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Institutional assistance
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INTRODUCTION:
y In India, the latest definition of a small-scale industry
(SSI) is any unit with an upper limit on investment (in
plant and machinery) of from Rs. 0.20 million to Rs. 0.35
million in the case of SSI and Rs. 0.45 million in the case
of ancillary units. What is called the village and smallindustries (VSI) sector comprises both traditional and
modern small industries; it is constituted by eight
specific groups· viz. Handloom, Handicrafts, Coir,
Sericulture, Khadi, Village Industries, Small-ScaleIndustries and Power looms. The last two items
constitute the modern group of industries, the others
being traditional.
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List of forest-based items which can only be purchased by
government from the SSI sector.
y Wooden items
y - Crates-Tool handles- Hand drawn carts-Teak Blocks-Tent poles- Shelving-Wood wool- Plugs- Ammunition boxes
- Chairs- Mallets- Flush doors-Wooden Pins-Veneers
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y . Other
y - Cane baskets- Bamboo cool handles
- Brooms
y
Mats and matting (which includes itemsmade from forest materials) can only be
purchased from the handicraft: sector
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y Some specialization exists in types of lending: the
commercial banks provide the bulk of short-term
advances to SSI units and the state financecorporations provide long-term loans. Both types of
finance are made available at relatively low rates of
interest for the SSI sector, the present schedule
being as under:
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y Type of loan
y Composite loans up to Rs. 25,000
y I) Backward areas :- 10.0%
y ii) Other areas :- 12.0%
y Short-term advances
y I) Up to Rs. 0.2 million :- 14.0%
y ii) Over Rs. 0.2 million to Rs. 2.5 million:- 16.5%
y iii) Above Rs. 2.5 million:- 18.0%
y Term loans
y I) Backward areas:- 12.5%
y ii) Other areas:- 13.5%
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GOVERNMENT STUDY:y Reserved items according to the Second All India
Census of Registered MSME Units (1987-88)accounted for:-
y *11.3% of the items produced in the MSME sector.
y
*28.3% of the production in MSME sector.y *36% of the working MSME units for which data
was compiled in the Census.
y *23.8% of the total number of working and closedunits.
y *68 reserved items were found to account for 80%of the production under reserved category. Out of these 5 items have been de-reserved, hence the listnow contains 63 reserved items.
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NSIC(National Small Industries Corporation)
y The Single Point Registration Scheme of NSIC was
launched as a market support measure for the MSME
Sector. Under the Scheme, the following benefits are
given to MSME units which get themselves registered
with the NSIC:-
y i) Availability of Tender sets free of cost;
y Ii) Exemption from payment of Earnest Money Deposit;
y Iii) Exemption from payment of Security Deposit;
y Iv) Price preference up to 15% over the lowest
quotation of the large scale units (on merits)
y
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Small Industries Development Bank of India ( SIDBI)
Origin & Objectives
y Small Industries Development Bank of India (SIDBI)
was established in April 1990 under an Act of Indian
Parliament as the principal financial institution for:
y
Promotiony Financing
y Development of industry in the small scale sector
y Co-coordinating the functions of other institutions
engaged in similar activities
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Channels of Assistance
y SIDBI's financial assistance to small scale sector has
three major dimensions:
y
Indirect assistance to primary lending institutions(PLIs);
y Direct assistance to small units; and
y Development and Support Services
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Development And Support Services
y Enterprise Promotion with emphasis on Rural
Industrialization
y Human Resource Development to suit the SSI sector
needsy Technology Up gradation
y Quality and Environment Management
y Marketing and Promotion and
y Information Dissemination.
y
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SARASWATI CHEMICALS AND
ENGINEERING Pvt. Ltd.
� The company has 10 workers and anannual turnover of 2 crores. The companyis presently handled by Mr. Jagdish MSalunke . The area near kalyan allows for
better accessibility to raw materials so thefounders were keen in starting theenterprise there. At the end the companyhas lot of growth potential andtremendous expansion plans.
� The company was initially funded by a
government bank, UCO Bank. This termloan was cleared shortly after the openingof the company. But the company still has agood relationship with the bank and doesapproach it for short term loans.
SaraswatiChemicals &
Engineering Pvt.Ltd was started by
Mr. Mohan S
Salunke, in the year1990. The
company basicallydeals in chemicalsand engineering
goods. Some of thechemicals
produced by thecompany are iron
sulphide etc.
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SARASWATI CHEMICALS ANDENGINEERING Pvt. Ltd.
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JUST IN TIME:
y Basically this is the waste control method it is not theinventory control technique. It is an organized approach to
introduce in the manufacturing cycle.
y TIMELINESS.
y QUALITY.
y PRODUCTIVITY.
y FLEXIBILITY.
y
WORK SIMPLIFICATION AND WASTE REDUCTION.
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KAIZEN:
y There are two elements of kaizen:
y IMPROVEMENT/CHANGE FOR THE BETTER.
y ONGOING/CONTINUITY.
y
KAIZEN & SUGGESTION:Suggestion is the change, suggested by any employee to be
done in view of cost reduction. It is no doubt both are
employee participation schemes. The suggestion legally is a
proposal, which is not part of the job of the suggested.
Suggestion & kaizen are generally small technical
improvement than innovation involving large investments.
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LEANRNINGS:
yThe company we visited taught us a lot about product qualityimprovement. Management is an ever changing arena
involving changes in methods & techniques. We have learned
a lot from the subject of productivity & quality management.
yThe management keeps changing but the
theories of quality improvement remain the same.
This is the reason companies have always been
striving to get the best quality products at the most
reasonable prices. This is what sells products off theshelves & earns profits for the company
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CONCLUSION:
y This project was a great learning experience for
everyone in our group. After visiting the company
which is, Saraswati Chemicals and Engineering
Industries we have got a deep insight into the
working if the SSI. The SSI sector in India ispromoted by the Ministry of Micro Small Medium
Enterprises, Government of India. The government
has tried hard to give every type of assistance to the
SSI sector this has increased the chances of thesurvival of this sector.
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y Institutes like SIDBI, UCO Bank, SISI, KVIC etc, are
just some of the government institutes which
provide assistance to the different companies. Thesesmall enterprises need a lot of assistance to grow
and prosper. Post independent India was a place of
oligopolies and family firms who needed political
connections to proper but now times have changed.
Now more and more entrepreneurs are steping into
the business scenario.
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y The company we visited saraswati chemicals and
engineering industries was started by Mr. Mohan S
Salunke in 1990. The company has a lot of growth
potential and has plans for expansion. This visit was
a wonderful experience for all of us. We learned
how a small enterprise is run and how do they
control the quality while keeping prices low. Aftercompleting this project we can truly say that the
small scale industry sector is the flesh and blood of
the Indian industry.
y