RPCD.No.PLNFS.BC.141/06.01.08/95-96

May 22, 1996
Jyestha 1, 1918

All Scheduled Commercial Banks

Dear Sir,

Publication or publishing units as SSI

     Office of the Development Commissioner, Small Scale Industries, SSI Board & Policy Division, Ministry of Industry, Government of India, New Delhi has decided in terms of its letter No.2(3)/91-SSI Bd. (3) dated July 18, 1995 (copy enclosed) that Publication or publishing units’ engaged in the production & publication of books and related reading material is an industrial activity and is registrable as Tiny/SSI/Ancillary, as the case may be, depending on the investment limit and nature of sales as SSI under MSME-DO registration scheme. They will therefore be eligible to avail all the incentives and facilities given to small scale industries.

2. Please acknowledge receipt.

Yours faithfully,

Sd/-
(AVINASH MISRA)
General Manager

Encl.: 1

No.2(3)/91-SSI Bd.(3)
GOVERNMENT OF INDIA
MINISTRY OF INDUSTRY OFFICE OF
THE DEVELOPMENT COMMISSIONER
SMALL SCALE INDUSTRIES
SSI BOARD & POLICY DIVISION
Nirman Bhavan, New Delhi

18^th July, 1995

To

1. Secretary (Industries)

2. Director (Industries) All States/U. Ts.

3. Director, All SISIs

Sir,

Publication or Publishing Units as SSI.

     Publication Units or Publishing units are typically engaged in the publication of books and related reading material. Depending on the size of such units, the layout, design and processing of the books and their printing is either carried out in house, or is done on job work basis. In either case, for the entire production activity, the working capital is generally engaged by the publication unit.

     The production and publication of books is an important activity that needs to be encouraged. Printing presses have already been recognised as SSI activity. It has now been decided that "Publication or publishing units" engaged in the production and publication of books, and relating reading material is an industrial activity and is registrable as Tiny/SSI/Ancillary, as the case may be, depending on the investment limit and nature of sales as SSI under the MSME-DO registration scheme. They will, therefore, be eligible to avail all the incentives and facilities given to small scale industries.

     This may be brought to the notice of all registering authorities and others concerned.

Yours faithfully,

 Sd/-
(RAJU SHARMA)
Director (SSI Board & Policy)

Copy to :

1. All Directors at Headquarters.

2. Director (Publication)

3. Others as per mailing list.

PCD.NRo.227/06.02.31/96-97

16 August 1996

All Public Sector Banks

Dear Sir,

Opening of specialised SSI branches to cater
to the needs of SSI

     As you are aware, banks were advised to operationalise 100 specialised SSI branches during the year 1995-1996 in 85 identified districts (vide our circular RPCD.No.PLNFS.BC.1/06.02.31/92-93 dated 3 July 1993). We now find from the data received from banks that 136 specialised branches have been operationalised in these districts by 31 March 1996 and 33 specialised branches in other districts. As these branches have been in existence for some time now, it is necessary to assess their performance with regard to their lendings to SSI units. We shall, therefore, be glad if you will please furnish us information/data as on 30.6.1996 in the enclosed proforma in respect of each of the specialised SSI branch operationalised by your bank within a period of fortnight.

1. Considering the importance of the SSI segment in our economy, particularly its large employment potential, contribution to exports, diversified development, etc. it is necessary to ensure timely and adequate flow of credit to the SSI sector. With a view to continuing the tempo of opening more specialised SSI branches, it has been decided that commercial banks should operationalise 100 more specialised branches (either by opening new branches or by converting some of the existing general branches into specialised SSI branch/es wherever there is potential) during the year 1996-97. For this purpose, you may please conduct necessary surveys and select the centres accordingly, keeping in view, the potential for financing SSIs, commercial viability, etc. It has also been decided that Lead Bank in each district should co-ordinate the work in this regard. Needless to emphasise that these specialised branches should be staffed by senior officials having requisite delegated powers and sensitising them to deal with the problems of the sector with empathy.

2. A list of branches proposed to be operationlised by your bank indicating the location (place, district and state) and the probable time by which the branch will be operationalised, may please be sent to us within a period of one month.

3. You may also please advise us the system evolved and put in place by your bank to redress the grievances of SSI borrowers at the branch/zonal/head office levels.

4. Please acknowledge receipt.

Yours faithfully,

 Sd/-
(R. RAMANUJAM)
Chief General Manager

Encl.: 1

PROFORMA

Name of the bank :

Statement showing the particulars of specialised SSI branches operationalised by the bank

RPCD.No.PLNFS.BC.39/06.06.12/96-97

October, 1996
9 Ashwina, 1918 (Saka)

All Scheduled Commercial Banks

Dear Sir,

Bank Credit to Khadi and Village
Industries (KVI) Sector

     As you are aware, a consortium of banks has been set up during 1995 to extend a line of credit to Khadi and Village Industries Commission (KVIC) for the purpose of financing viable Khadi and Village Industrial units either directly or through State level Khadi and Village Industries Boards (KVIBs). This arrangement envisages provision of a line of credit of Rs. 1000 crore by a consortium of banks. The rate of interest applicable to the line of credit has been linked to the average prime lending rates of five major banks in the consortium.

2. In this connection banks are advised that apart from lending by way of the consortium arrangement, they may also extend credit facilities directly, on merits, to KVI units approaching them at the stipulated rates of interest. A reference is invited in this connection to our circular RPCD.No.PLNFS.BC.16/06.06.12/94-95 dated 28 July 1994 wherein the measures to be taken on the basis of the Kalia Committee recommendations, have been mentioned. As indicated therein, banks are requested to keep in view, while assessing the working capital requirements of the Khadi institutions/KVI units, the following aspects so as to enable the khadi institutions to raise adequate working capital.

   1. Along with the proposal for working capital requirements. KVIC/KVI units will furnish the worksheet indicating the details of assessment of working capital requirements of the units.

   2. KVIC’s assessment may be accepted if it does not exceed the assessment made by the banks by more than 10%.

   3. In case the KVIC’s assessment of working capital exceeds the bank’s assessment by more than 10%, the quantum of working capital may be arrived at by mutual dialogue between the institutions/KVIC and the financing banks.

   4. In case of sharp differences between the peak level and lean season credit requirements, additional credit limits may be sanctioned by banks; KVIC will indicate such peak level credit requirements also in the credit proposals.

3. We shall be glad if you will please issue necessary instructions in this regard to all your branches and controlling offices.

Yours faithfully,

 Sd/-
(R. M. JOSHI)
General Manager

RPCD.No.BC.90/06.15.01/96-97

January 3,1997

The Chairman/Managing Director/
Chief Executive Officer
All Scheduled Commercial Banks

Dear Sir,

Registration of units manufacturing or processing tea

     We enclose for your information, a copy of circular letter No. 5(18)92.SSI.Bd & Policy dated 20 November 1996 on the above subject received from Office of the Development Commissioner (SSI), S.S.I. Board and Policy Division, Department of SSI and ARI, Ministry of Industry, Government of India, New Delhi. It will be observed therefrom that all units engaged in the processing or manufacture of tea are eligible for registration as small scale units under the MSME-DO registration scheme. This, however, does not include the activity of growing tea.

2. Please acknowledge receipt.

Yours faithfully,

 Sd/-
(R. M. JOSHI)
General Manager

Government of India
Ministry of Industry
Office of the Development Commissioner
(Small Scale Industries)
Nirman Bhavan, New Delhi

20^th November, 1

To,

1. Commissioner/Director of Industries

2. Secretary              All States/UTs

Ref:        This office Circular No.5 (18)/92-SSI.Bd.Dated 5^th August 1993 regarding
                 registration of units manufacturing or processing tea.

Sir,

     Reference is invited to the Office Circular referred to above wherein it has been started that small scale units engaged in the manufacture of packet tea or engaged in the activity of blending, procession packaging or repackaging of ‘made tea’ are registrable as small scale units under the MSME-DO Scheme. Further, units engaged in manufacture of ‘made tea’ from green leaves from their own tea estates of green leaves procured from other sources will not be eligible for registration of SSI units under the MSME-DO registration scheme.

     This issue has been reconsidered in the light of representations received from various industrial units, industry associations and discussions with the concerned State Governments.

     Accordingly, it has now been decided as follows:

     "All units engaged in the processing of manufacture of tea are eligible for registration as small scale units under the SIDO registration scheme. This, however, does not include the activity of growing tea."

     Accordingly the earlier office circular No.5(18)92 dated 5^th August, 1993 stands superseded.

     You are requested to bring these facts to the notice of all registering authorities and related agencies.

Yours faithfully

 Sd/-
(RAJU SHARMA)
Director (SSI Bd. & Policy)

RPCD.PLNFS.BC.99/06.03.01/96-97

5^th February, 1997
16 Madh, 1918 (Saka)

All Scheduled Commercial Banks

Dear Sir,

Credit flow to Handlooms and Handicrafts Sectors

     As you are aware, Handlooms and Handicrafts sectors rank next only to agriculture in employment and millions of people in the country are dependent on it for their livelihood. These sectors accounted for 15% and 62% of the total production of cloth and traditional industries respectively during the year 1995-96. In spite of their significant share in production and exports, these two sectors have not received adequate support and attention in credit flow as well as extension. The position in regard to credit flow to the Handlooms and Handicrafts Sectors was recently reviewed by the Hon’ble Union Minister for Textiles. It was felt that considering existence of large potential for these sectors, the actual credit flow to the sectors was very low and needed to be improved. For that purpose, the Ministry has identified 94 and 78 districts having concentration and potential for Handlooms and Handicrafts respectively. In the circumstances, we shall be glad if you will please issue necessary instructions to your controlling offices and branches for increasing credit flow to these sectors particularly in the identified districts. It is further advised that review of the progress made in extending credit to these sectors may be undertaken regularly in district level meetings where the representatives of these sectors also participate.

2. A list each of identified districts and of schemes evolved by NABARD for these sectors are enclosed in Annexure I and Ii respectively.

3. Please acknowledge receipt.

Yours faithfully,

 Sd/-
(R. M. JOSHI)
General Manager

ANNEXURE I

Office of the Development Commissioner (Handicrafts)
(Planning & Research Division)

List of State-wise Craft Concentration District in India

ANNEXURE II

NABARD’S REFINANCE SCHEMES FOR HANDLOOM/
POWERLOOM/HANDICRAFTS SECTORS

1. INVESTMENT CREDIT

   1. Automatic Refinance Facility (ARF) (For all agencies)

      1. Composite Loan Scheme :

         Refinance/Loan up to Rs. 50,000/- per borrower for financing block capital and/or working capital.

      2. Integrated Loan Scheme :

         Maximum refinance up to Rs. 10.00 lakhs per unit with project outlay up to Rs. 20.00 lakhs for Commercial Banks and Rs. 15.00 lakhs for other agencies.

   2. Pre-Sanction Procedure

      Schemes beyond ARF limit and upto SSI limit are eligible for refinance.

      The facilities mentioned under (i) & (ii) above are broadly classified as under:

      1. Schemes for Handloom Sector :

         • For modernisation/acquisition of looms and construction of work sheds (through all agencies)

         • Financial assistance for opening/renovation of marketing outlets -through Commercial Banks (Other agencies up to ARF limits)

         • Financial assistance for opening/renovation of emporia by Apex Weavers’ Society through Commercial Banks and State Co-operative Banks.

      2. Schemes for Powerloom Sector :

         • Financial assistance for acquisition of Powerlooms by individuals/powerloom weavers societies (through all agencies up to ARF limit).

         • Commercial Banks (CBs) and State Co-operative Banks (SCBs) can finance up to SSI limit under pre-sanction project finance.

         • Modernisation of Powerlooms - GOI scheme formulated by Manmade Textile Research Association (MANTRA) through all agencies.

         • Assistance to banks for financing acquisition of old Powerlooms from National Textile Corporation (NTC) by the workers of NTC opting for VRS.

      3. Scheme for Sericulture :

         For financing integrated development of mulberry and non-mulberry activities through all agencies.

      4. Term Loan Assistance to industrial co-opertives :

         Assistance for setting up of units up to SSI limit through SCBs under prior sanction Project finance.

      5. Margin Money Scheme :

         Assistance for meeting the shortfall in the margin money requirements stipulated under various schemes subject to certain ceilings through all agencies.

      6. Scheme for Project formulation & constancy services :

         Assistance up to Rs. 10.000/- is available to the units covered under Integrated Loan Scheme (ILS) in addition to the limits prescribed thereunder.

      7. Scheme for Infrastructural and Promotional Support through Commercial Banks and implemented by promotional agencies :

         Assistance for construction of Workshed, raw material depot, godown, transport vehicle etc.

      8. Financing of Mobiles Sales Van :

         For purchase of mobile sales van fitted with counter/shelves etc. for improving the marketing of Non-Farm products.

      9. Financing of mobile/static sales carts & kiosks :

         For purchase of such units for marketing Non-Farm products where the Bank loan does not exceed Rs. 50,000/-

      10. Promotional Schemes :

          • Promotion linked credit scheme for ancillarisation and sub-contracting/support to Mother Units.

            For providing centralised support system for various types of infrastructural and linkage support to decentralised or a cluster of ancillary units (both loan and grant) through CBs and SCBs.

          • Promotion linked credit support scheme for small, tiny, cottage and village industries in clusters: For providing centralised support system for various types of need based common facilities to a cluster of rural non-farm producing units (both loan and grant) through CBs and SCBs.

          • Assistance to Rural Women In Non-Farm Development (ARWIND): Exclusive women oriented scheme comprising both loan and grant component through all agencies.

      11. Refinance facilities under Govt. sponsored schemes :

          • Industry, Service and Business - ISB component of IRDP.

          • SC/ST Action plan out side IRDP.

          • SEMFEX-II : Assistance for setting up of non-farm units in rural areas by Ex-servicemen/widows of Ex-servicemen, disabled servicemen through all agencies.

2. MEDIUM TERM CREDIT FACILITIES :

   Assistance is provided to the grower members for purchase of shares in various processing societies through SCBs/DCCBs.

3. SHORT TERM CREDIT FACILITIES :

   1. SCBs/DCCBs :

      • Short term refinance assistance for production and marketing assistance to the Primary Weavers’ Co-operative Societies.

      • Short term refinance assistance for purchase and sale of yarn.

      • Short term refinance assistance for production and marketing activities of cottage and small scale industries.

      • Short term refinance assistance for financing rural artisans through PACS.

   2. Regional Rural Banks :

      Short term credit to Regional Rural Banks for financing working capital/marketing credit to non-farm units.

   3. Commercial Banks:

      Short term credit for financing the production and marketing needs of the Primary Handloom Weavers’ Co-operative Societies in areas, where co-operative credit structure is weak.

4. SHORT TERM CREDIT FACILITIES :

   1. Assistance is made available to the NGOs/VAs selectively for:

      • conducting REDPs/Training to Master Craftsman, Trainers’ Training Programme

      • setting up Training cum Production Centres, Artisans guilds.

      • for promoting Mother Units/Common Service Centres/Assistance for Rural Women in Non-Farm Development.

   2. Assistance is also made available to RRBs and Co-operative Banks for setting up of Technical Monitoring and Evaluation Cells and Women Development Cells.

DISTRICTS WITH A CONCENTRATION OF 5000 OR
MORE COMMERCIAL HANDLOOMS