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Institutional Support to Micro, Small and Medium Enterprises
The document outlines the institutional support systems for micro, small, and medium enterprises (MSMEs) in India, detailing three stages of enterprise development: inception, management, and expansion. It identifies key government organizations such as the Small Industries Development Organization (SIDO) and the National Small Industries Corporation (NSIC), alongside their roles and services in promoting and supporting MSMEs. Additionally, it highlights the importance of state and non-government entities in providing financial assistance, training, and resource allocation to enhance entrepreneurship and industrial growth.
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Institutional Support to Micro, Small and Medium Enterprises
- 1. INSTITUTIONAL SUPPORT TO MICRO,SMALL AND MEDIUM ENTERPRISES Presented by: Dharam Veer Singh Semester III (MBA – M52) MONIRBA, University of Allahabad
- 2. Institutional support systemis necessary at three stages enterprise development: • Inception or Promotion • Day-to-day management • Expansion and Diversification
- 3. Three dimensions ofinstitutional support system are: • Central Government • State Government • Non-government Support System
- 4.
- 5. SMALL SCALE INDUSTRIESBOARD (SSIB) Established in 1954 It consists of the following members: • Union Industry Minister • State Industry Minister • Selected members of Parliament • Secretaries of department concerned
- 6. NATIONAL BANK FORAGRICULTURE AND RURAL DEVELOPMENT (NABARD) Established in 1982 Services offered by NABARD: • Attracting youth to rural non-farm sector. • District Industries Rural Project (DRIP). • Rural Entrepreneurship Development Programme (REDP).
- 7. SMALL INDUSTRIES DEVELOPMENT ORGANISATION(SIDO) Constituted in 1954 to develop support services for promotion of SSS. Main objectives of SIDO are: • To formulate policy for promotion of SSI • Provide coordination of policies of state government • To collect and disseminate information
- 8. • To providewide range of extension services through allied institutions • To promote facilities for technology upgradation • To offer consultancy services
- 9. Services Rendered bySIDO: • Entrepreneurship development and Management training. • Efforts for skill development. • Preparation of feasibility reports for different products. • Provision of testing services. • Availability of tool room facilities.
- 10. NATIONAL SMALL INDUSTRIESCORPORATION (NSIC) Set up by government of India in 1955. Main functions are: Supply of machinery and equipment. Provision of financial assistance. Assistance for arrangement of raw materials. Establishment of technology transfer centers. Arrangement of marketing assistance. Priority in government purchase programme
- 11. SMALL INDUSTRIES DEVELOPMENTBANK OF INDIA (SIDBI) Established in 1990 Subsidiary of IDBI, setup as an act of parliament. Provides assistance for: • Setting up of new SSI units, small hotels, hospitals and so on. • Technological upgradation and modernization, expansion and diversification.
- 12. • Quality upgradation. •Development of markets. • Development of infrastructure. • Discounting of bills of manufacturer-seller in selling either equipments or components.
- 13.
- 14. STATE FINANCIAL CORPORATIONS(SFC) Objectives: • Provide term loans • Promotion of self-employment. • Encourage women entrepreneurs. • Expansion of industry. • Provide seed capital assistance.
- 15. STATE SMALL INDUSTRIESDEVELOPMENT CORPORATION (SSIDC) Important functions performed are: • Procurement and distribution of raw materials. • Supply of machine on hire-purchase basis. • Construction of industrial estates. • Providing assistance for marketing of products of SSI.
- 16. TECHNICAL CONSULTANCY ORGANISATON Services ofTCOs include: • Preparation of project profiles. • Undertaking industrial potential surveys. • Identification of potential entrepreneurs. • Undertaking market research. • Project supervision and rendering technical and administrative assistance. • Conducting EDPs.
- 17. KHADI AND VILLAGEINDUSTRIES COMMISION (KVIC) It is engaged in the development of khadi and village industries in rural areas. Main objectives of KVIC are: • Providing employment in rural areas. • Skill improvement. • Rural industrialization. • Transfer of technology.
- 18.
- 19. INDIAN COUNCIL OFSMALL INDUSTRIES (ICSI) It was established in 1979. Main functions are: • Information dissemination. • Entrepreneurship development. • Consultancy and managerial support. • Training and research.
- 20. LAGHU UDYOG BHARTI(LUB) It was founded in 1995. It is responsible to undertake: • Entrepreneurial training. • Technology upgradation. • Marketing services.
- 21.
Editor's Notes
- #2 The term institutional support system generally refers to the economic environment of industry and business comprising of authorities and institutions whose decisions and operational framework affect the level of business. These institutions include govt owned agencies, statutory corporations autonomous and semi autonomous organisations.
- #6 It is an apex body and has been entrusted to play advisory role in solving problems of SMEs. It provide effective coordination and inter-institutional linkages for the benefit of small scale sector. 4-Financial Institutions Selected Public Enterprises Industry Associations Eminent experts in the field
- #7 For providing credit for the promotion of agriculture small scale industries, cottage and village industries handicrafts and other rural industries. 1.To promote labour intensive industries in rural sector and open wide range of avenues for employment to the rural ppl. various schemes have been formulated by NABARD to provide exclusive support to activities undertaken by women like ASSISTANCE TO RURAL WOMEN IN NON FARM DEVELOPMENT, assistance for marketing of non farm products and so on.. 2.It is an integrated area based credit intensification pgm in collaboration with the govt. banks and other development agencies…so far it has been implemented in over 106 districts in the country.. 3.It is a promotional pgm setup to motivate and train educated unemployed rural youth to start their own enterprises.
- #10 1.Basic purpose of this pgm is to identify entr capabilities n motivate n train d entrepreneurs so dat they cn easily set up their industrial units. Various orgns resp to provide trng r: smal indstries service institute….national institute for entrepreneurshp and small business developmnt……natl institute for smal industry extension and trng 2.Arng trng facilities for technicl skill develpmnt to technicians and workers located at different parts of d country. 3.SIDO prepares project profiles related wid different pdt grps.it contains detailed info on pdt manufacturing process, mkt potential,quality control and standards, investmnt requiremnts, availability of raw materials and machines. 4.Main function of these testing centers and field status r to Provide certification facilities for quality assurance.it increases marketability of products being produced by SMEs 5.Main functns of tool rooms are to design n manufacture dies, tools, fixtures……
- #11 With the objective of promoting and developing SSIs. 1.it has two schemes in this context: hire purchase scheme and lease scheme…..under hire purchase scheme it arranges indigenous and imported machinery on easy instalmnt….in lease scheme 100% financial facilities are available to small entrepreneurs which enable them to diversify and ensure tech upgradation… 2. Financial assistance provided for marketing, bills discounting, purchase of raw materials and export activities. 3.…..import of raw materials…..supply of scarce raw materials on priority basis…. 4. SSIs are interested to avail facilities for tech acquisition, adoption and upgradation. Technicl service centers are established by NSIC in different parts of the country to provide diverse technical support to SSS. 5. ….ensures adequate margin or return to small entrepreneurs….encourage stadardisation and quality control for products of SSI…….assist in development of brand ie making pdts more marketable…..ensure effective advertising and publicity of pdts of SSI. 6. These benefits include supply of tender form free of cost…..freedom from security deposit….exemption from payment of earnest money.
- #12 It is the principal financial institution for the promotion, financing and development of industry in the small, tiny and cottage industries.
- #13 1.Acquiring of ISO 9000 series certification
- #15 At present 18 SFC (17 established under SFC act 1951) & tamilnaduindustrial corporation ltd under company act 1949. it Financing and promoting SMEs, achieving regional socio-economic growth and generating grtr employment opportunities. 1.For fixed assets like land, building, plant and machinery. 3.To encourage new and technically qualified women entrepreneurs in setting up industrial projects. 4.Expansion of industry by rural and urban artisans. 5.Provide guarantee loan from scheduled and cooprative bank Under the scheme of IDBI.
- #16 Established under the companies act 1956 3.PROVIDING ALLIED INFRASTRUCTURTE facilities and their maintenance.
- #17 INDIAN FINANCIAL INSTITUTIONS ALOGWITH COMMERCIAL BANKS AND STATE LEVEL FINANCIAL AND development institutions estblished a network of TCOS DURING THE 70S and 80s to cater to the consultancy needs of the SMEs and new entrepreneurs with a view to provide technical expertise. 3. And providing them technical and mgmt assistance. 6. And skill upgradation prgms.
- #18 Notable achievements of the kvic are introduction of fabric painted khadi, ready made garments, hand made paper….furthermore it also has tie ups with export companies for exporting kvi technology
- #20 To help tiny cottage and small industries and artisans of rural sector
- #21 To promote and safeguard the interest of small and medium scale industries.it has been given representation on the national and state level govt bodies.