Indian govt seeks Rs 7.5bn ADB loan for Khadi industry

22 Jan '13

2 min read

Indian Government has sought Rs. 7.5 billion loan from the Asian Development Bank (ADB) to revitalize and modernize the domestic Khadi industry, Union Minister of State for Micro, Small and Medium Enterprises (MSMEs) KH Muniyappa has said.

Talking to media on the sidelines of a meeting with representatives of trade bodies and industrial units, the Minister said the centre wants to technically upgrade the Khadi manufacturing units by replacing the old outdated machinery with new latest ones.

The Centre has earmarked Rs. 240 billion for the MSME sector in the 12th Five Year Plan, which is almost double the amount earmarked for the sector under the 11th plan, he added.

He said the Government has taken several steps to ensure effective implementation of the Prime Minister’s Employment Generation Programme in all districts of Karnataka state, to help those willing to set up a small or cottage industry in the state to obtain a loan of up to Rs. 2.5 million.

He added that all nationalized banks have been advised to conclude the loan formalities within three months from the date of filing of the application.

Rural women, physically challenged persons, and people belonging to scheduled castes and scheduled tribes and minority communities would get a 35 percent subsidy from the Government, while general category people would qualify for a subsidy of 15 percent if they set up units in the urban areas.

The Ministry of MSMEs has also agreed to offer 20 percent rebate on Khadi goods under the Marketing Development Assistance scheme, so as to push sales of Khadi items, Mr. Muniyappa said.

The Ministry is also considering setting up of a nodal agency in all the states of the country to ensure proper marketing of MSMEs products, he added.

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