The MSME ministry said it has done away with the role of District Level Task Force Committee headed by district collectors in recommending the proposals under the Prime Minister Employment Generation Programme (PMEGP).

As per the amended guidelines, Khadi and Village Industries Commission (KVIC), the nodal agency for implementing the 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, an official statement said.

As of now, the proposals were scrutinised by the District Level Task Force Committee (DLTFC), that often led to inordinate delays in sanctioning of the projects.

Under the PMEGP scheme, loans up to Rs 25 lakh are given for manufacturing and service industries, in which 15 to 35 per cent subsidy is provided by the KVIC depending upon the area.

KVIC chairman Vinai Kumar Saxena said a major bottleneck has been removed with the discontinuation of the DLTFC in approving the projects under the PMEGP.

It was noticed that the district collectors/magistrates heading the DLTFC were often preoccupied with local administrative issues and hence works pertaining to the approval of PMEGP applications were not on their priority at all, the statement said.

Prime Minister’s Employment Generation Programme

The Ministry of Micro, Small and Medium Enterprises (MSME) is implementing Prime Minister’s Employment Generation Programme (PMEGP). 

It is a major credit-linked subsidy programme aimed at generating self-employment opportunities through establishment of micro-enterprises in the non-farm sector by helping traditional artisans and unemployed youth.

PMEGP was launched in 2008 by merging two schemes — Prime Minister’s Rojgar Yojana (PMRY) and Rural Employment Generation Programme (REGP) — for generation of employment opportunities through establishment of micro enterprises in rural as well as urban areas. 

PMEGP is being implemented by Khadi and Village Industries Commission (KVIC), State Khadi and Village Industries Board (KVIB) and District Industries centres (DIC). Under the scheme, loan is being provided by all public sector banks, selected private sector banks and co-operative banks with margin money subsidy being given by ministry of MSME through KVIC.

Objectives of PMEGP

1) To generate employment opportunities in rural as well as urban areas of the country through setting up of new self-employment ventures. 

2) To bring together widely dispersed traditional artisans, rural and urban unemployed youth and give them self-employment opportunities to the extent possible, at their place. 

3) To provide continuous and sustainable employment to a large segment of traditional and prospective artisans and rural and urban unemployed youth in the country, so as to help arrest migration of rural youth to urban areas.

4) To increase the wage earning capacity of artisans and contribute to increase in the growth rate of rural and urban employment. 

The maximum cost of the project/unit admissible in the manufacturing sector is Rs 25 lakh and in the business/service sector is Rs 10 lakh. 

Any individual above 18 years of age is eligible for applying under the scheme. General category beneficiaries can avail margin money subsidy of 25 per cent of the project cost in rural areas and 15 per cent in urban areas.

Further, ministry of MSME introduced a new component of second financial assistance for expansion/upgrading the existing PMEGP/MUDRA units for manufacturing units up to Rs 1 crore and for service/trading units up to Rs 25  lakh with subsidy of 15 per cent from the year 2018-19.

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