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BW Businessworld

Govt Unveils Mega Plan To Create Rural Entrepreneurs

The Ministry of Micro, Small and Medium Enterprises (MSME) has unveiled an ambitious initiative to create tens of thousands of new entrepreneurs in rural areas and has tied up with a leading bank for project funding.

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B.H. Anil Kumar, joint secretary in the ministry, said the scheme is designed to promote innovation, rural enterprises and entrepreneurship.
“We are setting up a fund of funds with SIDBI which they will use to assist new entrepreneurs to start up on their own,” he said.  
Kumar said there is a huge potential in the rural industrial sector to set up agro-based companies.
The plan involves creating a network of research and academic institutions across India so that there is a smooth sharing of information and best practices.
To overcome the acute shortage of people with necessary business skills, the ministry will take the help of mentors and handhold entrepreneurs.
Sonal Khetarpal

The ministry will set up two kinds of incubation centres. One will focus on basic livelihood generation and the other will be more technology-intensive startups.
To set up the rudimentary incubation centres, the ministry will partner with government agencies such as NSIC, KVIC and also with private companies.
“For livelihood business incubator,we will be funding up to Rs 1 crore for plant and machinery to set up new incubation centre. It will be a grant, not a loan. This could also be used to set up incubation centre by the private sector in PPP basis along with NSIC and KVIC. In this case, we are looking at a one-time grant of 50 lakhs,” said Kumar.
Potential business owners will have to provide a covered space of 5,000 sq ft with all utilities in order to receive funding.
“For existing incubators we will fund up to Rs 30 lakhs and for new incubators Rs 1 crore,” he said.
The ministry had earlier set up a fund of Rs 60 crore that has been released to SIDBI to help new entrepreneurs.
Over next three years, the government plans to set up 80 new livelihood incubators and get 100,000 startups join them.
The ministry has already approved 19 livelihood business incubators, which are all functional and have incubated 117 people out of whom nine have started their own enterprises.