All posts by : Anand Daga

This budget prioritizes MSMEs and labor-intensive manufacturing sectors, emphasizing their critical role in the economy, stated Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman during the Union Budget 2024-25 presentation in Parliament today. The Union Finance Minister highlighted the Government’s comprehensive package designed to bolster MSMEs through financing, regulatory reforms, and technological support, aligning with the objectives set in the Interim Budget.

The Micro, Small and Medium Enterprises (MSMEs) are part of the four major themes in the Budget and the Union Finance Minister proposed the following specific measures in support of MSMEs

Credit Guarantee Scheme for MSMEs in the Manufacturing Sector

Union Finance Minister Smt. Nirmala Sitharaman proposed a credit guarantee scheme to facilitate term loans for MSMEs to purchase machinery and equipment without requiring collateral or third-party guarantees. The scheme will pool the credit risks of these MSMEs. A self-financing guarantee fund will be established to provide a guarantee cover up to ₹100 crore for each applicant, though the loan amount may exceed this limit. Borrowers will be required to pay an upfront guarantee fee and an annual guarantee fee based on the reducing loan balance.

PSBs to Develop New Assessment Model for MSME Credit

To improve credit accessibility for MSMEs, Union Finance Minister Smt. Nirmala Sitharaman proposed that Public Sector Banks (PSBs) build in-house capabilities for assessing MSME creditworthiness, moving away from reliance on external assessments. These banks will develop a new credit assessment model based on the digital footprints of MSMEs, offering a significant improvement over traditional asset or turnover-based assessments. This model will also accommodate MSMEs without formal accounting systems.

Credit Support to MSMEs During Stress Period from a Government-Promoted Fund

Smt. Sitharaman proposed a new mechanism to support MSMEs with continued bank credit during stress periods. When MSMEs are in the ‘special mention account’ (SMA) stage due to reasons beyond their control, they will be eligible for credit to maintain operations and avoid transitioning to Non-Performing Assets (NPA). This support will be facilitated through guarantees from a government-promoted fund.

MUDRA Loans Enhanced for Credit-Worthy Entrepreneurs to ₹20 Lakh

The Finance Minister announced an increase in the Mudra loan limit from ₹10 lakh to ₹20 lakh for entrepreneurs who have successfully availed and repaid previous loans under the ‘Tarun’ category.

Turnover Threshold for Buyers Halved for Mandatory Onboarding in TReDS

To help MSMEs unlock working capital by converting trade receivables into cash, Smt. Sitharaman proposed reducing the turnover threshold for mandatory onboarding on the TReDS platform from ₹500 crore to ₹250 crore. This change will bring 22 additional Central Public Sector Enterprises (CPSEs) and 7,000 more companies onto the platform, and will include medium enterprises within the scope of suppliers.

New SIDBI Branches in MSME Clusters for Easier and Direct Credit Access

Smt. Sitharaman proposed that the Small Industries Development Bank of India (SIDBI) will open new branches to enhance its reach to major MSME clusters within three years. With 24 branches to be opened this year, the coverage will expand to 168 out of 242 major clusters.

New MSME Units for Food Irradiation, Quality & Safety Testing

The Finance Minister proposed financial support for the establishment of 50 multi-product food irradiation units within the MSME sector, along with the setup of 100 food quality and safety testing labs accredited by NABL.

E-Commerce Export Hubs for MSMEs and Traditional Artisans

To help MSMEs and traditional artisans access international markets, Smt. Sitharaman proposed the establishment of E-Commerce Export Hubs in public-private partnership (PPP) mode. These hubs will provide trade and export-related services under a seamless regulatory and logistic framework, enabling easier access to global markets.

The Union Budget for the fiscal year 2024, presented by Finance Minister Nirmala Sitharaman, marks a significant step towards India’s economic recovery and growth post-pandemic. This budget focuses on infrastructure development, digital economy, and social welfare, aiming to bolster the country’s economic resilience and global competitiveness. Below are the key highlights and an analysis of the Union Budget 2024:

Focus on 4 major castes

1. Anandata ( Farmer )
2. Garib ( poor)
3. Yuva (youth)
4. Mahilayen ( Women )

Priorities for Viksit Bharat

1. Productivity and resilience in Agriculture

• Transforming Agriculture Research Comprehensive review of the agriculture research setup to bring focus on raising productivity and developing climate resilient varieties.
• National Cooperation Policy For systematic, orderly and all-round development of the cooperative sector
• Atmanirbharta For oil seeds such as mustard, groundnut, sesame, soyabean and sunflower
• Vegetable production & supply chain Promotion of FPOs, cooperatives & start-ups for vegetable supply chains for collection, storage, and marketing.
• Release of new varieties 109 new high-yielding and climateresilient varieties of 32 field and horticulture crops will be released for cultivation by farmers

2. Natural Farming

 • 1 crore farmers across the country will be initiated into natural farming, supported by certification and branding in next 2 years.

• 10,000 need-based bio-input resource centres to be established.

Shrimp Production & Export

 • Financing for Shrimp farming, processing and export will be facilitated through NABARD.

Digital Public Infrastructure (DPI)

 • DPI for coverage of farmers and their lands in 3 years.

 • Digital crop survey in 400 districts

• Issuance of Jan Samarth based Kisan Credit Cards

3. Employment & Skilling

PM’s Package (3 schemes for Employment Linked Incentive)

Scheme A First Timers :  One-month wage to new entrants in all formal sectors in 3 instalments up to ₹15,000 . – Expected to benefit 210 lakh youth

Scheme B Job Creation in Manufacturing: Linked to first time employees – Incentive to both employee & employer for EPFO contributions in the specified scales for the first 4 years – Expected to benefit 30 lakh youth

Scheme C Support to Employers : Government will reimburse EPFO contributions of employers up to ₹3000 per month for 2 years for all new hires. – Expected to generate 50 lakh jobs

• Facilitate higher participation of women in the workforce through setting up of working women hostels in collaboration with industry, and establishing creches.
• Loans up to ₹7.5 lakh with a guarantee from a government promoted Fund. Expected to help 25,000 students every year.
• Financial support for loans upto ₹10 lakh for higher education in domestic institutions. Direct E-vouchers to 1 lakh students every year. Annual interest subvention of 3%

4. Manufacturing & Services

• Credit Guarantee Scheme for MSMEs in the Manufacturing Sector
• New assessment model for MSME credit
• Enhanced scope for mandatory onboarding in TReDS
• Mudra Loans: The limit enhanced to ₹ 20 lakh from the current ₹ 10 lakh under the ‘Tarun’ category.
• MSME Units for Food Irradiation, Quality & Safety Testing
• Credit Support to MSMEs during Stress Period

5. Urban Development

• Stamp Duty : Encouraging states to lower stamp duties for properties purchased by women.
• Street Markets: Envisioning a scheme to develop 100 weekly ‘haats’ or street food hubs in select cities
• Transit Oriented Development : Transit Oriented Development plans for 14 large cities with a population above 30 lakh
• Water Management : Promote water supply, sewage treatment and solid waste management projects and services for 100 large cities through bankable projects.

6. Housing Needs

• PM Awas Yojana Urban 2.0 : Needs of 1 crore urban poor and middle-class families will be addressed with an investment of ₹10 lakh crore
• Enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place.

7. Energy Security

• Initiatives with private sector in Nuclear Energy : Setting up Bharat Small Reactors • R&D of Bharat Small Modular Reactor and newer technologies for nuclear energy
• Pumped Storage Policy : For electricity storage and facilitation of smooth integration of the growing share of renewable energy
• AUSC Thermal Power Plants : A joint venture between NTPC and BHEL will set up a full scale 800 MW commercial plant
• Energy Audit : Financial support for shifting of micro and small industries to cleaner forms of energy and Facilitate investment grade energy audit in 60 clusters, next phase expands to 100 clusters

8. Infrastructure

• Tourism: Development of Vishnupad Temple Corridor and Mahabodhi Temple Corridor modelled on Kashi Vishwanath Temple Corridor Comprehensive development initiative for Rajgir will be undertaken which holds religious significance for Hindus, Buddhists and Jains. The development of Nalanda as a tourist centre besides reviving Nalanda University to its glorious stature.  Assistance to development of Odisha’s scenic beauty, temples, monuments, craftsmanship, wildlife sanctuaries, natural landscapes and pristine beaches making it an ultimate tourism destination.

9. Innovation, Research & Development

• Operationalization of the Anusandhan National Research Fund for basic research and prototype development.
• Private sector-driven research and innovation at commercial scale with a financing pool of ₹1 lakh crore
• Space Economy: A venture capital fund of ₹1,000 crore is to be set up

10. Tax Proposals

1. Sector Specific Customs Duty Proposals : Comprehensive review of the rate structure for ease of trade, removal of duty inversion and  reduction of disputes
2. Changes in Custom Duty
3. Fully exempt 3 more cancer medicines from custom duties
4. Reduce BCD to 15% on Mobile phone, Mobile PCBA and charger
5. Reduce custom duty on gold and silver to 6% and platinum to 6.4%
6. Reduce BCD on shrimp and fish feed to 5%
7. Exempted more capital goods for manufacturing of solar cells & panels
8. Fully exempt custom duties on 25 critical minerals

To reduce the compliance burden, promote entrepreneurial spirit and provide tax relief to citizen

Rationalization of capital gains : Short term gains of financial assets to attract 20% tax rate Long term gains on all financial an non-financial assets to attract a tax rate of 12.5% Increase in limit of exemption of capital gains on financial assets to ₹1.25 lakh per year

Employment and Investment :

• Abolish ANGEL tax for all classes of investors.

• Simpler tax regime to operate domestic cruise
• Provide for safe harbour rates for foreign mining
  companies (Selling raw diamonds)
• Corporate tax rate on foreign companies reduced from 40%
  to 35%

Eligibility Criteria

An Eco Tourism Unit project should be established in ecotourism destinations such as forests, dam sites, reservoirs, water bodies, and other eco-sites where tourists can enjoy flora and fauna. The eligibility criteria include:

• Accommodation: The unit should have a minimum of two lettable rooms with attached bathrooms.
• Infrastructure: Tourism infrastructure proposed in the project should conform to environment-friendly, low-impact aesthetic architecture.
• Sustainability: Incorporate sustainability initiatives such as solar energy, waste recycling, rainwater harvesting, water conservation, natural cross-ventilation, energy conservation, and proper sewage disposal​(Tourism policy 2024)​.

Financial Assistance

Various forms of financial assistance are available for Eco Tourism Units under the Tourism Policy 2024:

1. Capital Investment Incentive:
   • 15% of the eligible capital investment or INR 15 crore, whichever is less.
2. SGST Reimbursement:
   • Up to 100% reimbursement of SGST on net paid, depending on the project category and location.
3. Interest Subventions:
   • Up to 5% interest subvention on loans, with ceiling amounts depending on the project scale.
4. Stamp Duty & Registration Charges Exemption:
   • Up to 100% exemption for sale/lease deeds executed for tourism projects​(Tourism policy 2024)​.

Components of Eco Tourism Units

Eligible Eco Tourism Units must include:

• Environment-Friendly Architecture: Incorporate elements such as solar energy systems, waste recycling processes, rainwater harvesting systems, water conservation techniques, and natural cross-ventilation.
• Sustainability Initiatives:
  • Installation of rainwater harvesting measures.
  • Restoring water bodies by de-silting defunct water bodies within the premises.
  • Installation of mechanized eco-system based systems for sewage cleaning and zero liquid discharge solutions.
  • Use of renewable energy sources like solar P.V. panels, solar wind hybrids, mini wind turbines, solar water pumps, solar lights, solar heaters, cooking systems, etc.
  • Use of electric vehicles for the transport of goods and personnel within the facility premises and EV buses for the transport of personnel from and to the facility.
  • Installation of wastewater treatment and recycling systems using technologies such as Activated Sludge Process (ASP), Membrane Bioreactors (MBR), and Reverse Osmosis (RO)​(Tourism policy 2024)​.

Additional Notes

• Registration Requirement: All eligible units must be registered with the Directorate of Tourism (DoT) and Ministry of Tourism (MoT).
• Use of Booking Platform: Compulsory use of DoT’s booking platform, if available.
• Application for Eligibility Certificate: Registered units must apply for an eligibility certificate to avail incentives​(Tourism policy 2024)​.

Eligibility Criteria

An Agro Tourism Unit should be situated on or near a working farm or agricultural field, and constructed especially for tourists, separate from the usual residence of the farm owner. The eligibility criteria include:

• Accommodation: The unit must have accommodation facilities with attached bathrooms.
• Reception Area: A reception area should be provided at the entrance to welcome visitors.
• Minimum Lettable Rooms: The unit should have a minimum of two lettable rooms.
• Core Components: The unit must include at least one of the following:
  • Agriculture farming
  • Horticulture orchard/garden
  • Fishpond
  • Dairy farm
  • Animal husbandry unit
  • Farm tours
  • Farm store
  • Other activities as decided by the Directorate of Tourism (DoT)​(Tourism policy 2024)​.

Financial Assistance

Various forms of financial assistance are available for Agro Tourism Units under the Tourism Policy 2024:

1. Capital Investment Incentive:
   • 15% of the eligible capital investment or INR 15 crore, whichever is less.
2. SGST Reimbursement:
   • Up to 100% reimbursement of SGST on net paid, depending on the project category and location.
3. Interest Subventions:
   • Up to 5% interest subvention on loans, with ceiling amounts depending on the project scale.
4. Stamp Duty & Registration Charges Exemption:
   • Up to 100% exemption for sale/lease deeds executed for tourism projects.
5. Awards:
   • District Level: INR 25,000
   • Division Level: INR 50,000
   • State Level: INR 1 Lakh​(Tourism policy 2024)​.

Components of Agro Tourism Units

Eligible Agro Tourism Units must include:

• Infrastructure: Adequate fencing, internal roads, signage, basic infrastructure, buildings, equipment, utilities, and installation charges.
• Excluded Components: Land acquisition, resettlement packages, investments in private assets, and rejuvenation of water bodies.

Additional Notes

• Registration Requirement: All eligible units must be registered with the Directorate of Tourism (DoT) and Ministry of Tourism (MoT).
• Use of Booking Platform: Compulsory use of DoT’s booking platform, if available.
• Application for Eligibility Certificate: Registered units must apply for an eligibility certificate to avail incentives​(Tourism policy 2024)​.

The “Guidelines for Modified Scheme for Setting Up of Semiconductor Fabs in India” dated 29th May 2023, outlines the policies and procedures for supporting the establishment of semiconductor fabrication plants in India. This modified scheme, which extends fiscal support of 50% of the project cost, aims to bolster the country’s semiconductor manufacturing capabilities. Here is a summary of the key points:

Background

• Notification and Modification: The scheme is a modified version of the earlier scheme notified on 21st December 2021, with the new notification dated 4th October 2022.
• Fiscal Support: It provides 50% fiscal support for the project cost on a pari-passu basis, contingent on meeting capital expenditure thresholds.
• Application Period: Applications will be accepted from 1st June 2023 and will remain open until further notice.

Scheme Guidelines

1. Definitions:
   • Modified Scheme: Extends fiscal support of 50% of project costs.
   • Applicant: Legal entities like Private Limited or Public Limited Companies.
   • Nodal Agency: India Semiconductor Mission (ISM) under the Ministry of Electronics and Information Technology (MeitY).
2. Eligibility and Project Cost:
   • Applicants must meet specific criteria related to project investment and capability.
   • Eligible project costs include land, building, machinery, and associated utilities.
3. Nodal Agency’s Role:
   • ISM will manage application processes, evaluate project proposals, and oversee the disbursement of funds.
   • ISM will also ensure compliance with the scheme’s guidelines and report progress to MeitY.
4. Application and Approval:
   • Applications must be submitted in a prescribed format with required documentation.
   • The Nodal Agency will evaluate applications based on technological and financial criteria.
   • Multiple applications from a single applicant are allowed.
5. Disbursement and Compliance:
   • Fiscal support will be disbursed based on project milestones and compliance with the scheme’s terms.
   • The Nodal Agency will submit budgetary requirements to MeitY for fund allocation.
6. Other Support:
   • Includes assistance with obtaining necessary licenses, permits, and clearances for project execution.

Additional Provisions

• Market and Technology Assessment: Applicants must provide detailed plans for market assessment, technology upgrades, and R&D collaborations.
• Human Resources and Capital Goods: Plans for training, skill development, and procurement of new or refurbished capital goods must be detailed.
• Regulatory Compliance: Applicants need to outline the regulatory requirements and timelines for obtaining necessary approvals.

This scheme is designed to attract significant investments in India’s semiconductor sector by providing substantial fiscal support and creating a conducive environment for establishing and expanding semiconductor fabs in the country .

The broad objective of CGSS is to provide guarantee upto a specified limit against credit instruments extended by Member Institutions (MIs) to finance eligible Startups. This scheme would help provide the much needed collateral free debt funding to Startups.

Eligible Borrower

The eligibility criteria for an entity to borrow under the Credit Guarantee Scheme for Startups shall be as follows, wherein an entity should be:

i. Startup as recognized by DPIIT as per Gazette Notifications issued from time to time, and

 ii. Startups that have reached stage of stable revenue stream, as assessed from audited monthly statements over a 12 month period, amenable to debt financing, and

 iii. Startup not in default to any lending/investing institution and not classified as Non-Performing Asset as per RBI guidelines, and iv. Startup whose eligibility is certified by the member institution for the purpose of guarantee cover.

Guarantees

1. Credit guarantee cover under this model would be either transaction based or umbrella based.
2. AIFs shall not be eligible to avail transaction based guarantee cover under the scheme.
3. In respect of transaction-based guarantee cover, the guarantee cover will commence from the date of payment of guarantee fee and shall run through the agreed tenure of the Loan/debt facility.
4. In respect of umbrella-based guarantee, the cover is based on the Pooled Investment in Startups. The guarantee cover will commence from the date of payment of commitment charges and shall run through the life of the VDF provided the borrowers being covered are eligible for coverage under the scheme and commitment charges are paid from the first year of operations of VDF annually till its closure.

Ceiling on guarantee cover

1. Maximum guarantee cover per borrower shall not exceed Rs.10 crore.
2. The credit facility being covered here should not have been covered under any other guarantee scheme.
3.  In respect of credit facilities where a portion of the same has been secured by way of partial collateral security, the remaining part comprising of the unsecured facility will be covered under the guarantee scheme

Extent of the guarantee For transaction-based guarantee cover –

The Trust shall provide guarantee cover, subject to a maximum of Rs.10 crore per borrower, as per details given below:

 i. to the extent of 80% of the amount in default if the original loan sanction amount is upto Rs.3 crore ii. to the extent of 75% of the amount in default if the original loan sanction amount is above Rs. 3 crore and upto Rs. 5 crore iii. to the extent of 65% of the amount in default if the original loan sanction amount is above Rs. 5 crore.

For umbrella-based guarantee cover

 i. The Trust shall provide guarantee cover of actual losses or upto a maximum of 5% of Pooled Investment on which cover is being taken from the fund in Startups, whichever is lower, subject to a maximum of Rs.10 crore per borrower

The “Guidelines for Startup India Seed Fund Scheme” provide a comprehensive framework to support early-stage startups in India through seed funding. Here is a summary of the main points:

The scheme aims to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry, and commercialization.

Eligibility

• Startups recognized by the Department for Promotion of Industry and Internal Trade (DPIIT).
• The startup should not be more than two years old at the time of application.
• The startup should have a business idea to develop a product or a service with market fit, viable commercialization, and scope of scaling.
• Shareholding by Indian promoters should be at least 51% at the time of application.

Funding

• Financial assistance to eligible startups will be provided through incubators.
• Up to Rs. 20 Lakhs for validation of Proof of Concept, or prototype development, or product trials.
• Up to Rs. 50 Lakhs for market entry, commercialization, or scaling up through convertible debentures or debt or debt-linked instruments.

Implementation:

• The scheme will be implemented by Startup India, a DPIIT initiative.
• An Expert Advisory Committee (EAC) will be set up by DPIIT to execute and monitor the scheme.
• The EAC will evaluate and select incubators for allotment of seed funds.

1. Incubator Selection:
   • Incubators must be legal entities registered in India.
   • They should have been operational for at least two years.
   • They should have facilities to support the startup ecosystem.
   • They should have a minimum of five startups undergoing incubation physically.
2. Process:
   • Startups will apply to the incubators for seed funding.
   • Incubators will shortlist startups based on eligibility criteria and due diligence.
   • Incubators will forward the recommendations to the EAC.
   • EAC will evaluate and approve seed funding.
3. Disbursement of Funds:
   • The funds will be released in installments based on milestones achieved.
   • Incubators will monitor the progress of startups and submit periodic reports to DPIIT.
4. Monitoring and Evaluation:
   • The EAC will periodically review the progress of the incubators and startups.
   • The scheme will be evaluated by a third party to assess the impact.

This scheme is designed to nurture innovation and entrepreneurship by providing crucial early-stage funding, thereby enabling startups to grow and succeed in their respective fields.

Components

A. Cluster Development Programme (CDP) (earlier known as Block Level cluster)

B. Handloom Marketing Assistance with special emphasis on uncovered & talented weavers.

C. Infrastructure & Special Projects including Indian Institutes of Handloom Technology (IIHT)-related projects

D. Mega Handloom Cluster [earlier known as Comprehensive Handloom Cluster Development Scheme (CHCDS)] E. Concessional Credit/Weavers’ MUDRALoan

F. Handloom Weavers’ Welfare {earlier known as Handloom Weavers Comprehensive Welfare Scheme (HWCWS)}

G. Miscellaneous ComponentsI. Research & Development projects II. Handloom Census III. Publicity, Advertisement, Monitoring, Training & Evaluation of Scheme IV. Education of weavers/their wards through National Institutes of Open Schooling (NIOS)/IGNOU

A. Cluster Development Programme (CDP)

The CDP focuses on development of weavers’ groups as a visible entity, so that the groups become self-sustainable.

A.1 Quantum of financial assistance and duration of the project The quantum of assistance for each cluster would be need based, depending on the requirement of the cluster, the scope of the activities envisagedtechnical, financial and managerial capacity of the cluster Organization, level of maturity and past track record of the cluster etc. Maximum permissible GoI financial assistance is upto Rs. 2.00 crore per cluster

A.3 Funding pattern

i) Other Interventions benefitting directly individual weavers like Hathkargha Samvardhan Sahayata and lighting units will be funded in the ratio of 90:10 by the GoI : Beneficiary

 (iii) Individual Workshed-BPL/SC/ST/Women/differentlyabled – 100% by GoI share. Others – 75% by the GoI: 25% beneficiary (iv) Common Workshed –90% by the GoI: 10% beneficiary (v) Solar Lighting System for Common Workshed – 90% by the GoI: 10% beneficiary

B. Handloom Marketing Assistance (HMA)

Components of HMA: 1. Domestic Marketing Promotion 2. Handloom Export Promotion 3. Setting up of Urban Haats 4. Marketing Incentive (MI)

B.1 Domestic Marketing Promotion Types of Expos/ Events, Craft Melas, Virtual Expos and Miscellaneous activities: (i) Domestic Expos (National Handloom Expo, State Handloom Expo & District Handloom Expo) (ii) Crafts Melas (iii) Dilli Haat Exhibits (iv) Brand Building (v) National Handloom Day (vi) Handloom Awards (vii) GeM On-boarding (viii) Miscellaneous Promotional activities/events (ix) Virtual Expos (For both domestic and international)

Guidelines for organizing Domestic expos: Funding pattern, participation, period for Expos/ Events, Craft Melas & Virtual Expos:

Detailed component-wise Financial Assistance to IA: B.1.(i)(a) National Handloom Expo (NHE)

Venue: Metropolitan and big cities · 40% of stalls to be reserved for the host region, remaining 60% amongst other four regions, North East being a separate region. · Handloom products of at least 10 States and UTs will be represented.

B.1.(i) (b) State Handloom Expo (SHE)

• Venue: Metropolitan and big cities • 40 stalls to be reserved for the host state, 20 preferably from outside the host State.

The State of Maharashtra has been broadly divided into 4 zones based upon the development of textile sector and availability of inputs for the

Textile Industry

1) Zone 1 (Vidarbha includes Nagpur and Amaravati Divisions)

2) Zone 2 (Marathwada includes Aurangabad Division including Dhule and Jalgaon

Districts)

3) Zone 3 (North Maharashtra includes Nashik Division excluding Dhule and Jalgaon

Districts)

4) Zone 4 (Western Maharashtra & Konkan includes Pune and Konkan Divisions)

Incentives and Measures:

The following incentives will be provided to the sericulture farmers to produce and promote silk production and tap the growing market demand.

Processing

i The State shall support in establishment of Paithani weavers’ clusters at village level with minimum of 20 weavers in one cluster.

ii 2 Drying centres and godown facilities will be made available to store and preserve Tasar silk cocoons

Centrally Sponsored Scheme:

i Silk Samagra-2- It is an integrated scheme for development of silk industry. It provides assistance to farmers for mulberry plantation, construction of rearing house, procurement of rearing equipment’s and irrigation facility.

Financial Assistance

Category (small and marginal farmers)	GoI	State	Beneficiary
General States	50%	25%	25%
General States- For SCSP & TSP	65%	25%	10%
Special Status States (for General, SCSP & TSP Category	80%	10%	10%

State Sponsored Scheme:

i. The State will offer 50% subsidy as per DSR rates or INR 40 lakh whichever is less for establishment of Automatic Reeling Machine Unit- (ARM Sheds) such that the shed has minimum 400 ends or 40 basins.

ii’. The State will offer 50% subsidy as per DSR rates or INR 20 lakh whichever is less for establishment of Automatic Reeling Machine Unit- (ARM Sheds) such that the shed has minimum 200 ends or 20 basins.

iii. The State will offer 50% subsidy as per DSR rates or INR 15 lakhs whichever is less for establishment of Automatic Reeling Machine Unit (ARM Sheds) such that the shed has minimum 120 ends or 12 basins.

iv. The State will offer 50% subsidy as per DSR rates or INR 3 lakh whichever is less for establishment of multi-end reeling machine unit- MRM sheds such that the shed has minimum 100 ends or 10 basins.

v. The State shall offer 50% subsidy as per DSR rates or Rs. INR 6 lakhs, whichever is less for establishment of twisting machine sheds

This Policy shall come into effect from the date of notification.

This Policy will remain effective till the time it is replaced by the new policy.

MSMEs in the manufacturing sector which start commercial production  on or after the date of notification of the policy will be eligible to get  assistance under this Policy. Such manufacturing MSMEs which have  started commercial production on or after 01.07.2020 but before the date  of notification of this Policy and invested more than Rs. 10 crores & up  to Rs. 50 crores in the plant & machinery, will be eligible to receive  assistance under the earlier relevant policies. It is clarified that such units  will not be eligible for assistance/facilitation under this Policy.

For new manufacturing units, which will start production on or  after the date of notification of this Policy, the option of availing  facilities/assistances under the earlier incentive schemes will not be  available. However, the existing MSMEs in the manufacturing sector  undertaking expansion/diversification/technological upgradation during  the effective period of this Policy will be eligible for assistance/facilities  equivalent to a new industrial unit on the additional eligible investment  made by them, if the unit remains in the eligible MSME category after  such investment

Industrial Development Subsidy

1. Industrial development subsidy will be provided as follows for a new industrial unit investing up to Rs. 10 crores in plant and machinery :-
2. Industrial development subsidy to the new industrial units @ 40% on the eligible investment made by them in Plant & Machinery and building. This assistance shall be disbursed in 4 equal annual installments.
3. The cost of building shall not be more than 100% of the cost of Plant and machinery for the purpose of calculating the assistance.

• Additional Industrial Development Subsidy of 2% per year (for four years) for unit set up by women/SC/ST entrepreneur(s) or 2.5% per year (for four years) for unit set up by women entrepreneur(s) of SC/ST category; and
• Additional Industrial Development Subsidy of 2% per year (for four years) to the industrial units for exporting more than 25% and upto 50% of their total sales

Financial Assistance for Infrastructure Development

1. 50% of the expenditure on infrastructure development up to its premises, subject to a maximum of Rs. 25 lakhs shall be provided to a new industrial unit set up in private or undeveloped government land with a minimum investment of Rs. 1 crore and a maximum investment of Rs. 10 crores in plant and machinery. 50% assistance subject to a maximum of Rs. 1 crore each shall be provided to medium scale MSME units investing more than Rs. 10 crores in plant and machinery for developing power, water & road infrastructure
2. 50% of the expenditure for setting up of Effluents Treatment Plant (ETP) by MSME units investing up to a maximum of Rs. 10 crores in plant and machinery, subject to a maximum assistance of Rs. 25 lakhs and 50% of the expenditure incurred on setting up of waste management, pollution control devices, health & safety standards and water conservation measures, subject to a maximum assistance of Rs. 100 lakhs, to a medium scale MSME unit with an investment of more than Rs. 10 crores in plant and machinery
3. 50% reimbursement up to a maximum of Rs. 100 Lakhs for the establishment of a Common effluent treatment plant by a group (minimum 5) of industrial units investing up to a maximum of Rs. 10 crores (each unit) in plant and machinery.
4. 50% of the expenditure incurred in development to the developer of industrial area/ flatted industrial complex in the private sector, maximum assistance of Rs. 250 lakhs provided that industrial area so developed is at least 5 acres and less than 10 acres or carpet area of flatted industrial complex should be at least 10000 sq. ft. and 15% of the expenditure incurred in establishment/development of industrial area/cluster of 10 acres or more subject to maximum assistance of Rs. 5 crores will be made provided to the developer. In such a developed industrial area/flatted industrial complex/cluster, it will be necessary to have a minimum of five working industrial units

Financial Assistance for Energy audit

To promote energy efficiencies in MSME units investing up to a maximum of Rs. 10 crores in plant and machinery, GoMP will reimburse 50% of the cost of conducting energy audit with maximum limit of Rs. 50,000 and 25% of the cost maximum Rs. 5 Lakhs for adoption of equipment and machinery