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Government supports available for setting up NTFP-based enterprises

Anybody interested in setting up an NTFP-based small unit can avail the benefit of at least two schemes in the MSME sector. One of them is for individual beneficiary or Self-help Groups (SHGs). The other one is for a cluster of beneficiaries making a traditional product from NTFP. These are briefly introduced below. Interested person is however advised to refer to the Ministry of MEME, Govt of India’s website for further information.

Prime Minister’s Employment Generation Programme (PMEGP) is a Central Sector Scheme of Ministry of Micro, Small & Medium Entreprises (MSME), implemented by Khadi and Village Industries Commission along with State Industries Department and State Khadi and Village Industries Board. Projects costing upto Rs 25 lakh can be set up under the Scheme with 35% subsidy in case of North-Eastern Region, 5% Beneficiary’s contribution and the remaining 60% Bank Loan. Subsidy is admissible on the total Project cost (Capital Investment + Working Capital).

How does the Scheme operate? Applications are called by KVIC, KVIB and DIC by newspaper advertisement every year, and a District level Task Force Committee headed by District Magistrate & Collector selects the Projects and recommends it to Banks for disbursement. The beneficiaries have to deposit their contribution and undergo two weeks training at identified institutes within the State. After an initial moratorium, the loan component is repaid in instalment. Normal rate of interest on the loan component is charged by the Bank. The subsidy component is kept in Beneficiary’s name as term deposit and is adjusted at the end of successful implementation of the Project.

What types of Projects are eligible?
An indicative list of Projects in the NTFP sector is:
  1. Ayurvedic medicines production unit
  2. Bamboo tooth picks making unit
  3. Honey-based beverages making unit
  4. Bamboo mat board making unit
  5. Medicated oil manufacturing unit
  6. Ayurvedic churna making unit
  7. Unit for manufacturing ayurvedic asava, arista, kwatha & syrup
  8. Apiary (Bee-keeping) unit
  9. Lac production unit
  10. Bamboo article manufacturing unit
  11. Broom making unit
  12. Tapioca chips making unit
  13. Jackfruit product making unit
  14. Mango jelly/ aam papad making unit
  15. Handmade paper & fibre unit
  16. Leaf cup plate making unit
  17. Mat production unit
  18. Agarbatti making unit
  19. Aloe vera gel making unit
  20. Unit for chemical etching on wood
  21. Toy making unit
  22. Bamboo & cane furniture unit
  23. Bee box making unit
  24. Lac bangle making unit
  25. Citronella oil production unit
  26. Pickles making unit
  27. Jam, jelly & squash making unit
How to prepare Projects?: Model Project Profiles are available in website For details, the Scheme Guidelines for Prime Minister’s Employment Generation Programme issued by Ministry of MSME, Government of India may be referred to.
Whom to contact?: Interested persons can contact:
  • GM, DIC (Phone No. West- 0381 2418170, Dhalai- 03826 267222, Gomati- 03821 222406, Unakoti- 03824 222246), or
  • Deputy Director, Khadi & Village Industries Commission, Agartala (Phone No. 0381 2223735/ 2209648), or
  • Executive Officer, Tripura Khadi & Village Industries Board (Phone No. 0381 2323386).
What about guarantee?: As per RBI Guidelines, no collateral guarantee is required for loan amount upto Rs 10 lakh. Beyond Rs 10 lakh, guarantee cover may be availed under CGT-MSE scheme of Ministry of MSME at a nominal fee, which also borne by many Banks.
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