi sector with enhanced
sustainability of khadi, increased artisans welfare, increased incomes and
employment opportunities for spinners and weavers with lesser dependence on Government grants, a Khadi Reform Development Programme was formulated by
the Ministry of MSME in consultation with Khadi and Village Industries Commission (KVIC), Asian Development Bank (ADB), Department of Economic Affairs (DEA) and Price Waterhouse Coopers (PWC). This programme is proposed to be implemented in 300 selected khadi institutions willing to undertake
the identified reforms. The DEA has arranged a sum of US$ 150 million
equivalent to Rs.717 crore (approx.) from ADB to be given to KVIC as grant in
four tranches over a period of 36 months. After completion of procedural
formalities, and signing of necessary agreement and announcement by ADB, the
first tranche of Rs.96 crore was released to KVIC in February 2010. The second
tranche of Rs.192 crore has been earmarked in BE 2010-11.
17. Market Development Assistance (MDA) Scheme The scheme has been introduced w.e.f. 01.04.2010 and envisages financial assistance @ 20% on value of production of khadi and polyvastra which will be
shared among artisans, producing institutions and selling institutions in the ratio
25:30:45. The scheme has been introduced on the basis of recommendations of several committees constituted during the past few decades and after running
several pilot projects in the past. The need had arisen because Khadi production
so far was not based on market demand or performance and the rebate system
did not benefit the spinners and weavers. Also KVIC was constrained to devote most of its resources for administration of rebate; to the detriment of its remaining
responsibilities regarding development of the sector. MDA seeks to rectify this
imbalance and provide flexibility/freedom to the khadi institutions to take
innovative measures to improve its marketing infrastructure such as renovation of outlets, training sales persons, computerization of sales, design improvement, publicity, discount to customers, improved equipments of production, training of artisans and capacity building so that khadi can attract more customers not just
because of discount, but because of its quality design and appeal. Most
importantly, for the first time a definite share of 25% of MDA has been earmarked
for spinners and weavers which will give them a prominent role in the entire khadi chain of activities. An amount of Rs.345.05 crore has been earmarked to be
incurred during 2010-11 and 2011-12 as MDA. 18. Workshed Scheme for Khadi Artisans Under this scheme, assistance is provided for construction of Worksheds for Khadi artisans for better work environment. Around 38,000 worksheds are
targetted to be constructed between 2008-09 and 2011-2012 at a total cost of
Rs.127 crore approximately, involving financial assistance of Rs.95 crore as grant
to KVIC from Government of India’s budgetary sources. Financial assistance for establishment of workshed has been provided to 5,951 artisans in 2009-10. In BE
2010-11, an amount of Rs.20 crore has been earmarked for assisting
10,000 artisans under this scheme. 19. Scheme for Enhancing Productivity and Competitiveness of Khadi Industry and Artisans The scheme aims to provide financial assistance to 200 of the ‘A+’ and ‘A’ category khadi institutions of which 50 institutions would be those which are managed exclusively by beneficiaries belonging to Scheduled Castes/Scheduled
Tribes to make them competitive with more market driven and profitable
production by replacement of obsolete and old machinery and equipment. The
total cost of the scheme is Rs.84 crore involving financial assistance of Rs.71.14
crore as grants to KVIC from Government of India’s budgetary sources between
2008-09 and 2011 -2012. 20 khadi institutions were assisted with financial assistance of Rs.2.23 crore under this scheme in 2009- 10. An amount of Rs.21 crore has been earmarked in BE 2010-11 for assisting
60 khadi institutions under this scheme. 20. Scheme for Rejuvenation, Modernisation and Technological Upgradation of
Coir Industry
Under the scheme, assistance is provided to spinners and tiny household sector
for replacement of outdated ratts/looms and for constructing worksheds so as to
increase production and earnings of workers. In 2009-10, 296 spinning units and
410 tiny household units have been assisted under this scheme and a target for assisting 320 spinning units and 880 household units has been fixed for 2010-11 with the budget allocation of Rs.21 crore. During 2010-11 (upto September 2010), Rs. 4.88 crore has been released by the Ministry. 21. Scheme of Fund for Regeneration of Traditional Industries (SFURTI)
This Scheme was launched in 2005 for regeneration of traditional industries,
identified clusters in khadi, village industries and coir
sectors with a view to make these industries more productive and competitive and
increase the employment opportunities in rural and semi-urban areas. The
objective of the Scheme is to establish a regenerated, holistic, sustainable and
replicable model of integrated cluster-based development of traditional industries
in khadi, village and coir sectors. So far 105 clusters (Khadi – 29, Village
Industries – 50 and Coir - 26) have been taken up under SFURTI and production has been
started in 72 clusters. Cluster interventions will be completed in remaining 33
clusters providing employment to around 16,000 rural artisans in 2010-11. 22. Mahatma Gandhi Institute for Rural Industrialization (MGIRI)
A national level institute named MGIRI has been established at Wardha, Maharashtra as a society under Societies Registration Act, 1860 by revamping
Jamnalal Bajaj Central Research Institute in association with IIT, Delhi for strengthening the R&D activities in khadi and village industry sectors. The main
objectives of the institute are as under:
To accelerate rural industrialization for sustainable village economy so that
KVI sector co-exists with the main stream. Attract professionals and experts to Gram Swaraj. Empower traditional artisans.
Innovation through pilot study/field trials. R&D for alternative technology using local resources. During 2010-11, it is proposed to initiate action on handholding support to 68 model enterprises in bio-processing, chemical, energy, rural crafts and solar garments sets and 21 machines/processes/services would be improved.
23. National Board for MSMEs The Government has set up for the first time, a statutory National Board for Micro, Small and Medium Enterprises so as to bring together the representatives of
different sub-sectors of MSMEs, along with policy-makers, bankers, trade unions and others in order to move towards cohesive development of the sector. The
deliberations and directions of the National Board will go a long way to guide and
develop enterprises in this sector to become more competitive and self-reliant. 24. Fiscal Benefits The Government has worked towards enhancing the level of fiscal incentives available for micro and small enterprises. Under the General Excise Exemption Scheme, exemption limit has been raised from Rs.1 crore to Rs.1.5 crore (in
2007-08 budget) and the turnover eligibility limit to avail the exemption benefits has been enhanced from Rs.3 crore to Rs.4 crore (in 2005-06 budget). Further, with effect from 1
st April 2005, small service providers having a turnover of up to Rs.4 lakh has been exempted from service tax. This exemption limit has been
gradually raised to Rs.10 lakh in the subsequent budgets. In order to encourage
small and medium enterprises to invest and grow, the surcharge on all firms and
companies with a taxable income of Rs.1 crore or less has been removed with
effect from 1
st April 2007. The turnover limit for tax audit and for the purpose of
presumptive taxation of small businesses has been enhanced to Rs.60 lakh with
effect from 1
st April 2010. To ease the cash flow position for small scale manufacturers, they have been permitted to take full credit of Central Excise duty
paid on capital goods in a single installment in the year of their receipt. Further,
they have also been permitted to pay Central Excise duty on a quarterly basis
rather than monthly basis.
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