The Hindu Business Line : Banks to extend Rs 181-cr loan for khadi and village industries in AP

Hyderabad, Nov. 25 The Khadi and Village Industries Commission (KVIC), Andhra Pradesh, has set a target of Rs 181 crore disbursals under the Prime Minister’s Employment Generation Programme (PMEGP) during the current financial year.

“The State Level Bankers Committee (SLBC) has approved to extend financial assistance to the tune of Rs 180.77 crore under PMEGP for khadi and village industries in the State before the end of March 2009,” Mr K Mohan Rao, Director, KVIC (Andhra Pradesh), told newspersons at the inaugural of an orientation programme on PMEGP for various stake-holders here on Tuesday.

The target subsidy for the programme is Rs 53.19 crore, he said, adding that the initial response for the scheme was good though a clear picture would emerge after the formation of district-level task force committees, involving District Collector and other revenue officials for the implementation.

Over 120 representatives from various banks, KVIC and non-governmental organisations attended the programme.

PMEGP was announced by the Prime Minister, Dr Manmohan Singh, on October 2, 2008 as a credit-linked subsidy programme by merging the two operational schemes – Prime Minister’s Rozgar Yojana (PMRY) and Rural Employment Generation Programme (REGP).

The objective of the programme is to generate employment opportunities through establishment of micro enterprises in rural as well as urban areas.

“This will give a big push to khadi and village industries in the urban areas as well and will prove them as a viable business models. While earlier schemes only focussed on the rural areas, PMEGP is also applicable to urban micro entrepreneurs who want to set up khadi and village industries,” Mr Rao said.

Maximum cost

The maximum cost of the project/unit admissible under the manufacturing sector is Rs 25 lakh while in the services sector, it has been fixed at Rs 10 lakh. The balance amount would be provided by banks as term loan.

Assistance would be available for any individual over 18 years only for new projects sanctioned specifically under the PMEGP.

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