Lok Sabha Question No. 5862 (UNSTARRED), answered on 2017-04-10
Subject: KVIC Schemes
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: SUKHBIR SINGH JAUNPURIA

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 5862 TO BE ANSWERED ON 10.04.2017

## KVIC SCHEMES

## 5862.      SHRI SUKHBIR SINGH JAUNAPURIA:

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

- (a) the  details  of  the  schemes  being  implemented  to  improve  the  quality  of  Khadi products  to  ensure  their  better  acceptability  and  marketing  by  the  Khadi  and  Village Industries Commission (KVIC); and
- (b) the details of the financial assistance provided for modernization thereof and study of various projects?

## ANSWER

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

- (a): To improve the quality of Khadi products and to ensure their better acceptability for marketing,  KVIC  is  implementing  schemes  like  Market  Promotion  and  Development Assistance  (MPDA)  Scheme,  Khadi  Reform  and  Development  Programme  (KRDP).  The details of the Schemes are as follows:
- i) Market Promotion Development Assistance (MPDA) - MDA scheme of KVIC has been modified as MPDA scheme formulated as a unified scheme by 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 net worth of Khadi & VI products. Under the erstwhile MDA scheme financial assistance was distributed amongst Producing Institutions (30%), Selling Institutions  (45%)  and  Artisans  (25%).  Under  the  Modified  MDA  (MMDA)  financial assistance is  distributed  amongst  Artisans  (40%),  Producing  Institutions  (40%) and Selling Institutions (20%).
- ii) Strengthening infrastructure of weak Khadi institutions and assistance for marketing infrastructure:    This  scheme  was  launched  in  2009-10  and  provides  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. Under this scheme, financial assistance is provided to existing weak Khadi institutions for strengthening of their infrastructure and for renovation of selected khadi sales outlets.

The  Pattern  of  Assistance  for  Strengthening  of  Infrastructure  of  Existing  Weak  Khadi Institutions:

| Sl.No.   | Component                                 |   Total Cost (Rs. in lakh) |
|----------|-------------------------------------------|----------------------------|
| 1.       | Preliminary and Pre-operative Expenditure |                       0.25 |
| 2.       | Capital Expenditure                       |                       3.5  |
| 3.       | Working Fund                              |                       6.15 |
| Total    | Total                                     |                       9.9  |

## The Pattern of Assistance for Marketing Infrastructure:

|   Sl. No. | Component                                  | Funding Pattern                      |   Govt. Grant |   Inst's Contr. |   Total |
|-----------|--------------------------------------------|--------------------------------------|---------------|-----------------|---------|
|         1 | Departmental Sales Outlets of KVIC         | Govt. Grant - 100%                   |         25    |            0    |      25 |
|         2 | Departmental Sales Outlets of KVIBs        | Govt. Grant - 85% Inst. Contr. - 15% |         21.25 |            3.75 |      25 |
|         3 | Institutional Sales outlets (Metro cities) | Govt. Grant- 75% Inst. Contr. - 25%  |         18.75 |            6.25 |      25 |
|         4 | Institutional outlets (Non-Metro cities)   | Govt. Grant - 75% Inst. Contr. - 25% |         15    |            5    |      20 |

iii) Khadi Reform and Development Programme (KRDP): In order to fully realize the significant growth potential of KVI Sector, in terms of employment generation, enhancing the earning of artisans and ensure positioning of Khadi in consonance with the current market needs,  a  comprehensive  reform  programme  captioned  Khadi  Reform  and  Development Programme (KRDP) was approved by Government of India and is being implemented with the assistance from Asian Development Bank (ADB).

## The objectives of KRDP are:

Revitalizing  the  Khadi  and  Village  industries  through  strategic/policy  level  reforms  and institutional reforms to achieve the following goals:

- i) Sustainability of Khadi
- Repositioning of Khadi and linking to market needs
- Selective subsidy
4. ii) Artisans Welfare
- Greater involvement
- Better remuneration and quality of life
- Thrust on Traditional Village Industries

Direct Reform  Assistance  (DRA)  is  given  to  Khadi  Institutions  for  increasing their productivity and ensuring better quality of products as well as for renovation of their sales outlets for better marketing of Khadi products.

In  addition  to  above,  following  initiatives  have  also  been  taken  to  enhance  the production and sales of Khadi & Village Industries products:

- 1) To ensure higher wages for artisans, the rate per hank has been increased to Rs.5.50 from Rs.4.00.
- 2) Simplified approval process of budget target to Khadi institutions has been adopted.
- 3) Khadi  certification  process  has  been  simplified  and  made  online  to  enable  new companies to start Khadi ventures from 2.10.2016.
- 4) KVIC has been catering to the need of bulk buyers such as, Defence, Health & Family Welfare,  Paramilitary  Forces  and  other  Ministries  of  Central  &  State  Governments  under Rate Contract (RC) agreement with Directorate General of Supplies & Disposals (DGS&D) as well as supply of Non Rate Contract (Non-RC) items like Polyvastra bed sheets and pillow covers to Railways, etc.
- 5) KVIC has signed a Khadi Mark Registration Agreement with Raymond for promoting Khadi fabrics and ready-mades through Raymond's dealers/showrooms/outlets in India and abroad.
- 6) Tie ups to increase marketing network with Raymond's and Arvind Mills to market the Khadi Denim across the world.
- 7) Efforts are being made to make khadi products more appealing and competitive in the market  by  engaging  designers  of  international  fame  viz.  Ms.  Ritu  Beri  as  'Honorary Consultant'.
- 8) Efforts have been made to make Khadi products on-line and as a part of this initiative tie up arrangements with M/s. Paytm has been made and launched through Khadi Gramodyog Bhavan, New Delhi.
- 9) For sale of Premium Khadi, Khadi Lounges are being opened at Delhi, Mumbai and Jaipur.
- 10) Organizing Domestic Exhibitions for promoting sales of Khadi and VI products. KVI units are also motivated to participate in international exhibitions for which financial support is extended up to a maximum limit of Rs.1.25 lakh under international co-operation scheme of Ministry.
- 11) KVIC as a part of its aggressive marketing efforts introduced 'Gift Voucher Scheme' for  its  patrons  from  Departmental  Sales  Outlets  (DSOs)  at  Delhi,  Kolkata,  Mumbai,  Goa, Patna,  Ernakulam  &  Bhopal  and  Visakhapatnam  Airport.  The  'Gift  Voucher  Scheme' consists of attractive 'Gift Vouchers' in the denomination of Rs. 500/-, Rs. 1000/- and Rs. 5000/- respectively has been launched.
- 12) Special  Exhibitions  at  Ahmedabad,  Vadodara  &  Mehsana    (Gujarat),  Kakinada  & Rajamundry  (A.P.),  Shivsagar  &  Nazira  (Assam),  KGB  Mumbai,  KGB  Delhi,  Panaji, Dehradun  (Uttarakhand)  and  Jaipur  (Rajasthan)  where  employees  will  purchase  Khadi  by coupons given by Oil & Natural Gas Corporation Ltd. (ONGC).
13. (b): Under  the  scheme  of  'Strengthening  infrastructure  of  weak  Khadi  institutions  and assistance for marketing infrastructure', Rs. 4.99 crore has been disbursed by KVIC to Khadi Institutions (KIs) for modernization of 100 sales outlets of KIs during the current financial year i.e. 2016-17 (upto 28.02.2017). Financial Assistance of Rs. 10.00 lakh has been provided to conduct various Evaluation Studies.