Lok Sabha Question No. 1968 (UNSTARRED), answered on 2016-11-28
Subject: Promotion of Khadi
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: ABHISHEK SINGH, NAGARAJAN P., GOPALAKRISHNAN CHINNARAJ, RANJANBEN BHATT

## GOVERNMENT OF INDIA

## MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 1968 TO BE ANSWERED ON 28.11.2016

## PROMOTION OF KHADI

1968.  SHRI ABHISHEK SINGH: SHRI P. NAGARAJAN: DR. C. GOPALAKRISHNAN: SHRIMATI RANJANBEN BHATT:

Will  the  Minister  of  MICRO,  SMALL  AND  MEDIUM  ENTERPRISES  be  pleased  to state:

(a) the details of the schemes being implemented and funds allocated by the Government for promotion of Indian khadi industry during each of the last three years and the current year, State/UT-wise;

(b)  whether  the  sale  of  khadi  products  has  increased  during  the  said  period,  if  so,  the details thereof;

(c) whether the Government proposes to open khadi outlets in foreign countries, if so, the details thereof, country-wise; and

(d) the other steps taken/proposed to be taken by the Government to add up new khadi products and create more employment opportunities in the khadi sector?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI GIRIRAJ SINGH)

(a): The  following  schemes/programmes  are  being  implemented  for  development  of Khadi:

(i)  Market  Promotion  Development  Assistance  (MPDA)  -  Government  has  introduced w.e.f  01.04.2010,  a  flexible,  growth  stimulating  and  artisan  oriented  Market  Development Assistance (MDA) Scheme, in place of the erstwhile system of Rebate. This scheme has been modified as Market Promotion Development Assistance (MPDA) merging different schemes/ sub-schemes/ components of different Heads implemented in the 11 th Plan, namely, Market Development Assistance, Publicity, Marketing and Market Promotion.  A new component of Infrastructure namely setting up of Marketing Complexes /Khadi Plazas has been added to expand the marketing reach of Khadi & VI products. Under the modified MPDA scheme, financial assistance is distributed amongst Artisans (40%), Producing Institutions (40%) and Selling Institutions (20%), which will help the Artisans and Khadi Institutions thus resulting in  the  development  of  Khadi  in  the  country.    Funds  released  to  KVIC  under  this  scheme during last three years and current year is given below:

(Rs. in crore)

| Year         |   R.E. | Funds released   |
|--------------|--------|------------------|
| 2013-14      | 139.8  | 126.94           |
| 2014-15      | 201.83 | 196.94           |
| 2015-16      | 148.4  | 147.48           |
| 2016-17 (BE) | 341.63 | 312.17*          |

*Upto 31.10.2016

- ii) Interest Subsidy Eligibility Certificate (ISEC) scheme was introduced in May 1977 to mobilize  funds  from  banking  institutions  for  filling  the  gap  between  the  actual  fund requirements and availability of funds from budgetary sources to meet the working capital demand. Under the Scheme, credit at the concessional rate of interest is made available. The institution is required to pay only 4% and interest charged by banks over 4% will be paid by Central Government through KVIC. Funds released to KVIC under this scheme during last three years and current year is given below:

(Rs. in crore)

*Upto 31.10.2016

| Year         |   R.E. | Funds released   |
|--------------|--------|------------------|
| 2013-14      |  29    | 23.24            |
| 2014-15      |  40.63 | 38.32            |
| 2015-16      |  40.07 | 40.07            |
| 2016-17 (BE) |  49.5  | 48.94*           |

- iii)    Workshed  Scheme  for  Khadi  Artisans  was  introduced  in  2008-09  for  providing financial  assistance  for  construction  of  worksheds  to  khadi  artisans  belonging  to  BPL category  through  the  khadi  institutions  with  which  the  khadi  artisans  are  associated.  The maximum quantum  of  assistance  for  individual  workshed  is  Rs.60,000  and  for  the  Group Workshed is  Rs.40,000  per  capita.  Funds  released  to  KVIC  under  this  scheme  during  last three years and current year is given below:
- iv) Scheme for Strengthening of Infrastructure of Existing Weak Khadi Institutions and  Assistance  for  Marketing  Infrastructure:  Under  the  scheme,  financial  assistance  is provided to existing weak Khadi institutions for strengthening of their infrastructure and for renovation  of  selected  khadi  sales  outlets.  In  order  to  facilitate  the  need-based  support towards the Khadi sector for nursing the sick/problematic institutions elevated from 'D' to 'C' category as well as those whose production, sales and employment have been declining while they have potential to attain normalcy  and  to support creation of  marketing infrastructure in other identified outlets.

*Upto 31.10.2016  # Targets

| Year    |   B.E. (Rs. in crore) | Funds released (Rs. in crore)   | Physical (No. of Artisans)   |
|---------|-----------------------|---------------------------------|------------------------------|
| 2013-14 |                  20   | 8.23                            | 1950                         |
| 2014-15 |                  20   | 15.24                           | 4324                         |
| 2015-16 |                   8.6 | 8.22                            | # 1100                       |
| 2016-17 |                  20   | 19.94*                          | # 3333                       |

Funds released to KVIC under this scheme during last three years and current year is given below:

*Upto 31.10.2016 # Targets

| Year    |   B.E. (Rs. in crore) | Funds released (Rs. in crore)   | KIs Assisted (Nos.)   |
|---------|-----------------------|---------------------------------|-----------------------|
| 2013-14 |                   7.5 | 1.15                            | 4                     |
| 2014-15 |                   7.5 | 4.33                            | 43                    |
| 2015-16 |                   2.2 | 2.12                            | # 53                  |
| 2016-17 |                   8.5 | 5.99*                           | # 50                  |

Funds are not released State-wise as the above schemes of the Ministry are Central Sector Schemes.  Funds are released to KVIC only.

(b): Yes Madam, the sale of Khadi products has increased during the said period, which is given in the following table:

| Year    | Sales (Rs. in crore)   | Sales (Rs. in crore)   |
|---------|------------------------|------------------------|
| Year    | Khadi                  | %incr.                 |
| 2013-14 | 1081.04                | 5.82                   |
| 2014-15 | 1170.38                | 8.26                   |
| 2015-16 | 1510                   | 29.02                  |

- (c): There is no such proposal for opening of khadi outlets in foreign countries.
- (d): The other steps taken/proposed to be taken by the Government:
1.  Khadi  and  Village  Industries  Commission  (KVIC)  has  set  up  interfaces  with  leading technological institutes to conduct research work under S&T programme of KVIC for development of tools, implements and processes involved in production of Khadi.
2.  The following steps have been taken to boost the export of Khadi and Village Industries product:
- i) Participation in domestic exhibitions at District, State and National levels wherein KVIs are allowed to participate and market their products.
- ii) Assistance  would  be  provided  under  the  MPDA  Scheme  to  the  eligible  KVI Institutions for participation in International Exhibitions/Trade Fairs held in foreign countries in order to showcase KVI  products to foreign countries, access international buyers and sellers and forge business alliances, etc.
- iii) Organizing Export promotion workshops.
- iv) KVIC  has  been  given  the  status  of  'Deemed  Export  Promotion  Council',  under which it has already registered more than 900 exporters.
3. Export incentive of 5% of Freight On Board (FOB) value of direct export of Khadi products  is  provided  to  KVI  institutions/units  registered  with  KVIC.  Besides,  KVIC  has also  been  focusing  on  quality  participation  in  International  Exhibitions  and  Buyer-Seller Meets abroad to tap new/emerging markets for Khadi products.
4. KVIC has applied to register 'Khadi' as a word mark and 'Khadi India' as a Trade mark  in  27  classes  for  various  products  among  45  classes  listed  out  in  the  Intellectual Property  Rights  Act  at  National  Level  as  well  as  has  filed  an  online  application  for registering  'Khadi'  as  a  trade  mark  under  International  bureau  in  European  Union  and other countries under 16 different class.
5. KVIC has roped in designers and started making readymade garments, including jeans and T-shirts, making the products more popular among the youth.

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