Special schemes have been designed for specific purposes like quality upgradation, common facilities, entrepreneurship development & consultancy services at nominal charges.
- Incentive provided for quality upgradation:
Government of India has been executing the incentive scheme for providing reimbursement of charges for acquiring ISO 9000 certification to the extent of 75% of the cost subject to a maximum of Rs. 75000/- in each case. ISO 9000 is a mechanism to facilitate adoption of consistent management practices & production technique as decided by the entrepreneur himself. This facilitates achievement of desired level of quality while keeping check on production process & management of the enterprise.
- Concession on Excise Duty payable by small units:
MSME units with a turnover of Rs 1 crore or less per year have been exempted from payment of Excise Duty. Moreover there is a general scheme of excise exemption for MSME brought out by the Ministry of Finance which covers most of the items. Under this, units having turnover of less than Rs. 3 crores are eligible for concessional rate of Excise Duty.
Moreover there is exemption from Excise Duty for MSME units producing branded goods in rural areas.
- Priority on providing credit to MSME:
Credit to micro, small & medium scale sector has been covered under priority sector lending by banks. Small Industries Development Bank of India (SIDBI) has been established as the apex institution for financing the MSME. Specific schemes have been designed for implementation through SIDBI, SFCs, Scheduled Banks, SIDCs & NSIC etc. Loans upto Rs 5 lakhs are made available by the banks without insisting on collaterals. Further Credit Guarantee Fund for loans to MSME up to Rs 25 lakhs extended by Commercial banks & some Regional Rural Bank.
- Policies & schemes for promotion MSME being implemented by State Governments:
All the State Governments provide technical & other support services to small units through their Directorates of Industries, & District Industries Centres. Although the details of the scheme vary from state to state, the following are the common areas of support.
- Development & management of industrial support.
- Suspension or deferment of Sales Tax.
- Power subsidies.
- Capital investment subsidies for new units set up in a particular district.
- Seed capital / margin money assistance scheme.
- Priority in allotment of power connection, water connection.
- Consultancy & technical support.