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Programs to promote Small Businesses

Keeping in view the contribution of small business to employment generation, balanced regional development of the country, and promotion of exports, the Government of India’s policy thrust has been on establishing, promoting and developing the small business sector, particularly the rural industries and the cottage and village industries in backward areas. Governments both at the central and state level have been actively participating in promoting selfemployment opportunities in rural areas by providing assistance in respect of infrastructure, finance, technology, training, raw-materials, and marketing. The various policies and schemes of Government assistance for the development of rural industries insist on the utilisation of local resources and raw materials and locally available manpower. These are translated into action through various agencies, departments, corporations, etc., all coming under the purview of the industries department. All these are primarily concerned with the promotion of small and rural industries.
Some of the support measures and programmes meant for the promotion of small and rural industries are discussed below:

National Bank for Agriculture and Rural Development (NABARD)

NABARD was setup in 1982 to promote integrated rural development. Since then, it has been adopting a multi-pronged, multi-purpose strategy for the promotion of rural business enterprises in the country. Apart from agriculture, it supports small industries, cottage and village industries, and rural artisans using credit and non-credit approaches. It offers counselling and consultancy services and organises training and development programmes for rural entrepreneurs.

The Rural Small Business Development Centre (RSBDC)

It is the first of its kind set up by the world association for small and medium enterprises and is sponsored by NABARD. It works for the benefit of socially and economically disadvantaged individuals and groups. It aims at providing management and technical support to current and prospective micro and small entrepreneurs in rural areas. Since its inception, RSBDC has organised several programmes on rural entrepreneurship, skill upgradation workshops, mobile clinics and trainers training programmes, awareness and counselling camps in various villages of Noida, Greater Noida and Ghaziabad. Through these programmes it covers a large number of rural unemployed youth and women in several trades, which includes food processing, soft toys making, ready-made garments, candle making, incense stick making, two-wheeler repairing and servicing, vermicomposting, and non conventional building materials.

National Small Industries Corporation (NSIC)

This was set up in1955 with a view to promote, aid and foster the growth of small business units in the country. This focuses on the commercial aspects of these functions.

  • Supply indigenous and imported machines on easy hire-purchase terms.
  • Procure, supply and distribute indigenous and imported raw materials.
  • Export the products of small business units and develop export-worthiness.
  • Mentoring and advisory services. • Serve as technology business incubators.
  • Creating awareness on technological upgradation.
  • Developing software technology parks and technology transfer centres.

A new scheme of ‘performance and credit rating’ of small businesses is implemented through National Small Industries Corporation (NSIC) with the twin objectives of (i) sensitising the small industries about the need for credit rating and (ii) encouraging the small business units to maintain good financial track record. This is to ensure that they score higher rating for their credit requirements as and when they approach the financial institutions for their working capital and investment requirements.

Small Industries Development Bank of India (SIDBI)

  • Set up as an apex bank to provide direct/indirect financial assistance under different schemes, to meet credit needs of small business organisations.
  • To coordinate the functions of other institutions in similar activities.

The National Commission for Enterprises in the Unorganised Sector (NCEUS)

The NCEUS was constituted in September, 2004, with the following objectives:

  • To recommend measures considered necessary for improving the productivity of small enterprises in the informal sector.
  • To generate more employment opportunities on a sustainable basis, particularly in the rural areas.
  • To enhance the competitiveness of the sector in the emerging global environment.
  • To develop linkages of the sector with other institutions in the areas of credit, raw materials, infrastructure, technology upgradation, marketing and formulation of suitable arrangements for skill development. The commission has identified the following issues for detailed consideration:
    • Growth poles for the informal sector in the form of clusters/ hubs, in order to get external economic aid.
    • Potential for public-private partnerships in imparting the skills required by the informal sector.
    • Provision of micro-finance and related services to the informal sector.
    • Providing social security for the workers in the informal sector.

Rural and Women Entrepreneurship Development (RWED)

The Rural and Women Entrepreneurship Development programme aims at promoting a conducive business environment and at building institutional and human capacities that will encourage and support the entrepreneurial initiatives of rural people and women. RWE provides the following services:

  • Creating a business environment that encourages initiatives of rural and women entrepreneurs.
  • Enhancing the human and institutional capacities required to foster entrepreneurial dynamism and enhance productivity.
  • Providing training manuals for women entrepreneurs and training them.
  • Rendering any other advisory services.

World Association for Small and Medium Enterprises (WASME)

It is the only International NonGovernmental Organisation of micro, small and medium enterprises based in India, which set up an International Committee for Rural Industrialisation. Its aim is to develop an action plan model for sustained growth of rural enterprises.

Apart from these, there are several schemes to promote the non-farm sector, mostly initiated by the Government of India. For instance, there are schemes for entrepreneurship through subsidised loans like Integrated Rural Development Programme (IRDP), Prime Minister Rojgar Yojana (PMRY), schemes to provide skills like Training of Rural Youth for Self Employment (TRYSEM), and schemes to strengthen the gender component like Development of Women and Children in Rural Areas (DWCRA).

There are schemes to provide wage employment like Jawahar Rojgar Yojana (JRY), food for work etc., on rural works programmes to achieve the twin objectives of creation of rural infrastructure and generation of additional income for the rural poor, particularly during the lean agricultural season. Last, but not the least, there are schemes for specific groups of industries such as khadi, handlooms and handicrafts.

Scheme of Fund for Regeneration of Traditional Industries (SFURTI)

To make the traditional industries more productive and competitive and to facilitate their sustainable development, the Central Government set up this fund with Rs. 100 crores allocation to begin within the year 2005. This has to be implemented by the Ministry of Agro and Rural Industries in collaboration with State Governments. The main objectives of the scheme are as follows:

  • To develop clusters of traditional industries in various parts of the country;
  • To build innovative and traditional skills, improve technologies and encourage public-private partnerships, develop market intelligence etc., to make them competitive, profitable and sustainable; and
  • To create sustained employment opportunities in traditional industries. 9. The District Industries Centers (DICs)

The District Industries Centers Programme was launched on May 1, 1978, with a view to providing an integrated administrative framework at the district level, which would look at the problems of industrialisation in the district, in a composite manner. In other words District Industries Centers is the institution at the district level which provides all the services and support facilities to the entrepreneurs for setting up small and village industries.

Identification of suitable schemes, preparation of feasibility reports, arranging for credit, machinery and equipment, provision of raw materials and other extension services are the main activities undertaken by these centers.

Broadly DICs are trying to bring change in the attitude of the rural entrepreneurs and all other connected with economic development in the rural areas. Even within the narrow spectrum, an attempt is being made to look at some of the neglected factors such as the rural artisan, the skilled craftsman and the handloom operator and to tune up these activities with the general process of rural development being taken up through other national programmes. The DIC is thus emerging as the focal point for economic and industrial growth at the district level.


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17 Responses

  1. we have our NGO placed in vadodara city. our goal is to help people and specially to empower women so suggest government schemes which can help women to start a business or can help in running business.

  2. sir I am shashikala, I am looking for small scale industry in chitradurga. I am interested in Our Own Business. any govt scheme business is there or any contact person in chitradurga is there please inform me.

  3. Hello sir, i am shashikala , i am looking for own business in chitradurga .

    you have any small scale industry in chitraduga , with training.
    if you have any contact person is there please informe me.

    thanking you sir

  4. Dear sir i want to start small scale industry in agri business in gujarat i have been complted my IN CHEMISTRY plz.information give goverment proved which help and lone process document and other requirment deparment contet to me.

  5. Sir i want start my own business in a village in tumkur district…. can you send me details of start up and government schemes

    thank you

  6. Dear Sir,

    I want to start Briquetting plant in village which comes in SURAT district can u please guide me how to take advantage of this unit by subsidy in interest as well as on capital investment
    thanking you

  7. Sir i want to start my own Dairy Farm what is the project cost and what help i can get from the Government.

  8. sir i want to startt my own cement factory..can you guide mee how to start and the govt schemes available

    • Sir could you please give an idea on the initial investment for a small cement factory because im also planning to start a small cement factory in pune.
      Thank You

  9. thank you…

  10. i started resently my enginnering manufacturing unit with my own contribution , i required financial assistant under government scheme

    • Sir could you please elaborate on what exactly you are planning to manufacture and the capital investment required beacuse i am also planning to start a small iron rod factory in pune.
      Thank You

  11. it is very useul……

  12. i want to start up my business in partnership but i dont find the information of plans which is offer by gov. of india in rural area

  13. i want loan upto 20 lack by gov scheme i can give my property morgage

  14. i want to start business under these govt peograme so pls give me knowledge

  15. We are providing consultancy services for Small Scale Industry in Gujarat Regiion. We are registraiton Small Scale Industry, Medium Scale Industry as per MSME Act 2006.