Micro, Small & Medium Enterprises National Manufacturing Competitiveness Programme (NMCP) for MSME sector

Implemented by Ministry of Micro, Small and Medium Enterprises Government of India New Delhi 1

Schemes for Exports

All most all the schemes of DC (MSME) are meant to encourage MSME including export, However ; • • National Manufacturing Competitiveness Programme (NMCP) for MSME Sector (To Enhance competitivenes s of MSME sector to take-up global challenges and Export Promotion are dedicated schemes

National Manufacturing Competitiveness Programme (NMCP) for MSME Sector

Challenges faced by Indian MSMEs  Access to Technology  I.P.R. related issues,  Design as market driver  Wasteful usage of resources / manpower  Energy in-efficiency and associated high cost  Low ICT usage  Low Market penetration  Quality Assurance / certification.

3

National Manufacturing Competitiveness Programme (NMCP) for MSME Sector

Objectives  Focus on increasing competitiveness of MSME sector  Key initiative for survival of MSMEs in domestic / international markets  A catalyst approach / create role models  Implementation with Public Private Partnership Challenges for implementation  Basically a Supply side initiative  Fear of MSMEs in disclosing data.

 MSMEs are hesitant in investing their contribution.

NMCP - Plan Outlay for 2012-13

(Rs. crore)

S. No.

1.

2.

3.

4.

5.

Name of the Scheme Enabling Implementation of Quality Management Standards and Quality Technology Tools (QMS/QTT) for SMEs Entrepreneurial & Management development of SMEs through Incubators National Campaign for awareness in Intellectual Property Rights Application of Lean Manufacturing Design Clinic Scheme Proposed Outlay (2012-13) 10.00

12.00

5.00

15.00

6.

Technology & Quality Up gradation support for MSMEs 14.00

26.00

7.

8.00

8.

Marketing Assistance & Technology Up gradation for MSMEs Promotion of ICT in Manufacturing sector Total 20.00

136.00

6

1. Lean Manufacturing Scheme

•

Objective :

To minimize wastages in manufacturing • Lean Manufacturing (LM) is Better Production of Goods by  Eliminating Non-value Added Activities / Wastes  Helping to Produce More with Same Resources • Scheme is under operation on pilot basis for 100 mini clusters • NPC is working as Monitoring & Implementing Agency • Evaluation completed for current scheme and further up scaling EFC note being processed .

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Lean Manufacturing Scheme

Implementation approach  Initially cluster units to be made aware regarding lean techniques  ‘Mini Clusters’ of 10 units (appx.) to be created  SPV to be formed by ‘Mini Cluster’.

 GOI : Private Share – 80:20  Max. cost of LMC to be Rs.

23.5 lakh  Monitoring of milestones by NMIU .

8

Lean Manufacturing Scheme ….contd.

• Total Scheme Budget –

GoI contribution

:

:

Rs.

30.57 cr.

Rs.

25.87 cr.

Financial Progress

– Till March 2012 : Rs.

12.51 cr

Physical Progress

 Awareness Programme  SPVs formed  Lean Consultants finalized  Lean implementation underway Mini clusters MSME units : : : : : : 120 (target 100) 100 (target 100) 85 (target 100) 85 (target 100) 840 (target 1000) 9

1S implementation - scrap yard

Before

After

Removed the scrap in scrap yard. & create the space for die storage

2S implementation - Packing & dispatch area

Before

After

Packing & dispatch area –unwanted material removed

Shining Example for Shadow Board

Before

After

Die Set up Graph- (Before/After)

SPVs formed (Zone wise)

Sr. No. Zone SPVs formed 1 2 3 4 North East West South Total 37 16 25 26 104

SPVs formed (State wise)

1 2 3 4 5 6 7 8 9 10 S.No.

State Andhra Pradesh Assam Bihar Delhi Gujarat Haryana Himachal Pradesh Jharkhand Karnataka Kerala No. SPVs formed 3 2 1 11 8 3 2 3 5 4 S.No.

11 12 13 14 15 16 17 18 19 20 State Madhya Pradesh Maharashtra Orissa Punjab Puducherry Rajasthan Tamil Nadu Uttar Pradesh West Bengal Uttarakhand Total No. SPVs formed 2 15 5 11 1 2 13 7 5 1 104

SPVs formed (Sector wise)

S.No. Sector/Sub Sector 1 2 3 4 5 6 Auto & Engg. Components Ball Bearing Diamond Processing Diesel Engines/Motor&Pump sets Electrical/Electric Fans Engg. & Fabrication No. of SPVs formed 18 3 1 2 3 19 7 8 9 Food Processing Foundry Granite 6 4 1 10 Hand Tool 4 11 Handicrafts Apparels and Garments 2 8 12 13 Leather 3 S.No. Sector/Sub Sector Light Engineering 14 15 16 Machine Tools Metal Work Oil expellers 17 18 19 20 21 22 23 24 25 Packaging Chemical & Die Units.

Pharma Plastic IT Hardware & Electronics Rice Milling Scientific Instruments White Goods Total No. of SPVs formed 7 3 1 1 3 2 3 2 1 2 4 1 104

Lean Manufacturing Scheme (Constraints)

• Lean Manufacturing is a comparatively new initiative (on such a large scale) hence MSMEs are initially hesitant • Reluctance in data sharing • SPV formation is time consuming • NPC has limited resources for monitoring on large scale, hence some more agencies are required • Good LMCs not inclined to work with MSMEs • Pvt. Share is not being contributed as per schedule • Difficulty in co-ordination among 10 units 17

2. Design Clinics Scheme



Objective :

 To Bring the industrial design fraternity closure to the MSME sector  Increase the competitiveness of local products / services through design  Develop an institutional base for the industry’s design requirement  Major activities :  Setting up of design clinic centre - HQ  Regional Centres – 4 Nos.

 Awareness seminars and workshops – 200 Clusters.

 Design projects for individual MSME or a group of MSMEs  Students Projects  Orientation Programme for Designers

NID & IISc. Are the nodal agency

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Design Clinics Scheme – New Products developed by MSMEs (1) Visitor Management System, (2) Improved light weight pump (3) Bottle vision equipment 19

Design Clinics Scheme – New Products (1) Portable Hydraulic (2) ENT multi scope (3) Syringe (precision type) 20

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Design Clinics Scheme ……contd.

• Total Scheme Budget –

GoI contribution

:

:

Rs.

73.58 cr.

Rs.

49.08 cr.

Financial Progress

– Fund Released (upto 16.07.2012): Rs.

15.30cr

Physical Progress

 Setting up Design centres  Design Seminars  Design Workshops  Design projects MSMEs  Students : : : : : 5 (target 5 ) 197 (target 200) 49 (target 200) 66 (target 300) 23 ( target 100) 21

Design Clinics Scheme (Constraints)

 Lack of inclination of Industrial Design professionals towards MSMEs  MSMEs hesitant to contribute their share  Sector specific design institutes not yet actively involved  MSMEs still believe in copy – paste rather then innovation 22

3. Technology and Quality Upgradation Support (TEQUP)

Objective :

• Focuses Certification on Energy Conservation, CDM & Product • Activities Proposed : 1) Awareness Generation for Energy Efficient Technology 2) Credit Linked subsidy for EET Projects (25 %) 3) Encourage MSMEs through subsidy to acquire National as well as International Certification of Products 23

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ENERGY EFFICIENT TECHNOLOGY FOR MSME SECTOR Roller kiln - Morbi ceramic cluster

Boiler - Plywood unit, Ernakulum Re-cupeater – pot furnace Firozabad



Technology and Quality Upgradation Support

Total Scheme Budget ◦

GoI contribution

(TEQUP)

: Rs.

: Rs.

140.98 cr.

65.73 cr.

Financial Progress

◦ Till end of 2011-12 (XI Plan) ◦ Expenditure (till 31.3.2012) : : Rs.

5.97 cr Rs.

6.04 cr.

Physical Progress

 MSMEs asstd for EETs (XI Plan):  MSMEs asstd for product certi.

4000)  Awareness programme 113 (target 390) : 448 (target : 50 (target 60) 25

TEQUP – Constraints

• Fund release for EETs too complex – SIDBIs procedure may be streamlined • EET DPRs for MSMEs ( 1050 nos ) received from BEE recently, – These need to be capitalized with the assistance of MSME-Dis • Product Marking reimbursement taking time at MSME-DI end 26

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4. Promotion of ICT in MSME sector

•

The modified ICT Scheme with cloud computing approach has been concurred by Planning Commission and Shortly SFC meeting will be held .

Advantage of Cloud Computing

• • • • • Capital Expenditure(CAPEX) is getting converted into operational expenditure (OPEX).

Device and Local independent Centralized meeting system.

Pay as you use model facility MSMEs does not have to invest in IT personnel for maintenance purpose.

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Components of Cloud Computing

• • • Software as Service Portal as Service Infrastructure as Service

29

SCALING OF SUBSIDY*

Sl .

No .

Turn over Category Of MSME 1.

2.

3.

4.

Below Rs.1.0 cr.

OTNER Rs. 1.0 cr < up to Rs. 5.0 cr.

Rs. 5.0 cr. And Above All OTNER OTNER NER, Special states 5.

All Women owned units 1 st year subsidy 85 % 75 % 60 % 85 % 85 %

* Tentative

2 nd year subsidy 75 % 70 % 55 % 3 rd year subsidy 70 % 65 % 50 % 75 % 75 % 70 % 70 %

FUNDING PATTERN OF MODIFIED ICT SCHEME* (Rs. In Lacs)

Done by Sl.

No.

1.

2.

3.

Activity Awareness Programme and workshops, etc.

Subsidy for availing Cloud computing services National Portal for MSMEs 4.

Impact Assessment Quantity Rate 100 NOS.

1500 units LS LS 2.0

3.0

MSME-DI Service Provider, with local partners, etc.

On service usage model 100 50 By Outsource Agency By Outsource Agency GOI contr.

200 Pvt Contr.

Total 200 3375 1125 4500 200 50 200 50 TOTAL 3825 1125 4950

* Tentative

5. Quality Mgt. Systems/Tools (QMS/QTT)

• •

Objectives

: Scheme to support awareness generation as well as implementation of Quality System Tools in MSME sector  Conforming to International Standards, 5S, Six-sigma, TQM, TPM  ISO 9000, ISO 14000, ISO18000, ISO 22000 etc.

Major activities to propagate Quality Management in MSMEs are : 1) Compulsory Courses in Govt . ITIs / Polytechnics 2) Awareness Programmes in Clusters on QMS / QTT topics 3) Implement Quality Mgt Techniques among MSMEs 4) Special Studies for Threatened Products 5) Assist International Study Missions for SME groups 6) Organize National level workshop on QMS/QTT 32

Quality Mgt. Systems/Tools (QMS/QTT) ….Contd.

Progress : 1) Course materials for trained, 1800 ITIs prepared and 1745 teachers 2) Course details for Polytechnics is taken up this year .

3) More than 364 awareness programmes in completed on QMS / QTT topics by expert agencies, MSME clusters 4) Implementation of Quality Mgt .Techniques among MSMEs 10 clusters has been initiated.

– 5) Assist International Study Missions for SME groups – 1 mission to Japan (with 20 SMEs) completed last year.

33

Quality Mgt. Systems/Tools (QMS/QTT)

• Total Scheme Budget –

GoI contribution

:

:

Rs.

50.00 cr.

Rs.

41.10 cr.

Financial Progress

– Till date : Rs.

5.31 cr

Physical Progress

 Awareness Programme  ITI teachers trained  Study mission  QMS/QTT implementation : ; : : 364 (target 400) 1745(target 1800) 01 100nos.MSME initiated ( 10 Cluster) 34

QMS/QTT (Constraints)

• QMS/QTT implementation not yet sanctioned due to IFW insisting on competitive bidding for engaging expert agency • Limitation to use only clusters from Threatened product catagory • QMS/QTT courses yet to be prepared for Polytechnics • State Govt not sparing ITI teachers for training • MSMEs / Associations Hesitant to give contribution • Medium units not included 35

6. I P R Campaign

•

Objectives

: • IPR Tools : – – Patents Copyrights Trademark G.I

.

Indl. Design Trade Secret • Most MSMEs are unaware of IPR Benefits / Norms • Focused Activities 1) 2) 3) 4) 5) 6) Awareness & Sensitization Programmes Pilot Study Interactive Seminars / Workshops Short / Long Term Training IP Facilitation Centre Assistance for Grant on Patent / GI Registration 36

36

IPR Campaign

• Total Scheme Budget –

GoI contribution

:

:

Rs.

55.00 cr.

Rs.

50.00 cr.

Financial Progress

– Till end of 2011-12 – Budget Outlay (2012-13) – Expenditure (till 12 July,12)

Physical Progress

 Assistance for setting up IPFC :  Awareness Programme :  Workshops :  Pilot Study  Short term training : : : : : Rs.

7.64 cr Rs.

5.00 (GoI) Rs.

8.42 cr.

24 (target 40) 128 (target 150) 42 (target 50) 02 ( target 30) 07(target 50) 37

IPR Campaign (Constraints)

1) Lack of Awareness, Knowledge & Expertise 2) Lack of confidence in Enforcement mechanism and perception of higher cost of Monitoring & litigation .

3) Majority of MSMEs do not have IP Strategy in place .

4) Shortage of Trained Human Resources 38

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7.

Incubators

Objectives

:  Assist Incubation of Innovative Ideas  Promote Emerging Technological Innovative Ventures  Encourage Ideas to Become MSMEs & Knowledge-based • 100 BIs to be Located in engineering colleges, management institutions and R&D Institutes @ 25 p.a in 4 yrs.

• Govt. Grant (Max. 85%) = Rs.4 - 8 lakh per Idea • Each BI to Assist 10 Ideas / Units – Max. Rs.62.5 lakh + Rs.3.78 for Infrastructure & Training .

• BIs to support and Nurture ideas for commercialization in a year 39

• Total Scheme Budget –

GoI contribution

Incubators

:

:

Rs.

79.45 cr.

Rs.

66.50 cr.

Financial Progress

– Till end of 2011-12 – Budget Outlay (2012-13) – Expenditure (till June,12) : : : Rs.

9.00 cr Rs.

12.00 cr (GoI) Rs.

9.20cr.

Physical Progress

 Incubators set up  Incubatees approved  Incubatees assisted : : : 105 (target 100) 350 (target 1000) 250 40

Constraints (Incubators)

• • • • Lack of proposals with new ideas Payment terms not attractive ( 30 %, 70 %) Delay in Up-front contribution from Beneficiary Delays in signing agreement Incubator / Incubatee 41

8. Marketing Assistance and Technology Upgradation Scheme for MSMEs

    •

Objectives :

• To enhance MSMEs competitiveness in the National as well as International market through following activities ; • Major activities:  Technology up gradation in packaging   Skill up gradation /development for Modern marketing techniques Special component for NER clusters State/District level local exhibitions Corporate governance practices Marketing hubs Reimbursement to ISO 18000/22000/27000 certification 42

Marketing Assistance and Technology Upgradation Scheme for MSMEs

• Total Scheme Budget –

GoI contribution

:

:

Rs.

23.00 cr.

Rs.

18.61 cr.

Financial Progress

– Till 16.07.2012

– Budget Outlay (2012-13) – Expenditure (till March,12)

Physical Progress

 MSMEs (NER) benefitted  MSMEs (OTNER) benefitted  ISO 18000/22000/27000  Corporate Governance : : : : : : : Rs.

0.95 cr.

Rs.

8.00 cr.

Rs.

0.99 cr.

18 847 7 20 43

Marketing Assistance and Technology Upgradation Scheme for MSMEs (Constraints)

      Selection of agency is through EoI / Tender ISO certification agencies not available Duplicity of activity with other similar initiatives State level local exhibitions not allowed outside states Corporate governance practice not preferred by MSMEs Marketing hubs only for limited scope of work 44

9. Bar Code Objectives

: • Bar Coding assist in popularizing MSME Products, especially for Exports & Retail • Bar Coding an effective Tool to improve marketability • Reimbursement allowed :  75% of Annual Fee for first 3 years (Bar Code Certificate) 45

Bar Code contd……..

• Bar Code Component (NMCP) has been merged in MDA scheme for the year 2012-13 onwards.

Further Funds for Bar Code is in process for allocation to MSME-DIs .

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NMCP Web Applications

Bar Code Marketing Assistance Product Certification Incubator Design Clinic

NMCP Web Applications

Bar Code Marketing Assistance Product Certification Incubator Design Clinic

Web Address

• •

http://dcmsme.gov.im

http://nmcp.dcmsme.gov.in

(To launch soon)

Thank You

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