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Raw Material Assistance to the Small Scale Industries Finance NSIC NEW

Raw Material Assistance to the Small Scale Industries Finance NSIC NEW

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Summer Training Project Report

ON Raw Material Assistance Scheme to Small Scale Industry

Submitted for partial fulfilment towards the award of the degree in Master of Business Administration of Mahamaya Technical University.

Submitted by: Paras Mani Roll No:-1013370035 (Batch: 2010-12)

Under the Supervision of: (Mr. Manoj Kumar Bhatnagar)

Department of MBA Noida Institute of Engineering and Technology (NIET) 19, Knowledge Park –II, Institutional Area, Greater Noida Gautam Buddh Nagar (UP), India-201306

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Declaration

I Paras Mani student of MBA (2010-12) of NIET, Greater Noida hereby declare that this project report “Raw Material Assistance to the Small Scale Industries” is written and submitted by me under guidance of Mr. Manoj Kr. Bhatnagar is my original work. The entire analysis and conclusion of this report are based on the information which is collected by me. The empirical finding in the report are based on the data collected myself while preparing this project. I have not copied anything from any source or other project submitted for the similar purpose

Paras Mani

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ACKNOWLEDGEMENT:

By the grace of GOD, I take the opportunity with great pleasure to plot the circle of warm complement deep sense of gratitude and profound thanks to all those who have spared their valuable time and giving me their cooperation to make this project complete. First of all I would like to express my sincere thanks to my supervisor Mr. Javed Finance manager NSIC, Aligarh. For his efforts, continuous proper guidance, supervision and generous cooperation throughout this work which enabled me to present this project report. Special thanks have to be reserved for Mr. T. S. Rajput (DGM) NSIC, Aligarh for providing facilities and extending full support to project work. I express my profound thanks to Mr. Manoj Kumar Bhatnagar (Lecturer) NIET Gr. Noida, who helped a lot during this training for giving precious time, giving encouragement time to time. I would be filling in my duty if, I do not express my heartiest thanks to lecturer and coordinate department for giving all possible support, suggestion and is valuable time in preparing this project.

Paras Mani

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Contents

Page No

Chapter I- Introduction 1.1 Introduction...........................................................................................7-8 1.2 Objective of the study...........................................................................9 1.3 Need and scope......................................................................................10 1.4 Methodology..........................................................................................11 1.5 Limitation...............................................................................................12

Chapter II- A profile of Organization 2.1 History..................................................................................................14-26 2.2 About the organization........................................................................27-31 2.3 products................................................................................................32-56 2.4 Financial position....................................................................................57 2.5 Organization structure.........................................................................58-62

Chapter III- Theoretical framework 3.1 Meaning................................................................................................64 3.2 Importance............................................................................................65 3.6 Research Methodology........................................................................66-71 3.6.1 Universe of study.........................................................................72 3.6.2 Sample size.....................................................................................73

Chapter IV- Analysis and interpretation...............................................................75-83

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........................................................................................Conclusions 5...........................................1 findings........................85 5....................2 Suggestion....86 Bibliography Annexure 5 .............................Chapter V....

Chapter-I Introduction 6 .

Sanction of Limit to the Unit. cash discount etc NSIC takes care of all the procedures.1 Introduction (Raw Material Assistance) Raw Material Assistance Scheme aims at helping Small Scale Industries/Enterprises by way of financing the purchase of Raw Material (both indigenous & imported).1. Signing of agreement between NSIC and Unit. Process to Apply The Entrepreneurs are required to apply for Raw Material Assistance only on the prescribed application forms. Preliminary appraisal and Unit inspection is carried out by NSIC.SSI helped to avail Economics of Purchases like bulk purchase.). documentation & issue of Letter of credit in case of imports. Duly filled application form is to be submitted along with the Application Processing Fee (by Bank Draft / Pay Order in favour of NSIC Ltd. The blank forms are also available free of charge from the zonal and Branch offices. Benefits of the Scheme Financial Assistance for procurement of Raw Material up to 90 days. 7 . Disbursement of assistance to the unit. This gives an opportunity to SSI to focus better on manufacturing quality products.

) c.1 core for 8 .2.1% of the assistance applied d.50 lacs and up to Rs.Processing Fee (depends on amount of assistance sought) S.25 lacs above Rs.25 lacs and up to Rs. 10.000/Rs.) b. 5.50 lacs above Rs.No.) above Rs. Slab for Processing fee a.) Up to Rs.500/Rs.1 core Rs.000/0.

2.To study the customer satisfaction towards the raw material assistance scheme provide by NSIC.2 Objective of the study 1. 9 .To analyze the benefit to SME‟S through raw material assistance scheme of NSIC.1.

3 Need and scope The small scale industrial sectors have recorded significant growth and impressive performance. also helping the government in formulating small scale industrial policy to revive the sick units by promoting better performance. This study aims at identifying and analyzing the factors responsible for successful survival by providing required raw material for their business. 10 .1.

Sample Size : 50 Sample Area : NSIC.4 Methodology Type of research : Descriptive.1. Aligarh Sample Unit : SSI‟s in Aligarh Methods Used : Questionnaire Questionnaire Type : Close ended questions Sampling Technique : Convenience Sampling Data Collection : Primary Data and Secondary Data 11 .

Due to time constraint the research could not be done exhaustively which may not have resulted deeper insights.Some unavoidable errors occurred during the process of transforming raw data from questionnaire in to the research in to the research findings 12 . 2. 4. 3.1.The sample size is small and cannot represent whole of NSIC.Some SSI‟s are reluctant to give response to some questions.5 Limitations 1.

CHAPTER-II A profile of Organisation 13 .

has been working to fulfil its mission of promoting. Over a period of five decades of transition. The year witnessed the Corporation achieved new heights on all parameters.projects and products from small industries. (NSIC). quality consciousness. 4488 crore over the previous year‟s turnover of Rs. an ISO: 9001 certified company. 3508 crore. achieved record operational and financial performance in terms of gross volume of business and profitability in the recently concluded financial year 2009-10. a Government of India enterprise under the aegis of Ministry of MSME.2. since its establishment in 1955. There was substantial improvement in enhancing the company‟s outreach and its volume of operations. The Business Turnover of the Corporation for the year jumped to Rs. To manage operations in African countries. NSIC has proved its strength within the country and abroad by promoting modernization. zinc. aiding and fostering the growth of small scale industries and industry related small scale services/business enterprises in the country. Performance and Achievements National Small Industries Corporation Ltd (NSIC). NSIC continued with its efforts to provide various raw materials like steel. NSIC operates from its office in Johannesburg. supported by a team of over 500 professionals spread across the country. making the total number of NSIC offices 123. With the opening of new offices the Corporation expanded its reach to serve larger number of MSMEs. up gradation of technology. NSIC operates through more than 120 offices. 14 . strengthening linkages with large medium enterprises and enhancing exports . growth and development.1 History National Small Industries Corporation Ltd. aluminium.

increased to Rs.  In the year 2009-10. registering a growth of 53%. 1056 crore to MSMEs as against Rs.  Under B2B portal. total 3327 new units were registered under Single Point Registration Scheme.55 crore from Rs. 4.12 Crore in the year 2008-09. as against 5011 units rated in the previous year. total 3802 members were added during the year 2009-10. 17.  The Corporation during the year provided credit support of Rs. 5.  The Corporation‟s revenue from its above mentioned two membership schemes during the year 2009-10. the Corporation also started distribution of Coal to MSMEs in West Bengal. buyer-sellers meets and marketing campaigns as compared to 874 events in the previous year 2009-10. In addition.  NSIC organized 963 Marketing Promotion events including participation / organization / co-sponsoring of exhibitions. paraffin wax etc to MSMEs through arrangements made with bulk manufacturers of these materials. 12. Total raw material facilitation to MSMEs increased from 302164 MTs in the year 2008-09 to 355719 MTs in the year 2009-10.  Under the Performance & Credit Rating Scheme.54 crore in the year 2008-09 to Rs. as against 2808 members made under Infomediary Services in the year 2008-09. 15 . while in the previous year 2677 units were registered. registering the growth of 35%. 688 crore provided during the previous financial year.16 crore in the year 2009-10. total 7531 micro & small enterprises were rated during the year. The aggregate income of the technical centres rose from Rs. NSIC‟s „Techmart 2009‟ organized at the India International Trade Fair during November.  The performance of NSIC‟s Technical Centres also showed remarkable improvement in the year 2009-10.copper. registering a growth of 37%.

21 crore in the previous financial year. So far. NSIC organized 963 Marketing Promotion events including participation / organization / cosponsoring of exhibitions. 2009 was awarded „Gold Medal‟ for outstanding 16 . The Corporation. NSIC continued its initiative to set up new Training-cum Incubation centres under Public-Private Partnership (PPP) mode for the purpose of inculcating entrepreneurial skills in the youth by way of skill development through which they become employable or create their own enterprises.2009 was awarded „Gold Medal‟ for outstanding display of the MSMEs technology and products. showing a jump of 205. These are in addition to three incubation centres opened at our technical centres. 25.12 crore.92 crore earned during the previous year. 2. The overall improved performance resulted in achievement of higher profit. During the year.94 crore. NSIC‟s „Techmart 2009‟ organized at the India International Trade Fair during November. 45 such centres have been established at various locations in the country. 9. 6.43% over the operating profit of Rs. 8364 candidates were trained at these centres. After amortization of VRS expenditure of Rs.  During the year. during the year achieved operating profit of Rs.13 crore. buyer-sellers meets and marketing campaigns as compared to 874 events in the previous year 2009-10. as against 5011 units rated in the previous year. as compared to Rs. total 7531 micro & small enterprises were rated during the year. 28. the Corporation has earned a net profit (before tax) of Rs. The major highlights of the achievements of the Corporation for the financial year 2009-10 are briefly summed up here-below: Under the Performance & Credit Rating Scheme.

45 such centres have been established at various locations in the country. These schemes are briefly described as under: 17 . These audited results are indicative of the continuous improvements in the performance of the Corporation. both in an outside the country. The schemes comprise of facilitating marketing support. So far. NSIC acts as a facilitator to promote small industries products and has devised a number of schemes to support small enterprises in their marketing efforts. is critical to the growth and survival of small enterprises in today's intensely competitive market.display of the MSMEs technology and products. During the year. technology support and other support services. These are in addition to three incubation centres opened at our technical centres. a strategic tool for business development. based on the audited data is „Excellent‟. During the year. NSIC carries forward its mission to assist small enterprises with a set of specially tailored schemes designed to put them in a competitive and advantageous position. Marketing: Marketing. credit support. 8364 candidates were trained at these centres. NSIC continued its initiative to set up new Training-cum Incubation centres under Public-Private Partnership (PPP) mode for the purpose of inculcating entrepreneurial skills in the youth by way of skill development through which they become employable or create their own enterprises. The MOU rating of the Corporation for the year 2009-10.

Consortia and Tender Marketing: Small Enterprises in their individual capacity face problems to procure & execute large orders. firms and small scale units to expand further. Testing facilities are also provided to enable units to improve and maintain the quality of their products conforming to the standard specifications. after due verification.      Issue of tender sets free of cost. Waiver of security deposit up to the monetary limit for which the unit is registered. NSIC. exporters and service providers in India. The Corporation explores the market and secures orders for bulk quantities. B2B Web Portal for Marketing : NSIC Infomediary is a Business-to-Business (B2B) Portal that has been established to give online services for small and medium time importers. Thus. exemption from payment of Earnest Money Deposit etc. which inhibit and restrict their growth. Single point Registration for Government Purchase: NSIC operates a single Point Registration Scheme under the Government Purchase Programme. Exemption from payment of earnest money. Advance intimation of tenders issued by DGS&D. anyone involved in business activities and wants to utilize the strength and visibility of Internet can 18 . thereby easing out marketing problems of SSIs. These orders are then distributed to small units in tune with their production capacity. The portal is an initiative to provide business opportunities to small businesses. Issue of competency certificate in case the value of an order exceeds the monetary limit. accordingly adopts Consortia approach and forms consortia of units manufacturing the same products. wherein the registered SSI units get purchase preference in Government purchase programme.

Defence. Participation in these events exposes SSI units to international practices and enhances their business prowess. Exhibitions and Technology Fairs: To showcase the competencies of Indian SSIs and to capture market opportunities. in addition to spreading awareness about various programmes / schemes for MSMEs. Those who look for promotion and prospect for their trade and products/services can also join NSIC Infomediary. NSIC participates in select International and National Exhibitions and Trade Fairs every year. Buyer-Seller meets: Bulk and departmental buyers such as the Railways. NSIC facilitates the participation of the small enterprises by providing concessions in rental etc. will specifically maintain database and disseminate information. quality standards.join NSIC Infomediary. These programmes are aimed at vendor development from MSMEs for the bulk manufacturers. Communication departments and large companies are invited to participate in buyer-seller meets to enrich small enterprises knowledge regarding terms and conditions. This cell. etc required by the buyer. Credit Support: NSIC facilitates credit requirements of small enterprises in the following areas 19 . Marketing Intelligence : Collect and disseminate both domestic as well as international marketing intelligence for the benefit of MSMEs.

NSIC facilitates import of scares raw materials. NSIC is 20 . Finance through syndication with Banks In order to ensure smooth credit flow to small enterprises.NSIC takes care of all the procedures. Exports and Bill Discounting. 3. 4. Financing for Marketing Activities (Short term) NSIC facilitates financing for marketing actives such as Internal Marketing. Performance and Credit Rating Scheme for small industries To enable small enterprises to ascertain the strengths and weaknesses of their existing operations and take corrective measures to enhance their organizational strength. The arrangement envisages forwarding of loan applications of the interested small enterprises by NSIC to the banks and sharing the processing fee.Financing for procurement of Raw Material (Short term) NSIC's Raw Material Assistance Scheme aims at helping Small Enterprises by way of financing the purchase of Raw Material (both indigenous & imported). The salient features are 1. NSIC is entering into strategic alliances with commercial banks to facilitate long term / working capital financing of the small enterprises across the country.Financial Assistance for procurement of Raw Materials upto 90 days. documentation & issue of letter of credit in case of imports.Bulk purchase of basic raw materials at competitive rates. 2.

The benefits to small enterprises are as follows:  An independent. CRISIL.  Good rating to enhance the acceptability of the small enterprise with Banks.50 lakh to Rs.will be reimbursed to the small enterprise having a turnover upto Rs. NSIC offers small enterprises the following support services through its Technical Services Centres and Extension Centres 21 .will be reimbursed to the small enterprise having a turnover above Rs. FIs.200 lakh by way of grants. customers and suppliers. trusted third party opinion on capabilities and credit worthiness of small enterprises.50 lakh by way of grants. Rating agencies will charge the credit rating fee according to their policies.200 lakh by way of grants. 75% of the credit rating fee subject to a maximum of Rs. FITCH.  75% of the credit rating fee subject to a maximum of Rs.000/. CARE. 25.000/. 30. ONICRA.   Facilitate prompter credit decisions from Banks on proposals of SSI units. Technology Support Technology is the key to enhancing a company's competitive advantage in today's dynamic information age. 40.operating a Performance and Credit Rating Scheme through empanelled agencies like ICRA. BRICKWORK RATINGS and SMERA. marketing and operational strategies and adopt the one that helps integrate their operations with their environment. Small enterprise has the liberty to choose any of the rating agencies empanelled with NSIC. Small enterprises need to develop and implement a technology strategy in addition to financial.000/. customers and buyers.will be reimbursed to he small enterprise having a turnover above Rs.  75% of the credit rating fee subject to a maximum of Rs.

EDM. Classroom and practical training for skill upgadation NSIC Technical Services Centres are located at the following places Name of the Centre Chennai Howrah Hyderabad New Delhi Rajkot Rajpura (Pb) Aligarh (UP) Focus area Leather & Footware General Engineering Electronics & Computer Application Machine Tools & related activities Energy Audit & Energy Conservation activities Domestic Electrical Appliances Lock Cluster & Die and Tool making 22 . Energy and environment services at selected centres 6. Material testing facilities through accredited laboratories 3. Advise on application of new techniques 2. 5. Product design including CAD 4.1. CNC. etc. Common facility support in machining.

is offering Infomediary Services which is a one-stop. Software Technology Parks NSIC Software Technology Parks (STPs) facilitate small enterprises in setting up 100% export-oriented units for software exports. Access to national and international business leads.Infomediary Services Information today is becoming almost as vital as the air we breathe. specialized services for members of Infomediary Service. rules and regulations. The scheme is governed by STPI regulations of the Ministry of Information Technology. 23 . JV opportunities and trade information. technology and finance.  Comprehensive information on Government policies. realizing the needs of MSMEs. NSIC. the demand for information is reaching new heights. With increase in competition and melting away of international boundaries. Various value added. They also act as nodal point to activate software exports directly through NSIC. These STPs extend support in terms of the requisite infrastructure to the small enterprises to start business operations with a minimum lead time. schemes and incentives. and also exhibit the core competence of Indian SMEs. Banner display on NSIC Website Access to a wide range of technologies from India and abroad. one-window bouquet of aids that will provide information on business. We need it every minute of our working lives.   Access to industrial databases and member's directory. Membership Benefits     Tender & Trade Information.

Government of India. NSIC established the first STP at Okhla, New Delhi in 1995 and second in Chennai in 2001. Several small enterprises have taken advantage of these parks and contributed export earnings to the exchequer.

Incubation of unemployed youth for setting up of New Micro & Small enterprises

This programme facilitates setting up of new enterprises all over the country by creating selfemployment opportunities for the unemployed persons. The objective of this scheme is to facilitate establishment of new small enterprises by way of providing integrated services in the areas of training for entrepreneurial skill development, selection of small projects, preparation of project profiles/reports, identification and sourcing of plant, machinery and equipments, facilitating sanction of credit facility and providing other support services in order to boost the development of small enterprises in manufacturing and services sectors. International Cooperation

NSIC facilitates sustainable international partnerships. The emphasis is on sustainable business relations rather than on one-way transactions. Since its inception, NSIC has contributed to strengthening enterprise-to-enterprise cooperation, south south cooperation and sharing best practices and experiences with other developing countries, especially those in the African, Asian and Pacific regions. The features of the scheme are:
 

Exchange of Business / Technology missions with various countries. Facilitating Enterprise to Enterprise cooperation, JVs, Technology Transfer & other form of sustainable collaboration.

 

Explore new markets & areas of cooperation: Identification of new export markets by participating in sector- specific exhibitions all over the world.

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International Consultancy Services

For the last five decades, NSIC has acquired various skill sets in the development process of small enterprises. The inherent skills are being networked to offer consultancy services for other developing countries. The areas of consultancy are as listed below:

1. Capacity Building 2. Policy & Institutional Framework 3. Entrepreneurship Development 4. Business Development Services

Insurance of Export Creditfor Microand Small Enterprises

NSIC is facilitating micro and small enterprises to insure their export credits by entering into strategic alliance with Export Credit Guarantee Corporation of India Limited (ECGC). MSEs would be helped in insuring their export credits through any office of the Corporation, located all over the country. This arrangement is made to strengthen promotion of exports from small enterprises.

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AWARDS & RECOGNITIONS In recognition of the services rendered by the Company for the development of MSMEs the awards conferred upon NSIC include “Icon of the year Award from the Institute of Cost and Works Accounts of India (ICWAI), “Meri Dilli Award” by Hon‟ble Chief Minister of Delhi in recognition of the innovative NSIC Incubation programme for Small Enterprise establishment launched by NSIC for creating new employment opportunities, employment and the growth of MSME sector in the country, “Small Business Mentor of the Year” Award at the National Convention for Small Business & Entrepreneurship organized by Zee TV, FSIA – V.B. Gulati Award for services rendered to the MSME sector and Award and Letter of Appreciation from VEL TECH Technical University, Chennai for partnering with the University in imparting skills to students by way of in-plant training and projects entitled “India – a Superpower in 2020”.

2.2 About the organisation
NSIC-TSC, ALIGARH THE NSIC-TECHNIAL services center was established during the year 1986 primarily for the upliftment of locks and hardware, allied small scale industries and rural artisan. AIMS AND OBJECTIVES: 1- To provide technical and vocational training to youths for employment generation. 2- To improve and quality and productivity by providing tools and on job training. Up gradation of technology to SSIs 3- To provide skilled manpower to SSI units. 4- To provide common facility services in areas such as:

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Design and development of press tool, dies and mould, jigs and fixtures gauges. Job work services to SSIs. QUALITY POLICY

We shall endeavor to provide effective and prompt service so as to achieve total customer satisfaction at all times. We shall continuously upgrade our service quality,

 

Communication facilities and the skill sets to meet customer requirements efficiently. We shall constantly adapt, innovate and refine our processes in line with global business trends to maintain credibility and leadership in our field.

We commit ourselves for fair play, transparency and sincere endeavor for the promotion and growth of Micro, small & Medium Enterprises.

We shall strive to achieve operational efficiency by attaining better productivity and profitability.

QUALITY OBJECTIVES 

To enhance reach of the Corporation resulting in growth in its business

To achieve operational efficiency and self-sustenance by attaining better productivity and profitability.

To upgrade the professional skills of all employees keeping in pace with business needs.

To provide safe, clean, hygienic & congenial work environment for effective contribution by every employee.

Additional NTSC/NTSECs Objectives are as below: To provide training for skill up gradation of trainees leading to opportunities for their employment/self employment. To provide common facility services to industries for enhancing their competitiveness

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NSIC. 200 Child labour youths have been trained under Indus project supported by ILO. Further. 28 . The centre has trained more than 16000 youths in the different industrial trades till date. TRAINING ACTIVITIES : NTSC. We are committed for quality training.and quality. Aligarh has also been conducting specialized training Program of OBS candidates sponsored by National Backward Classes Finance and development corporation (NBCFDC).NSCFDC has also sponsored 25 youths six months training.. ALIGARH has a wide spectrum of training courses ranging from Basic Technical Training courses to specialized and HI-TECH training courses as well as tailor made training courses to suit the need and requirements of one and all.

We maintain the ethics of teacher and student relationship. We are more emphasizing on job training along with classroom training. We trained our trainees to get employment and also inspired them for self employment. COURSES AVAILABLE AT NSIC Course Name DurationCourse Name DurationCourse Name DurationCourse Name Duration: Tool & die design with Auto CAD 2Years : Tool & Die Maker with CNC wire-cut 2Years : Turner with CNC lathe 2Years : Product Design Engg(with Delcam) 1year 29 .

Course Name Course Name DurationCourse Name DurationCourse Name DurationCourse Name DurationCourse Name DurationCourse Name DurationCourse Name DurationCourse Name Duration- : Tool Design with Auto CAD : CNC Wire-cut Programming and operation 3months : Programming and Operation of CNC Milling 3months : Programming and Operation of CNC Lathe 3months : Programming and Operation of CNC Wire-Cut 3months : Programming and Operation of CNC Lathe 6months : Programming and Operation of CNC Milling 6months : Auto CAD 2007(Mechanical) 2months : Press Tool Design with Auto CAD 50hrs CONVENTIONAL TRAINING PROGRAMME 30 .

NSIC arranges for credit support (fund or non fund based limits) from banks without any cost to MSME‟s. Axis Bank. Yes Bank. State Bank of Hyderabad. IndusInd Bank and Oriental Bank of Commerce which forms a unique mix of various Nationalized and Private Sector Banks. China trust commercial bank. Through syndication with these banks. UCO Bank. These banks are United Bank of India. HSBC.NSIC has entered into a Memorandum of Understanding with various commercial banks. Furthermore the MSME‟s can upgrade their competence in terms of business and 31 . Bank of Maharastra. Karur Vysya Bank.3 Product BANK CREDIT FACILITATION SCHEME To meet the credit requirements of MSME units .Course Name DurationCourse Name DurationCourse Name Duration- : Draughtsman (Mechanical) 1Year : Electrician 1year : Machinist 1Year SPECIALIZED TRAINING PROGRAMME (short term) Course Name Course Name Course Name : TQM/ISO 9001:2008 Awareness : 1 Electronics 2 Mobil Repairing : Electric Motor Repair and Rewindin 2. Central Bank of India. Bank of India.

in.ucobank.com 5.kvb. please contact at the below given addresses : dmbd@nsic.www.com 6. UNITED BANK OF INDIA (UBI).i To download loan application forms from the banks under BANK CREDIT FACILITATION SCHEME the website address of the banks are given:- 1.unitedbankofindia.www. SMERA-D&B.www.in 11. STATE BANK OF HYDERABAD (SBH) .com 2. FITCH.co. To send in your loan enquiries . BANK OF INDIA (BOI) .bankofmaharashtra.co. renowned and professional rating agencies empanelled with NSIC.www.chinatrustindia.in 7. The MSE‟s which get rated under NSIC-Performance and Credit Rating Scheme not only has a liberty to get rated from any one of rating agencies of its preference but it also invariably increases their creditability in business and help them in getting timely credit from banks at liberal rates of interest.www.com 10.axisbank. AXISBANK .ORIENTAL BANK OF COMMERCE (OBC) . HSBC .in 8.centralbankofindia. BRICKWORK and ICRA. CHINA TRUST COMM.www.hsbc. BANK OF MAHARASHTRA (BOM) . CARE. KARUR VYSYA BANK(KVB) .in 3.co.com 9. The empanelled rating agencies are CRISIL.obcindia. bts@nsic.co.www.co.com 32 .www. BANK(CTCB)-www. ONICRA.sbhyd.in 4.bankofindia.co. UCO BANK .technologies by getting rated through independent.www. All documentations pertaining to completion and submission of a credit proposal to banks shall be undertaken by NSIC thereby saving cost and time to MSME. CENTRAL BANK OF INDIA-www.

Fast changing global economic scenario has thrown up many opportunities and challenges to the Small Scale Industries in India.indusind.com Performance & Credit Scheme for Rating of Small Scale Industries BACKGROUND The Small Scale Sector occupies an important position in any developing economy the world over. there is a need to create awareness amongst Small-Scale Units about the strengths and weaknesses of their existing operations and to provide them an opportunity to enhance their organizational strengths. Therefore. it has also put an obligation on them to upgrade their competence in terms of technology.www. many opportunities have opened up for the small scale sector to enhance productivity and look for new markets in other countries. management & financial strength to successfully meet the global competition. INDUSIND BANK ) . As a step in this direction.12. While. on the one hand. a need was felt for introducing a 33 .

ii. business and management risks. & Indian Banks‟ Association and various Rating Agencies viz. It is expected that the Rating Scheme would encourage SSI sector in improving its contribution to the economy by way of increasing their productivity. APPROACH FOR RATING OF SSI UNITS i.Rating Scheme for the Small Scale Industries. since a good rating would enhance their acceptability in the market and also make access to credit quicker and cheaper and thus help in economizing the cost of credit. 34 .e. The unit‟s rating shall be a combination of performance and credit worthiness of the unit. iii. It has the approval of the Government. for implementing the Scheme in order to facilitate the Rating process. Besides. ICRA. With above background. The Rating Agencies shall be empanelled by NSIC Head Office. CRISIL. SALIENT FEATURES OF THE SCHEME 1. Dun & Bradstreet (D&B) and ONICRA. financial. Small Industries Associations. a Performance & Credit Rating Scheme for Small Scale Industries has been formulated in consultation with various stakeholders i. the rating would also infuse a sense of confidence amongst the buyers for taking a decision on the options of sourcing material from Small Scale Units. NSIC is the nodal agency for implementing the scheme of performance and credit rating for Small Scale Industries through its various branches/offices located in the country. The SSI rating methodology shall cover a combination of credit and performance factors including parameters measuring operational.

3. 35 . RATING PROCESS The rating process will be undertaken in the following manner: STEPS RATING PROCESS 1. Request for Rating from SSI units 2. Collection of Information from the SSI unit(s) 3.iv. Analysis of Information obtained from the SSI Unit(s) 5. NSIC shall maintain a database about the units awarded Rating by different Rating Agencies. 2. The rating agency chosen by the unit shall be mentioned in its request for obtaining the rating. Assign Rating The validity of a rating shall be for a period of one year from the date of issue of the rating letter. Onsite meeting with SSI Management 4. SELECTION OF THE RATING AGENCY BY SSI UNITS The Small Scale Unit shall be at liberty to select any of the rating agencies empanelled under the rating scheme with NSIC.

The Rating Agencies will. SHARING OF FEES The fee to be paid to the rating agencies shall be based on the turnover of the Small-Scale Units which has been categorized into three slabs. the rating fee of different Rating Agencies may vary but for the purpose of subsidizing the fee. if the SSI unit backs out from the rating process after the Rating Agency has carried out its inspection. no amount shall be refunded back. the rating fee to be charged by the Rating Agencies will be varying. The rating fees may. however. 5. however.4. The payment can be made by way of pay order / demand draft drawn in favour of the Rating Agency selected by the SSI unit. a ceiling has been prescribed by the Government as per table give below under Sharing of Fees. As the evaluation criteria for award of Rating is different with various Rating Agencies and their acceptability also varies with the users. RATING FEE The Rating Agencies have different fee structure for their rating of various clients including Small-Scale Units. The Rating Agencies will devise their fee structure for SSI units under this Scheme separately. Although. In the event of the request for Rating being treated as closed by the Rating Agency due to non-receipt of the complete information. The slabs of the Turnover and the Share of Ministry of SSI towards the fee charged by the Rating Agency have been indicated in the table given below:- 36 . so that fee is well known in advance to the applicant unit as well as NSIC. 50% of the fees received from the SSI unit shall be refunded by the Rating Agency. be reviewed by Rating Agencies from time to time due to the competition and the number / size of clientele. However. be free to decide their rating fees which will be intimated to NSIC at the time of empanelment. The Small-Scale Units will have to pay their contribution towards the rating fee along with its application.

50 lacs 75% of the fee charged by the rating agency subject to a ceiling of Rs.200 lacs 75% of the fee charged by the rating agency subject to a ceiling of Rs. The symbols along with their definition while assigning a Rating to Small-Scale Units are placed at Annexure-I.30. The details of the scheme would also be available on the website of the Ministry of SSI. NSIC.50 lacs to Rs. The Rating to be awarded by each of the Rating Agencies shall be prefixed by the word NSIC. the symbols and their definition for indicating the risk score in the rating awarded has been evolved for uniform implementation by the Rating Agencies. 8.Above Rs.The balance amount towards the fee shall be borne by the Small-Scale Units.000/. Thus Rating awarded by say ICRA shall be termed as “NSIC-ICRA Performance and Credit Rating” 7. 6. PROMOTION OF THE SCHEME The scheme would be given wide publicity by NSIC. 37 .000/.000/.200 lacs 75% of the fee charged by the rating agency subject to a ceiling of Rs.Above Rs. RATING SCALES While the criteria for evaluation would be left to each of the Rating Agencies. SHARING OF THE EVALUATION/RATING OF SSI UNITS The Rating Agencies shall share the Rating awarded to SSI units with NSIC.Turnover Fee to be reimbursed by Ministry of SSI Up to Rs. IBA and Credit Rating Agencies. These symbols depict both the performance evaluation as well as the credit worthiness of the unit. The portion of the fee to be subsidized by the Ministry shall be released through NSIC after submission of the Rating Report to NSIC by the Rating Agencies.40.25.

APPLICATION FORM The application forms will be available at all the offices of NSIC and with the empanelled Rating Agencies. 11. TIME FRAME FOR COMPLETION 38 . 9. NSIC will forward the IInd copy along with the information and documents submitted by the unit to the Rating Agency along with their comments. IBA and the Rating Agencies. SSI Associations and the Rating Agencies shall also be used to promote the Rating Scheme. if the Application is submitted to the Rating Agency. Alternatively. PROCESS FLOW OF APPLICATION The SSI unit will have to submit its application for rating in duplicate. if any.The forms will also be made available at the website of NSIC. It can be submitted to any of the offices/branches of NSIC or directly to the Rating Agency selected by the SmallScale Unit. Interested Small Industries Associations will also be requested to make available the Application Form from their website. INFORMATION REQUIRED FOR RATING SSI units applying for rating will have to submit the documents as per list placed as Annexure-I (B) along with the application. 12.IBA & its member banks.On receipt of Application. Any SSI unit wishing to apply for rating will have to fill up the prescribed application form and submit the same to NSIC or the rating agency chosen by it. 10. one copy of the application shall be sent by Rating Agency to NSIC for their reference and comments.

the entity has moderate capacity to meet its financial obligations. 39 . Rating Scale of SEs on Performance and Credit Parameters under the NSIC Scheme of Rating of SEs. High Financial strength. Prospects of performance are high and the entity has high capacity to meet its financial obligations. Low Financial strength. the entity has low capacity to meet its financial obligations. the rating agency shall complete the exercise of evaluation and award of Rating within one month thereof. SE 1C: Highest Performance capability. Prospects of performance are the highest. Prospects of performance are the highest. In the event of the unit not responding within 15 days from the date of 2nd communication to the unit. However. communicate the same to the unit for completion / rectification thereof within a period of 15 days. SE 1B: Highest Performance capability. From the date of receipt of all information from the applicant unit. Moderate Financial strength. Prospects of performance are the highest and the entity has high capacity to meet its financial obligations.The Rating Agencies shall peruse the documents received and in case of any short fall. If the particulars are not received within the period mentioned the agencyshall the reminder giving further 15 days time for submission. SE 2A: High Performance capability. SE 1A: Highest Performance capability. However. High Financial strength. the case will be treated as closed.

High Financial strength. SE 3C: Moderate Performance capability. Low Financial strength. However. SE 3A: Moderate Performance capability. Prospects of performance are high. Prospects of performance are weak. SE 4B: Weak Performance capability. Prospects of performance are poor. Prospects of performance are weak. SE 2C: High Performance capability. SE 4A: Weak Performance capability. High Financial strength. However. However. However. Moderate Financial strength. the entity has moderate capacity to meet its financial obligations. Prospects of performance are moderate. However. SE 5C: Poor Performance capability. Prospects of performance are poor. High Financial strength. 40 . However. Prospects of performance are weak and the entity has low capacity to meet its financial obligations. the entity has moderate capacity to meet its financial obligations. Low Financial strength. SE 5B: Poor Performance capability. Low Financial strength. the entity has moderate capacity to meet its financial obligations. Moderate Financial strength. Low Financial strength. Prospects of performance are moderate.Prospects of performance are moderate and the entity has moderate capacity to meet its financial obligations. the entity has high capacity to meet its financial obligations. SE 3B: Moderate Performance capability. SE 4C: Weak Performance capability. Prospects of performance are high. However. the entity has high capacity to meet its financial obligations. the entity has high capacity to meet its financial obligations. Moderate Financial strength. the entity has low capacity to meet its financial obligations. Moderate Financial strength. the entity has low capacity to meet its financial obligations. However.SE 2B: High Performance capability. Prospects of performance are poor and the entity has low capacity to meet its financial obligations. SE 5A: Poor Performance capability.

hand tools etc. Export of IT solutions from India. Supply of Small Industry Projects on turnkey basis.EXPORTS NSIC is a recognized Export House. leather items.Export of Relief supplies from India to UN and other International Agencies Product NSIC is associated with the exports of Small Scale Industries products to other countries. on behalf of small industries. NSIC. The major areas of operation are: Export of Indian products like handicrafts. is exporting products and projects around the globe. Project NSIC undertakes export of industrial projects under its is associated with the exports of Small 41 .

NSIC provides a package of services for setting up of Industrial Projects to other countries Exports Assistance NSIC is associated with the exports of Small Scale Industries products to other countries. The broad categories of products exported by NSIC are: Builders Hardware Garden Tools & Accessories Handicrafts Electrical Products & Accessories Sports Goods Sanitary Fittings Textile and Textile Products Leather Products Auto Components Architectural Iron Light Engineering Goods Hand Tools Castings & Forgings 42 .Scale Industries products to other countries on turnkey basis.

Purchaser unit(s) may approach NSIC for sanction of annual limits by furnishing information as per the prescribed application form. GRANT OF SELLER-WISE LIMITS Seller unit(s) may provide bank guarantee in favour of NSIC for availing financial assistance under the scheme. duly accepted by the purchaser will be financed. purchase of supplies made by small scale units to reputed Public Limited Companies / State and Central Govt. Bills drawn by them against their supplies made. Annual limits can be fixed for such units by obtaining 43 . Departments / Undertakings.BILL DISCOUNTING SCHEME THE SCHEME The Scheme covers purchase / discounting of bills arising out of genuine trade transactions i. Departments / Undertakings ii) Public Limited Companies GRANT OF PURCHASER-WISE LIMITS Bills drawn by small-scale units for the supplies made by them and duly accepted by the Purchaser will be financed against security of Bank Guarantee in favour of NSIC.e. SELLERS Small Scale Units BUYERS i) State and Central Govt.

PERIOD OF USANCE OF BILLS TO BE CONSIDERED FOR DISCOUNTING : The maximum usance period of such bills should not exceed 90 days. The period of unexpired usance of the bill shall not exceed 90 days while the tenure of the bills shall not exceed 120 days. 44 .information as per the prescribed application form. OR Bill of Exchange duly accepted by large corporate units of good financial standing with a turnover exceeding Rs 200 Crores and net-worth exceeding Rs 50 crores and which are profit making for the last three years. The Bank Guarantee to be obtained should be equivalent to the value of assistance (including discounting charges & service charges for 90 days). SECURITY: Bank guarantees issued by banks approved by Head Office.

as mentioned at Sl. (ii) and (iii) above shall be applicable only to those cases. 45 . nos.40% The concessional rate of interest on the good rated units. shall not be eligible for the concessional rate of interest.90% (iii) Units having valid SE 1B rating under NSIC‟s Rating Scheme 12. where the units make timely repayments of the Corporation‟s dues. partners of firms and Directors of the company shall also be obtained.40% (ii) Units having valid SE 2A rating under NSIC‟s Rating Scheme 12. RATE OF INTEREST : a) Assistance against the security of BG/SDR/FDR : Particulars Effective Rate of Interest (w.e. (i).Personal guarantee of proprietor. The units which have not re-paid its dues within the stipulated 90 days.f 20/09/2011) (i) Units having valid SE 1A rating under NSIC‟s Rating Scheme 12.90% (iv) Other Units 13.

against the assistance already granted & disbursed. FOR UNITS PLACED IN NORTH EASTERN REGION Minimum service charges will be 0. B) Principal amount outstanding as on 20.40%) for the delays beyond 90 days. OR Commitment charge @ 2% p.13% for first 30 days and thereafter 0.e. on the limit sanctioned to be collected in advance. 13.04% per week subject to a maximum of 1. Revised rate of interest (normal as well as interest on delayed payment) shall be made applicable on : A) All the cases sanctioned and / or disbursed on or after 20. 46 . amount of invoice to be discounted).The rate of interest on the delayed payment shall be charged as: The Additional rate of interest on delayed payment shall continue to be charged 3% over and above the normal rate of interest (i.08% per week subject to maximum of 3% of the Principal amount (i.25% for the first 30 days and thereafter 0.a.2011.2011.09. amount of invoice to be discounted).09. SERVICE CHARGES FOR UNITS PLACED ALL OVER THE COUNTRY OTHER THAN NORTH EASTERN REGION Minimum service charges will be 0.e.e.50% of the principal amount (i.

The application for the request to sanction limit under the Bill Discounting Scheme is to be submitted by the seller unit duly signed by the authorized signatory i. (ii) At the time of processing of application for enhancement of limit. The processing fee shall be 0. PROCESSING FEE (i) Processing Fee shall be collected in advance on receipt of application and will be nonrefundable.e. the rates shall be fifty percent of the rates as at (i) above. NSIC registers Micro & small Enterprises (MSEs) under Single Point Registration scheme (SPRS) for participation in Government Purchases. on the limit sanctioned to be collected in advance.OR Commitment charge @ 1% p.2% of the limit applied for. Proprietor / Partner / Director of the Firm / Company in duplicate in the prescribed form GOVERNMENT STORES PURCHASE PROGRAMME The Government is the single largest buyer of a variety of goods.a. the rates shall be the same as at (i) above. With a view to increase the share of purchases from the small-scale sector. the Government Stores Purchase Programme was launched in 1955-56. Benefits of Registration 47 . (iii) At the time of processing of application for renewal of limit.

conforming to BIS or such standards as required by the Government buying agencies. How to Apply Micro & Small Enterprises shall have to apply on the prescribed application form in Duplicate and to be submitted to the concerned Zonal/Branch Office of NSIC located nearest to the unit.     Issue of tender sets free of cost. Waiver of security deposit up to the monetary limit for which the unit is registered. please consult any of the Zonal / Branch office of NSIC. Advance intimation of tenders issued by DGS&D. Exemption from payment of earnest money. after due verification. The application form containing Terms & conditions are available free of cost from all offices of the NSIC. Eligibility Micro & Small Enterprises registered with the Director of Industries (DI) / having acknowledgement of Memorandum (EM) from the Office Of Commissioner of Industries (Registration) and are in continuous production of stores for a minimum period of ONE YEAR as manufacturing micro & small enterprises as well as Micro and Small Enterprises engaged in providing or rendering services who own workshop of their own or on lease basis and have the commercial and technical competence to produce stores/provide services for supply to the Central/State Government Departments and Central/State Government Public Sector Undertakings etc. 48 . Issue of competency certificate in case the value of an order exceeds the monetary limit. In case of any difficulty in filling the application form and completing the documentation.

000/. The Fee structure is indicated in the table as below: S.The guidelines attached with the Application Form provide a checklist for the documents that are required to be submitted along with the application REGISTRATION FEE The registration Fee is based on the Turnover as per latest audited Balance Sheet of the Micro & Small Enterprise for the Registration.for 49 .No. Renewal and any other amendment etc. 2000/. 5000/- Fee for Fresh Registration of Micro & a) I.5. Small Enterprises: b) Rs. Category (Turnover Based) Proposed Fee Rs.plus Rs.

Such charges as decided by the Inspecting Agency are borne by the unit. No. Registration (Every Two Years) The Registration Fee as mentioned in the table above is exclusive of the Inspection charges as levied by the inspecting agency. 5000/Rs. 100 Lacs and upto Rs. 1250/Rs. 5 Lacs Up to 25 Lacs >Rs. 3500/- >Rs. the present Inspection Fee by MSMEDI & NSIC’s Technical Service Centre shall be charged as reproduced below:A. Investment in Plant and Inspection Fees for MSME-DI / Machinery 1 2 3 4 Up to Rs.P. Inspection Fees for MSME-DI / NTSCs S.No. and b) Fee for issuance of Renewal of Sr.a) Turnover up-to Rs. 25 Lacs Up to 100 Lacs NTSCs Rs. Fee for issuance of change in monetary limit or any other amendment in the as mentioned at certificate. Till such time the Inspecting Agency makes any amendments in their charges. 2000/Rs. b) Turnover exceeding Rs. I above G. 100 Lac. 100 Lacs II. 100 Lacs every additional turnover of Rs. 5 Lacs >Rs. a) Fee for issuance of amendments 50% of the charges in stores (Qualitative & Quantity).500 Lacs 50 .

3000/.. service tax and travel expenses for Micro Enterprises. service tax and travel expenses for Small Enterprises. and M/s Consultancy Development Centre for undertaking physical inspection will remain unchanged which are: By RITES Rs. 4495/. and Rs. REGISTRATION PROCESS 1. service tax (incl. 2. Travel expenses) for Small Enterprises. 3000/.excl. service tax (incl.incl.incl.B. Travel expenses) for Micro Enterprises and Rs.P.excl. The Professional fee payable by MSEs to M/s RITES Ltd. 4495/. Duplicate copy of the G. By CDC Rs. Registration Application Form submitted by the Micro & Small Enterprise will be forwarded to the concerned MSME-DI RITES / CDC along with copies of required documents and requisite Draft/Pay Order of inspection 51 . The Micro & Small Enterprise has to submit the application form (in duplicate) alongwith requisite fee and documents to the Zonal/Branch and Sub Office/Extension office of NSIC situated nearest to their location.

Monetary Limit = Rs. A. 80 Lacs Therefore.  In case the Company/Partnership concern/Proprietorship unit is in loss for one year out of past three years. NSIC will issue the GP Registration Certificate to Micro & Small Enterprise for items/stores as recommended. 4. Procedure for calculation & fixation of Monetary Limits of Micro & Small Enterprises. 50 Lacs 2008-09 – Rs. when the Micro & Small Enterprise is in loss for two years out of the past three years.  In the event of Micro & Small Enterprise being in loss throughout past three years. After receiving MSME-DI Inspection Report. (50+75+80)/3 X 50% = Rs.26 Lac. returns etc Details of the net sales of the company during last three years:2007-08 – Rs. 34 Lac. the 52 . 34. their monetary limit will be fixed at 40% of their average net sales turnover. Sample calculation: Net Sales = Total sales – All Duties. Monetary limit of the company is fixed on the basis of the unit's net sales turnover during the last three years reflected in the Audited Balance Sheets. Taxes. the monetary limit will be accordingly fixed at 30% of their average net sales turnover of the past three years.  Similarly. 75 Lacs 2009-10 – Rs. 3.charges in favor of concerned Inspection Agency requesting for carrying out the Technical Inspection of Micro & Small Enterprise and forward their recommendations in this regard. Say = Rs.

monetary limit of the Unit will be fixed at 20% of the average net sales turnover of the Unit during the past three years In cases of initial registration where the firm has been in existence for less than 3 years MTL may be fixed at 50% of the average net sales value of the last year for which audited accounts are available. 2003 is valid for Two Years and will be reviewed and renewed after every two years by verifying continuous Commercial and Technical Competence of the registered Micro & Small Enterprise in manufacturing / producing the stores for which it has been registered by NSIC. A Copy of the Permanent Account Number (PAN CARD). P. P. Documents Required for Renewal of the Registration 1. 2008-09 and 2009-10 the turnover had grown steadily and was highest in 2009-10. List of major Govt. in this scenario the Monetary Limit should be fixed by taking the basis of highest net sales / turnover achieved in the year 2009-10. The other terms and conditions will remain unchanged. Orders executed during last 2 (two) years. Where the turnover of the Enterprise has steadily increased over the last three years and the unit is in profit continuously. 3. 2. the Monetary Limit may be fixed at 50% of net sales turnover achieved in the last year. For Example : If during the last three years 200708 . 53 . Registration The G. Validity Period of G. B. Copy of valid SSI Registration Certificate 4. Original GP Registration Certificate. Registration Certificate granted to the Micro & Small Enterprise under Single Point Registration Scheme (Revised).

Copies of Audited Balance sheet for last 3 years duly signed by the authorized person under his seal 6. Factory License/Shop Establishment Act License 2. For the following documents one declaration shall be given :- 1. We need it every minute of our working lives. and also exhibit the core competence of Indian SMEs in terms of 54 . List of addition/deletion in the plant and machinery after the registration. one-window bouquet of aids that will provide information on business. No Objection Certificate from Pollution Control Board. Proof of ownership Deed/Lease Deed/ Rent Deed 4. technology and finance. And with the increase in competition and melting away of international boundaries. A one-stop. Photocopy of Municipal Corporation Certificate 3. Keeping in mind the information needs of small industries NSIC has launched "Infomediary Services". Infomediary Services Information today is becoming almost as vital as the air we breathe. the demand for information is reaching new heights.5. 7.

JV opportunities and trade information. sector-specific newsletters (both print and electronic).g. Access to a wide rang of technologies from India and abroad. exhibitions/fairs. Comprehensive information on Government policies. SME seeking business collaboration and co-production opportunities. photocopy and A/V aids etc. and those looking for technology transfer. schemes and incentives. e. exporters and importers.. NSIC's Infomediary Services use a professionally managed HR base and modern technology for dissemination of vital information-websites.  Availability of a wide range of escort services. and e-mails. Salient Features       Tender Information in your e-mail box and web based browsing Banner display on NSIC's website Concessions on Apollo Hospitals Medical Facilities. Concessions on hotel reservation in select hotels. fax. joint ventures.  Access to a wide range of assistance for participation in business delegations. Access to industrial databases and members' directory. telephone. rules and regulations. as well as domestically. Potential beneficiaries would be entrepreneurs-both existing and aspiring-R&D labs. product design.price and quality-internationally. Access to national and international business leads.  Information on Trade and events.  Access to NSIC's Business Centre with facilities such as conference hall. credit and support 55 .

25 130. energy and environment audit. 2.17 Net Assets Employed 231. banners display on websites and market studies. common facility at NSIC Technical Services Centre(s).  In addition Infomediary member would get discounts from Apollo Hospital for medical facilities. Skill up gradation Training. Crore) Gross Turnover 1524.37 Net Worth 64. introduction of information technology (IT) solution in Business operations.76 1056. developing catalogues and product literature.02 Profit before Tax 1. mentoring services.00 Gross Income 43.10 7979.71 35.62 56 .(Five Thousand Only).rating. 5000/. Access to Infomediary services is through NSIC Infomediary Services (IS) membership at a cost of Rs.69 166.4 Financial Position Financial Snapshot 2006-2011 2006 2011 (figures in Rs.

The main emphasis is on prevention of wear and also wastage.78 Dividend 0. 2011.Earnings Per Share (Rs. as a whole is high productivity.96 As at 31st March The roller coaster ride that NSIC had in the last few years enabled it to achieve the „Mini Ratna‟ (Category-II) which was awarded by the Government on 1st March.63 12. 57 .00 5.5 Organization Structure Descriptions of various functions TECHNICAL DEPARTMENT Engineering services a vital role in proper working of an organization. The quality those services decides the quality of work life (QWL) and the productivity level. Engineering services actions always try to improve its utilities services and maintenances service.) 0. 2. The role is highly emphasized since the main motive of every worker and the factory.

keeping focus on customers 58 . Quality policy NSIC is committed to: 1) Procurement. Audit compliance Variance Analysis. Finance and account department is the backbone of any organization. production and marketing of safe clean wholesome foods of high quality.FINANCIAL DEPERTMENT “Money is all about” goes famous saying. Purchases Accounting and control. These are in total 8 persons working in accounts department. NSIC has a well-equipped finance department with vice president finance as the controlling from the Delhi. Thus it can be said that success of any organization largely depends upon the optimum utilization of funds. Aligarh factory also controls the computer department. QUALITY ASSURANC DEPARTMENT Quality this word meant a lot for FMCG Company because they are known for their good quality so it is not mere an accidents but the promise which they keep against the costumers. Wages Administration. Budgetary control. Functions of account Department: Fund Management. Information Technology. NSIC has finance executive and account officers and other staff working under him who are placed at Aligarh factory. development. It is a collective work of efficient people with a team of well trained and experienced people.

Recruitment in NSIC 59 . campus recruitment. walk in. Occupational health and environment standards by establishing internal review procedure to compliance applicable laws and regulations. employee referrals former employees.Advertisement. employment exchange. Establishing and maintaining appropriate Training programme so that every person responsible for products integrity and safeguarding quality environments competent to carry out his responsibilities. so as to ensure that customer‟s confidence is generated and maintained consistently. PERSONNEL AND HRD DEPARTMENT 1-RECRUITMENT AND SELECTION Recruitment refers to the getting interested applicants and providing a pool of prospective employees as that the management can select the right person for the right form the poor. Source of recruitment 1-Internal source – Present employees. The purpose of the selection process is to choose right type of candidates‟ form various type of jobs. previous applicant. talking write in interview.By establishing and maintaining proper facilities necessary for controlled production consistency in a sanitary manner. 3) Achieving high safety. 2-External source. 2) Establishing and maintaining appropriate operating and monitoring procedure necessary for controlled production.

NSIC has its own recruitment policies. The training needs are indemnified by personnel department in consideration with department heads. Vacancies are widely publicized through various means as newspaper etc. In order to carry out the organizational activities every organizational needs to recruits people. It help them to inculcate the team sprit and better relations among them to keep in pace with the competitive word. it has a selection committee comprising of director of company. B development means growth of the individuals in all respects enables them to be more effective in performing the various functions of management. Appointment letters issue at the of joining of the service. Improves knowledge and skills of employees personally and provides them with feeling of job satisfaction. The HRD at Mumbai takes care of T & D activities. the authorized staff of NSIC consider job description and specification is done before going for recruitment and selection. Company has been organizing various training programme for its employees as it increases their efficiency and update the latest technology. As an internal sources.There is provision for 60 .Here the aim of selection process is to reject the unsuitable candidates. In NSIC training is an integral part of the HRD and considered essential for encouraging employees for commitment to quality. Candidates are selected through written test and interviews. 2-Training and development Training is an organized activity for increasing the knowledge and skills of people for definite purpose. In NSIC recruitment is mainly done through internal as well as external sources. It involves systematic procedure for transferring technical employees so as to increase their knowledge and skills for doing specific job with proficiency. But recruitment is a positive process because it aims at attracting applicants for various jobs.

V – Welfare activities NSIC has been providing a series of welfare activities (statutory and non. For the management staff it is based on “performance appraisal rating Method” and for the other staff is based on “annual review system”. III.both in house training programme as well as external training programme. Proper measures are taken to evaluate the training programme. 61 .promotion and transfer Promotion is based on the basis of seniority. Proper measures are taken to evaluate the training programme. Deduction from the wages is made on account of damage to the company property or when the loan is taken by the employee. Performance. attendance is chronological order. IV – wages and salary Administration Fixation of wages is based on job analysis Remuneration = Basic salary +DA +HRA Difference in compensation is according to the grades and groups of employees.statutory) to its employees. Casual workers are paid fortnightly. increasing the production and solving disputes which arise between workers and management by bilateral talks. Vl – Industrial relation I R help in maintain industrial pieceworker participation in management (WPM) helps in improving the relationship with workers. These facilities make the employee feel satisfied and make them loyal towards the company and they perform their duties with great interest and enthusiasm.

against certain risks. gratuity bonus. VII. factories Act etc. and payment of wages Act. 62 .performance appraisal Performance appraisal thus is systematic and object way of judging tae relative worth or employees in performing the task.VII – social security and labor laws The company has implemented various labour laws in order to provide social security to its workers. The labour laws implemented by the company are ESI act.

These units are under a handicap in obtaining raw materials of requisite quality at reasonable prices. There is acute shortage of even the basic raw materials required by small scale units. the handloom industry is facing shortage of yarn. For instance. They do not get the benefits of bulk buying.Chapter III Theoretical framework of topic 3. small and medium enterprises. Small scale industries also face shortage of power due to which they are unable to make full 63 .1 Meaning Non-availability of quality raw materials on a timely basis in an adequate quantity is one of the main problems faced by micro.

Benefits of the Scheme   Financial Assistance for procurement of Raw Material up to 90 days. It facilitates availability of scarce raw material either through the domestic market or by importing. The Central Government has introduced a buffer stock scheme to ensure availability of scarce raw materials to this sector. This gives an opportunity to SSIs to focus better on manufacturing quality products. 64 . 3.2 Importance Raw Material Assistance Scheme of NSIC aims at helping small scale industries by way of financing the purchase of raw material (both indigenous & imported). cash discount etc. Majority of them cannot afford to install their own power generating plants to ensure uninterrupted operations. State Directorate of Industries distributes scarce raw materials to small units. They have set up depots for distribution of raw materials to small scale industries (SSIs). National Small Industries Corporation (NSIC) and State Small Scale Industries Development Corporations are involved in making efforts for providing some raw materials to MSME sector. thus allowing them to focus on manufacturing quality products. SSI helped to avail Economics of Purchases like bulk purchase. NSIC aims to help small scale units by financing purchase of raw material both (indigenous and imported).utilization of plant capacity.

Marketing research is also useful to help create and enhance equity. Research is also used to study competition and analysis the competitor‟s products positioning. 3. documentation & issue of Letter of credit in case of imports.6 Research Methodology “Marketing Research” is a key to evolution of successful marketing and program me. It is an important tool to study buyer‟s behaviour. Change in consumer life style and consumption patterns brand loyalty and forecast market changes. 65 . NSIC takes care of all the procedures.

Data can include case. studies. within descriptive research surveys can give statistical information about an event as well as give an idea about how people experienced the event. while the method can be disadvantageous in the sense of confidentiality and objectivity and error. The advantages of descriptive research include data collection and life experiences. Descriptive Research Designing can be used to study:  Consumer profile  Market potential studies  Product usage studies  Attitude surveys  Sales analysis  Media research  Price survey Descriptive research gives researchers the opportunity to use both quantitative and qualitative data in order to find data and characteristics about the population or phenomenon that is being studied.Descriptive research-descriptive researches are design to describe some things. Research has both its advantages and disadvantages. These case studies can be collected from individuals‟ personal accounts or from 66 . For example. This study is used to make specific prediction. Another advantage of descriptive research is the unique data collection form of case studies. The data collection for descriptive research presents a number of advantages as it can provide a very multifaceted approach. Researchers can focus on these strengths and weaknesses in order to implement a research design that can account for them. observation or surveys and give several angles on the information.

The purpose of descriptive research is just to describe and not to establish any relationships. Descriptive research includes the data collection that describes the events and then organizing the data through visual aids. Descriptive research also carried with it an observer‟s paradox. Subjectivity and error also play a disadvantageous role in descriptive research. you can just describe and report the observations. In interviews. A researcher may choose what information to use and ignore data that does not conform to their hypothesis. The advantages of descriptive research are that as the study does not involve certain variables to be studied. it can provide a lot of information. It is useful in identifying further areas of research. you select the method depending on what you expect to find rather than selecting the method and then studying. There are a number of advantages of descriptive research like education search and experiences may contain many variables that are not realistically 67 . This data collection allows descriptive research to provide an insight into life experiences in a way that other research methods can‟t.written data such as newspaper reports. Questions presented by a researcher are predetermined and prescriptive. participants may also refuse to answer any questions that they feel are too personal or difficult. The main disadvantage of this type f research is that you cannot identify the cause behind a phenomenon. they may change the way that they act. while studies can contain errors. It is very useful in studying abstract ideas like customer satisfaction etc where it is not possible to develop models. Subjects that researchers are question may not always be truthful and instead will give answers that they feel that the researcher wants to hear. Confidentiality is a big disadvantage of descriptive research. It can remove barriers of strict academic approaches so that researchers can witness how others experience an event. The study is also very flexible. if a participant knows that someone is observing them.

Thirdly.Exploratory research helps determine the best research design. descriptive research is less expensive and time consuming. Exploratory Research-It is a type of research conducted for a problem that has not been clearly defined . there are some disadvantages of descriptive research. data collection method and selection of subject it should draw definitive conclusion only with extreme caution. results of this research can change over the period of time. Secondly. The first disadvantage is that descriptive research requires more skills. exploratory research often concludes that a perceive problem does not actually exist. then the information regarding the facts collected by the investigators or enumerators would be termed 68 . Given its fundamental nature. if the cost of living of workers in a city are to be computed. These variables can be studies through descriptive research. Secondly. On the other hand. Thirdly. it is one which is collected by the investigator for the first time e.controllable. Type of data used Primary Data It refers to the statistical material which the investigator originates for him for the purpose of the enquiry in hand. response rate is low in this research.g. descriptive research may collect the data from large geographical area. In other words.

National Income. e. it is called raw material. or when Primary data is utilised for any other purpose at some subsequent enquiry it is termed as Secondary data.g.a document that is used to guide what questions are to be asked respondents and in what order. is used in some other statistical enquiry. Blair." Secondary Data It refers to the statistical material which is not originated by the investigator himself but obtained from someone else's records. journals etc. According to M. "Data originally collected in the process of investigation are known as primary data. State Level Economic and Statistical Departments etc. 69 . According to Wessel..as Primary data.g. Exports or Imports. bulletins." TECHNIQUE OF DATA COLLECTION Questionnaires. it will be termed as Secondary data. This type of data is generally taken from newspapers. sometimes lists the alternative responses that are acceptable. In India there are various agencies which collect primary data e. National Sample Survey (NSS). magazines. if the data published by RBI on currency. "Secondary data are those already in existence for some other purpose than the answering of the question in hand. reports. When we use primary data.M.

however.What is the purpose of questionnaires? As a mechanism for obtaining information and opinion. by this definition. A more limiting definition is: A closed question can be answered with either 'yes' or 'no'. Thus 'Are you happy?' and 'Is that a knife I see before me?' are closed questions. a comprehensive means of evaluation and should be used to support and supplement other procedures for evaluating and improving teaching. questionnaires are effective mechanisms for efficient collection of certain kinds of information. This limited definition is also sometimes called a 'yes or no' question. closed. They are not. A common definition is: A closed question can be answered with either a single word or a short phrase. The key strengths and weaknesses of questionnaires are summarized in bullet points below. 70 . Type of question Close ended closed questions Definition There are two definitions that are used to describe closed questions. In general. Thus 'How old are you?' and 'Where do you live?' are closed questions. whilst 'How are you?' and even 'How old are you?' are not. for obvious reasons. questionnaires have a number of advantages and disadvantages when compared with other evaluation tools.

3. open questions deliberately seek longer answers.Using closed questions Closed questions have the following characteristics:     They give you facts. They will give you opinions and feelings. and are the opposite of closed questions. They are quick to answer.1 Universe of study Sample Area Sample Unit : : NSIC. Using open questions Open questions have the following characteristics:    They ask the respondent to think and reflect. They hand control of the conversation to the respondent. Although any question can receive a long answer. They are easy to answer. Open questions Definition An open question can be defined thus: An open question is likely to receive a long answer.6. They keep control of the conversation with the questioner. Aligarh SSI‟s in Aligarh 71 .

2 Sample size Sample size determination is the act of choosing the number of observations to include in a statistical sample.6. The sample size is an important feature of any empirical study in which the 72 .3.

hence the sample size is equal to the population size. there may be different sample sizes for each group. can result in wide confidence intervals or risks of errors in statistical hypothesis testing.  using a target variance for an estimate to be derived from the sample eventually obta 73 . in as survey sampling involving stratified sampling there would be different sample sizes for each population. In experimental design. though sometimes necessary. data are collected on the entire population. A choice of small sample sizes. Sample sizes may be chosen in several different ways:  Expedience . In practice.For example. and the need to have sufficient statistical power. In complicated studies there may be several different sample sizes involved in the study: for example.goal is to make inferences about a population from a sample. the sample size used in a study is determined based on the expense of data collection. include those items readily available or convenient to collect. where a study may be divided into different treatment groups. In a census.

Chapter IV Analysis and interpretation 4.1 Analysis & Interpretation Ques1-Do you know about the Raw Material Assistance scheme? 74 .

Ques2. It shows that most of the SSI‟s are not aware about the scheme.Are you satisfy with Raw Material Assistance scheme? 75 . 40% says YES and 60% says NO.No Yes 0% 10% 20% 30% 40% 50% 60% 70% This question is tried to know about the awareness of the scheme in SSI‟s.

30% says YES and 70% says NO.Rate your level of satisfaction with the process charge and rate of interest under Raw Material Assistance scheme. 76 . It indicates that most of the customers are not satisfied with this scheme.Yes 30% No 70% This question is to know about the customer satisfaction towards the scheme. Ques3.

Highly satisfy 6% Satisfy 22% Dissatisfy 44% Neither satisfy nor Dissatisfy 28% In this question I try to know about the level of satisfaction with the charge and rate of interest under Raw Material Assistance scheme. 22% satisfied. 6% highly satisfied. Ques4.Would you like to suggest this scheme to other unit? 77 . It shows that level of dissatisfaction of the customer is very high. 28% neither satisfy nor dissatisfied and 44% dissatisfied.

Ques5. they would like to suggest others to take this scheme.Is it easier to avail the Raw Material Assistance from NSIC rather than any other financial institution? 78 .80% 70% 60% 50% 40% 30% 20% 10% 0% Yes No In this question trainee try to know that the customers who are using this scheme. Only 20% says YES and 80% says NO. It shows those customers do not like this scheme so they don‟t want to tell others.

Yes No 40% 60% In this question trainee try to know that availability of Raw Material Assistance is easier in NSIC than other financial institution. After analysis 40% says YES and 60% says NO. Ques6. It shows that Raw Material Assistance is available but not easily.What is the percentage rate increase in to your turnover after availing the Raw Material Assistance scheme? 79 .

15% says 0<20. 20% says 40<50. 35% says 20<30. Ques7. 30% says 30<40.How fast your application for Assistance under Raw Material Assistance proceeds? 80 .35% 30% 25% 20% 15% 10% 5% 0% 0<20 20<30 30<40 40<50 This question for try to know about how much percentage rate increase in to their turnover after availing the Raw Material Assistance.

Ques8.45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Very slow Slow Fast Very fast In this question trainee try to know how much fast application for assistance procedure.45% says very slow 25% says slow 20% says fast and 10% says very fast. It shows that procedure is very slow.How much is the portion of Assistance under this scheme out of the total assistance? 81 .

40<50 21% 0<20 11% 30<40 26% 20<30 42% Ques9.Is Raw Material Assistance scheme help you in producing quality product? 82 .

83 . It shows that most of them are not able to produce quality product after using this scheme.Yes No 40% 60% In this question trainee try to know that this scheme help them in producing quality product. After analysis 40% says YES and 60% sys NO.

1 Findings 84 .Chapter V Conclusion 5.

2 Suggestions 85 . Most of the respondents were not aware about Raw Material Assistance scheme provided by NSIC  Most of the customer‟s (SSIs) thinks that the schemes provided by NSIC are not satisfactory  Most of the customer's (SSIs) thinks the interest rate is not reasonable  Most of the customer‟s thinks that the process charge is very high  Most of the customer‟s (SSIs) thinks that the schemes provided by NSIC are not promoting their business  Most of the customer's think that the assistance timing is slow 5.

or other electronic media  NSIC should decrease the rate of interest on the Raw Material Assistance scheme  NSIC should decrease the process rate under Raw Material Assistance and as well as simplify documentation process  NSIC should be providing the Raw Material Assistance scheme to SSI‟s as soon as possible  Provide special incentives for encouraging larger flow of Venture Capital & Private Equity funds into the sector. internet. T. NSIC should make more efforts to spread the awareness about its Raw Material Assistance scheme through newspaper.V. Bibliography 86 .

M NSIC) Books 1.google. Kothari” Annexure 87 . Website: www.com  Resources Person: Mr.com www.M NSIC) Mr.G.nsic. Javed Ahmad (F.S. T. Marketing Management – “Philip Kotler” 2. Research Methodology – “C.Rajput (D.R.

Dissatisfy Ques4.Questionnaires Ques1.Would you like to suggest this scheme to other unit? 1.Do you know about the Raw Material Assistance scheme? 1.No Ques5.Is it easier to avail the Raw Material Assistance from NSIC rather than any other financial institution? 1.40<50 88 .No Ques6.Yes 2.0<20 2.Rate your level of satisfaction with the process charge and rate of interest under Raw Material Assistance scheme.Yes 2.20<30 3.Neither satisfy nor Dissatisfy 4.Satisfy 3.Are you satisfy with Raw Material Assistance scheme? 1.What is the percentage rate increase in to your turnover after availing the Raw Material Assistance scheme? 1.Highly satisfy 2.Yes 2-No Ques3. 1.30<40 4.No Ques2.Yes 2.

Fast 4.Yes 2.0<20 2.20<30 3.Slow 3.Very fast Ques8.Ques7.40<50 Ques9.No 89 .30<40 4.Is Raw Material Assistance scheme help you in producing quality product? 1.How much is the portion of Assistance under this scheme out of the total assistance? 1.How fast your application for Assistance under Raw Material Assistance proceeds? 1.Very slow 2.

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