In a significant policy decision, the Ministry of Micro, Small and Medium Enterprises (MSME), headed by Union Minister Nitin Gadkari, has done away with the role of District Collectors in recommending the proposals under the Prime Minister Employment Generation Program (PMEGP), thereby simplifying the entire procedure.
As per the amended guidelines, Khadi and Village Industries Commission (KVIC), the nodal agency for implementing PMEGP scheme, after due diligence, will directly clear the proposals/applications of the prospective entrepreneurs and will forward it to the Banks for taking credit decisions. As of now, the proposals were scrutinized by the District Level Task Force Committee (DLTFC) that often led to inordinate delays in sanctioning of the projects.
KVIC Chairman Vinai Kumar Saxena said a major bottleneck has been removed with the discontinuation of the DLTFC in approving the projects under PMEGP. He thanked Gadkari for taking swift action in the interest of the country.
The government’s move has come at a time when the employment sector has taken a hit due to nationwide lockdown in the wake of the Corona disease. The amendment in the policy would pave the way for swift implementation of projects and create new employment opportunities in rural and semi urban areas under the PMEGP scheme.
The District Collectors/Magistrates heading the DLTFC were often preoccupied with local administrative issues and hence deciding on granting approval of PMEGP applications was not on their priority list and prroposals under the scheme remained pending for several months.
“We are grateful that the Hon’ble Minister accepted our request and decided to discontinue the role of DLTFC. This will ensure swift and timely implementation of the projects. The government’s decision will safeguard the interest of lakhs of people in the country seeking employment opportunities under PMEGP.,” Saxena said.
As per the new guidelines, the KVIC after receiving the applications will scrutinize and examine the proposals and the corrected applications will be forwarded to the banks for taking credit decisions. Under the PMEGP scheme, loans up to Rs 25 lakhs are given for manufacturing and service industries, in which 15 to 35% subsidy is provided by the KVIC depending upon the area.
Since its launch in 2008, the PMEGP scheme was receiving an average of 35,000 applications per year. However, KVIC in 2016 developed an in house, user-friendly PMEGP portal and launched it in July 2016 to receive online applications under the scheme. The online facility received massive public response and the number of online applications increased manifolds up to four lakh applications per year, which itself shows the popularity of the scheme.
In 2019-20, the KVIC released over Rs 1951 crore margin money subsidy and set up 66,653 projects in the country.