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UNIT -III
SCHEMES AND FUNCTIONS OF DIRECTORATE OF INDUSTRIES :
The Directorate of Industries (DOT) is a state level industry which has been set up to implement develop and control
the various policies and programmes of scale, medium scale, large scale and cottage industries. The constitution of
india stated that , the issues related to the small scale industries has to be dealt within the state because the
expansion and promotion of small scale industries is a state matter.
DOI carry out its functions under the guidance of small Industries Development Organization (SIDO) and other
control institutions. It provides regulatory and development functions. It is connected with the district industries
offices, extension offices located in districts, sub-regal offices and block level. The power or authority to implement
and develop the policies are decentralised to the maximum extent level and are vested in the Hands of District
industries Centers (DIC).
Objectives of Directorate of Industries
1.To improve and expand the village and small scale industries is the state.
2 To develop, manage control the district level policies and programmes of the various Department.
3.To provide a complete framework which helps in enabling the employment opportunities in the state, producing a
significant increase in the state domestic products and utilizing the resources to the maximum extent.
Functions of Directorate of Industries
1.It helps in registering and maintain the Small Scale Industries (SSI)
2 I provides financial assistance to the Small Scale Industries (SSI)
3.I provides scarce as well as domestic raw materials to the industries
4. It provides important certificates which are useful for importing and exporting the raw materials.
5. It helps to set up the industrial cooperatives and industrial estate
6.It helps in developing and improving the infrastructure of the industries .
7.It conducts carious surveys and collects information regarding the industries
8. It maintains communication with other agencies or firms for the development of industries.
DISTRICT INDUSTRIES CENTRE(DICs)
In the Industrial policy announced by the Government of India on 23.12.1977 laid special stress on the
development of Small Scale, Village and Cottage Industries. The policy statement indicated that the District
would be the main focus of efforts and the agency for promotion of small scale, village and cottage industries
would be a new organization called "District Industries Centre".
The District Industries Centre was started on the objective to find out the Micro, Small and Medium
Enterprises in the District.
The District Industries Centre have been formed with a view to provide all assistance to Micro, Small and
Medium Enterprises under One Roof, thereby reducing the time taken to finish all government procedures.
OBJECTIVES OF DICs :
Accelerate the overall efforts for Industrialization of the district.
Rural Industrialization and development of rural industries and handicrafts.
Attainment of economic equality in various regions of the district.
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Providing the benefit of the government schemes to the new entrepreneurs.
Centralization of procedures required to start a new industrial unit and minimization- of the efforts
and time required to obtain various permissions, licenses, registrations,
To provide a focal point for the promotion of small, tiny and cottage industries and to provide all the
service and support to the decentralized industries under a single roof at pre investment, investment
and post investment stage.
FUNCTIONS OF DICs :
Acts as the focal point of the industrialization of the district.
Prepares the industrial profile of the district
Statistics and information about exist industrial units in the district in the large, Medium, small as
well as co-operative sectors.
Opportunity guidance to entrepreneurs.
Compilation of information about local sources of raw materials and their availability
Organizes entrepreneurship development training programs.
MONITORING OF DICs :
To resolve the problems of industries/industrialists, there are two types of committee at the district
level viz.
District Industrial Executive Committee (DIEC):
DIEC is constituted for solving industry related problems And promoting industrial growth. District
Collector is the Chairman of this Committee and General Manager of DIC is the Member Secretary. The other
members of the DIEC are President of District Panchayat, DDO, MP, MLAS, Prominent persons active in
Industries in the district and members of all district level industries associations.
Single Window Industrial Follow up Team (SWIFT) :
Entrepreneurs face many difficulties when they start new industries. They have to deal with many
government agencies and get many clearances. SWIFT helps them in guiding solving their problems at a
single spot. This committee is working under the District Collector, General Manager of DIC is the Member
Secretary and District Development Officer is Vice President of SWIFT. All industries related officers in the
district are members of this committee.
SERVICES OFFERED BY DICs :
FILING OF ENTREPRENEUR MEMORANDUM PART-1:
This is required for the proposed industry to be set up by the entrepreneurs to get the financial assistance
from Banks /Government Department.
FILING OF ENTREPRENEUR MEMORANDUM PART-II:
Any MSM Enterprises, which has commenced production can file E.M. Part-II so that they can avail the
facilities, incentives and concessions offered by the Government from time to time. under the Industrial Policy 2008.
The following categories of Units are covered under TWENTY POINT PROGRAMME introduced by the Government of
India.
COTTAGE INDUSTRIES REGISTRATION:
These Industries which are set up in rural areas and the products are manufactured by the group of family
members. The District Industries Centre, identify such units and help them to get financial assistance from banks.
HANDICRAFTS INDUSTRIES REGISTRATION:
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District Industries Centre, identify the artisans who are engaged handicrafts such as wood carvings, paper
mash, embroidery, paper toys etc., and assist them to get bank loans. District Industries Centre, also recommend
these artisans to get the master craftsman award from Government.
INDUSTRIAL DEVELOPMENT CORPORATION :
The government has established IDC to help the entrepreneurs in the procurement of land for their
industrial units. This is because land is a significant factor of production and its rates are so high that a
common man cannot afford it in distant places, people are facing numerous problems and obstructions
such as power connections, water supply and telephone connection. This discourages the development of
industries especially, the modem entrepreneurs are disappointed while working on these facilities
The IDC is a state level corporation established in all states. For example, in Maharastra it is referred as
MIDC, in Gujarat is referred as GIDC, etc. The IDCs obtained land near the outskirts of the cities. It
distributed open plots of land, created galas and sheds as per the need of entrepreneurs.
Objectives of Industrial Development Corporations (IDCs)
1.To promote infrastructure facilities to entrepreneurs of the state
2.To generate network of industries all over the state as IDC's commenced industralization in economically
backward regions by promoting open space and buildings to entrepreneurs.
3.To hurry eye industrial development of the state.
4.To develop economic equality and decentralization of economic growth in particular regions.
5. To attain above objectives, it supply road, power, water , street lighting, drainage and sewage disposal,
post and communication, police station, security, fire and other general facilities in the IDC areas
it is not difficult for the entrepreneurs to acquire loan from the financial institutions for the
procurement of land, shed , if the industrial units are located near IDC.
ORGANIZATIONAL STRUCTURE OF IDC :
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SERVICES PROVIDED BY IDC :
1.Industrial promotion
2.Land Acquisition
3.Infrastructure development
4.project construction
SCHEMES OF IDC :
1.CLCSS (credit in capital subsidy scheme)
2.MSME (micro small and medium entrepreneurship scheme)
3.EDI (entrepreneurship development institution)
STATE FINANCIAL COORPORATION :
In order to meet the financial requirements of small scale and medium sized industries, there was
an need of special financial institutions.
Central government has passed the state financial corporation act on 28th September 1951
The state government to establish financial corporation to operate within the state.
So far 18 financial corporation has been established in different state.
Objectives of State Financial Corporation
To establish uniformity in regional industries
To provide incentive to new industries
To bring efficiency in regional industrial units
To provide finance to small-scale, medium sized and cottage industries in the state
To develop regional financial resources
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Functions
1. To provide loans for period not exceeding 20 years to industrial units
2. To underwrite the issue of shares, debentures and bonds for a period not exceeding 20 years
3. To give guarantee to loans taken up by industries .
Management :
State Financial Corporations of every state is Governed by a board of directors consisting of 18 directors in
all, duly elected and nominated.
SHARE CAPITAL:
The SFCs can have share capital ranging from Rs. 50 lakhs to Rs. 5 crores. It can be increased up to Rs. 10
crores with the prior sanction of the Central Government.
BONDS AND DEBENTURES:
The SFCs can issue bonds and debentures to a maximum of ten times the amount of its paid-up capital and
reserve fund.
PUBLIC DEPOSITS:
The SFCs can accept public deposits for a maximum period of 5 years. However, the total amount received
by way public deposits should not exceed twice its paid-up capital.
Other Sources:
Borrowings from the State Government and the RBI.
Critical Evaluation : It has been alleged that the SFCs are not working in accordance with the financial
needs of the small scale, medium sizes and cottage industries. The main arguments against their working
are
Inadequate assistance.
Undue delay in sanctioning and disbursing loans.
Indifferent attitude towards new business enterprise.
Absence of financial technical experts
Speed of progress is quite low.
Complex working procedure and full of unnecessary and unwanted formalities.
Shortage of requisite capital.
Difference between loans and sanctioned and disbursement is quite large.
Lack of requisite training facilities to employees.
Inadequate underwriting.
At Present
There are 18 SFCs in India.
Out of which 17 were established under SFC Act 1951.
Tamil Nadu industrial corporation limited established under company act 1949 is also working as
state financial corporation.
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SMALL SCALE INDUSTRIES DEVELOPMENT COORPORATION(SSIDCs):
This bank was setup under the companies Act 1956. Its main objective is to take care of the needs
of the small, tiny, and cottage industries. SSIDCs is operating through 18 of its branches.
FUNCTIONS OF SSIDCs:
1.It acquires and distributes the scarce raw material.
2. It supply machinery on hire purchase agreement.
3. It helps in marketing of goods manufactured by small industries.
4. It provides seed capital to the entrepreneurs.
5.It provides management assistance to manufacturing and production units.
6.It helps in increasing the market share of the tiny and small scale units.
SSIDCs are located in Andhra Pradesh, Assam, Bihar, Goa, Gujarat and Jammu and Kashmir,
Himachal Pradesh, Kerala, Punjab, Rajasthan and Tamil Nadu.
KHADI & VILLAGE INDUSTRIES COMMISSION:
KHADI (brand ambassador): Mahatma Gandhi
Khadi refers to handspun and hand-woven cloth and the raw materials may be cotton, silk, or wool, which
are spun into threads.
Khadi was launched in 1920 as a political weapon in the Swadeshi movement of Mahatma Gandhi.
Khadi is sourced from different parts of India like West Bengal, Bihar, Orissa, Andhra Pradesh, Uttar
Pradesh.
Village Industry :
Any industry located in a rural area which produces any goods or renders any service with or without the
use of power and in which the fixed capital investment per head of an artisan or a worker does not exceed
[one lakh rupees] or such other sum as may, by notification in the Official Gazette, be specified from time
to time by the Central Government.
Relevance of Khadi and village industry
Both are labor intensive in nature and we are labor surplus country.
Required little capital to set up.
KHADI VILLAGE INDUSTRIES COMMISSION:
KVIC is a statutory formed by the government of India. Six zonal offices are in Delhi, Bhopal,
Bangalore, Mumbai and Guwahati.
CHRONOLOG :
1935- All India Village Industries Association was formed.
1946-Government of Madras sought the advice of Gandhiji and set up a department for Khadi.
1953 - Govt. of India set up All India Khadi & Village Industries Board (AIKVIB)
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1955 - It was decided that a statutory body should replace the Board.
1956 -Khadi and Village Industries Commission Act 1956, was passed.
1957 - Khadi and Village Industries Commission came into being.
OBJECTIVE
SOCIAL OBJECTIVE: Creating and providing employment opportunities in Rural areas with focus on
women and other weaker sections of the society.
ECONOMIC OBJECTIVE: Making use of locally available raw material and skill.
WIDER OBJECTIVE: Creating sense of self-reliance among the rural people
PROMISE: Transparency, responsiveness and prompt action on queries/request from the target
group.
GUIDANCE, HELP AND COMPLAINTS: Contact Public Relation Officer at KVIC.
The KVIC has broadly re-grouped various village industries under seven heads:
Agro Based and Food Processing Industry (Fruit and Vegetable Processing, pulses
processing,village oil etc)
Polymer and Chemical Based Industry (Soap Industry, Leather Industry)
Forest Based Industry (Medicinal Plants Industry, Bee Keeping Industry)
Mineral Based Industry (Lime)
Handmade Paper and Fiber Industry (Handmade Paper Industry, Fiber Industry)
Rural Engineering and Bio - Technology Industry (Non - Conventional Energy, Electronics)
Service Industry
Function of KVIC
Planning, promotion, organization and implementation of programs for the development of
Khadi and other village industries in the rural areas.
Training of persons employed or desirous of seeking employment in Khadi and Village
Industries.
To build up reserves of raw materials and supply them to persons engaged or likely to be
engaged in production of handspun yarn or Khadi or Village Industries.
To provide financial assistance to institutions or persons engaged in the development and
operation of Khadi or Village Industries
Studies of the problems of Khadi or Village Industries.
Scheme & program of the commission
Prime Ministers Employment Generation Program (PMEGP)
Rajiv Gandhi Swavlamban Rozgar Yojna (RGSRY)
Rural Industry Service Centre (RISC)
Interest Subsidy Eligibility Certification Scheme (ISEC)
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TECHNICAL CONSULTANCY ORGANIZATION:
All India financial institutions and state Govt. have setup a network of TCOS.
For facilitating technical for industrial projects.
Were established by the all India financial Institutions (IDBI, ICICI, IFCL etc)
In the collaboration with the state level financial /development organisations and
commercial banks.
There are in all 18 state-level TCOs across India.
9 have been lead sponsored by IDBI, 5 by IFCI, 3 by ICICI bank and one by the Govt. Of
Karnataka.
TCOs have transformed being consultancy firm handling project reports, market surveys,
etc. to Multifunctional, multi-disciplinary organisations
Offering a wide range of services to the industrial and infrastructure sector.
Functions of TCO
Conducting surveys on industrial potential
Preparing project profiles
Undertaking techno-economic appraisal of projects
Carrying out market research
Providing technical and managerial assistance to entrepreneurs, assistance in modernization
Technology up gradation and rehabilitation programs.
organising information cell and data bank.
concerning industrial and economic activities and provide these to entrepreneurs.
Development of Industry Clusters
Vocational training
Offering Merchant Banking Services
Offering Consultancy for Export oriented Enterprises.
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Major TCOs in India
1. KITCO Ltd. (Kerala)
2. APITCO Ltd. (Andhra Pradesh)
3. GITCO Ltd. (Gujarat)
4. HIMCON Ltd. (Himachal Pradesh)
5. ITCOT Consultancy and Services Ltd. (Tamil Nadu)
6. TECSOK Ltd. (Technical Consultancy of Karnataka)
7. MPCON Ltd. (Madhya Pradesh Consultancy Organisation Ltd)
8. MITCON Consultancy and Engineering Services Ltd. (Maharashtra)
9. NITCON Ltd. (North India Technical Consultancy Organisation Ltd.)
10. UPICO Ltd. (UP Industrial Consultants Ltd)
11. WEBCON Ltd. (West Bengal Consultancy Organisation Ltd)
KITCO Ltd. India's first TCOS
It is an Indian Public Sector Engineering consultancy organisation. Headquartered in Kochi, Kerala.
Established by Govt. In 1972. To speed up the industrialisation process in the State of Kerala. It was with
initiative of IDBI and Kerala Govt. that the organisation was established. Success of KITCO, Govt. Set up
similar TCOs in many other states also. KITCO has implemented more than 600 projects of varying
magnitude sectors. Prepared more than 3500 feasibility Reports/Bankable project Report/Detailed project
reports/study reports. Also successfully providing the operation & Maintenance services for the leading SEZ
in the country-at Kochi, cochin SEZ and MEPZ SEZ at Tambaram .Trained more than 80,000 entrepreneurs
through EDP in various sectors.
Projects of KITCOS
Cochin International Airport
Spices Parks
Titanium Sponge Plant
Mobility Hub
The Marina Tourism Govt. Of Kerala
SMALL INDUSTRIES SERVICES INSTITUTES(SISI)
Introduction to SISI:
Set-up one in each state to provide consultancy. Training to small and prospective entrepreneurs. 28 SISI's
and 30 Branch SISI's set up in state capitals and other places all over the country. Assist the utilization of
assets. 40 percent share in total industrial output.35 percent share in exports.
Objectives of SISI
• Initiating steps for technological upgradation and modernization ofexisting units.
• Expanding the channels for marketing the products of the small scale sector.
• Promotion of employment-oriented industries.
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Functions of SISI
Assist existing and prospective entrepreneurs.
• Conduct EDPs all over the country.
• Testing of raw materials and products of SSIS.
• Financial assistance.
• Conduct economic and technical surveys.
• Market information.
Activities of SISI
1. Assistance/Consultancy to prospective entrepreneurs
2. Assistance/Consultancy to existing units
3. Preparation of State Industnal Potential Survey
4. Preparation of District Industrial Potential Survey
5. Preparation of Detail Project Report
6. Entrepreneurship Development Programme Training
7. Industrial Motivation Campaign
8. Management Development Programme Training for SS1 Units
9. Skill Development Programme Training 10.Preparation of Directory of Specific Industry
11.Production Index
12.Pollution Control
13.Export Promotion
14. Quality Control & Upgradation.
NATIONAL SMALL INDUSTRIES CORPORATION(NSIC):
The National Small Industries Corporation (NSIC), an ISO 9000 certified company, has been
working to fulfill its mission of promoting, aiding, and fastering the growth of the small-scale
industries and industry related small services/businesses the country.
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Functions of NSIC:
1.Provide machinery on hire-purchase scheme to small-scale industries.
2.Provide equipment leasing facility.
3.Help in export marketing of the products of small-scale industries.
4.Participate in bulk purchase programme of the Government.
5.Distribute basic raw material among small-scale industries through raw material depots.
6.Help in development and up-gradation of technology and implementation of modernization
programmes of small-scale industries.
7.Impart training in various industrial trades.
8.Set up small-scale industries in other developing countries on turn-key basis.
9.Undertake the construction of industrial estates.
ROLE AND RESPONSIBILITY OF NSIC:
The main aim is to fulfil the machinery and equipment requirements for the development of
small entrepreneurs.
NSIC provides equipment, plant, and machinery on a hire-purchase basis.
Under its scheme, entrepreneurs can procure indigenous as well as imported machinery.
But the scheme does not include second-hand machinery and machinery costing less than
Rs. 1000.
NSIC Registration helps to assists the entrepreneurs in procuring government orders for
various items of stores.
Discrimination is made between the units located in industrially developed regions & the
units of scheduled castes, scheduled tribes, and persons with disabilities, ex-servicemen,
and women.
New entrepreneurs are given special incentives. For imported machinery, an entrepreneur
must abide by the provisions of the government's import policy.
Entrepreneurs have to secure the license for such imports. In special cases, the
entrepreneurs have to prepare prototypes of the machines.
Organizational Set-Up:
The policy guidelines to the NSIC are provided by the Board of Directors consisting of a full-
time Chairman cum-Managing Director, two Functional Directors, two Government
Nominee Directors, one SIDBI Nominee Director, and six Non-official part-time Directors.
The National Small Industries Corporation operates through 9 Zonal Offices, 33 Branch
Offices, 14 Sub Offices, 10 NSIC Business Development Extension Offices, 5 Technical
Services Centres, 3 Extension Centres, and 2 Software Technology Parks supported by the
team of over 500 professionals spread across the country.
Schemes of the Corporation:
To enhance the competitiveness of MSMES, the NSIC provides integrated support
services in the areas of Marketing, Technology, Finance, etc. It implements various
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