Motivation of Entrepreneurs and Financial Assistance for Rehabilitation of Sick Industries
Motivation of Entrepreneurs and Financial Assistance for Rehabilitation of Sick Industries
The "Motivation of Entrepreneurs and Financial Assistance for Rehabilitation of Sick Industries" scheme is an initiative by the Industries and Commerce Department of Puducherry. This program aims to support industrial units categorized as "sick" by providing financial aid for the implementation of expert recommendations in technology, marketing, and finance. Furthermore, the scheme offers a substantial subsidy aimed at diagnostic studies to enhance the recovery of these businesses.
Overview of the Scheme
This scheme is designed to reimburse the expenses incurred in executing suggestions made by specialists engaged to assist sick industrial units. The financial support includes a 50% subsidy on the cost of diagnostic studies conducted by recognized technical institutions, which can be initiated through banks or financial institutions. The application process is straightforward and can be completed offline using a specified form available on the official website of the Department.
Key Benefits
- Diagnostic Study Subsidy: A subsidy of 50% is provided on the costs associated with diagnostic studies carried out by technical institutions, with a limit of ₹50,000.
- Implementation Reimbursement: Up to 50% of fees (maximum ₹50,000 per unit) will be reimbursed for the adoption of expert recommendations in technology, marketing, and finance.
- Interest Subsidy: An interest subsidy of 5% per annum on additional finance provided by banks or financial institutions, capped at ₹3,00,000 per year for a duration of three years.
- The interest subsidy will be disbursed through the financial institution, which encompasses PIPDIC and other government corporations, as well as scheduled and co-operative banks.
Eligibility Criteria
- The applicant must be a Micro, Small, and Medium Enterprise (MSME) that possesses UAM/EM (Part-II)/Permanent Registration.
- The applicant must be classified as a "Sick" Industrial Enterprise, which is defined as follows (subject to periodic revision in accordance with RBI guidelines):
- Continuous decline in gross output compared to the previous two financial years.
- Loan repayment delays exceeding 12 months from institutional sources.
- Erosion of net worth due to accumulated losses reaching 50% of the net worth in the last accounting year.
- Other enterprises that take over a sick unit for rehabilitation purposes are also eligible for this scheme.
Application Procedure
To apply for this scheme, applicants must follow the steps outlined below:
- Obtain a printed copy of the application form from the Directorate of Industries and Commerce, Puducherry.
- Complete the application form by filling in all mandatory fields, and attach required documents.
- Submit the signed application form along with the documents to the Director of Industries either in person or via postal service.
- Ensure to request a receipt or acknowledgment from the authority at the Directorate.
The State Level Committee will assess each application to determine if the unit qualifies for financial assistance.
Official Source
For more information, visit myScheme.gov.in.
Eligibility Criteria
1. The applicant should be MSME unit those who have obtained UAM/EM(Part-ll)/Permanent Registration.
2. The applicant should be a "Sick" Industrial Enterprise. "Sickness" is defined as follows at present and shall be revised as per RBI guidelines from time to time:
Continuous decline in gross output compared to the previous two financial years.
Delay in repayment of loan, taken from institutional sources, for more than 12 months.
Erosion in net worth due to the accumulated losses to the extent of 50% of the net worth during the previous accounting year.
3. Other firms taking over a sick unit for rehabilitation will also be eligible.
Benefits
Subsidy @ 50% on the cost of diagnostic study by technical institutions initiated through Financial Institutions/Banks/Government with a maximum of ₹50,000/-.
50% of fees (maximum ₹50,000/- per unit) will be reimbursed on implementing suggestions given by the experts in the field of technology, marketing and finance engaged to advise sick units.
Interest subsidy @ 5% per annum limited to ₹3,00,000/- per year for 3 years on additional finance disbursed by Banks/Financial Institutions for Rehabilitation.
*The interest subsidy will be paid through the financial institution.
*The financial institution shall mean and include PIPDIC or any other Government Corporation, Scheduled Banks including Co-operative Banks.
Application Process
Apply OfflineStep 1: The sick enterprise should take print from the prescribed form from the Directorate of Industries and Commerce, Puducherry.
Step 2: In the application form, fill in all the mandatory fields, and attach copies of all the mandatory documents.
Step 3: The enterprise should submit the duly filled and signed application form and the documents to the Director of Industries either in person or by post.
Step 4: Request a receipt or acknowledgement from the concerned authority at the Directorate.
*The State Level Committee will go into the merits of each case to decide whether the unit qualifies for the grant of financial assistance.
References & Official Links
Scheme Details
| Full Name | Motivation of Entrepreneurs and Financial Assistance for Rehabilitation of Sick Industries |
| Short Title | MEFARSI |
| Level | State |
| Scheme For | Infra |
| Categories | Business & Entrepreneurship |
| States | Puducherry |
| Gender | All |
| Area | Both |
| Source | www.myscheme.gov.in ↗ |