Industry Policies

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Industry Policies

Improving productivity of enterprises in the unorganised sector

The National Manufacturing Competitiveness Council (NMCC) was set up by the Government in 2004, an interdisciplinary and autonomous body at the highest level to serve as a policy forum for credible and coherent policy initiatives in manufacturing sector. The Council is expected to energise and sustain the growth of manufacturing industries in the country and also help in implementation of strategy. The council has finalised a five-year National Manufacturing Competitiveness Programme (NMCP) that was accepted by the government and announced for implementation in the Budget of 2006-07. This programme was directed at improving competitiveness at the firm level rather than a sector or industry level and based on the idea that Micro, Small and Medium Enterprises or MSMEs need to build abilities to acquire, develop or assimilate new technology, reduce cost of production, enhance productivity, practice Total Quality Management (TQM) and improve customer service. The NMCP is the direct responsibility of the state governments, though supported by the central government in terms of setting the framework and ensuring uniformity.

Appropriate technologies in the MSME sector continue to remain a focus area, evident from the plans in the upcoming 12th Five Year Plan. At the national level, it is expected that a technology upgradation fund of Rs2500 crore will be created within the plan for the MSME sector to acquire and upgrade technology

Technology and quality upgradation support to MSME

Ten schemes were drawn up under the National Manufacturing Competitiveness Programme (NMCP) of which one of the most relevant for the clean upgradation of the brick sector is the Technology and Quality Upgradation Support to MSMEs (TEQUP) which has provisions for:

• Capacity building of MSME Clusters for Energy Efficiency/Clean Development Interventions and other technologies mandated as per
the global standards.

• Implementation of Energy Efficient Technologies (EET) in MSME sector/units.

• Setting up of Carbon Credit Aggregation Centres (CCA) for introducing and popularising Clean Development Mechanism (CDM)
in MSME clusters.

• Encouraging MSMEs to acquire product certification/licences from National/International bodies and adopt other technologies
mandated as per the global standards.

Rajiv Gandhi Udyami Mitra Yojna (RGUMY)

The RGUMY is a scheme for promotion of MSMEs. Part of the 11th FYPs objective is to support MSMEs by handholding first generation entrepreneurs who have successfully completed an Entrepreneurship Development Program (EDP), Skill Development Programme (SDP), or an Entrepreneurship cum Skill Development Programme (ESDP) of at least two weeks duration, or have undergone vocational training from Industrial Training Institutes.

Prime Minister’ Employment Generaton Programme (PMEGP)

Launched in 2008, PMEGP is a credit linked subsidy programme for generation of employment opportunities through establishment of micro enterprises in rural and urban areas. The upper limit of the cost of project that could be set up in the manufacturing sector is Rs25 lakhs. At the state level, schemes will be implemented through State Directorates of Khadi and Village Industries Commissions and Boards. In rural areas and in urban areas, the scheme will be implemented by the State and District Industries Centres (DICs). By 2011-2012, the scheme aims to generate an estimated 37.38 lakh jobs and the total outlay for subsidy under the PMEGP is Rs4485 crore. This scheme caters to VSBK and fly ash units.

State industrial Promotion Policies

Every State in India has an Industrial Promotion Policy that outlines the priority sectors for industrial development and the initiatives of the state to boost these industrial sectors, by providing subsidies and incentives in these sectors.

The following are details relevant to the brick sector from two State industrial policies:

Bihar Industrial Incentives Policy (2011)

Orissa Industrial Policy Resolution (2007)

Bihar Industrial Incentives Policy (2011) Bricks units are not eligible for subsidy except for mechanised units engaged in manufacturing refractory bricks and bricks from fly ash, red earth, raw industrial waste material which can qualify for incentives. The older Industries Incentive Policy, 2006 of Bihar excluded all brick manufacturing units from any incentives.

Brick-making units (except units making refractory bricks and those making bricks from fly ash, red mud and similar industrial waste), though not eligible for fiscal incentives as industrial units are eligible for investment facilitation, allotment of land under normal rules, recommendations to financial institutions for term loans and working capital & recommendation for power. This is a progressive change from the policy of 2001 where brick manufacturing units were excluded from all incentives and facilitation.