07/23/2023

UNIT-4
 MSME: Definition of MSME (latest).
 SMALL SCALE INDUSTRY: Meaning, and definition,
Characteristics, steps to start SSI, Role of SSI in economic
development, problems faced by SSI. Introduction to GATT, WTO
&LPG, Sources of financing (brief), Forms of ownership - Sole
proprietorship, Hindu Undivided Family, Partnership, and
Cooperative.
 Institutional Support: Central level Institutions – NBMSME, KVIC,
NSIC, SIDBI, IIE-Indian Institute of Entrepreneurship, EDI and
NABARD. State level Institutions- DIC, KSFC, KIADB,TECSOK.
 STARTUP COMPANIES-Meaning and Challenges. Make in India
concept and MUDRA Bank Initiative.
 Activity for students: Schemes for startup companies.
MSME
The standard definition of MSME emerged only after
the enactment of the act MSMED (development) in
2006. The enterprises are broadly classified into
Manufacturing & service sector & further classified
into Micro, small & medium enterprises based upon
their investment in Plant & Machinery, Equipment
excluding the investment on Land & building.
Manufacturing sector engaged in production,
processing or preservation of goods.
Service sector engaged in rendering of services
through their establishments in semi urban, urban &
rural areas & self employed professionals.
 DEFINITION OF MSME
Description Manufacturing Service

Micro Up to Rs 25 lakh Up to Rs 10 lakh

Enterprises MSMEs will now be called Micro units if they have
investments upto Rs 1 crore and turnover of less than
Rs 5 crore.

Small Above 25 lakh & up to 5 crore Above 10 lakh & up

Enterprises For an MSME to be defined as a Small unit, its to 2 crore
investment limit has been raised from Rs 5 crore to
Rs 10 crore with a turnover of less than 50 crore.

Medium More than 5 crore but does not exceed 10 crore More than 2 crore
Enterprises Enterprises with investments up to Rs 20 crore with but does not exceed
a turnover of less than Rs 100 crore will now be 5 crore
called Medium units.
SMALL SCALE INDUSTRY
 Play a vital role in the industrial development
of any country.
 Recognized world over from its significant
contribution in gratifying various socio-
economic objectives, such as higher growth of
employment, output, promotion of exports and
fostering entrepreneurship.
 07/23/2023

DEFINITION
 Following requirements to be complied - to be
graded as SSI undertaking w. e. f. 21.12.1999.
 An industrial undertaking in which the
investment in fixed assets in plant and
machinery whether held on ownership terms or
on lease or on hire purchase does not exceed
Rs.10 million.
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CHARACTERISTICS
 Capital investment is less.
 Number of people employed per unit is less
 Generally they are family owned and
organized as sole proprietorship organisations.
 Employees of the small scale industries are
generally unorganized.
 Fixed assets forms largest components of
small units.
 07/23/2023

 Success of the unit depends on entrepreneurial

abilities of the owners.
 Competition is very high among small units.
 Incidents of infant mortality is very high and
only a few SSI units grow into large scale
organizations.
 It is found that many units indulge in
exploitation of natural and human resources.
 Financial discipline is very weak among the
units
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 Profit margins are very low.

 Generally engage in production of light consumer
goods.
 Entrepreneur’s savings contribute to the major
portion of SSI’s in India.
 07/23/2023

SCOPE OF SSI
 Very vast and it involves wide range of
manufacturing and service activities.
 Performing well in many areas like
manufacturing, servicing, financial, construction,
retailing, transport, food and other important
sectors.
 Government of India has reserved the following
items for SSI.
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 Food and Allied Industries, Textile Products

Including hosiery, Art Silk/Man made fibre
Hosiery, Wood and Wood Products, Paper
Products, Leather and Leather Products
including foot wear, Rubber Products, Plastic
Products, Injection, moulding, thermo plastic
products, Chemicals and Chemical Products
Laboratory, Chemicals and Reagents, Water
Soluble Wood Preservative Based on Copper
Chrome, Arsenic Boric Components, Basic
Dyes, Fast Colour Bases, Natural Essential Oils,
 07/23/2023

 Organic Chemicals, Drugs and Drug

Intermediaries, Other Chemicals and Chemical
Products, Glass and Ceramics, Roofing Tiles,
Flooring Tiles, Ceramic Table Wares and Allied
items in Stone wares Semi vitreous ware and
earthen wares, Mechanical Engineering
Excluding Transport Equipment, Electrical
Machines, Appliances and Apparatus including
Electronics, Electrical Appliances, Electronic
Equipments and Components,
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 Transport Equipment Boats and Truck body

building, Auto parts Components and Ancillaries
and Garage Equipment, Bicycle Parts, Tricycles
and Perambulators, Miscellaneous Transport
Equipment, Mathematical and Survey
Instruments, Sports Goods, Stationary Items and
Clocks and Watches.
 07/23/2023

STEPS IN SETTING UP AN SSI

 Decision to be self- employed
 Selection of an activity
 Deciding upon the ownership
 Location and layout of the unit
 Financial assistance
 Project report
 Project appraisal
 Registration
 Procurement of other resources
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ROLE OF SSI IN ECONOMIC DEVELOPMENT

 High employment generation
 Low capital investment
 Balanced regional development
 Flexibility in operation
 Short gestation period
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PROBLEMS FACED BY SSI’S

 Technology obsolescence
 Managerial inadequacies
 Delayed payments
 Poor quality
 Incidence of sickness
 Lack of appropriate infrastructure
 Lack of marketing network
GATT, WTO & LPG
 Established on 1995 by 23 founder nations.
 Headquartered at Geneve, switzerland with 142 plus members
 GATT-General agreement on Tariffs & Trade -1948
Objective –
 to ensure freer, more transparent, & predictable trading regime.
 Agreements covered are GATT, GATTS(Services),TRIPS(Trade
related intellectual property rights)
Functions –
 Implementation of Multi lateral & plurilateral agreements
 To provide a forum for negotiations on new issues
 Settlement of disputes
 Review of trade policies
GATT, WTO & LPG
Impacts:
 Opening of economies
 Reduction in tariffs
 Free entry of foreign goods–threatened domestic
markets.
 Rigid export markets
 Wave of standardisation
 International trade becoming Knowledge based
LPG: Liberalisation, Privatisation &
Globalisation
 07/23/2023

IMPACT OF GLOBALIZATION ON SSI IN INDIA

 Process of liberalization and economic reforms since

1991, have a major impact on SSI in India.
 Initiatives on one hand created tremendous opportunities
for the growth, on the other hand they have also thrown
up new challenges for them.
 Issues like building global competitiveness, technology
up gradation and achieving world class quality have
become essential for growth and survival of SSIs.
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 Government have over protected SSIs prior to

reforms and now SSIs have to face severe
competition from both domestic and
multinational large scale industries.
LONG TERM SOURCES
Shares - Issue of shares is the most important, popular and easy
source of obtaining fixed or long-term capital. The share is a
company's owned capital which is split into a large number of
small equal parts, each such part being called a share. Those who
purchase these shares are called 'shareholders'. They are the
owners of the company. According to the provisions of
companies Act, 1956, a company can issue only the following
two types of shares, (i) Preference Shares, (ii) Equity Shares.
 Debentures- Issue of debentures is another important source of
obtaining fixed or long-term capital by a joint stock company. A
debenture is an acknowledgement of a debt by a company
usually issued under a common seal. Debentures are the uniform
parts of a loan raised by the company. A debenture-holders is a
creditor of the company. A fixed rate of interest is paid on
debentures. Debenture holders are not the owners of the
company.
 Long term loans from Financial Institution-is the loan from the
financial institutions. They provide loan for a period varying from
7 to 25 years and charge interest @ 13% to 17% per annum. A
number of special financial institutions have been established by
both the Central and State Governments to provide long-term
industrial finance to companies engaged in business. Noteworthy
among these financial institutions are- (i) Industrial Development
Bank of India, (ii) Industrial Finance Corporation of India, (iii)
Industrial Credit and Investment Corporation of India. (iv) Unit
Trust of India, (v) The Industrial Reconstruction  Corporation of
India, (vi) The National Small Industries Corporation, (vii) State
Financial Corporations, (viii) State Industrial Development
Corporations etc.
 Depreciation Fund - Depreciation funds created out of
profits of the company provide a good service of short-
term capital, provided they are not invested in or
represented by an asset.
 Retained earnings - Accumulated large profits are also
considered to be good source of financing long-term
capital requirements. It is the best and cheapest source of
finance. It creates no charge on future profits. Retained
profits may be represented by various uncommitted
reserves and surpluses or specific reserves created out of
profits.
SHORT- TERM SOURCES
 Indigenous/ Informal Lending-Indigenous bankers are private money
lenders and other country bankers who provide short-term finance and
charge high rates of interest. Nowadays with the development of
commercial banks and other financial institutions they have lost their
earlier monopoly. These days, the business houses take the shelter of
indigenous banks only in case of urgency.
 Accruals Expenses: are the expenses which have been incurred but not
yet due hence not paid ex: rent, salary etc. They serve as a spontaneous,
interest free, limited source of short term financing.
 Trade- credit - Present-day business is built on credit. Trade credit
refers to the credit extended by the supplier (seller) to the buyer. Under
this arrangement, credit is not granted in cash. The goods are sold on
credit. The usual duration of trade credit varies from 15 days to 90 days.
It is granted to those customers who have sound financial standing,
goodwill and reputation.
 Bills discounting & Purchasing: Under this bank lends credit
without any collateral security. The seller draws the bill on buyer &
this bill is presented to the banker & banker credits the seller
account with the amount after deducting the discount & on the due
date he collects it from the buyer full amount.
 Overdraft: it refers to an agreement with a bank by which current
account holder is allowed to withdraw more than the balance to his
credit up to a certain limit.
 Advances from customers-Now-a-days leading and reputed
industries whose products are in good demand, such as, Tata Steel,
Maruti Car, Philips (India) Ltd., Bajaj Auto, A.C.C., Hero Cycle
etc. get advances from their customers and agents against orders
received from them. It is also a cheap source of short-term finance.
 Working capital loan & Term loan from banks
OTHER SOURCES
 Lease Financing
 Hire purchase & Installment system
 Venture Capital
 Angel Investors
FORMS OF OWNERSHIP

 Sole Proprietorship -One man owns this type of business. The

business man invests capital, employs labor and machines. For
example 1. Retail-shops. 2. Workshops etc. The single owner
invests, maintains and controls the entire business. Hence all
gains or loss from business goes to him. It should be noted that
he is fully liable for all the debts associated with the business.
This type of ownership is easy to establish and simple to run with
a minimum of legal restrictions.
 Partnership -Partnership has been defined by the Indian
Partnership Act 1932 as the relationship between persons who
have agreed to share profit of a business concern carried on by
all or any one of them acting for all. Partnership comes into
existence by means of an agreement. This written agreement is
called a partnership deed.
FORMS OF OWNERSHIP
 Joint Stock Company - A joint stock company is an association of
individuals, called shareholders, who join together for and agree to
supply capital divided into shares that are transferrable for carrying on a
specific business other than banking business A joint stock company
consists of more than 20 persons for carrying any business other than the
banking business. It is established under the Indian Companies Act of
1956.
 There are two types of joint stock companies 
1.Private limited company
2. Public limited company 
 Co- operative Firm - This is the most democratic form of business
organization for the betterment of the general public. These cooperative
societies help to protect the interest of the customers, small and
independent producers and of the workers while fighting against
monopolists and capitalists. The members of society supply the capital
through shares; they manage the business and share the profit or loss.  
FORMS OF OWNERSHIP
 Hindu Undivided Family - The Hindu Undivided Family can
best be defined as a family that consists of a common
ancestor and all his lineal male descendants and their wives
and unmarried daughters. The Hindu Undivided Family
(HUF) cannot be created by acts of any party. The only
exceptions are in the case of an adoption or a marriage when
a stranger may become a HUF member. An undivided family,
which is a normal condition of Hindu society, is ordinarily
joint, not only in estate but also in food and worship. Head is
known as KARTA, Members known as COPARCENERS.
 07/23/2023

SUPPORTING AGENCIES AND INSTITUTIONAL SUPPORT

 GOI and State Governments have introduced

several schemes for encouraging
Entrepreneurship and Development of SSI in the
country.
 The advantages of this support provided are
multi-fold.
 Produce large number of variety of goods with
relatively low investment, great employment
opportunities.
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 Geographically spread all over which brings in

distinct socio-economic advantages.
 Contribute to economic development of the
country, with better utilization of capital and skill
and also help in equitable distribution of National
Income.
 Considering this immense contribution of SSIs
to the national economy, Government has
introduced schemes to promote SSIs.
CENTRAL LEVEL FINANCIAL INSTITUTIONS
1. National Board of MSME(NBMSME)
2. Khadi and Village Industries Commission (KVIC)
3. National small industries corporation (NSIC)
4. Indian institute of entrepreneurship (IIE)
5. Small scale industries development Bank of India(SIDBI)
6. Entrepreneurship development institute of India(EDI)
7. National Bank for Agriculture and Rural Development (NABARD)
8. Small scale industries board (SSIB)
9. Small industries development organization (SIDO)
10. National Science and Technology Entrepreneurship Development Board
(NSTEDB)
11. National Productivity Council (NPC)
12. National Institute for Small Industry Extension and Training (NISIET)
13. National Institute for Entrepreneurship and Small Business Development
(NIESBUD)
NBMSME
 National Board for Micro, Small & Medium Enterprises
(NBMSME)
 Established under the MSMED Act-2006
 The National Board for Micro, Small & Medium Enterprises
(NBMSME) was established / notified for the first time on
15th May 2007 consisting of 47 members including
Chairman, Vice Chairman and Member Secretary in
accordance with the Sub Section 1 of Section 3 of MSMED
Act, 2006 and National Board for Micro, Small & Medium
Enterprises Rules, 2006. The Minister in-charge of Ministry
of MSME is ex-officio Chairman of the National Board.
 Salient Features of the NBMSME:
 NBMSME is consisting of 47 members (18 Ex-officio
members and 29 members- the tenure of members is for two
years from the date of notification).
 Has statutory backing.
 Provides representation to all sections/segments including
Associations of Micro, Small and Medium manufacturing
and service enterprises, women enterprises, Central
Ministries, States representing different regions of the
country, trade unions, etc.
 Quarterly meeting of the Board mandatory as per MSMED
Act, 2006 - the Board has met six times from the date of its
establishment.
 Functions of the National Board:
 » Examine the factors affecting the promotion and
development of Micro, Small & Medium Enterprises
and review the policies & programmes of the Central
Government in regards to facilitating the promotion &
development & enhancing the competitiveness of such
enterprises and the impact thereof on such enterprises.
 Advice the Central Government on the use of the Fund
 » To examine matters referred by the NBMSME
concerning promotion and development of MSME
sector and enhancing its competitiveness.
 » To provide advice to the Central Government on issues related to the
promotion, development and enhancement of competitiveness of micro, small
and medium enterprises, covered under Section 9 to 12 and Section 14 of the
MSMED Act, 2006, which include issues concerning Credit Facilities,
Procurement of Preference Policy, Constitution and Administration of Funds,
etc.
 » To provide advice to the State Governments (in case sought by any of them)
on issues relating to notifying any rule made to carry out the provisions of the
MSMED Act-2006 including the composition of Micro, Small Enterprises
Facilitation Councils etc. as provided under section 30.
 » Recommend or advice Central Government or State Governments or the
Board, as the case may be, in connection with the classification of a class(es) of
enterprises after taking into consideration the level of employment, investments,
need of higher investment in plant and machinery or equipment for technology
upgradation, employment generation and enhanced competitiveness and
international standards for classification of small and medium enterprises.
'KHADI AND VILLAGE INDUSTRIES COMMISSION
 The Khadi and Village Industries Commission (KVIC) is
a Statutory body formed in April 1957 by the GOI, under the Act
of Parliament, 'Khadi and Village Industries Commission Act of
1956'.
 It is an apex organisation under the Ministry of MSME, with
regard to Khadi and village industries within India, which seeks to
- "plan, promote, facilitate, organise and assist in the
establishment and development of khadi and village industries in
the rural areas in coordination with other agencies engaged in
rural development.
 Its head office is in Mumbai, whereas its six zonal offices in Delhi
, Bhopal, Bangalore, Kolkata, Mumbai and Guwahati. Other than
its zonal offices, it has offices in 28 states for the implementation
of its various programmes.
OBJECTIVES

These are -
 The Social Objective - Providing employment in
rural areas
 The Economic Objective - Providing saleable
articles
 The Wider Objective - Creating self-reliance
amongst people and building up a strong rural
community spirit.
SCHEMES AND PROGRAMS OF THE COMMISSION

 Prime Ministers Employment Generation

Program (PMEGP)
 Programme for Promotion of Village Industry
Cluster - Rural Industry Service Centre (RISC)
for Khadi And Village Industry
 Interest Subsidy Eligibility Certification Scheme
(ISEC)
 Rebate Scheme
 Janashree Bima Yojana For Khadi Artisans
 Market Development Assistance
 07/23/2023

NATIONAL SMALL INDUSTRIES CORPORATION(NSIC)

 Estd 1955.
 Fulfill its mission of promoting, aiding and fostering the
growth of small scale industries and industry related SS
services/business enterprises in the country.
 Over a period of five decades of transition, growth and
development, NSIC has proved its strength within the
country and abroad by promoting modernization,
upgradation of technology, quality consciousness,
strengthening linkages with large medium enterprises
and enhancing exports-projects and products from small
industries.
 07/23/2023

NSIC
 It operates through 9 Zonal Ofices, 33 Branches, 14 Sub
offices, 10 NSIC Business development Extension
Offices, 5 Technical Services Centres, 3 Extension
centres and 2 Software Technology Parks supported by a
team of ver 500 professionals spread across the country.
 To manage operations in African countries NSIC
operated from its office in Johannesburg.
 07/23/2023

OBJECTIVES
 A composite term loan scheme assists existing
and prospective entrepreneurs to acquire land and
building, machinery, equipment and working
capital at one place.
 Working capital finance and off the shelf
availability of scarce materials are also provided.
 Does bills discounting up to a specified limit.
 07/23/2023

OBJECTIVES/FUNCTIONS OF NSIC
 Provides trained manpower, testing facilities and
prototype modification.
 The technology transfer centre provides on line data on
latest technology.
 NSIC also provides various marketing facilities.
 Marketing support, Credit Support, Technology Support,
Infomediary services, Software Technology parks,
International Consultancy services.
 07/23/2023

SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA - SIDBI

 Estd April 1990 under the act of parliament as principal

financial institution.
 Functions: Refinancing of the term loans granted by SFCs,
SIDCs, Banks and other financial institutions.
 Rediscounting of short term trade bills arising out of sale of
products of the small scale sector. Direct discounting /
rediscounting of bills arising out of sale of machinery /
capital equipment on deferred credit manufactured by small
scale sector.
 Presently, It tenders equity type of assistance to new
promoters, women and ex-servicemen under National Equity
fund.
 07/23/2023

SIDBI
 It provides assistance to the voluntary organisations
working for development /upliftment of under
privileged women. It also provides technical support
to small scale sector for promotion, development and
growth.
 It also extends financial support to NSIC and SIDCs
for the purchase of material and marketing of SSI
products and for financing hire purchase and leasing
activities.
 SIDBI introduced scheme of direct assistance in
1991-92 in order to encourage the existing units to
undertake technology up gradation/ modernization for
improving the quality of their products.
INDIAN INSTITUTE OF ENTREPRENEURSHIP (IIE)
 Indian Institute of Entrepreneurship (IIE) is an
autonomous organization under the Ministry of Skill
Development & Entrepreneurship.’
 The Indian Institute of Entrepreneurship (IIE)
 registered under the Societies Registration Act,1860
 was established in the year 1993 in Lalmatio,
Guwahati by the erstwhile Ministry of Industry (now
the Ministry of Micro, Small and Medium Enterprises)
 IIE has been transferred to the Ministry of Skill
Development & Entrepreneurship on 22nd May’2015.
AIMS & OBJECTIVES

 To provide training, research and consultancy activities in

Small and Micro Enterprises (SME),with special focus on
entrepreneurship development. 
 To promote and develop entrepreneurship.
 To conduct research and provide consultancy for
entrepreneurship development.
 To coordinate and collaborate with other organizations in
undertaking training, research and other activities to increase
outreach of the institute.
 To provide consultancy and monitoring service to MSMEs/
potential entrepreneurs and enhancing employability of
participants.
 To promote greater use of information technology in the
activities/ functions of the IIE.
 To comply with statutory responsibility.
 FUNCTIONS
 Designing and organising training activities for different
target group and undertaking research in the relevant to
entrepreneurship.
 Improving the efficiency, effectiveness and delivery of the
change agents and development practitioners i.e. trainers,
support organizations engaged in enterprise building. etc.
 Provides consultancy service to the prospective and
existing entrepreneurs.
 Increasing the outreach of activities of the institute
through collaborative activities and increasing their
effectiveness through use of different tools of information
technology.
ENTREPRENEURSHIP DEVELOPMENT INSTITUTE OF INDIA:

 EDII was established on 1983 with the active

support of the Government of Gujarat, 
IDBI Bank, IFCI Ltd, ICICI Bank and 
State Bank of India.
 EDI’S mission is to become a catalyst in
facilitating emergence of competent first
generation entrepreneurs and transition of
existing SMEs into growth-oriented enterprises
through entrepreneurship education, training,
research & institution building.
THE ENTREPRENEURSHIP DEVELOPMENT INSTITUTE OF INDIA
(EDII),

  Located in Gandhinagar ,Gujrat is an autonomous

institute. The institute was established in 1983 and is
approved by AICTE, MHRD, and NBA. The institute is
spread in a 23 acres green campus. EDII offers PGDM
Program in Business Entrepreneurship and Development
Studies and Fellow Programme in Management. 
 EDII has set up its own Technology Business Incubator
named as the Centre for Advancing and Launching
Enterprises (CRADLE).
FOCUS AREAS
 Entrepreneurship education and research;
 Micro-enterprises, micro-finance and sustainable
livelihood;
 SMEs and business development services;
 Cluster competitiveness, growth and technology;
 Social entrepreneurship and CSR and
 Women entrepreneurship and gender studies.
NATIONAL BANK FOR AGRICULTURE AND RURAL
DEVELOPMENT (NABARD)

 National Bank for Agriculture and Rural Development (NABARD) was

established as the premiere development bank.
 The main purpose of the National Bank for Agriculture and Rural Development
is to provide credit for the development and publicity of small-scale industries,
handicrafts, rural crafts, village industries, cottage industries, agriculture, etc.
 The NABARD also provides assistance to the reserve bank of India, other
organizations related with the development of the rural sector, and the
government of India.
 Coordinates the functions of the rural loan providers, aids the state governments
in assisting the rural developmental institutions.
 Provides training facilities for the cooperatives, banks, and other organizations.

 The National Bank for Agriculture and Rural Development would facilitate the
provision of direct loan to different institutions on the approval of the Central
Government of India.
FUNCTIONS OF NABARD
 Credit Function
 Regulatory & Development function
 Refinance other institutions acting as an APEX
bank.
 Investment on Securities through contribution
to share capital
 Financial help to non agricultural sectors
 Conduct Training programmes
STATE LEVEL FINANCIAL INSTITUTIONS
1. District Industries Centers (DICs)
2. Karnataka State Financial Corporation’s
(KSFCs)
3. Karnataka industrial area development
board – KIADB
4. Technical Consultancy Services orgn, of
Karnataka
 07/23/2023

DISTRICT INDUSTRIES CENTRE-DIC

 DICs are the District level functionary of the
State Directorate of Industries.
 Objectives: Supervision and control of District
level functionaries, Act as a Nodal Promotional
Agency in the development of industries.
Organises and implements various programmes
and schemes to provide the basic infrastructural
facilities for the creation of industrial awareness
and atmosphere.
 07/23/2023

DIC
 Also runs regular vocational training courses for
creation of skilled manpower.
 Accelerate the pace of industrialization process,
infrastructure development and development of
industrial areas and estates are being given importance.
 Financial assistance is made available to tiny/ cottage,
to large/medium sector of industrial units in the form
of grants-in-aid to technical entrepreneurs to package
scheme of incentives and central transport subsidy.
 Some of the scarce raw materials like paraffin wax,
iron and steel materials are also allotted to registered
industrial units at concessional rates
 07/23/2023

STATE FINANCIAL CORPORATIONS

 State felt the need for institutions which could cater to the
financing needs of the units.
 SFC act was passed in 1951, which authorise each state and union
territory to set up SFC.
 Punjab was the first state to setup a corporation under this act in
1953.
 At present there are 18 financial corporations working in different
states.
 Area of operations is limited to one state only.
 However, their activities can be extended to neighbouring states
and union territory if they donot have their own.
 07/23/2023

OBJECTIVES
 To provide financial assistance to all types of industrial
units in small and medium scale.
 Manufacturing, preservation or processing of goods;
Mining, Hotel Industry, Road Transport, Generation and
Distribution of Electricity, or any other form of power,
Development of any area of land as an industrial estate;
Fishing, Providing technical knowledge or other services
for the promotion of industrial grwoth.
 07/23/2023

KARNATAKA STATE FINANCIAL CORPORATION -KSFC

 Offers loan assistance up to 90% of the cost of fixed
assets and soft loans for backward areas for special
category of entrepreneurs at attractive terms.
 Rehabilitates sick units and gives loans for the
Vishwa Programme.
 Equity contribution in small/medium entrepreneurs.
Reduced margin money from promoters.
 Reduced – interest rates.
 Seed capital and venture capital assistance.
KARNATAKA INDUSTRIAL AREA DEVELOPMENT BOARD - KIADB

 It was Estd. through the passing of the act by GOK

in 1966. It has ISO-9000 Certification.
 Objectives:
• Promote rapid & orderly development of industries.
• Assist in implementation of policies.
• Facilitates for infrastructure development.
• Functions on corporate policy of “No- profit, No-
loss” policy.
FUNCTIONS:
• Acquire land & build industrial areas
• Provide & create all infrastructure in such areas.
• Acquire land for single use complexes.
• Acquire land for Government projects.
 Some of the industrial areas developed by
KIADB are Peenya in bengaluru, Hebbal in mysore,
Baikampady in Mangalore, Tarihal in Dharwar,
Kakati in Belagavi, Auto complex in Shimogha.
 07/23/2023

STATE SCHEMES
 GOK for encouraging SSIs in the state.
 Several institutions of GOK offering these schemes
and their roles are discussed.
 TECSOK:-Technical Consultancy Services orgn, of
Karnataka –
 Multi disciplinary management consultancy
organization promoted by the GOK to provide
reliable consultancy services in India.
 It has been considered by GOK, GOI, State and
Central Financial institutions, Commercial Banks,
ADB and a host of other institutions of the Govt and
private as the recognized consultancy agency.
 07/23/2023

TECSOK
 TECSOK driven by top notch professionals
from different disciplines, engineers,
management experts, economists and
financial consultants.
 Has been excelling its expertise in a wide
range of services:
 Locate Specific identification of investment
opportunities.
 Assistance in obtaining statutory and
procedural clearances.
 07/23/2023

TECSOK
 Feasibility studies and environment impact
studies.
 Preparation of detailed project reports as per
investment norms and financial norms.
 Market survey and research
 Project implementation and turn key
assistance.
 Re organisation and restructuring of
enterprises.
 07/23/2023

TECSOK
 Valuation of assets, MPP and budgetary
control.
 Energy management & audit, corporate plan,
technology transfer.
 Diagnostic studies and rehabilitation of sick
industries.
 Designing and organizing training
programmes.
 07/23/2023

TECSOK
 TECSOK has catalyzed a large number of
industries throughout the province.
 Management studies, company formation,
corporate plan, enterprise restructuring.
 Port tariff study and related areas.
 Consultancy for agro based industries as a
Nodal Agency of Government of India.
 Consultancy for merger/takeovers.
 Infrastructure development project reports.
 07/23/2023

TECSOK
 TECSOK has over 25 well experienced Engineers of
different disciplines, MBA’s Finance professionals
apart from subject experts associated as empanelled
consultants involved on assignment basis.
 Clients:- GOI-Ministry of Food Processing industries,
DSIR, Council for Advancement of People’s Action
and Rural Technology CAPART, Technology
information Forecasting and Assessment Council
TIFC, Jungle Lodges and Resorts, IDBI, Danish
Embassy, JN Port Trust, Ford Foundation, Heycarb
Colombo, Major Port trust of India.
START- UP COMPANIES
 A startup or start up is a company initiated
by individual founders or entrepreneurs to
search for a repeatable and
scalable business model. More specifically,
a startup is a newly emerged business venture
that aims to develop a viable business model
to meet a marketplace need or problem.
 Founders design startups to 
effectively develop and validate a scalable 
business model. Hence, the concepts of
startups and entrepreneurship are similar. 
 A startup is a newly emerged business venture
that aims to develop a viable business model to
meet a marketplace need or problem.
 The biggest difference between these
two company types is in their top
objectives. Small businesses are driven by
profitability and stable long-term value,
while startups are focused on top-end revenue
and growth potential.
 CHALLENGES  FACED
 MONEY
 NEGLECTING MARKETING/SALES
 LACK OF PLANNING
 FINDING THE RIGHT PEOPLE
 TIME MANAGEMENT
 WEAK COFOUNDERS
 SCALING UP
 UNWILLINGNESS TO PUSH THE CO. BEYOND
COMFORT ZONE
 COMPETITORS
 LACK OF MENTOR
 POOR MANAGEMENT
MAKE IN INDIA CONCEPT
 Make in India' initiative was launched on September
25, 2014 by GOI.
 Aim: To make India a global manufacturing hub, by
encouraging both multinational as well as domestic
companies to manufacture their products within the
country.
 The program includes major new initiatives designed to
facilitate investment, foster innovation, protect
intellectual property, and build best-in-class
manufacturing infrastructure.
MAKE IN INDIA VISION
 Manufacturing currently contributes just over
15% to the national GDP. The aim of this
campaign is to grow this to a 25% contribution as
seen with other developing nations of Asia. In the
process, the government expects to generate jobs,
attract much foreign direct investment, and
transform India into a manufacturing hub
preferred around the globe. 
SECTORS COVERED
 25 nos. Namely: Automobiles; Auto
components; Aviation; Biotechnology; Chemica
ls;Construction;
Defense manufacturing; Electrical machinery;
Electronic system design and manufacturing;
Food processing; IT and BPO; Leather; Media
and entertainment; Mining; Oil and
gas; Pharmaceuticals; Ports; Railways;
Renewable energy; Roads and Infrastucture
MERITS & DEMERITS
MERIT: India is a country rich in natural resources. Labour
is a plenty and skilled labour is easily available given the
high rates of unemployment among the educated class of the
country. With Asia developing as the outsourcing hub of the
world, India is soon becoming the preferred manufacturing
destination of most investors across the globe. Make in India
is the Indian government's effort to harness this demand and
boost the Indian economy.

DEMERIT: India ranks low on the "ease of doing business

index“ released by World Bank(63rd rank amongst 190
countries). Labour laws in the country are still not conducive
to the Make in India campaign. This is one of the universally
noted disadvantages of manufacturing and investing in India.
REASON FOR INTRODUCTION
 Make in India campaign is at loggerheads with the Make in China
ideal that has gained momentum over the past decade. China is a
major rival to India when it comes to the outsourcing,
manufacturing, and services business. India's ailing infrastructure
scenario and defunct logistics facilities make it difficult for the
country to achieve an elite status as a manufacturing hub. The
bureaucratic approach of former governments, lack of robust
transport networks, and widespread corruption makes it difficult
for manufacturers to achieve timely and adequate production. The
Modi government has vowed to remove these hurdles and make
the nation an ideal destination for investors to set up industries.
MICRO UNITS DEVELOPMENT AND REFINANCE AGENCY LTD.
[MUDRA]
 MUDRA is an NBFC supporting development of
micro enterprise sector in the country. MUDRA
provides refinance support to Banks / MFIs /
NBFCs for lending to micro units having loan
requirement up to Rs. 10 lakh. MUDRA provides
refinance support to micro business under the
Scheme of Pradhan Mantri MUDRA Yojana.
PURPOSE OF MUDRA LOAN

 Mudra loan is extended for a variety of purposes which

result in income generation and employment creation. The
loans are extended mainly for:
 Business loan for Vendors, Traders, Shopkeepers and other
Service Sector activities
 Working capital loan through MUDRA Cards
 Equipment Finance for Micro Units
 Transport Vehicle loans – for commercial use only
 Loans for agri-allied non-farm income generating activities,
e.g. pisciculture. bee keeping, poultry farming, etc.
 Tractors, tillers as well as two wheelers used for commercial
purposes only.
 Shishu : covering loans up to  50,000/-
 Kishor : covering loans above  50,000/- and up
to 5 lakh
 Tarun : covering loans above  5 lakh and up to 10
lakh
BANKS OFFERING MUDRA LOAN
 Corporation Bank
 Dena Bank
 HDFC Bank
 Allahabad Bank
 Andhra Bank
 Bank of Baroda
 IDBI Bank
 Indian Bank
 United Bank of India
 Syndicate Bank
 Tamilnad Mercantile Bank
 Union Bank of India
 Punjab and Sind Bank
 Punjab National Bank
 State Bank of India