Govt allocates Rs 8,060 cr to set up 5 lakh projects

Government so far has released Rs 5,251 crore under the PMEGP scheme

The government today said it has allocated Rs 8,060 crore, under Prime Minister's Employment Generation Programme (PMEGP), to set up 5 lakh projects, creating over 35 lakh jobs during the 12th Plan period (2012-17).

"For the country as a whole, the outlay for the 12th Plan under PMEGP has been kept at Rs 8,060 crore, which is 70% higher than the allocation of 11th Plan for the scheme," Minister of State (Independent Charge) for Micro, Small and Medium Enterprises (MSME) K H Muniyappa said.

"This would create over 5 lakh entrepreneurs providing employment to over 35 lakh people," he said on the sidelines of a function here.

So far, the government has released Rs 5,251 crore under the scheme and more than 2.2 lakh projects have been assisted, providing jobs to an estimated 20.42 lakh persons.

The scheme aims at generating employment through setting up of micro enterprises, including rural industrial units.

Under the PMEGP, urban and rural entrepreneurs in the general category can avail a subsidy of 15% and 25% on the project cost. In the case of weaker sections of society, a 25% and 35% subsidy is provided to urban and rural businessmen.

The scheme, which is credit-linked programme, was launched in 2008-09 after merger of erstwhile programmes of Prime Minister Rozgar Yojana and Rural Employment Generation Programme.

"The MSME Ministry has also directed the Khadi and Village Industries Commission (KVIC) and the implementing agencies to ensure that at least 100 projects per district are assisted under the scheme this fiscal," Muniyappa said.

KVIC, which is the nodal agency to implement the PMEGP, assigns targets to its field officers and the khadi and village industries boards of various states.

The ministry has also issued instructions to KVIC that the units assisted under the scheme are actually set up within a time frame of 100 days.

Besides, the ministry has constituted a District Level Advisory Committee to be chaired by Member of Parliament (Lok Sabha of the district) comprising 30 members. It will provide overall guidance and suggestions for implementation of the programme.

"The panel would coordinate with KVIC, state government and other agencies like banks for effective mobilisation of Young entrepreneurs under the scheme, besides ensuring that the scheme is implemented in accordance with its guidelines," Muniyappa said.

The country's MSME sector contributes 8% to the Gross Domestic Product (GDP); its share in the country's total exports is 36% and contributes 45% to the manufactured output.

The sector provides employment to over 8 crore people engaged in over 3.6 crore units, producing more than 6,000 products.