New scheme for SME

Once approved, units based in these clusters would also be given special rebates and tax exemption by the state govt

The Bihar state government has approved a new scheme for small and medium enterprises (SME). Under this scheme, the government will provide financial and managerial help to such entrepreneurs.

The state cabinet approved this scheme, which has been named Chief Minister Small and Medium Enterprise Cluster Development Scheme, earlier this week.

"There is lot of potential of SME development in the state," said Brajesh Mehrotra, principal secretary of the Cabinet Coordination Department, "however, due to lack of proper training and new technology, these entrepreneurs have not been able to rise up.

Therefore, the state government has decided to put special focus on their development."Under this scheme, the state government has also decided to set up of a Common Service Centres (CSC) in every SME cluster.

Mehrotra said, "The objective for setting up these CSCs is to make our SME's products better and cost efficient. For this, these centres will provide technical help to entrepreneurs. They will also help SMEs in skill development. It will help them in marketing.'

The scheme will be monitored by a special committee in every district and the district magistrate would be the chairman of the committee.

To set up a cluster, entrepreneurs would have to form a special purpose vehicle (SPV). The SPV would then have to apply to the committee for its approval.Once approved, units based in these clusters would also be given special rebates and tax exemption by the state government.

Meanwhile, the state government will provide 90 percent funds - with a ceiling of Rs 10 crore - to set up of a CSC in every cluster. The rest of the funds would be contributed by the SPV.

State Industries Minister Renu Kushwaha told Business Standard, a few days ago, "It will not only benefit the small entrepreneurs, but will also provide jobs to the people. It will create solid base for the industrialisation of the state. It will help us in creating a new and vast network of SMEs across the state."During the last fiscal, 2,321 new SMEs set their shops in Bihar, which brought almost Rs .250 crores wroth of investment to the state. Almost 10,000 people have been employed by these units.