The MSME Ministry has approved a proposal by the Khadi and Village Industries Commission (KVIC) to increase the wages of artisans by over 36 per cent, from Rs 5.50 per hank previously to Rs 7.50 per hank.

In a statement, KVIC said on Tuesday its proposal for an increase in wages to khadi spinners along with payment of government subsidy -- modified market development assistance (MMDA) -- has been approved with effect from August 15, 2018.

Under the MMDA programme, 30 per cent of the prime cost is paid to the khadi institutions as production subsidy. Of this 30 per cent, 40 per cent goes to artisans as wage incentives and the remaining 60 per cent goes to the khadi institutions.

The wage incentives are paid by KVIC directly to the accounts of the artisans through direct benefit transfer. As a result, if an artisan makes 20 hanks in a day — he will get Rs 150 per day as wage at the rate of Rs 7.50 per hank, plus incentives including MMDA, which would be approximately 35 per cent on Rs 150, that is Rs 52.

“Hence, on an average, an artisan spinning a minimum of 20 hanks in a day will now start earning Rs 202 per day, including his wages and government incentive — after this increase. It may be noted that, most of the artisans spin more than 20 hanks per day currently,” KVIC said.

KVIC Chairman V K Saxena said the enhancement in wages would draw youth to taking up spinning as a profession. “This increase will also attract new and younger artisans to khadi — who were earlier sceptical about their income, comparing it to the wages given to daily wagers under MNREGA,” he said.

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