Executive Summary:
This document outlines measures by the Ministry of MSME to streamline the Udyam Registration process, strengthen the Khadi and Village Industries Commission (KVIC), and details the implementation and impact of the Credit Linked Capital Subsidy Scheme (CLCSS). Key initiatives include the launch of the Udyam Registration Portal (URP) on July 1, 2020, and the Udyam Assist Platform (UAP) on January 11, 2023, to formalize informal micro-enterprises. The Credit Linked Capital Subsidy Component was operational until March 31, 2020.
Key Points / Main Content:
Udyam Registration Process:
* Udyam Registration Portal (URP) launched on July 1, 2020: A free, paperless, and digital online platform for MSME registration.
* Udyam Assist Platform (UAP) launched on January 11, 2023: Collaborates with SIDBI to onboard Informal Micro Enterprises (IMEs) through Designated Agencies.
* Formalisation Drives: Conducted by Ministry of MSME field offices with State/UT MSME Industry Departments to onboard Micro and Small Enterprises, including those in rural areas and informal sectors.
* Yashasvini Initiative: Special drives for onboarding Women-owned Enterprises.
Strengthening KVIC Performance and Governance:
* MoU with Mahatma Gandhi Institute for Rural Industrialization (MGIRI-Wardha): Focused on innovation, science & technology interventions, quality guidance, and entrepreneurship support for Khadi and Village Industries institutions.
* Modified Market Development Assistance (MMDA): Introduced w.e.f. October 1, 2016, to promote accountability, productivity, and artisan welfare in the Khadi Sector.
* Infrastructure Strengthening: Financial assistance provided to weak Khadi Institutions (KIs) for infrastructure upgrades and renovation of Khadi sales outlets.
* Workshed Scheme for Khadi Artisans: Assistance for constructing individual/group worksheds.
* Raw Material Support: KVIC extends raw material support on credit from Departmental Central Sliver Plants (CSPs).
* Centre of Excellence for Khadi (CoEK): Established with NIFT New Delhi to provide design, product development, and capacity building support to Khadi Institutions. KVIC promotes Khadi products through various channels, including retail outlets, exhibitions, e-commerce, and Khadi Lounges.
Credit Linked Capital Subsidy Scheme (CLCSS):
* Component of the Credit Linked Capital Subsidy and Technology Upgradation Scheme.
* Aimed to facilitate technology upgradation in Micro and Small Enterprises (MSEs).
* Offered a 15% upfront capital subsidy to MSEs for technology induction.
* Operation ended on March 31, 2020.
* Benefitted approximately 87,989 units with a total capital subsidy of Rs 5685.87 crore since its inception in 2001-02.
Impact Analysis:
Micro and Small Enterprises (MSEs):
* Impact: Benefit from streamlined registration, technology upgradation subsidies (until March 31, 2020), and support for Khadi and Village Industries.
* Action Required: Utilize the Udyam Registration Portal (URP) for registration, explore technology upgradation opportunities, and engage with KVIC initiatives.
Khadi and Village Industries Institutions (KIs):
* Impact: Receive support for infrastructure strengthening, access to raw materials, and design/product development assistance through the Centre of Excellence for Khadi (CoEK).
* Action Required: Engage with KVIC initiatives, utilize available financial assistance, and participate in capacity building programs.
Artisans:
* Impact: Benefit from improved work environments through the Workshed Scheme and enhanced welfare through the Modified Market Development Assistance (MMDA).
* Action Required: Utilize available resources for workshed construction and engage with KVIC to benefit from welfare programs.
Ministry of MSME:
* Impact: Responsible for implementing and overseeing the Udyam Registration process, supporting KVIC, and managing schemes like CLCSS.
* Action Required: Continue conducting formalization drives, monitoring the performance of KVIC, and evaluating the impact of support schemes.
Key Entities Referenced
Ministry of Micro, Small and Medium Enterprises: The Indian government ministry responsible for the development of micro, small, and medium enterprises.
Khadi and Village Industries Commission (KVIC): An Indian statutory body engaged in promoting and developing khadi and village industries.
Udyam Registration Portal (URP): A free, paperless, and fully digitalized online platform launched by the Ministry of MSME for MSME registration.
Udyam Assist Platform (UAP): A platform launched in collaboration with SIDBI to formalize Informal Micro Enterprises (IMEs) by onboarding them through Designated Agencies.
Mahatma Gandhi Institute for Rural Industrialization (MGIRI), Wardha, Maharashtra: A research and training institute focused on promoting innovation, Science and Technology interventions for Khadi and Village Industries.
Modified Market Development Assistance (MMDA): An initiative introduced to promote accountability, productivity, and artisan welfare in the Khadi Sector.
National Institute of Fashion Technology (NIFT) New Delhi, Delhi: An institute that supports the Centre of Excellence for Khadi (CoEK) by providing design and product development, and capacity building to Khadi Institutions.
Credit Linked Capital Subsidy Scheme (CLCSS): A scheme aimed at facilitating technology upgradation in Micro and Small Enterprises (MSEs) by providing an upfront capital subsidy.
GOVERNMENT OF INDIA
MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES
LOK SABHA
UNSTARRED QUESTION NO. 2066
TO BE ANSWERED ON: 31.07.2025
KHADI AND VILLAGE INDUSTRIES COMMISSION
2066. SMT. PRATIMA MONDAL:
Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:
(a) the specific measures adopted/to be adopted by the Government to streamline the Udyam
Registration process and the steps taken/being taken to ensure that micro and small enterprises in
rural and informal sectors are effectively onboarded;
(b) the steps being taken to strengthen the performance and governance of the Khadi and Village
Industries Commission (KVIC) and the manner in which the traditional industries are being linked to
contemporary markets; and
(c) the details of the data on the implementation and impact of the Credit Linked Capital Subsidy
Scheme (CLCSS) including the sectors and regions that have benefited the most?
ANSWER
MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES
(SUSHRI SHOBHA KARANDLAJE)
(a): On 1st July, 2020, the Ministry of Micro, Small and Medium Enterprise (MSME) launched
Udyam Registration Portal (URP), a free of cost, paperless and fully digitalized online platform, on
which an enterprise can register itself as an MSME. To formalize Informal Micro Enterprises (IMEs),
Udyam Assist Platform (UAP) was launched on 11.01.2023, in collaboration with SIDBI which
onboard these IMEs through Designated Agencies.
Formalisation Drives are conducted by the field offices of Ministry of MSME, in coordination
with MSME/ Industry Departments of States/UTs concerned and other MSME stakeholders to ensure
that Micro and Small Enterprises, across the country, including in rural areas and informal sectors are
effectively onboarded. Further, special drives are conducted for onboarding of Women-owned
Enterprises under Yashasvini initiative of the Ministry.
(b): To strengthen the performance and governance of the KVIC, following initiatives have been
taken:
i. KVIC has entered into a Memorandum of Understanding (MoU) with Mahatma Gandhi
Institute for Rural Industrialization (MGIRI)/Wardha, a dedicated research and training
institute focused on promoting innovation, Science and Technology interventions, quality
guidance, and entrepreneurship support for Khadi and Village Industries institutions.
ii. Modified Market Development Assistance (MMDA) introduced w.e.f 1.10.2016 to promote
accountability, productivity, and artisan welfare in the Khadi Sector. The MMDA is a
production linked incentive.: 2 :
iii. Under ‘Strengthening Infrastructure of existing weak Khadi Institutions (KIs) and Assistance
for Marketing Infrastructure’, financial assistance is provided to existing weak Khadi
Institutions for strengthening their infrastructure and for renovation of Khadi sales outlets.
iv. ‘Workshed Scheme for Khadi Artisans’ provides assistance for construction of individual as
well as group workshed for better work environment.
v. KVIC extends raw material support on credit from Departmental Central Sliver Plants (CSPs)
supplying raw materials in form of sliver/roving to the needy KIs.
To link traditional industries with contemporary markets, Centre of Excellence for Khadi
(CoEK) has been set up on Hub and Spoke model with National Institute of Fashion Technology
(NIFT) New Delhi. CoEK provides design and product developments, capacity building support to
Khadi Institutions. KVIC promotes Khadi products through retail outlets, national exhibitions, e-
commerce platforms, and Khadi Lounges in urban centers.
(c): Credit Linked Capital Subsidy (CLCS) is one of the components of the Credit Linked Capital
Subsidy and Technology Upgradation Scheme. CLCS aimed at facilitating technology up-gradation
in Micro and Small Enterprises (MSEs) by providing an upfront capital subsidy of 15 percent to the
MSEs, across the country on institutional finance availed by them for induction of well-established
and improved technology in the specified sub-sectors/products approved under the scheme. Credit
Linked Capital Subsidy Component was operation till 31.03.2020. The scheme benefitted around
87,989 units by providing them with total capital subsidy of Rs 5685.87 crore, since the inception of
the Scheme in the year 2001-02.
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