The Hindu : National : Nod for new khadi products scheme

Online edition of India's National Newspaper
Friday, Jan 29, 2010
ePaper | Mobile/PDA Version

National

National

Nod for new khadi products scheme

P. Sunderarajan

NEW DELHI: The Union Cabinet Committee on Economic Affairs (CCEA) on Thursday approved the introduction of a market development assistance (MDA) scheme for polyvastra and khadi and khadi products, in place of the existing rebate scheme to make the sector more robust and self-reliant.

The new scheme is expected to provide for the distribution of the products throughout the year. At present, though the normal rebate was provided throughout the year, sales usually picked up only during periods when special rebates were extended.

Further, while the rebate scheme was meant only for price stabilisation, with little emphasis on quality improvement, the new scheme proposes to improve the quality of products and marketing standards and techniques, besides trying to bring in a modern and competitive trend in the entire sector.

The MDA scheme would also provide for specific earmarking and distribution of allocation and commitment of enhanced wages to artisans. The rebate scheme did not have this component.

The new scheme envisages financial assistance at the rate of 20 per cent of production value on polyvastra and khadi and khadi products, to be shared among spinners/weavers, producing institutions and selling institutions in the ratio of 25:30:45.

The Khadi and Village Industries Commission will implement the scheme, and the Ministry of Micro, Small and Medium Enterprises will monitor it. It is estimated to cost the exchequer Rs.345 crore and the expenditure will be incurred between 2010-11 and 2011-12.

Chaired by Prime Minister Manmohan Singh, the CCEA also approved certain modifications in the guidelines of the Micro and Small Enterprises Cluster Development Programme to improve the productivity and competitiveness of these ventures.

The changes include an increase in the maximum project cost for common facility centres (CFC) from Rs.10 crore to Rs.15 crore, for infrastructure development from Rs.5 crore to Rs.10 crore, and for soft loan intervention from Rs.10 lakh to Rs.25 lakh. Further, the cost ceiling for preparing a detailed project report for CFC and infrastructure development would be higher at Rs.5 lakh.

Printer friendly page
Send this article to Friends by E-Mail

National