Session 9 B Institutional Support System for Entrepreneurs.pptx

1. INSTITUTIONAL
SUPPORT SYSTEM
FOR
ENTREPRENEURS

2. Introduction
◦ This institutional support system has been designed at four
levels:
1. Central Government
2. State Government
3. Non-Government Support System
4. District Industries Centres (DIC).

3. Introduction
1. Central Government Institutions:
◦ The Government Formulated the Micro, Small and
Medium Enterprises:
Development Act, 2006 and
established the National Board for
Micro, Small and Medium Enterprises (NBMSME) and
made rules there under in the year 2006.

4. Introduction
1. Central Government Institutions:
This Board examines the factors affecting promotion and
development of MSMEs and
reviews policies and programmes from time to time relating
to these enterprises, and
makes recommendations to the Government in formulating
the policies for the growth of MSMEs.

5. Introduction
1. Central Government Institutions:
The Government of India constituted the National Commission
for Enterprises in the Unorganised Sector (NCEUS)
to examine the problems of the enterprises in the
unorganized/informal sector.
The Commission has made recommendations
to provide technical, marketing and credit support to these
enterprises.

6. Introduction
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.

7. (i) Small Scale Industries Board (SSIB)
It was established in 1954 to provide effective coordination and
inter- institutional linkages for the benefit of small-scale sector.
It consists of the following members:
◦ a. Union Industry Minister
◦ b. State Industry Minister
◦ c. Selected members of Parliament
◦ d. Secretaries of department concerned
◦ e. Eminent experts in the field

8. (ii) National Bank for Agriculture and Rural
Development (NABARD)
NABARD is designated as an apex development bank in the country.
This national bank was established in 1982 by a Special Act of the
Parliament,
with a mandate to uplift rural India by facilitating credit flow in
agriculture,
cottage and village industries,
handicrafts and small-scale industries.
 It is also required to support non-farm sector while promoting other
allied economic activities in rural areas.

9. (ii) National Bank for Agriculture and Rural
Development (NABARD)
NABARD functions to promote sustainable rural development
for attaining prosperity of rural areas in India.
It is basically concerned with “matters concerning policy, as well
as planning and operations in the field of credit for agriculture
and other economic activities in rural areas in India”.
It is worth noting with reference to NABARD that RBI has sold
its own stake to the Government of India.
Therefore, Government of India holds 99% stake in NABARD.

10. (ii) National Bank for Agriculture and Rural
Development (NABARD)
Role of NABARD:
It is an apex institution which has power
◦ to deal with all matters concerning policy,
◦ planning as well as operations in giving credit for agriculture and
◦ other economic activities in the rural areas.
I. It is a refinancing agency for those institutions that provide
◦ investment and production credit
◦ for promoting the several developmental programs for rural
development.

11. (ii) National Bank for Agriculture and Rural
Development (NABARD)
Role of NABARD:
II. It is improving the absorptive capacity of the credit delivery
system in India,
◦ including monitoring,
◦ formulation of rehabilitation schemes,
◦ restructuring of credit institutions, and
◦ training of personnel.

12. (ii) National Bank for Agriculture and Rural
Development (NABARD)
Role of NABARD:
III. It co-ordinates the rural credit financing activities of all sorts
of institutions
◦ engaged in developmental work at the field level
◦ while maintaining liaison with Government of India, and
◦ State Governments, and
◦ also RBI and
◦ other national level institutions
◦ that are concerned with policy formulation.

13. (ii) National Bank for Agriculture and Rural
Development (NABARD)
Role of NABARD:
IV. It prepares rural credit plans, annually, for all districts in the
country.
V. It also promotes research in rural banking, and the field of
agriculture and rural development.
 Various services offered by NABARD are:
◦ a. Attracting youth to rural non-farm sector
◦ b. District Industries Rural Project (DRIP)
◦ c. Rural Entrepreneurship Development Programme (REDP).

14. (iii) Small Industries Development Organisation
(SIDO)
◦ It was constituted in 1954 to develop support services for promotion
of SSIS.
◦ Over the years, it has seen its role evolve into an agency for advocacy,
hand holding and facilitation for the small industries sector.
◦ It has over 60 offices and 21 autonomous bodies under its
management.
These autonomous bodies include:
i. Tool Rooms
ii. Training Institutions
iii. And Project-cum-Process Development Centres.

15. (iii) Small Industries Development
Organisation (SIDO)
◦ i. The SIDO provides a wide spectrum of services to the small
industries sector.
◦ These include:
◦ Facilities for testing,
◦ tool making,
◦ training for entrepreneurship development,
◦ preparation of project and product profiles,
◦ technical and managerial consultancy,
◦ assistance for exports,
◦ pollution and energy audits etc.

16. (iii) Small Industries Development
Organisation (SIDO)
◦ ii. The SIDO provides economic information services and
◦ advises Government in policy formulation for the promotion
and development of SSIs.

17. (iii) Small Industries Development
Organisation (SIDO)
oConsequent to the increased globalization of the Indian
economy, small industries are required to face new challenges.
oThe SIDO has recognised the changed environment and is
currently focusing on providing support in the fields of credit,
marketing, technology and infrastructure to SSIs.
oGlobal trends and national developments have accentuated
SIDO’s role as a catalyst of growth of small enterprises in the
country.

18. (iii) Small Industries Development
Organisation (SIDO)
The Institutions/Centres Administered by SIDO:
oThe SIDO has promoted the institutes and centres and is
responsible for their management:
I. Small Industries Service Institutes (SISI):
I. The institute functions under the Ministry of SSI, Government of
India and
II. it provides services such as preparation of project reports, training
programmes in different activities, extending technical assistance
and offering guidance on Industrial policy of Government of India.

19. (iii) Small Industries Development
Organisation (SIDO)
Small Industries Service Institutes (SISI):
• It is a pioneer organisation, to develop small scale industries
through counselling, consultancy/training.
• It also assists the industries in marketing the products and
acquiring quality standards.
• SISI also provides various types of extension services and
assistance in setting up of units,
• promoting and developing product and services by the Small
Scale Industries.

20. (iii) Small Industries Development
Organisation (SIDO)
Small Industries Service Institutes (SISI):
• The small industries service institutes
• have been set up in state capitals and
• other places all over the country
• to provide consultancy and training
• to small entrepreneurs both existing and prospective.
• At present the SIDO has been administering 28 SISIs and 30
branch SISIs working in different parts of the country.

21. (iii) Small Industries Development
Organisation (SIDO)
II. Product-cum-Process Development Centres:
• These have been promoted
• to provide specific service to different types of small
scale units concentrated in different locations.

22. (iii) Small Industries Development
Organisation (SIDO)
II. Product-cum-Process Development Centres:
• These centres are responsible for serving as research and
development institutions in areas of dense industry
clusters,
• to encourage product design and innovation,
• to develop new processes and upgrade the existing level
of technology,
• to act as centres of excellence in respective areas and
• to provide technical and managerial support services.

23. (iii) Small Industries Development
Organisation (SIDO)
III. Regional Training Centres (RTCs):
• These centres are located in major cities and are responsible for
quality awareness programme among the small units.
• For this purpose, they are engaged in systematic testing and
technical consultancy services.
• These centres are also responsible for assisting field testing
stations which are expected to provide testing services to SSI
units.

24. (iii) Small Industries Development
Organisation (SIDO):
Main Objectives of SIDO are:
i. To formulate policy for promotion of SSI
ii. To Provide coordination of policies of state government
iii. To collect and disseminate information
iv. To provide wide range of extension services through allied
institutions
v. To promote facilities for technology up gradation
vi. To offer consultancy services

25. (iii) Small Industries Development Organisation
(SIDO):
Various Services Rendered by SIDO:
◦ i. Entrepreneurship development and Management training.
◦ ii. Efforts for skill development.
◦ iii. Preparation of feasibility reports for different products.
◦ iv. Provision of testing services.
◦ v. Availability of tool room facilities.

26. (iv) National Small Industries Corporation (NSIC):
• The National Small Industries Corporation (NSIC) Ltd. was established by
the Government as a Public Sector Company in 1955.
Its main functions are:
i. To arrange for Supply of machinery and equipment.
ii. To arrange Provision of financial assistance.
iii. To provide Assistance for arrangement of raw materials.
iv. To aid establishment of technology transfer centres.
v. To make arrangement of marketing assistance.
vi. To ensure priority in government purchase programme
vii. To promote, aid, and foster the growth of micro and small enterprises
in the country, generally on a commercial basis

27. (iv) National Small Industries Corporation (NSIC):
viii. To provide wide variety of support services to micro and small
enterprises catering to their different requirements in the areas of
◦ raw material procurement;
◦ product marketing;
◦ credit rating;
◦ acquisition of technologies;
◦ adoption of modern management practices,
◦ arranging for business partners,
◦ ensuring technology transfer programmes through missions,
delegations and expositions etc.

28. (iv) National Small Industries Corporation (NSIC):
• The Technical Service Centres (TSCs),
• established by NSIC are functioning in different parts of the
country,
• providing diverse technical support to the small scale sector.

29. (v) Small Industries Development Bank of India (SIDBI)
• It is a Subsidiary of IDBI and was setup as an act of parliament,
• for ensuring larger flow of financial and non-financial assistance
to the small scale sector.
• The SIDBI has taken over the outstanding portfolio of the IDBI
relating to the small scale sector for
• promotion,
• financing and
• development of the SSI sector and
• for coordinating the activities of other institutions.

30. (v) Small Industries Development Bank of India (SIDBI)
◦ It has also devised tailor-made schemes for direct
lending to small scale sector so as to supplement the
efforts of Primary Lending Institutions (PLIs), which
includes:
◦ i. State Financial Corporation’s (SFCs), State Industrial
Development Corporations (SIDCs), Scheduled Commercial
Banks (SCBs) both in the public and the private sector.
◦ ii. Co-operative banks, scheduled urban co-operative banks
and regional rural banks, SIDBI – Venture Capital Ltd.

31. (v) Small Industries Development Bank of India (SIDBI)
◦ It provides assistance for:
◦ i. Setting up of new SSI units, small hotels, hospitals and so on.
◦ ii. Technological upgradation and modernization, expansion and
diversification.
◦ iii. Quality upgradation
◦ iv. Development of markets
◦ v. Development of infrastructure.
◦ vi. Discounting of bills of manufacturer-seller in selling either
equipment or components.

32. 2. State Government Institutions
◦ The State Governments also execute different promotional
and developmental projects and schemes
◦ to provide number of supporting incentives for development
and promotion of MSMEs in their respective states.
◦ These are executed through the
◦ State Directorate of Industries, which has
◦ District Industries Centres (DICs) under it,
◦ for implementing the central/state level schemes.

33. 2. State Government Institutions
◦ Maharashtra Industrial Development Corporation
(MIDC)
◦ It was established on August 1st 1962.
◦ Constituted under the Maharashtra Industrial
Development Act 1961.
◦ MIDC

34. 2. State Government Institutions
◦ State Financial Corporation (SFC):
◦ Its main objectives are:
◦ i. To provide term loans for the acquisition of land, building,
plant and machinery.
◦ ii. To promote self-employment.
◦ iii. To encourage women entrepreneurs
◦ iv. To bring about expansion of industry
◦ v. To provide seed capital assistance.

35. 2. State Government Institutions
◦ State Small Industries Development Corporation (SSIDC)
◦ State government undertakings
◦ to cater to the primary developmental needs of the small tiny and village
industries in the state/union territories under their jurisdiction
SSIDC provides the following important functions:
◦ i. Procurement and distribution of raw materials.
◦ ii. Supply of machine on hire-purchase basis
◦ iii. Construction of industrial estates.
◦ iv. Providing assistance for marketing of products of SSI.

36. 2. State Government Institutions
◦ (iii) Technical Consultancy Organisations (TCOs):
◦ Maharashtra Industrial and Technical Consultancy Services Ltd. (MITCON)
◦ MITCOn was promoted by ICICI, IDBI, IFCI, SICOM, MIDC, MSSIDC &
Banks
◦ as a catalyst for Industrial growth especially in the SMEs sector.
◦ MITCON is well networked with experts in various fields and updated of
latest developments across the globe.

37. 2. State Government Institutions
◦ (iii) Technical Consultancy Organisations (TCOs):
◦ Services of TCOs include:
◦ i. Preparation of project profiles.
◦ ii. Undertaking industrial potential surveys.
◦ iii. Identification of potential entrepreneurs.
◦ iv. Undertaking market research.
◦ v. Project supervision and rendering technical and
administrative assistance.
◦ vi. Conducting EDPs.

38. 4. District Industries Centres (DIC)
◦ District Industries Centers (DICs) provide full assistance to the
entrepreneurs who are going to start the business on their own
and in their regional places. ...
◦ These DIC programs can take over the responsibilities in order
to promote cottage and small scale industries at district level
effectively.

39. TECHNOLOGY BUSINESS INCUBATOR (TBI)
◦ A technology business incubator (or TBI) is a type of business incubator focused
on supporting startups which use modern technologies as the primary means of
innovation.
◦ In several countries, including India, China, and the Philippines there have been
government initiatives to support TBIs.
◦ The goal of the TBI is to facilitate economic development by improving the
survival and growth of new entrepreneurial groups.
◦ They aim to accelerate the development of young entrepreneurial start-ups and
companies from early to mid-stage entrepreneurial development.