Government has recognized the important role of entrepreneurs in the industrial development of the country, especially through the

small scale industries (SSIs).

 SSIs are essential for Indian economy in terms of employment generation, foreign exchange earnings, its share in industrial output, and contribution to national income. The government of India and state governments provides a number of special facilities and incentives.

 In order to facilitate the growth of small scale sector, the central and state governments have created an elaborate institutional framework in the country. The institutions providing assistance to small scale industries are broadly classified as All India Institutions , State Level Institutions and Fund-Based Institutions.

 Directorate of Industries The Directorate of Industries is established at a state level under the Ministry of Industry, Power and Labour . Functions of the Directorate Implementation of the industrial policy of the government Promotion of the industrial development in the sate and accelerate the speed of implementation of various industrial projects Establishment of cooperatives industrial estates.

 Registration for the small scale units Procurement of land, water, electricity of the small scale sector. Provision of financial assistance to industries. Helping the small scale units in procuring plant and machinery, scarce raw materials and machinery. Training to new entrepreneurs. Coordination between various government departments and committees established for the promotion and development of small scale industries.

 Implementation of the various financial schemes, subsidies and grants for small scale industries. Helping and rehabilitating the sick industries. Development of rural industries. Export promotion Promotion and development of agro-industries. Compilation of statistics related to indusry , trade and commerce. Marketing assistance.

 District Industries Centre (DIC): District Industries Centre (DIC) The central Government established District Industries Centres I each district of the country. Objectives of DIC Accelerate the overall efforts for industrialisation of the district. Rural industrialisation and development of rural industries and handicrafts.

 Attainment of economic equality in various regions of the district. Providing the benefit of the government schemes to the new entrepreneurs. Centralization of procedures required to start a new industrial unit and minimization of the efforts and time required to obtain various permissions, licenses, registrations, subsidies, etc.

 Small Scale Industries Development Corporation: Small Scale Industries Development Corporation Small Scale Industries Development Corporation is a state level corporation. It caters to the marketing requirements of the small scale entrepreneurs. Functions of SSIDC Assists entrepreneurs in identifying products and preparing project reports Organises entrepreneurship training programmes

 Supplies scarce raw materials at reasonable rates by procuring these materials in a bulk quantity from their main suppliers Arranges imported raw materials Provides credit facilities for raw material supplies

 Arranges for marketing assistance to products manufactured by small entrepreneurs Participates in the exhibitions to promote the products of the small entrepreneurs Arranges exhibitions of handicrafts to promote the product of the small entrepreneurs Arranges exhibitions of handicrafts to promote village and cottage industry. Provides permanent display, exhibitions and sale facilitates for small entrepreneurs

 Small Industries Service Institute (SISI): Small Industries Service Institute (SISI) Functions of SISI Technical information Workshop Technical training Economic investigation division Export promotion Modernisation Development of the market Library exhibition

 National Small Industries Corporation: National Small Industries Corporation NSIC is a national level institution . It was set up in 1955 as a central Government undertaking. The main aim of NSIC is to fulfill the requirement of machinery and equipment for the development of small entrepreneurs.

 Composite Term Loan Scheme Hire Purchase Scheme Equipment leasing Working Capital Finance Raw Material Assistance Marketing Support Programme Tender Marketing Integrated Marketing Support Government Stores Purchase Programme Technology Upgradation Software Technology Parks Exports

 The Khadi and Village Industries Commission (KVIC) is a statutory body created by an Act of Parliament in April 1957. The KVIC is supposed to do the planning, promotion, organisation and implementation of programmes for the development of khadi and other village industries in the rural areas in coordination with other agencies engaged in rural development wherever necessary.

 Coir Board is a statutory body established by the Government of India under a legislation enacted by the Parliament namely Coir Industry Act 1953 for the promotion and development of Coir Industry in India as a whole.

 There are three National Level Training Institutes. These are: National Institute of Small and Medium Enterprises (NISME), Hyderabad, which undertakes operations ranging from training, consultancy, research and education, to extension and information services.

 National Institute for Entrepreneurship and Small Business Development (NIESBUD), New Delhi, which conducts national and international level training programmes in different fields and disciplines. Indian Institute of Entrepreneurship (IIE), Guwahati was established to act as a channel for entrepreneurship development with its focus on the North East .

 DISTRICT INDUSTRIES CENTRES (DICS): DISTRICT INDUSTRIES CENTRES (DICS) The main functions of DICs are as follows: a) It conducts surveys to know industrial potential of a district keeping in view the availability of raw material, human skills, infrastructure, demand, etc. b) It prepares an action plan for industrial development. c) It appraises the various investment proposals received from entrepreneurs.

 d) It guides and assists entrepreneurs in buying appropriate machinery and equipment and raw material. e) It suggests appropriate marketing strategies to entrepreneurs. f) It maintains links with research and development institutions for upgradation of technology, quality improvement, industrial training etc. g) It conducts artisans training programmes . h) It has been assigned operation responsibility for special schemes to provide self-employment to educated unemployed youths.

 FUND-BASED INSTITUTIONS: FUND-BASED INSTITUTIONS Of all the elements that go into a business, credit is perhaps the most crucial. The best of plans can come to naught if adequate finance is not available at the right time. SSIs need credit support not only for running the enterprise & operational requirements but also for diversification, modernisation / upgradation of facilities, capacity expansion etc.

 Government of India recognised the need for a focused credit policy for SSIs in the early days of promotion of SSIs and RBI has been instrumental in devising a multi-stage approach/financial system for credit dispensation to different sectors of the economy, for example, agriculture , industry , exports, SSIs etc.

 STATE INDUSTRIAL DEVELOPMENT CORPORATIONS (SIDCS): STATE INDUSTRIAL DEVELOPMENT CORPORATIONS (SIDCS) Incorporated under the companies Act 1956 SIDCs were set up in different states as wholly owned companies for promoting industrial development in their respective states. The main functions of SIDCs are as follows: Providing term finance to all small, medium and large industrial enterprises set up in state. Underwriting and directly subscribing to shares, and debentures of debentures of industrial enterprises being set up in the state.

 Contd.: Contd. Preparing feasibility studies, conducting market surveys and motivating private entrepreneurs to set up their industrial ventures in the state. Collaborating with private entrepreneurs to set up industrial ventures in joint and assisted sector. Implementing scheme of Industrial Development Bank of India of seed capital in the state.

 Small Industries Development Bank of India (SIDBI): Small Industries Development Bank of India (SIDBI) Small Industries Development Bank of India is a development bank exclusively for the small scale industries. Established in 1990, SIDBI coordinates the long term and short term finances of commercial banks and financial institutions, gives loan assistance to entrepreneurs and also provides refinance facilities.

 Indirect and direct assistance 1. Indirect assistance a) SIDBIs financial assistance to small sector is primarily channelised through the existing credit delivery system, which consists of state level institutions, rural and commercial banks.

 b) SIDBI provides refinance to and discounts bills of Primarily Lending Institutions (PLI). c) The assistance is available for i . Marketing of SSI product ii. Setting up of new ventures iii. Availability of working capital iv. Expansion v. Modernisation vi. Human resource development vii. Diversification of existing units for all activities

 2. Direct assistance a) The loans are available for new ventures, diversification technology upgradation , modernization and expansion of well run small scale enterprises. Assistance is also available for private sector. b) Small scale sector is eligible for maximum debt-equity ratio of 3:1

 c) Foreign currency loan for import of equipment are also available to export oriented small scale enterprises. d) SIDBI also provide venture capital assistance to the entrepreneurs for their innovative ventures if they have a sound management team, long term competitive advantage and a potential for above average profitability leading to attractive return on investment.

 New Initiatives of SIDBI a) Two Subsidiaries viz. SIDBI Venture Capital Limited and SIDBI Trustee Company Limited formed to oversee Venture Capital. b) Technology Bureau for Small Enterprise formed to oversee Technology Transfer, Match making Services, Finance Syndication and facilitating Joint Ventures.

 c) SIDBI Foundation for Micro Credit has been launched to provide financial assistance to the poor and to meet emerging needs of the micro finance sector especially in rural areas.

 State Financial Corporation: State Financial Corporation Finance is another important factor of production. The easy availability of financial resources is an impetus for the speedy development of industries.

 To overcome these hurdles in the industrialization of the country, the government has established State Financial Corporation (SFC) in each state according to the provisions of State Financial Corporations Act, 1951.

 Presently following assistance is provided to small scale and medium scale entrepreneurs or units: a) Providing long term finance to industrial enterprises having sole proprietary, partnership, company and co-operative society form of business organization.

 b) Subscribing equity and debentures of industrial enterprises. c) Providing financial assistance to small and medium enterprises engaged in service sector. d) Provide working capital loans and meeting various short-term needs of their clients.