GUIDELINES ON PRIME MINISTER 'S EMPLOYMENT GENERATIONPROGRAMME (PMEGP)

1 • The Scheme

Government of India has approved the introduction of a new creditlinked subsidy programme called Prime Minister's EmploymentGeneration Programme (PMEGP) by merging the two schemes that ere

in operation till 31.03.2008 namely Prime Minister's Rojgar Yojana

(PMRY) and Rural Employment Generation Programme (REGP) forgeneration of employment opportunities through establishment of microenterprises in rural as well as urban areas. PMEGP will be a central

sector scheme to be administered by the Ministry of Micro, Small andMedium Enterprises (MOMSME). The Scheme will be implemented byKhadi and Village Industries Commission (KVIC), a statutoryorganization under the administrative control of the Ministry of MSME as

the single nodal agency at the National level. At the State level, theScheme will be implemented through State KVIC Directorates, StateKhadi and Village Industries Boards (KVIBs) and District IndustriesCentres (DICs) and banks. The Government subsidy under the Schemewill be routed by KVIC through the identified Banks for eventualdistribution to the beneficiaries / entrepreneurs in their Bank accounts.The Implementing Agencies, namely KVIC, KVIBs and DICs will associatereputed Non Government Organization (NGOs)/reputed autonomousinstitutions/ Self Help Groups (SHGs)/ National Small IndustriesCorporation (NSIC) / Udyami Mitras empanelled under Rajiv GandhiUdyami Mitra Yojana (RGUMY), Panchayati Raj institutions and otherrelevant bodies in the implementation of the Scheme, especially in thearea of identification of beneficiaries, of area specific viable projects, andproviding training in entrepreneurship development.

2. Objectives

(i)To generate employment opportunities in rural as well asurban areas of the country through setting up of new self-employment ventures/projects/micro enterprises.To bring together widely dispersed traditional artisans/ ruraland urban unemployed youth and give them self-employment opportunities to the extent possible, at theirplace.

To provide continuous and sustainable employment to alarge segment

of traditional and prospective artisans andrural and urban unemployed youth in the country, so as tohelp arrest migration of rural youth to urban areas.

(iv) To increase the wage earning capacity of artisans andcontribute to increase in the growth rate of rural and urbanemployment.

3. Quantum and Nature of Financial Assistance

Levels of funding under PMEGP

Categories of benefici i 'ar esunder PMEGP

Beneficiary scontribution(of project cost)

Rate of Subsidy(of project cost)

Area (location of project/unit)General Cat Urban RuralegoryS

10% 15% 25%pecial (including SC / ST /B

05% 25% 35%O C /Minorities/Women, Ex-servicemen, Physically

handicapped, NER, Hill andL Border areas etc.Note: (1) The maximum cost of the project /unit admissible under manufacturing sector isRs. 25 lakh.

(2) The maximum cost of the project/ unit admissible under business / service sectoris Rs . 10 lakh.(3) The balance amount of the total project cost will be provided by Banks as termloan

4. Eligibility Conditions of Beneficiaries

(i) Any individual, above 18 years of age

(ii) There will be no income ceiling for assistance for settingup projects under PMEGP.

(iii) For setting up of project costing above Rs. 10 lakh in themanufacturing sector and above Rs. 5 lakh in thebusiness /service sector, the beneficiaries should

possess at least VIII standard pass educationalqualification.

(iv) Assistance under the Scheme is available only for newprojects sanctioned specifically under the PMEGP.

(v) Self Help Groups (including those belonging to BPLprovided that they have not availed benefits under anyother Scheme) are also eligible for assistance underPMEGP.

(vi) Institutions registered under Societies RegistrationAct, 1860;

(vii) Production Co-operative Societies, and(viii) Charitable Trusts.

(ix) Existing Units (under PMRY, REGP or any other scheme

of Government of India or State Government) and theunits that have already availed Government Subsidy

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under any other scheme of Government of India or StateGovernment are not eligible.

4.1 Other eligibility conditions

(i) A certified copy of the caste/community certificate orrelevant document issued by the competent authority in thecase of other special categories, is required to be producedby the beneficiary to the concerned branch of the Banksalong with the Margin Money (subsidy) Claim.

(ii) A certified copy of the bye-laws of the institutions is requiredto be appended to the Margin Money (subsidy) Claim,wherever necessary.

(iii) Project cost will include Capital Expenditure and one cycle ofWorking Capital. Projects without Capital Expenditure arenot eligible for financing under the Scheme. Projects

costingmore than Rs.5 lakh, which do not require working capital,need clearance from the Regional Office or Controller of theBank's Branch and the claims are required to be submittedwith such certified copy of approval from Regional Office orController, as the case may be.

(iv) Cost of the land should not be included in the Project cost.Cost of the ready built as well as long lease or rental Work-shed/Workshop can be included in the project cost subjectto restricting such cost of ready built as well

as long leaseor rental workshed/workshop to be included in the projectcost calculated for a maximum period of 3 years only.

(v) PMEGP is applicable to all new viable micro enterprises,including Village Industries projects except activitiesindicated in the negative list of Village Industries.Existing/old units are not eligible (Para 29 of the guidelinesrefers).

Note:(1) The Institutions/ Production Co-operative Societies /Trusts specifically registered assuch and

SC/ ST/ OBC/ Women/ Physically Handicapped / Ex-Servicemen andMinority Institutions withnecessary provisions in the bye-laws to that effect areeligible for Margin Money (subsidy) for the special categories . However, forInstitutions /Production Cooperative Societies /Trusts not registered as belonging tospecial categories , will be eligible for Margin Money (Subsidy) for general category.

(2) Onlyone person from one family is eligible for obtaining financial assistance forsetting up of projects under PMEGP. The `family' includes self and spouse.

5. Implementing Agencies

5.1 The Scheme will be implemented by Khadi and Village IndustriesCommission (KVIC), Mumbai, a statutory body created by the Khadi andVillage Industries Commission Act, 1956, which will be the single nodalagency at the national level. At the State level, the scheme will beimplemented

through State Directorates of KVIC, State Khadi and Village

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Industries Boards (KVIBs) and District Industries Centres in rural areas.

In urban areas, the Scheme will be implemented by the State DistrictIndustries Centres (DICs) only. KVIC will coordinate with State

KVIBs/State DICs and monitor performance in rural and urban areas.KVIC and DICs will also involve NSIC, Udyami Mitras empanelled under

Rajiv Gandhi Udyami Mitra Yojana (RGUMY), Panchayati Raj Institutionsand other NGOs of repute in identification of beneficiaries under PMEGP.

5.2 Other Agencies

The details of other agencies to be associated by nodal agencies inthe implementation of PMEGP are as under:

i) Field Offices of KVIC and its State offices

ii) State KVI Boards

iii) District Industries Centre (DIC) of all State Governments/ UnionTerritories Administrations reporting to respectiveCommissioners /Secretaries (Industries).

iv) Banks/Financial Institutions.

v) KVI Federation

vi) Department of Women and Child Development (DWCD ), NehruYuva Kendra Sangathan (NYKS), The Army Wives WelfareAssociati f Ion o ndia (AWWA) and Panchayati Raj Institutions

vii) NGOs having at least five years experience and expertise inProject Consultancy in Small Agro & Rural Industrial Promotionand Technical Consultancy Services, Rural Development, SocialWelfare having requisite infrastructure and manpower and

capable of reaching Village and Taluk level in the State orDistricts. NGOs should have been funded by State or NationalLevel Government Agency for any of its programmes in thepreceding 3 years period.

viii) Professional Institutions /Technical Colleges recognized byGovernment/ University and University Grants Commission(UGC)/ All India Council for Technical Education (AICTE)having department for vocational guidance or technical coursesproviding skill based training like ITI, Rural Polytechnic, FoodProcessing Training Institute, etc.

ix) Certified KVI institutions aided by KVIC / KVIB provided these

are in category A+, A or B and are having requiredinfrastructure, manpower and expertise for the role.

x) Departmental and Non - Departmental Training Centres of KVIC/ KVIBs.

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xi) Micro, Small and Medium Enterprises Development Institutes(MSME-DIs), MSME Tool Rooms and Technical DevelopmentCentres, under the administrative control of Office ofDevelopment Commissioner, MSME.

xii) National Small Industrie C 's orporation s (NSIC) offices, TechnicalCentres, Training Centres, Incubators and Training cumIncubation Centres (TICs) set up in PPP Mode.

xiii) National level Entrepreneurship Development Institutes likeNational Institute for Entrepreneurship and Small BusinessDevelopment (NIESBUD), National Institute for Micro, Smalland Medium Enterprises (NIMSME) and Indian Institute ofEntrepreneurship (IIE), Guwahati under the administrativecontrol of Ministry of MSME, their branches and theEntrepreneurship Development Centres (EDCs) set up by theirPartner Institutions (PIs).

xiv) Udyami Mitras empanelled under Rajiv Gandhi Udhyami MitraYojana of Ministry of MSME.

xv) PMEGP Federation, whenever formed.

6. Financial Institutions

(i) 27 Public Sector Banks.(ii) All Regional Rural Banks.

(iii) Co-operative Banks approved by State Level Task Force

Committee headed by Principal Secretary(Industries) /Commissioner (Industries)

(iv) Private Sector Scheduled Commercial Banks approved by StateLevel Task Force Committee headed by Principal Secretary(Industries)/ Commissioner (Industries).

(v) Small Industries Development Bank of India (SIDBI).

7. Identification of beneficiaries:

The identification of beneficiaries will be done at the district level bya Task Force consisting of representatives from KVIC/State KVIB and

State DICs and Banks. The Task force would be headed by the DistrictMagistrate / Deputy Commissioner / Collector concerned. The Bankersshould be involved right from the beginning to ensure that bunching of

applications is avoided. However, the applicants, who have alreadyundergone training of at least 2 weeks under EntrepreneurshipDevelopment Programme (EDP) / Skill Development Prc^iarrune (SDP) /Entrepreneurship cum Skill r •..

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.^eveiopment Programme (ESDP) orVocational Training (VT) will be allowed to submit applications directly toBanks. However, the Banks will refer the application to the Task Forcefor its consideration. Exaggeration in the cost of the project with a view

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only to availing higher amount of subsidy should not be allowed. KVIC

will devise a score card in consultation with SBI and RBI, and forward itto the District Level Task Force and other State/District functionaries.This score board will form the basis for the selection of beneficiaries.This score card will also be displayed on the websites of KVIC andMinistry. The selection process should be through a transparent,objective and fair process and Panchayati Raj Institutions should beinvolved in the process of selection (Para 11 (i)(b) of the guidelines refers).

8. Bank Finance

8.1 The Bank will sanction 90% of the project cost in case of GeneralCategory of beneficiary/ institution and 95% in case of special category of

the beneficiary/institution, and disburse full amount suitably for settingup of the project.

8.2 Bank will finance Capital Expenditure in the form of Term Loanand Working Capital in the form of cash credit. Project can also befinanced by the Bank in the form of Composite Loan consisting of CapitalExpenditure and Working Capital. The amount of Bank Credit will beranging between 60-75% of the total project cost after deducting 15-35%

of margin money (subsidy) and owner's contribution of 10% frombeneficiaries belonging to general category and 5% from beneficiariesbelonging to special categories. This scheme will thus require enhancedallocations and sanction of loans from participating banks. This isexpected to be achieved as Reserve Bank of India (RBI) has already

issued guidelines to the Public Sector Banks to ensure 20 % year to yeargrowth in credit to MSME Sector. SIDBI is also strengthening its creditoperations to micro enterprises so as to cover 50 lakh additionalbeneficiaries over five years beginning 2006-07, and is recognized as aparticipating financial institution under PMEGP besides otherscheduled/ Commercial Banks.

8.3 Though Banks will claim Margin Money (subsidy) on the basis ofprojections of Capital Expenditure in the project report and sanctionthereof, Margin Money (subsidy) on the actual availment of CapitalExpenditure only will be retained and excess, if any, will be refunded toKVIC, immediately after the project is ready for commencement ofproduction.

8.4 Working Capital component should be utilized in such a way thatat one point of stage it touches 100% limit of Cash Credit withili threeyears of lock in period of Margin Money and not less than 75% utilization

of the sanctioned limit. If it does not touch aforesaid limit, proportionateamount of the Margin Money (subsidy) is to be recovered by theBank/Financial Institution and refunded to the KVIC at the end of thethird year.

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8.5 Rate of interest and repayment schedule

Normal rate of interest shall be charged. Repayment schedule mayrange between 3 to 7 years after an initial moratorium as may beprescribed by the concerned bank/financial institution. It has beenobserved that banks have been routinely insisting on credit guaranteecoverage irrespective of the merits of the proposal. This approach needsto be discouraged.

RBI will issue necessary guidelines to the Banks to accord priorityin sanctioning projects under PMEGP. RBI will also issue suitable

guidelines as to which RRBs and other banks will be excluded fromimplementing the Scheme.

9. Village Industry

Any Village Industry including Coir based projects (except thosementioned in the negative list) located in the rural area which produces

any goods or renders any service with or without the use of power and inwhich the fixed capital investment per head of a full time artisan orworker i.e. Capital Expenditure on workshop/ workshed, machinery andfurniture divided by full time employment created by the project does notexceed Rs. 1 lakh in plain areas and Rs.1.5O lakh in hilly areas.

10. Rural Area

(1) Any area classified as Village as per the revenue record of theState/Union Territory, irrespective of population.

(ii) It will also include any area even if classified as town, provided itspopulation does not exceed 20,000 persons.

11. Modalities of the operation of the Scheme

(i) Project proposals will be invited from potential beneficiaries atdistrict level through press, advertisement, radio and other multi-

media by KVIC,KVIBs and DICs at periodical intervals dependingon the target allotted to that particular district. The scheme willalso be advertised /publicized through the Panchayati RajInstitutions which will also assist in identification of beneficiaries.

(a) Sponsoring of project by any agency is not mandatory. The

beneficiary can directly approach Bank/Financial Institution alongwith his/her project proposal or it can be sponsored by KVIC/

KVIBs / DIC/Panchayat Karyalayas etc. However, the applicationsreceived directly by the Banks will be referred to the Task Force forits consideration.

(b) A Task Force, consisting of the following members, will be set up toscrutinize the applications received by it.

Dist Magistrate/ Deputy Commissioner/ Collector - ChairmanLead Bank Manager - MemberRepresentative of KVIC/KVIB - MemberRepresentative of NYKS/SC/ST Corporation - Special InviteeRepresentative of MSME-DI, ITI/Polytechnic - Special InviteeRepresentatives from Panchayats - 3 members(To be nominated by Chairman/ DistrictMagistrate/ Deputy Commissioner/ Collectorby rotation)

General Manager, DIC or State Director of KVIC -Member Convenor

Note : Task Force may also co-opt representatives of other lending institutions.

(c) The Task Force will scrutinize the applications and based on the

experience, technical qualification, skill, viability of the projectetc., the task force will shortlist the applications and call for aninterview of the applicants separately for rural and urban areas

to assess their knowledge about the proposed project, aptitude,interest, skill and entrepreneurship abilities, market available,sincerity to repay and make the proposed project success. Theselected candidates will be provided project formulation guidance

and orientation by KVIC, KVIBs and DICs who will also assistand guide them in project formulation and submission to theconcerned Bank in the area. The applicants may also approachany of the other agencies listed in para 5.2 of these guidelines forassistance in this regard.

(d) KVIC will identify the Nodal Banks at State level in consultationwith State Governments and will forward the list to all theimplementing agencies.

(ii) The release of funds to the implementing agencies will be in thefollowing manner:-

(a) Government will provide funds under PMEGP to the nodal

implementing agency, i.e. KVIC which will in turn, (within aperiod of 15 days of receipt of the money from theGovernment), place the margin money (subsidy)funds with theimplementing Banks at the State level in their respectiveaccounts in accordance with the targets allocated to eachimplementing agency. CEO, KVIC will convey the marginmoney (subsidy) targets allotted to each State to the PrincipalSecretaries/ Secretaries (Industries)/ Commissioners(Industries) simultaneously. The target among the Districts inthe State will be assigned by the State Level Bankers

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Coordination Committee. SLBCC will ensure that targets areevenly distributed within each district. The State-wise targetsin respect of KVIC/KVIBs will be made available by KVIC to

SLBCC where overall allocation of district-wise targets will bedecided. Any modification of the targets for which KVIC isdirectly responsible will be permitted only with theconcurrence of the Ministry.

(b) KVIC will place the margin money (subsidy) amount with theBanks involved in the implementation of the scheme in

accordance with the targets allocated to the implementingBanks in the State/ District. DICs, in close coordination withBanks, will ensure that at least 50 % of the total marginmoney (subsidy) allocated to them will be utilized in setting upof projects in rural areas.

(c) KVIC being the single Nodal Agency at the National level, willcoordinate with the identified implementing agencies, i.e.,KVIBs, DICs and others. KVIC will carry out most of theimportant tasks envisaged in the forward and backwardlinkages, including e-tracking, web management, publicity,physical verification of units, organizing EDP trainingprogrammes, awareness camps, workshops and exhibitionsand therefore will require to utilize major share of the

allocation under forward and backward linkages. However,KVIC will ensure that it will reserve and allocate at least 25 %of the total allocation under Forward and Backward linkages,

under the Scheme to DICs of different participating Statesappropriately taking into account the demand and extent ofimplementation. This money will be released to DICs, onlyafter obtaining an undertaking from the State Governmentthat the funds already provided under the erstwhile PMRY

Scheme's Training and Pre motivational campaigns have beenfully utilized by the DICs. Any unspent balance availableunder the training and contingencies of erstwhile PMRYScheme will be utilized for training and relevant expenditure

under PMEGP. DICs will submit monthly utilization report toKVIC in this regard.

(d) The Task Force, under the chairmanship of DistrictMagistrate/ Deputy Commissioner / Collector will holdquarterly

meeting with the Banks at district level to reviewthe status of the project proposals. Wherever the projects arerejected, shortcomings/ reasons will be furnished by the

concerned Banks to the implementing agencies concerned andthe applicants concerned will be requested by KVIC/KVIBs /

DICs to provide additional information/ documents if requiredand concerned representatives of KVIC, KVIBs and DICs, willprovide assistance to the applicants in this process. Since theBank's representative will also be a member of the Task Force,

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it needs to be ensured that maximum number of projects,cleared by the Task Force, is sanctioned by the Banks.Chairman of the District Task Force will review theperformance of Banks and the loan repayment / recoverystatus in the quarterly review meetings.

(e) Banks will take their own credit decision on the basis ofviability of each project. No collateral security will be insistedupon by Banks in line with the guidelines of RBI for projectsinvolving loan upto Rs. 5 lakh in respect of the projectscleared by the Task Force. However, they will appraise projectsboth technically and economically after ensuring that eachproject fulfills inter alia the criteria of

(a) Industry(b) Per Capita Investment(c) Own Contribution

(d) Rural Areas (projects sponsored by KVIC/KVIBs/DICs) and

(e) Negative List (Para 29 of the guidelines refers)It is essential that the applications cleared by the District TaskForce also fulfill these requirements at that stage itself so as toavoid delays in approval of loans in Banks.

(f) Once the project proposals are received by KVIC, KVIBs, DICsor Banks, the details of such proposals are to be fed in theweb based application tracking system with a uniqueregistration number for each beneficiary at the District levelby the State Offices of KVIC/State KVIBs/State DICs to enablethe entrepreneurs to track their application status at anypoint of time. Till such time the e-tracking system becomesfully operational (for which detailed guidelines will be issuedby KVIC separately to all concerned) disaggregated data inrespect of progress of each application, assistance availed bybeneficiaries belonging to special categories (category wise),employment details, etc., will be maintained byKVIC/KVIBs/DICs and the data will be reconciled everymonth with Director (PMEGP) in KVIC. The status of suchreconciliation will be reviewed by the District Magistrate /Deputy Commissioner / Collector, in the Task Force meetingsand by CEO, KVIC in the review meetings at KVIC. Separatecolour code will be given to application form as well asapplications/claim forms of Margin Money (subsidy) throughKVIC/KVIBs/DICs, so as to help the beneficiaries and the tiprocessing/ sanctioning functionaries to identify and monitorthe progress of implementation.

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(g) Once the project is sanctioned and before the firstinstallment of the Bank Finance is released to thebeneficiary , Bank will inform the State / Regional Office ofthe KVIC/ KVIBs / State DICs , as the case may be, forarranging EDP training (Para 12 (1) of the guidelines refers)to the beneficiary , if he /she has not already undergonesuch training. If he/she has already undergone suchtraining of at least 2 weeks duration, either with the trainingcentre of KVIC/KVIB /State DICs or the institutionsrecognized by or under the administrative control of Ministryof MSME or at any other training centre of repute, suchbeneficiary need not undergo further EDP training.

(h) First installment of the loan will be released to thebeneficiary only after completion of EDP training of at least 2weeks (Para 12 of the guidelines refers) specially designed forthe purpose, which will be organized by KVIC / KVIBs / DICsor the institutions recognized by or under the administrative

control of Ministry of MSME or at any other training centre ofrepute. Those who have already undergone training from therecognized institutions need not undergo further EDP training.

(i) After the successful completion of EDP training arranged bythe KVIC/KVIBs/State DICs, the beneficiary will depositwith the bank , the owner 's contribution . Thereafter, thebank will release first installment of the Bank Finance to thebeneficiary.

(j) Projects sanctioned will be declared ineligible for MarginMoney (subsidy) assistance if the EDP training is notcompleted.

(k) After the release of Bank finance either partly or fully, Bankwill submit Margin Money (subsidy) claim in the prescribedformat to the designated Nodal Branch of the State/Regionwhere KVIC has placed lump sum deposit of Margin Money(subsidy) in advance in the Savings Bank Account in the nameof KVIC, for release of Margin Money (subsidy). In the case ofprojects financed by the branches of the Regional RuralBanks, the financing branches of the RRBs will have to submitthe Margin Money (subsidy) Claim to their Head Office, which,in turn, will submit the consolidated claims to the designatedNodal Branch of their sponsoring Bank. In the case ofprojects financed by SIDBI, the guidelines issued by SIDBI forrelease of loan/margin money (subsidy) will be followed.Though the margin money (subsidy ) will be released by thedesignated Nodal Branch of the Bank , KVIC /State DIC isthe final authority to either accept the project/claim orreject , based on the parameters of the Scheme . Detailedgrounds for rejections shall be maintained by

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KVIC/KVIBs/DICs. A separate system of acknowledginggrievances or complaints will be instituted by KVIC/KVIBsand DICs and a monthly report with the details of grievances /complaints received and the status / action taken for theirredressal shall be furnished to CEO, KVIC by KVIBs and DICs.A consolidated report will be forwarded to the Ministry ofMSME every quarter by CEO, KVIC.

(1) Once the Margin Money (subsidy) is released in favour of theloanee, it should be kept in the Term Deposit Receipt of threeyears

at branch level in the name of thebeneficiary/ Institution. No interest will be paid on the TDRand no interest will be charged on loan to thecorresponding amount of TDR.

(m) Since "Margin Money" (subsidy) is to be provided in the formof subsidy (Grant), it will be credited to the Borrowers loanaccount after three years from the date of first disbursementto the borrower/ institution, by the Bank.

(n) In case the Bank's advance goes "bad" before the three yearperiod, due to reasons, beyond the control of the beneficiary,the Margin Money (subsidy) will be adjusted by the Bank toliquidate the loan liability of the borrower either in part or full.

(o) In case any recovery is effected subsequently by the Bankfrom any source whatsoever, such recovery will be utilized bythe Bank for liquidating their outstanding dues first. Anysurplus will be remitted to KVIC.

(p) Margin Money (subsidy ) will be 'one time assistance', fromGovernment. For any enhancement of credit limit or forexpansion/ modernization of the project, margin money(subsidy) assistance is not available.

(q) Margin Money (subsidy) assistance is available only for newprojects sanctioned specifically under the PMEGP. Existingunits are not eligible under the Scheme.

(r) Projects financed jointly i.e. financed from two differentsources (Banks / Financial institutions), are not eligible forMargin Money (subsidy) assistance.

(s) Bank has to obtain an undertaking from the beneficiary beforethe release of Bank Finance that, in the event ofobjection (recorded and communicated in writing) by KVIC/KVIB/State DIC, the beneficiary will refund the MarginMoney (subsidy) kept in the TDR or released to him afterthree years period.

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(t) Banks / KVIC / KVIBs / DICs have to ensure that eachbeneficiary prominentlydisplays the following sign- board atthe main entrance of his project site:-

. (Unit Name)

Financed By... (Bank), District Name

UnderPrime Minister's Employment Generation

Programme (PMEGP)

MiMi=roof Micro , Small and Medium Enterprises

(u) Margin Money (subsidy) Claim will be submitted by the

Financing Branch of the Bank to the designated Nodal Branchat the earliest possible time.

12. Entrepreneurship Development Programme (EDP)

12.1 The objective of EDP is to provide orientation and awarenesspertaining to various managerial and operational functions like finance,production, marketing, enterprise management, banking formalities,bookkeeping, etc. The duration for EDP under REGP was only 3 days,whereas, under PMRY it was 10 days.discussions and recommendations of DepartmDuring various meetings,

ent Related ParliamentaryStanding Committee for Industry (DRPSCI) it was felt that 3 days werenot adequate for providing this inputs effectively and, hence two tothree weeks

period has been provided under PMEGP which will includeinteraction with successful rural entrepreneur, banks as well asorientation through field visits. The EDP will be conducted through

KVIC, KVIB Training Centers as well as Accredited Training Centers runby Central Government, NSIC, the three national level EntrepreneurshipDevelopment Institutes (EDIs), i.e., NIESBUD, NIMSME and IIE, and

their partner institutions under the administrative control of Ministry ofMSME, State Governments, Banks, Rural Development and SelfEmployment Training Institutes (RUDSETI) reputed NGOs, and otherorganizations / institutions, identified by the Government from time to

time. EDP will be mandatory for all the PMEGP beneficiaries. However,the beneficiaries who have undergone EDP earlier of duration not lessthan two weeks through KVIC/KVIB or reputed training centers will beexempted from undergoing fresh EDP. The training centres / institutes

will be identified by KVIC and extensive publicity will be provided aboutthe training centres / institutes, content of courses available, duration,etc. by circulating the same to all the Implementing Agencies.

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12.2. Budget for EDP Charges to the Training Centers

An amount of Rs. 2500/- to Rs.4000/- per trainee for a period of twoto three weeks towards course material, honorarium to guest speakers,lodging, boarding expenses, etc. is admissible under the Scheme. KVIC

will reimburse the expenditure to the training centres / institutes chosenfor the purpose, in accordance with the procedures to be separatelydevised by it and circulated to KVIBs and DICs.

13. Physical verification of PMEGP Units

100% physical verification of the actual establishment andworking status of each of the units, set up under PMEGP, includingthose set up through KVIBs and DICs, will be done by KVIC, through theagencies of State Government and/or, if necessary by outsourcing thework to professional institutes having expertise in this area, following theprescribed procedures as per General Financial Rules (GFR) of

Government of India. Banks, DICs and KVIBs will coordinate and assistKVIC in ensuring 100 % physical verification. A suitable proforma will bedesigned by KVIC for such physical verification of units. Quarterlyreports, in the prescribed format will be submitted by KVIC to theMinistry of MSME.

14. Awareness Camps

14.1 KVIC and State DICs will organize awareness camps, in closecoordination with each other and KVIBs, throughout the country to

popularize PMEGP and to educate potential beneficiaries in rural, semirural and urban areas about the Scheme. The awareness camps willinvolve participation from the unemployed men and women with specialfocus on special category, i.e., SC, ST, OBC, Physically challenged, Ex-servicemen, Minorities, Women, etc. The requisite information /details inthis regard will be obtained by KVIC/KVIBs/DICs from State levelorganizations like SC/ST Corporations, AWWA, NYKS, reputed NGOs andEmployment exchanges. There will be two camps permissible for adistrict, one by KVIC in coordination with concerned KVIB and anotherby DIC. KVIC and DIC should preferably consider organizing thesecamps jointly for a specific district. A Committee consisting of LeadBank, KVIC/KVIB/DIC and Principal, Multi Disciplinary TrainingCentres (MDTC) of KVIC will shortlist the beneficiaries and send them fortraining as well as RICS for project formulation and to Bank for project •sanction. The amount specified can be spent on publicity, arrangement Pand other necessary expenses for organizing such camps, which will becommunicated by KVIC in their guidelines separately.

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14.2 Mandatory activities to be undertaken in the awarenesscamps:

(i) Publicity through banners, posters, hoardings and pressadvertisements in local newspapers.

(ii) Presentation on the scheme by KVIC/KVIB /DIC officials.(iii) Presentation by Lead Bank of the area.

(iv) Presentation N su.

M Distribution of sanction letters to PMEGP entrepreneurs whohave been sanctioned the project by Bank.

(vi) Press conference

(vii) Collection of data (in the prescribed format ) from the potentialbeneficiaries , which will include information like profile ofbeneficiaries , skills possessed , background and qualifications,experience , project interested in, etc . For ascertaining thetraining (

as described in para 12 of the guidelines) a committeeconsisting of representatives of Lead Bank

, KVIC, KVIB, DICand Principal ,MDTC will shortlist the beneficiaries and send

them for orientation and training . They will also be sent toRICS and Banks for project formulation and project sanction,respectively.

viii) A Shelf of Projectsfor consideration under PMEGP, prepared by

KVIC has already been circulated by KVIC/Ministry to some ofthe prominent State Industries Secretaries and Banks includingState Bank of India, Central Bank of India, Canara Bank,

Allahabad Bank and Union Bank of India. For any furtherinclusion of projects in the shelf already prepared, KVIBs andDICs shall forward the details of such projects to KVIC. KVIC

will in turn, expand the Shelf of Projects, in due course, inconsultation with Banks, KVIBs and DICs, by utilizing the

provisions in Training and Orientation' under forward andbackward linkages.

(ix) Marketing Support

(a) Marketing support for the pr3ducts, produced by the unitsunde1 Pivlr. p may be provided through KVIC's MarketingSales outlets, as far as possible. KVIC will reserve the right

provide such a support based on quality, pricing andother parameters to be separately circulated by KVIC toKVIBs/DICs.

(b) Besides the above, Exhibitions, Workshops at District/State

Zonal/National and International levels, Buyer-Seller Meets,

y ccessful PMEGP/REGP Entrepreneurs

15

etc., will be arranged for the benefit of PMEGP beneficiariesby KVIC.

15. Workshops

a) Objectives

(i) To brief potential beneficiaries about benefits under the

PMEGP Scheme and other KVIC Schemes like PRODIP,SFURTI, etc.

(ii) To create a Data Bank of PMEGP units regarding productsproduced, services /business activity details, production,supply capacity, present marketing set up employment andproject cost, etc.

(iii) To interact with PMEGP entrepreneurs to obtain feed backabout the units, their problems, support required, successstories etc.

(iv) To involve experts in marketing and export to support PMEGPunits in these areas.

Note : (i). It should be ensured that a minimum number of 200 prospective entrepreneursparticipate in the Workshop.

(ii) One State level Workshop for KVIC and one for DIC are permissible.(iii) KVIC and DIC may consider organizing these Workshops jointly in a specific State(iv) One representative of KVIC and DIC will participate in each Workshop.

b) The State Level Workshop will include the following activities:.

1. Presentation of PMEGP Scenario of the State.

2. Presentation of views of Banks on PMEGP by senior officials oflead Bank in the State.

3. Sharing of experience and success stories by PMEGP/REGPentrepreneurs, providing special emphasis to entrepreneursbelonging to special categories.

4. Briefing about support Schemes of KVIC like ProductDevelopment, Design Intervention and Packaging (PRODIP),Rural Industrial Service Centres (RISC), Scheme of Fund forRegeneration of Traditional Industries (SFURTI), Micro andSmall Enterprises Cluster Development Programme(MSECDP), Credit Linked Capital Subsidy Scheme forTechnology Upgradation (CLCSS), Credit Guarantee FundTrust for Micro and Small Enterprises (CGTSME), etc.

5. Briefing about support schemes related to cluster andmarketing by NABARD and SIDBI.

16

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6. Utilizing the services of NYKS, MWCD, AWWA for involving therural Youth, weaker sections, women, minorities, ex-servicemen, physically challenged, war widows in PMEGP.

7. Presentation on Domestic and Export Market Potentialavailable, by Marketing experts.

8. Open house discussion with PMEGP entrepreneurs on

implementation issues, constraints encountered, furthersupports required, etc., and arriving at possible solutions.

1) - Data collection of PMEGP entrepreneurs in the prescribedformat.

10. Arranging the exhibition cum sale of PMEGP products.

11. Formation of PMEGP Federation.

12. Press conference.

(c) KVIC will be co ordinating these workshops and will get the annualcalendar of workshops approved by the Ministry, in advance.

16. Exhibitions

PMEGP Exhibitions will be organized by KVIC at National, Zonal,State and District Levels and special exhibitions for North Eastern Zonein co ordination with KVIBs and DICs, to promote products produced by

PMEGP units. KVIC will get the annual calendar of exhibitions to beconducted at various parts of the count D'advance. Se , approved by the Ministry in

Separate pavilions will be provided for display of productsproduced by units set up through KVIBs/DICs. Separate logos andnomenclature for rural entrepreneurs and urban entrepreneurs will beworked out by KVIC/KVIBs/DICs. For example, for rural PMEGPexhibitions nomenclatures like GRAMEXPO, GRAMUSTAV, GRAM MELA,

etc., may be used. KVIC, in coordination with KVIBs and DICs will beorganizing one district level exhibition (per district), one State levelexhibition and one Zonal level exhibition, annually.

17. Participation in International Exhibitions

Participation by PMEGP units is envisaged in InternationalExhibitions like India International Trade Fair (IITF), etc., for developingtheir export market. KVIC will organize participation in the internationalexhibitions in coordination with KVIBs and DICs and will seek the list ofwilling units from KVIBs and DICs. KVIC will ensure that the unitsdesirous of participating in the fair, set up through KVIBs and DICs areconsidered judiciously on the basis of merit, variety and quality of theproducts. A maximum amount of Rs. 20 lakh will be provided to meetexpenditure on rental charges for pavilion, fabrication of stalls and

17

towards display, demonstration etc. KVIC may meet the rest of theexpenditure out of its regular marketing budget provisions.

18. Bankers Review Meetings

PMEGP is a bank driven scheme and the final sanction of projectand release of loan is done at the level of concerned Bank. It is thereforeimperative that KVIC, KVIBs and DICs interact regularly with the higherofficials of Bankers at District/ State/National level to ensure that thebottle necks, if any, in implementation, are resolved, outcomes areeffectively achieved and targets are met. Bankers Review Meeting atfollowing levels shall be organized as below:

(i) Lead District Managers Meet(LDM): This will be organized by State

Office and Divisional Office of KVIC jointly with KVIB and DIC. Thefocus of the meeting will be to inform and educate the bank officialsat LDM level about PMEGP and regularly monitor and review theimplementation of the scheme. The meeting will be held onuarterl basis.

(ii) Zonal review meeting: To review and monitor the PMEGP scheme,

zonal review will be conducted quarterly by KVIC in 6 zones whererepresentatives of KVIC, KVIB and DIC will participate in the review.Concerned Bank officers will also be invited.

(iii) Top level Bankers Meeting: KVIC will organize the Top Level

Bankers meeting half yearly (in June and December) so that proper

monitoring can be done at the beginning and towards the end of thefinancial year. CMDs/Senior Executives of nationalized Banks,representatives from Ministry of MSME, State DICs and KVIBs willparticipate in the National level Bankers meeting which will be

chaired by CEO, KVIC. All the States/UTs will be invited in twogroups and KVIC will ensure that around half of the States/UTs'

representatives (of KVIBs and DICs) participate in each of these halfyearly review meetings. The meeting will focus on reviewing thetargets and will examine the issues related to policy decisionsrelating to banks for the implementation of PMEGP.

19. Orientation and Training under PMEGP

The staff and officers of KVIC, KVIB, DIC and concernedagencies have to be sensitized on the operational modalities of PMEGPwhich can be imparted in the `one day training workshops' to beconducted throughout the country at State / District levels by KVIC (incoordination with KVIBs) and DICs. 40 such programmes per year willbe organized by KVIC and DICs (each). KVIC and DICs may organize

18

0

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such training workshops jointly, wherever feasible, on theguidelines to be issued by KVIC separately, for this purpose. basis of

20. TA/DA of Staff and Officers

The officers of KVIC, KVIBsvisits and monitoring activities of PM

andEGpICs will carry out relevant field

Year is proposed towards TA/DA Provision of Rs. 1 crore perrPMEGP A of staff and officers for monitoring andreviewing

evie , which includes administrative expenses likestationery, documentation, contingencies, etc., and around 40% of thi

amount can be earmarked for DICs.into KVIC will issue separate isincorporating the detailed modalities of certification of the slaying down the norms for such field visits so as to otim expenditure,assistance and ensure eld visi

in expenditure.

21. Publicity and promotional activities

21.1 pMEGP Should becampaigns inclo Popularized through aggressive

g posters, banners publicitytelevision messages, advertisements in local hoardings, radio jingles,also involving Wlps and distinguished papers, press conferences,

guests in major events of pMEGP.21.2 Release of advertisement /publicity for PMEGP.

Advertisement will be issuedlocal language newspapers. For

istribclts leelinevents,

English, Hindi and

advertisement will be released and for State level events, q halfea pageadvertisement will be released. a page

Keeping in view the significance ofactivities required to be undertaken for PMEGP, an and nt of Rs.16

Crore will be allocated during the four years period. amount n s will

be earmarked by KVIC to DICs for release of advertise25 %ment/ of uud willthe Scheme, in accordance with the guidelines framed b publicity

whileensuring maximum coordination and synergy KVIC whileDICs. gy of efforts with KVIBs and

22. MIS Package , Application Trackinsupporting packages g System , E-Portal and other

22.1 E-governance is a vital requirement for effective monitorinreviewing of the scheme. g and

addition,as well as PMRY have also^ to data base

be documented.of existing REGP

PMEGP website will be constructed by A separatelinkages with Ministry of MSME, State IKVIBincluding all the relevantproviding all the necessary NIC and Banks,also be introduced b information. Application tracking system willby

KVIC in coordination with KVIBs / DICs for

19

PMEGP beneficiaries. In addition Rural Industrial Consultancy Services(RICS)'s software package for project preparation of KVIC will beextended to all training centers in the country for assisting potentialbeneficiaries to prepare project under PMEGP. A separate provision isavailable under forward-backward linkages for the purposes for use byKVIC.

22.2. KVIC will issue further guidelines in regard to utilization offunds for the purposes outlined in the backward and forwardlinkages by ensuring proper documentation etc., from KVIBs andDICs. Proper account of the expenditure in this regard will bemaintained by State/ KVIBs/ DICs and monitored by KVIC regularly.

23. Proposed Estimated Targets under PMEGP

23.1 The following estimated targets have been proposed underPMEGP during the four years, i.e., from 2008-09 to 201 1-12.

Note: an amount of Rs.250 crore has been earmarked for backward andforward linkages.

2. To begin with, the targets would be distributed between KVIC (includingState KVIBs) and State DICs in the ratio of 60:40 to ensure comparativelygreater emphasis to micro enterprises in rural areas. The margin moneysubsidy would also be allocated in the same ratio . DICs will ensure thatat least 50% of the amount allocated to them will be utilized in the ruralareas.

3. The annual allocation of targets would be issued State-wise to the implementingagencies.

Year

2008-09

Employmentin Nos616667

Margin Moneysubsid Rs.crore

740.002009-10 740000 888.002010-11 962000 1154.402011-12 1418833 1702.60Total

1. An additio l3737500 4485.00

23.2 Criteria for distribution of targets under PMEGP

The following are the broad suggested criteria for distribution ofstate-wise targets:

(i)(ii)(iii)

Extent of backwardness of State;Extent of unemployment;

Extent of fulfillment of targets under PMRY and REGP in2007-08;

(iv) Extent of recovery of loans under PMRY and REGP in2007-08;

(v) Population of State/Union Territory; and(vi) Availability of traditional skills and raw material.

20

I

23.3 KVIC will assign targets to State KVIC Directorates KVIgs andState Governments. Target at District levels will be decided b

y StateBankers Coordination Committee. SLBCC will ensure that targ Level

evenly distributed within each district. The State-wise targets in resareof KVIC/KVIBs will be made available b

yallocation of district-wise targets will be decided. toAny moddioicatio overall

targets for which KVIC is directl responsible will be permitted of thethe concurrence of the Minis Y Permitted only with

try- KVIC will ideBranches in consultation with State Governments and tl

acNodal Bank

Money (subsidy) with these branches both for rural p e the Marginassigning the targets of subsidy parameter

and urban areas. Foremployment opportunities, etc.) to KVIC Di eorats (number

KVIC will

adopt the criteria of rural population of the State, backwardness of wil lState (based on 250 backward districts identified

by PlanningCommission) and past performance of the State under REGP Scheme forgdeciding the targets as per weightages given below.assigning the targets to DICs, Sim

KVIC will adopt he forbackwardness of the State (based on 250 abackward d stricts identified byPlanning Commission), urban unemployment level (as reflected in the

Planning Commission's report (2002) on `Special Group on tar etin thetmillion employment opportunities per year' and rural o g g en

State. From the second year i.e. P pulation of the

PMEGP during the previous year(s) will also begiven approriate

for deciding the targets. The approximate we ghtages to beassigned for determining the targets to the implementing agencies arebelow. e

24. Rehabilitation of Sick Units

Sick units under PMEGP for their rehabilitation will be linked withRBI's Guidelines for rehabilitation of sick small scale industrial unitsissued to all Scheduled CommercialRPCD.No.PLNFS.BC.57/06.04.0110

2 01 002 dated 16th January, letter2002.

25. Registration

Registration with the KVIC/KVIBs/State DICs under the Scheme isvoluntary. No registration fee will be charged from the beneficiaries andthe funds available under Forward and Backward linkage will be utilizedto meet expenses on documentation cost, etc.

21 .

Beneficiary will submit quarterly report about production, sales,employment, wages paid etc. to the State/ Regional Director of theKVIC/KVIB/State DIC, and KVIC will in turn analyze and submit aconsolidated report to the Ministry of MSME, every six months.

26. Role of Private Sector (Scheduled , Commercial / Co-operative)Banks in the implementation of PMEGP

The Scheme will also be implemented through the Private SectorScheduled Commercial Banks/Co-operative Banks on selective basis,after verification of intending Banks' last 3 years' Balance Sheet andascertaining quantum of lending portfolio. Margin Money (subsidy)portion will be paid on actual reimbursement basis to the Banks byKVIC.

27. Monitoring and evaluation of PMEGP

27.1 Role of Ministry of MSME

Ministry of MSME will be the controlling and monitoring agency forimplementation of the scheme. It will allocate target, sanction andrelease required funds to KVIC. Quarterly review meeting will be held inthe Ministry on the performance of PMEGP. CEO, KVIC, PrincipalSecretaries / Commissioners (Industries) responsible for implementationof the Scheme in States through DICs, Representatives of State KVIBsand Senior officials of Banks will attend the meeting.

27.2 Role of KVIC

KVIC will be the single Nodal Implementing Agency of the Schemeat the National level. CEO, KVIC will review the performance with State

KVIBs, DICs and Banks every month and submit a monthly performancereport to the Ministry. The report will include the component wise detailsof beneficiaries indicating the amount of the Margin Money (subsidy)

allotted, employment generated and the projects set up. KVIC will ensure

that the margin money (subsidy) is utilized as per the sub componentplans approved for SC, ST, Women, etc. The targets and achievementwill also be monitored at the Zonal, State and District levels by the

Dy.CEOs, Directors of KVIC and the Commissioner /Secretary of •Industries (DIC), of the States concerned. The existing REGP units will

continue to be monitored by the KVIC as hitherto fore, and separate •monthly report submitted directly to Ministry of MSME.

22

I

3 Role of State Governments / Union Territories

The Scheme will be reviewed half 1by Chief SecretaryRepresentatives KVIC, Y of theState.

IB SecretaryRepresentatives , Ministry of MSME, State Director (KVIC)

CEO, KVr/ Commissioner (Industries) of the State, Senior

(cials of the Banks and other officials concerned will attend thedng. State Governments {Commissioners

foruvard their monthly reports to KVIC, specifying rthe (Inducomponentuse details of beneficiaries indicating the amount of the Margin Money

(bsidY) allotted, employment generated and the projects set up, whichbe analyzed, compiled and consolidated b

comprehensive report forwarded to Ministry eve y KVIC and a

Alj;,fRy units will continue to be monitored by the tatenDICs,ras hithertofps d report submitted directly to Ministry of MSME.

28• Evaluation of the Scheme

A comprehensive, independent and rigorous evaluation of thescheme will be got done after two years of its implementation. Based onto findings of the evaluation study the scheme would be reviewed.

29• Negative List of Activities

The following list of activities will not be permitted under PMEGPfor setting up of micro enterprises/ projects /units,

a) Any industry/business connected with Meat(slauehtered iprocessing, canning and/or serving items made of it as food,

p cluction/manufacturing or sale of intoxicant items like Beedi/PanCrgar/Cigarette etc., any Hotel or Dhaba or sales outlet servin /

g liquor,p,'Ixatiori/producing tobacco as raw materials, tapping of toddy forsale•

b) Any Industplanation ry/business connected with cultivation of crops/

like Tea, Coffee, Rubber etc. sericulture (Cocoon rearing),j4orticulture, Floriculture, Animal Husbandry like Pisciculture,Poultry, H Pie

^'vester machines etc. gg rY,

c) Manyfacturing of Polythene cthickness carry bags of less than 20 microns

ahd manufacture of carry bags or containers made of recycledy other i Itoring, carrying, dispensing or packaging of food stuff and

t:ern which causes environmental problems.

Industries such as processing of Pashmina Wool andproducts likhadi Progr a hand spinnin such other

amme under the g and hand weaving,Certification taking

tofDales rebate purview of

Rural l

Ruleseandavailing

land Rural

(Except Auto Rickshaw in Andaman & Nicobariokshao''(' se Boat, Shikara & Tourist Boats in J&K and Cycle

23

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'ttflW : KVIC/ KVIB/DIC

APPLICANT ID: ( OFFICE USE) I

APPLICATION FORM FOR FINANCIAL ASSISTANCE UND ER PRIMEMINISTER ' S EMPLOYMENT GENERATION PROGRAMME (PMEGPI

Preference for sponsoring agency of the project to Bank: (mark.)

KVIC

TO

KVIB DIC Rural Urban

PHOTO

Details in blocks should be entered in CAPITAL LETTERS only

1. Name of the a plicant/ Institution Name

2. Date of Birth

3. Sex I Male

D D M Y

Female

Y Y Y

14.Father ' s name / Spouse's Name / Contact Person Name (if Institution):

^ I I I I I I5. Communication Address:

Taluk/Block:District: F

Email:

6. Address of proposed location of unit

Taluk/Block:District:

Contact No

Rural Urban

7. Name of the preferred Bank Name & Address in the area for Projectsanction

Bank Name:Address:

8. ualification

Taluk/BlockDistrict:

Branch Code:

Academic Technical

9. Whether Entrepreneur Development Programme(EDP at least 2 weeks ) undergone : (mark 3 ) Yes No

Name & Address of Training InstitutePeriod traii

10. Whether the a licant belongs to mark 3

SC ST OBC PHC Ex- Hill BoarderServiceman Minority

Area

11.Whether the project for Manufacturing( k 3mar ) unit

12. Name of the project / business activity proposed:

13. Amount of loan requiredBuildingType(own/

leased/Rented)

in Rs.(Ca ital E^xpenclit u re Loan

Work shed,Building etc

Machinery &equipment

. Preoperative

Cost

General

Business/Service

unit

Workingcapital/cashcredit Limit

Tota l

14. Details of earlier or current Loan /grant and sub ids y availed fromCentral state Govt . Scheme or any other similar scheme.Activity of the Project with Amount( In Rs.

Address Year of Sanction

I certify that all information furnished by me is true ; and that I and anyof my dependent have not borrowed any money under Subsidy LinkedScheme from any central /State Government or bank for establishing anysuch project.

Date :Signature of the applicant

NOTE:• Own contribution must be invested 5% for SC/ST/OBC/PHC/woman/ Ex-serviceman/ North East Reason/Hill Boarder Area and 10 % for General• Total Project Cost should not exceed 25 /akhs for Manufacturing unit and 10

lakhs for Business/service unit.• Applicant will not be entitled for additional Margin Money(Subsidy) in caseof Own Contribution over and above the prescribed limit.• VIIIth pass for Manufacturing Unit above Rs - 10 /akhs project cost and underService Sector above Rs.5 lakhs

• Application should be submitted complete in all respect along with attestedcopies of the following documents:

1. Certificate of qualification-academic and technical (if project cost above 5 lakhs underbusiness/service industry or above 10 lakhs under Manufacturing industry)2. Relevant Certificate for SC/ST/OBC/Minority/Ex-Servicemen/PHC3. If Entrepreneur Development programme(EDP) training und re gone (at least for two

I weeks) then submit photocopy of the certificateFor Official Use only (Rejected/ to be placed before District Task force committee)Reasons (if rejected):

Place: Signature, Name and Designation of OfficerDate: KVIC/ KVIB/DIC

O

I

TO BE TYPED / PREPARED ON RS . 100/- STAMP PAPER & SIGNEDBY THE BENEFICIARY DULY NOTARISED

UNDERTAKING BY PMEGP APPLICANT( To be furnished by the applicant and is mandatory)

Declaration is to be made by the beneficiary while submitting application forfinancial assistance for setting up project under PMEGP.

Son/Daughter/Wife of Ageresiding at Village, Post,

Block/Tahsil , District in State solemnlydeclare that the information submitted by me on account of myapplication for availing loan and margin money subsidy underPMEGP is correct in all respect to the best of my knowledge andbelief. Further I hereby declare that :

1. I am not a defaulter of any Financial Institution , Central Govt.,State Govt., KVIC, DIC and there is no any trial pending or underconsideration with crime or fraud.

2. I have read and understood the guidelines and terms andconditions of PMEGP Scheme in detail, more par ticularly thecriteria such as nature of Industry , Per Capita Investment,Own Contribution , Rural Areas (projects sponsored by KVIC/KVIBs and Negative List (para 29 of the guidelines ) beforesubmitting the application for financial assistance under thePMEGP Scheme.

3. I understand that KVIC is Nodal Agency at National Level forPMEGP Scheme and that the PMEGP Scheme is implementedthrough KVIC State /Divisional Offices and KVIBs in the ruralareas of the Country and through District Industries Center (DIC)in both rural and urban areas.

.4. I understand that application has to be submitted either to KVICor KVIB or DIC for applying for loan under PMEGP scheme.

5. I understand that my application will be forwarded to DistrictTask Force Committee ( DTFC) for scrutiny and short listing. Iam also aware that the sort listed applicants will be calledfor an interview by the DTFC separately for rural and urbanareas to assess their knowledge about the proposed proje;.:t,

?Merest, :i .,1 a {;rtf ^:,•rE;',t_' lrc-

^CCr/^1oc& lrhm. t/i0 /,j, vio7(1 Q 1, 1

availability, ability to repay and to run the p ro po sedst plojte

successfully and recommend only merito r ious

applicants to Bank for sanction of project.

6. The documents,. quotations, and certificates are submittedalongwith my application / project report are true to the best ofmy knowledge and belief and if any information furnished

bedocuments submitted is / are found false or forged, me shallby bankresponsible for all consequences and loan released to 5 /

and margin money subsidy released by nodal bankKVIC,KVIB/DIC may be recovered as per Govt. rules.

7. I understand that Banks are the final authority to take the

decision for sanctioning the project based on viability of the

project, on which the KVIC / KVIB / DIC has no say. If the bank

is not sanctioning the project for whatsoever reasons,

KVIC/ KVIB / DIC shall not be liable for the same and I shall

not raise any claim whatsoever against KVIC/ KVIB/DIC in

any petition before a Court of Law.

8. Only one person from one family is eligible for obtaining financialassistance for setting up of projects under PMEGP. The 'family'

includes self and spouse.

9. I am fully aware that Margin Money is an "one time assistance"

from Govt. For any enhancement of credit limit or forexpansion/ modernization of the project, margin money

assistance is not available.

10. I agree and abide by the condition that once the Margin Money isreleased in favour of the loanee, it will be kept in the TermDeposit Receipt of three years at Financing Branch level in thename of the Beneficiary/ Institution. No interest will be paid tonthe TDR and no interest will be charged on oan to

corresponding amount of TDR.

i i . I agree and abide the conditions visualized in the scheme-guidelines. Further the margin money released by the designatedNodal Branch of the Bank, KVIC/KVIB/DIC (sponsoring

implementing agency) is the final authority to either accept or

reject the claim based on the parameters of the Scheme.

12. I declare that I have not availed any 'loan from any financialfor the 'project under cor--id.eration of PMEGP

J

2Ksr/desk /Chav. Vig./cir.vig. 20.9.12

T

to be 'ineligible ' to claim margin money for any reasc,whatsoever and in that event , I shall refund the entire/pa,M.M. received on my project to KVIC.

20. I agree to permit officials of KVIC, KVIB, DIC, Bank and or anagency authorized to conduct physical verification of the unitand-. will-.provide all the information about my unit andproduce/show required documents including books of accountsto them.

21.I agree and abide the conditions visualized in the schemeguidelines . Further any legal issues against the sponsoring /implementing agency of any matter concerning the Projectthe Courts shall be in the respective State jurisdiction only.

22. It is hereby declare that all the information furnished by me withapplication are correct and if any information is found to be falseor misleading and made with the ulterior motive of availingGovt. Subsidy, KVIC/ KVIB /DIC shall be free to prosecute meor to initiate any other legal proceedings as deemed fit.

Date: a (Signature of beneficiary)

Place:

Ksr/desk /Chav. Vig./cir.vig .20.9.12 4

It

J

Scheme and not availed any subsidy from any State or Central

Govt. Department.

13. It is also certified that the unit shall be located at the address

given in the application will be new unit and I will be the soleproprietor of this, unit. It is also declared that, it will not be aPartnership Firm/Private Company, etc.

14. I agree and abide by the condition to attend the necessary EDP

Training within the stipulated time.

15. I agree to display following Sign-Board at the main entrance of

my project site :-

..................................................................... (unit

name)

Financed by ....................................................... (Bank)

Under PMEGP Scheme of KVIC

16. I am also fully aware of the condition that though Banks will

claim Margin Money (subsidy) on the basis of projections ofCapital Expenditure in the project report and sanction

accordingly , Margin Money (subsidy) on the actual availment 'of

Capital Expenditure only will be retained and excess if any, will

be refunded to KVIC, immediately after the project is ready for

commencement of production.

17. I agree with the condition that working capital component

should be utilized in such a way that at one stage it touches 100%limit of Cash Credit within three years of lock in period of MarginMoney and not less than 75% utilization of the sanctioned limit. Ifit does not touch aforesaid limit, proportionate amount of heMargin Money (subsidy) is to be recovered by the Bank / FinancialInstitution and refunded to the KVIC at the end of the Third year:

18. 1 agree to refund the part/full amount of Margin Money (subsidy)to financing Bank branch to remit the Govt. subsidy toKVIC/KVIB/DIC kept in the TDR in the event of non fulfillment of

scheme guidelines/ norms etc.

19. I agree that KVIC is a final authority to accept/reject or call back

Margin Money sanctioned in favour oI' me if the unit is found

I(cr/r1oc4 /fhav Via./rir.via 20.9.12 3

I

DOCUMENTS REQUIRED FOR SUBMISSION OF PROJECT

PROPOSAL UNDER PMEGPNOTE : All the papers/documents should be Submitted in duplicate.PROJEC

T REPORT: It should not be one from (he negative list.1 Affid

avit on Rs.100/- Stamp Paper (Duly attested by the Notary Public)2 S.

tandard Application Form 2 Copies

3. Two Passport Size Photographs (Self attested).4

. Proof of Residence viz copy of Ration Card / Election Card etc.5 . Qualification certificate / Experience Certificate,

6. Proof of Land / Building where proposed unit is to be setup.a) If L.

and / Building is in name of applicant then Xerox copy of Deed/Registry should besubmitted.

b). If Land / Building is not in name of applicant, then lease Deed for minimum 1.0 yearsshould be submitted,

c). If Land /Building is hired on Rnrrt / Lease, then the copyof rent agreement/leaseminimum for 10 years should bn attached along with photocopy of owner's Deed/Registry.

7. Map of the proposed / exisitnq building, lay out plan along with location identification.8. N.O.C. and population certificate frum " Gram Panchayat" dully signed by Sarpanch / Talati

/ Tehsildar or any competent authority.

9. Any type of Licenses / Registration if applicable for proposed unit like from Pollution

Control Board / DFSC / SSI / FPO I e\gq mark / BSI etc.10. Consent Letter from the concern R3 %,ik.

11. Certificate from the competent autli 'rity required for reserve category i .e. for SC if ST /013C / Ex-serviceman / Hill area / -11 ibal area / Minority / P. H. etc.

12. In case of registered Society / Trust / Co-operative / Registration certificate and By-laws orSociety and resolution passed for availing benefits under PMEGP.

13. Quotation of Machinery and raw material required for the proposed project.

14. Project report (fulfill the norms PMEGP)

Negative List of ActivitiesThe following list of activities will not be permitted under PMEGP for setting up of micro

enterprises / projects / units.

a). Any industry / business connected with Meat (slaughtered), i.e. processing, canning and / or

serving items made of it as food, production / manufacturing or sale of intoxicant items like

Beedi / Pan / Cigar / Cigarette etc, any Hotel or Dhabu or sales outlet serving liquor,

preparation / producing tobacco as raw materials, tapping of toddy for sale.

b). Any Industry / business connected with cultivation of crops / plantation like Tea, Coffee, Rubber

etc. sericulture (Cocoon rearing), Horticulture, Floriculture, Animal Husbandry like Pisciculture,Piggery, Poultry, Harvester machines etc.

c). Manufacturing of Polythene carry bags of less than 20 microns thickness and manufacture of

carry bags or containers made of recycled plastic for storing, carrying, dispensing or packaging

of food stuff and any other item which causes environmental problems.

d). Industries such as processing of Pashmina Wool and such other products like hand spinningand hand weaving, taking advantage of Khadi Programme under the purview of CertificationRules and availing sales rebate.

e). Rural Transport (Except Auto Rickshaw in Andaman & Nicobar Islands, House Boat, Shikara &