Assistance for obtaining Raw Material, Machinery, Land and Building and Technical Assistance14th September 2022 0 By indiafreenotes
Raw Material Assistance Scheme aims at helping MSMEs by way of financing the purchase of Raw Material (both indigenous & imported). This gives an opportunity to MSMEs to focus better on manufacturing quality products.
The following benefits are provided under the scheme:
- Financial assistance (Credit) for procurement of raw material up to 90 days.
- Materials facilitated under Bulk supplies arrangements are provided at bulk supplier’s rate by eliminating the middlemen and thus goods are procurred at a lower price.
- Discounts received under bulk supplies arrangements are shared with MSMEs, enabling them to reduce cost of purchase of materials (Economies of Scale).
- Availability of raw material on credit and enabling MSMEs to execute the orders in hand.
Any manufacturing MSME having Udyog Aadhaar Memorandum (UAM) can apply for the assistance under the Scheme.
The The Entrepreneurs and any MSME needs raw material through NSIC may apply to any of the NSIC field office for Raw Material Assistance in the prescribed application forms, which can be downloaded from NSIC’s web site (www.nsic.co.in) or may be obtained free of cost from any of the field offices. The duly filled in application form along with prescribed documents can be submitted with the nearest branch office of NSIC. Details of NSIC offices are available on www.nsic.co.in.
Process of Disbursement
NSIC will make a visit to the applicant’s unit for the purpose of preliminary appraisal after submitting the form. Then, the agency will sanction a limit for the unit post inspection. After getting the sanction, the prospective beneficiary will be required to sign the agreement with NSIC. After signing the agreement, NSIC will disburse the assistance for the unit, provided that a security in the form of Bank Guarantee from approved or nationalized banks is furnished by the applicant.
Scheme for Assistance in Rent to MSMEs
Micro, Small and Medium Enterprises (MSEs) play a significant role in the economic growth of the country owing to their contribution to production and employment. In the recent years, there is a sharp increase in the cost of land and building in the country and therefore Micro, and Small Enterprises having minimal financial resources could not able to start their manufacturing enterprises. Government of Gujarat has decided to provide financial assistance through Scheme for assistance in Rent to MSMEs for shed and plot developed by private developers for the generation of employment and development of MSMEs in the state. The task of administering and implementing this Scheme is entrusted with the Gujarat Industries Commissionerate. In this article, we will look at the Scheme for Assistance in Rent to MSEs
Features of the Scheme
Under this Scheme, the Government provides financial assistance to Private Developer for developing readymade sheds in Mini Estate.
Gujarat Government has felt that there is a need for small estates having a small row house type (Gala type) shed for MSEs which will provide basic infrastructure to set up MSEs. This type of mini Estate can be developed by a private developer for MSEs.
The government also offers financial Assistance in rent to MSEs
The Government felt that the MSE Industrial units have to keep more margins for purchase of land and building while approving the loan from the financial Institution/ bank. This will affect the working capital requirement and also adversely affect the overall viability of the entire project. In view of above, the government has decided to assist MSEs units in rent which will improve the initial liquidity of the project and also help the financial institution/bank to sanction the term loan on plant and machinery required for the project.
Note on Private Developer
Private Developer means any registered Private, Public Limited Company or Industrial Association, Individual industries, Group of industries or Cluster
Mini Estate is an industrial estate having necessary infrastructure facilities like developed plot, water distribution facilities, internal roads, power distribution and such other facilities or services as may be required designed for the establishment of MSEs in manufacture any product
The eligibility criteria to obtain the financial benefit under the Scheme for Assistance in Rent to MSEs for Shed and Plot developed By Private Developer are explained in detail below:
The New Micro and Small Enterprise registered as an industrial unit under the MSME Development Act, 2006 with respective Director of Industries Commerce (DIC) as a manufacturing enterprise and obtained term loan from the Financial Institution.
Eligible new unit
For availing the grant under the Scheme for Assistance for in Rent to MSEs, the new unit has to commence production during the operative period of this Scheme.
Eligible Fixed Capital Investment
The eligible fixed Capital investment of the project will be decided based on the following criteria:
Cost of Land
The cost of land will be decided on the basis of prevailing jantri price of the area or the actual price paid by the private Developer, including the stamp duty and registration charges.
Cost of Building
The cost of the building is fixed up by SLEC for the industrial building and SOR of the Roads and Building Department.
Other Infrastructure Facilities
The cost of other infrastructure facilities will be as decided by the SLEC.
Assistance in Rent to MSEs
The Government felt that the MSE Industrial units have to keep more margins for purchase of land and building while approving the loan from the Financial Institution. This will affect the working capital requirement and also adversely affect the overall viability of the entire project. In view of above, the government has decided to assist MSEs units in rent which will improve the initial liquidity of the project and also help the financial Institution or bank to sanction the term loan on plant and machinery required for the project.
Quantum of assistance
The Scheme intends to provide assistance to set up MSEs by small entrepreneurs having limited financial resourced, the Government will assist with rent to strengthen the MSEs in the initial period of establishment.
- The assistance at 50% of rent paid or Rs.50000/- per annum, whichever is less in Municipal Corporation area and areas under the Urban Development Authority
- The assistance at 50% of rent paid or Rs.25000/- per annum, whichever is less except mentioned above
- The financial assistance will be provided for three years