There are two main types of institutions that provide support to small scale industries (SSI) in India - state level institutions and central government institutions. State level institutions include State Directorates of Industries, State Small Scale Industries Development Corporations, District Industries Centers, State Finance Corporations, and Technical Consultancy Organizations. Central government institutions that support SSI include the Department of Small Scale Industries, Small Scale Industries Board, Small Industries Development Organisation, National Small Industries Corporation, Industrial Credit and Investment Corporation of India, and Industrial Finance Corporation of India. These institutions provide various services like financing, training, marketing assistance, infrastructure development, and policy guidance to small businesses.

1. INSTITUTIONAL
SUPPORT
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2. INSTITUTIONS TO ASSIST SSI ARE TWO
TYPES
i) State Level Institutions
1. State Directorate of Industries
2. State Small Scale Industries development
Corporation (SSIDC)
3. District Industries Centers (DICs)
4. State Finance Corporations(SFCs)
5. Technical Consultancy Organization(TCOs)
6. State Industrial Area Development Board
(SIADB)
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3. ii. Central Government Institutions
1. Department of Small Scale Industries (DSSI)
2. Small Scale Industries Board(SSIB)
3. Small Industries Development Organisation(SIDO)
4. National Small Industries Corporations(NSIC).
5. Industrial Credit and Investment Corporation of
India(ICICI)
6. Industrial Finance Corporation of India (ICFI)
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4. STATE SMALL INDUSTRIES
DEVELOPMENT CORPORATION
(SSIDC)
Under the companies Act, SSIDC were started in 1956 in all
the states.
These State Government Undertakings take care of the
growth and development needs of village industries , tiny
industries and small industries.
The main functions of SSIDC are
i. Procurement and distribution of scarce raw materials
ii. Supply of machinery on hire –purchase basis
iii.Providing assistance for marketing of the products of small
scale units
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5. iv. Construction of industrial estates/sheds, providing allied
infrastructure facilities and their maintenance.
v. Extending seed capital assistance on behalf of the State
Governments.
vi. Providing management assistance to production units.
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6. SMALL SCALE INDUSTRIES
BOARD(SSIB)
SSIB was started in 1954 by the Central Government with
the objective of developing small-scale industries throughout
the country.
The development work of small-scale industries involves
various Ministries and Departments and other factors like
land owners, financial institutions etc.
The Director of the SSIB advises the Government about
various development activities of small industries and related
matters
The committee governing SSIB consists of Industries
Minister(as chairman) and various Secretaries, Member of
Parliament , State Government Industry Ministers and the
Committee
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7. DISTRICT INDUSTRIES CENTERS
(DICs)/SINGLE WINDOW CONCEPT
The District Industries Centres (DICs) programme was
started during 1978 for promotion of small-scale industries
in rural areas.
Services and Support to small entrepreneurs are provided
under a single roof through the DICs
Registration of small industries is done at the District
Industries Centres
The organizational structure of DICs consists of one General
Manager, 4 Functional Manager and three Project Managers
to provide technical service
Management of the DICs is done by the State Governments
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8. Functions Of DICs
i. To conduct industrial potential surveys keeping in view the
availability of resources in terms of material and human skill,
infrastructure, demand for product etc., to prepare techno-economic
surveys and identify product lines and then to
provide investment advice to entrepreneurs.
ii. To prepare action plan to effectively implement the schemes
identified
iii. To guide entrepreneurs in matters relating to selecting the
most appropriate machinery and equipment, sources of its
supply and procedure for procuring imported machinery , if
needed , assessing requirements for raw materials etc.
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9. 9
iv. To appraise the worthiness of the various proposals received
from entrepreneurs.
v. To assist the entrepreneurs in marketing their products and
assess the possibilities of ancillarisation and export promotion
of their products.
vi. To undertake product development work appropriate to small
industries.
vii. To conduct artisan training programmes.
• About 430 District Industries Centres (DICs) have been set up
covering major districts of the country leaving out the
metropolitan cities and some new districts

10. TECHNICAL CONSULTANCY ORGANISATION
(TCOs)
`In various states TCOs were established to provide total
consultancy services as a package under single roof .
Overall 17 organizations were started by the group of financial
organizations like IDBI , IFCI and ICICI.
The activities of TCOs are as follows
i. Identify potential industrial projects and prepare feasibility survey
reports
ii. Evaluation of various project proposals put up by the
entrepreneurs.
iii. Provide turn key services in project reports preparations and
project implementation.
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11. iv. Undertake market surveys for various existing and new
products
v. Carry out study on sick industries and advice for
rehabilitation schemes
vi. Undertake entrepreneurial development training
programmes
vii. Undertake consultancy for export oriented projects
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12. SMALL INDUSTRIES SERVICE
INSTITUTES (SISIs)
The SISIs are set up to provide consultancy and training to small
entrepreneurs- both existing and prospective.
There are 28 SISIs and 30 Branch SISIs set up in state capital and
other places all over the country.
The main functions of SISIs include:
i. To serve as interference between Central and State Governments.
ii. To render technical support services to conduct Entrepreneurship
Development Programmes.
iii. To initiate promotional programmes
iv. Economic Consultancy /Information /EDP Consultancy
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v. Trade and market informations
vi. Project profiles
vii. State industrial potential survey
viii. District industrial potential surveys
ix. Modernisation and in-plant studies.
x. Workshop facilities
xi. Training in various trade/ activities

14. INDUSTRIAL CREDIT AND INVESTMENT
CORPORATION OF INDIA LTD. (ICICI)
The ICICI was set up in January 1955 under the Indian
Companies Act with the primary objective of developing small
and medium industries in the private sector.
Its issue capital has been subscribed by the Indian banks,
insurance companies , British Eastern Exchange Bank and other
companies and general public in India.
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15. The ICICI performs the following functions.
i. It provides assistance by way of rupee and foreign currency
loans, underwriting and direct subscriptions to shares/
debentures and guarantees.
ii. It offers variety of financial services such as deferred credit,
leasing credit , installment sale, asset credit and venture
capital.
iii.It guarantees loans from other private investment sources.
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16. The ICICI has set up a Merchant Banking Division , Asset
management company Ltd , in June 1993 to operate the schemes of
the ICICI Mutual Fund ,yet another subsidiary called ICICI
Investors Services Ltd (March 1994) and ICICI Banking Corporation
Ltd.,(January 1994) .
Assistance sanctioned by the ICICI during 1994-95 increased by
77% to Rs.15000 crore , while disbursements went up by 55.9% to
Rs. 6,800 crore.
The ICICI assists all sectors , that is , private sector, joint sector, the
public sector and the Co-operative sector.
Private sector continue to claim the largest share (90%)of ICICI
sanctions during 1994-95, followed by public sector (5%), joint
sector(4%) and co-operative sector(1%)
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17. NATIONAL SMALL INDUSTRIES
CORPORATION
NSIC was started by the Central Government in 1955 with
objective of promoting and developing SSI units throughout
the country.
It started with multiple objectives of helping SSI units for
1. Providing machinery on hire purchase
2. Assisting , marketing and exports
3. Enlisting SSI units for tender participation in Government
purchases
4. Organising supply of raw materials
5. Training of personnel
6. Assistance in modernisation of the units
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18. The functions of NSIC are
1. Financial assistance by way of hire purchase scheme for purchase
of local and imported machinery
2. Provision for various equipments on lease basis
3. Assistance for marketing the products in the country and also to
help in exporting the products of SSI units.
4. Enlisting quality conscious good SSI units for sending enquiries of
Government stores and purchase departments
5. Training of workers in various trades required for SSI units
6. Assistance in up gradation of technology, processes and
modernisation of plant and machinery
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19. 7. To make bulk purchase of important raw materials and
distribute to SSI unit at reasonable rates.
8. To develop industrial estates and testing facilities in the
industrial areas.
 NSIC has got offices in various industrial cities and towns
and is having socio-economic approach in industrialisation
of non-industry areas
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20. SMALL INDUSTRIES DEVELOPMENT
ORGANISATION(SIDO)
This organisation mainly created for development of various
small-scale units in different areas.
SIDO identifies the needs of SSI units, Co-Ordinating and
monitoring the policies and programmes for promotion of the
small industries.
It undertakes various programmes of training consultancy,
evaluation for needs of SSI and development of industrial
estates.
All these functions are taken care with the organisation
structure of 27 offices , 31 SISI, 31 extension centers of SISI
and 7 centers related to production and process development
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21. (a) Coordination activities of SIDO
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1. To coordinate various programmes and policies of various state
Government pertaining to small industries
2. To maintain relation with the Central Industries Ministry, Planning
Commission , State Level Industries Ministry and Financial institutions
3. Implement and coordinate in the development of industrial estates

22. INDUSTRIAL DEVELOPMENT ACTIVITIES OF SIDO
Develop import substitutions for components and products
based on the data available for various volume –wise and
value wise imports.
To give essential support and guidance for the development
of ancillary units
To provide guidance to SSI units in terms of costing , market
competition and encourage them to participate in the
Government Stores and purchase Tenders.
To recommend the central Government for reserving certain
items to produce at SSI level only.
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23. MANAGEMENT ACTIVITIES OF SIDO
To provide training development and consultancy services to
SISI to develop their competitive strength.
To provide marketing assistance to various SSI units
To assist SSI units in selection of plant and machinery ,
location , layout design and appropriate process.
To help them get updated with various information related
to the small-scale industries activities
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24. INDUSTRIAL DEVELOPMENT BANK OF INDIA(IDBI)
The IDBI was established on july 1, 1964 under the ACT of
parliament as the principle financial institution in the
country.
In February 1976 the IDBI was made an autonomous
institutions and its ownership passed from the Reserve Bank
of India to the government of India.
The IDBI provides assistance to the small-scale industries
through its scheme of refinance and through its bill
rediscounting scheme
Its assistance to the large number of small scale industries
reaches indirect in the form of refining of loans granted by
the banks and state financial corporations. 24

25. In 1988 the IDBI also launched the National Equity Fund
Scheme(NEFS) for providing support in the nature of equity to tiny
and small-scale industries engaged in manufacturing not exceeding Rs.
5lakhs.al assist
The IDBI has also introduced the single window assistance scheme for
grant of term loans and working capital assistance to new, tiny and
small-scale enterprises.
The IDBI has also set up a Voluntary Executive Corporation
Cell(VECC) to utilise the services of experienced professionals for
counseling small units , tiny and cottage units and for providing
consultancy support in specific areas.
During 1987-88 the IDBI sanctioned assistance worth Rs.1500 crore
to the small-scale industries out of total sanction of Rs.4580 crore
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26. SMALL INDUSTRIES DEVELOPMENT
BANK OF INDIA
SIDBI was set up in1989 as wholly owned subsidiary of the
IDBI
SIDBI does collaborative efforts to timely flow of credit for
both term loans and working capital to small-scale in
collaboration with commercial banks.
Earlier SIDBI was doing refinancing and discounting of bills.
Now in addition to this it directly participates in the equity
type of loan on soft terms, term loan, working capital both in
rupee and foreign currencies, bill discounting , venture
capital support and different forms of resource support to
banks and other institutions
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27. Amongst support functions SIDBI finances for technology
transfer and upgradation, quality improvements , exports,
environmental care and industrialisation.
For these activities SIDBI involves consultants and national
and international level for improvements.
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28. STATE FINANCIAL CORPORATION
(SFCs)
SFCs are set up in 1948 to provide financial assistance to
medium and large-scale industries.
In 1951 the role was extended for assistance to small-scale
units also.
There are 18 SFCs in different states with each having prefix
of the state name. for example KSFC in Karnataka State
Financial Corporation .
Each SFC has its own Managing Director, Executive Director
, Board of Directors and Management team to take care
activities independently.
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29. Term loans are provided to various small, medium and large
industries in various categories like proprietary ,
partnership , Co-operative, private and public limited
companies.
The loans are given based on securities like land , buildings ,
machineries and shares etc.
SFC has different schemes for women , ex-service men ,
physically handicapped and SC/ST to give them opportunity
to become entrepreneurs.
Apart from industries , loan is given for Transport
operators , Hotels , Hospitals , Nursing homes and Tourism
facilities like lodges and guest houses
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30. OBJECTIVES OF SFCs
1. To provide term loan for purchase of land, buildings,
machinery and other facilities.
2. To promote self-employment for professionally qualified
men and women entrepreneurs interested in starting their
own projects.
3. Financial assistance for expansion , modernisation and
mechanisation in the existing set up.
4. Financial assistance for rehabilitation of sick units.
5. To give financial assistance for transport vehicles and
tourism related activities.
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31. 6. To entrepreneurial development programmes and
seminars for up coming young industries.
7. To provide financial assistance for quality improvement
and environmental control needs.
• SFC caters to all categories of small and big industries ,
tourism operators , service centers like Hospitals and
Hotels, service activities thus attending the various needs
of a socioeconomically developing society
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32. PROBLEMS OF SFCs
Since SFCs are started by respective State Governments the
usual problems of State bureaucracy of procedures , delays ,
castism and favouritism do occur.
In the state offices problems of corruption and other
malpractices continue to bother the applicants
In case of repayments very strict procedures are followed
and units are sealed.
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33. INDUSTRIAL FINANCE
CORPORATION OF INDIA LTD(IFCI)
The Government of India set up the Industrial Finance
Corporation of India(IFCI) under IFCI Act july 1 , 1993, it
has brought under Companies Act 1956.
The IFCI extends financial assistance to the industrial sector
through rupee and foreign currency loans , underwriting
/direct subscriptions to shares/debentures and guarantees
and also offers financial services through its facilities of
equipment procurement , equipment finance , buyers and
suppliers credit, equipment leasing and finance to leasingand
hire purchase companies
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34. The financial resources of the IFCI are constituted of the
three components i.) Share capital ii.)Bonds and Debenture
iii.) other borrowings.
The Idustrial Development Bank of India, scheduled banks ,
insurance companies, investment trusts and the cooperative
banks are the share holders of the IFCI.
IFCI has started new promotional schemes, such as interest
subsidy scheme for women entrepreneurs ; consultancy fee
subsidy for providing marketing assistance to small-scale
industries .
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35. Flaws of IFCI in its functioning
1. The IFCI lending operations have encouraged concentration
of wealth and capital.
2. There are great delays in sanctioning loans and then, making
the amount of loan available
3. The IFCI has failed to exercise necessary control over the
defaulting borrowers
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