An Overview Of GoI’s National Manufacturing Competitiveness Programme (NMCP) For MSMEs

The manufacturing sector contributes 17% to the country’s overall GDP of which 45% of the manufacturing sector’s output is contributed by the SME sector alone. The SME sector forms an integral part of the Indian manufacturing sector and enjoyed a sheltered existence with a high tariff on imports, fiscal incentives and a monopoly on the manufacture of certain goods. However, the reform era beginning 1991 opened India to trade agreements with other countries that proved advantageous to organizations that held a monopoly in their respective trades. To help with this and augment the global competitiveness of the Indian micro, small and medium enterprises (MSME), the Government of India in partnership with the MSME ministry launched a set of schemes under the National Manufacturing Competitiveness Programme (NMCP). These schemes which began to be implemented in 2006 aim to give these enterprises a competitive edge to survive in a liberalised economy.

The goal of the NMCP on a larger scale is to increase the manufacturing sector’s contribution to the nation’s GDP to 25%. The schemes under this five-year programme as finalised by the National Manufacturing Competitiveness Council (NMCC) aim to help SME’s with information and communication technology, manufacturing management, financing help, design clinics, skill development and marketing support for SMEs.

Listed below are the various schemes under the NMCP:

1. Lean Manufacturing Competitiveness Scheme for MSMEs
2. Design clinic scheme
3. Technology & quality upgradation support for MSMEs (TEQUP)
4. Building awareness on Intellectual Property Rights (IPR)
5. Support for entrepreneurial & management development of SME’s through incubators
6. Enabling the manufacturing sector to be competitive through Quality Management Standards (QMS) and Quality Technology Tools (QTT)
7. Marketing support/ assistance for MSMEs
8. Marketing assistance & technology upgradation scheme in MSMEs
9. Promotion of ICT in the Indian manufacturing sector

 Here’s a quick look at the NMCP schemes:

The Lean Manufacturing Competitiveness Scheme

This scheme is aimed at increasing competitiveness through reduced wastage in manufacturing by implementing suitable techniques. The Quality Council of India and the National Productivity Council monitor the implementation of the scheme. Lean Manufacturing Consultants (LMC) will oversee the implementation of these techniques for a period of 18 months, with 80% of the cost of these consultants being borne by the government while 20% will be borne by the unit.

What is the eligibility criteria?

• All manufacturing SMEs that are registered with the DIC (EMII) or with any other professional body, association, Government agency, department or agency can apply.
• The units should form a mini cluster (MC) ideally of 10 units (minimum 6), by signing a MoU among themselves.

How do I apply?

• A group of SMEs, recognized SPV or a mini cluster formed by a group of ten or more units can apply for the scheme.
• The SPV (mini clusters) can apply to the National Monitoring and Implementing Unit (National Productivity Council for the Scheme) in the prescribed format by submitting to the National Productivity Council (NPC), Utpadakta Bhawan, Lodhi Road, New Delhi-110003
• The approval is given in two steps; first, the provisional approval and final approval is given once the criteria of the provisional approval are fulfilled.

For more information regarding the Lean Manufacturing Competitiveness Scheme, please click here.

The Design Clinic Scheme

The Design Clinic Scheme is aimed at enabling MSMEs to improve design practices, embrace cost-effective product development, and improve the value of existing products through awareness seminars and projects. Beneficiaries of funding support for ‘Design Awareness’ workshops & seminars and  implementation of ‘Design’

Projects are expected to attain a level of skill that will enable them to move from design manufacturing to design conception and original manufacturing. The MSME ministry with the National Institute of Design launched the scheme in 2010, with NID being the sole agency that brings together design consultants and enterprises.

What is the eligibility criteria?

• Any expert agency such as industry associations or technical institutions can apply to conduct seminars and workshops
• MSMEs or groups of MSMEs can apply as prime applicants
• Academic institutes, design companies or design consultants can apply as co-applicants along with an MSME that is the prime applicant
• Individual design students too can apply as co-applicants in collaboration with an academic institution and an MSME as the prime applicant.

How do I apply?

• Expert agencies can directly apply to design clinic centres to conduct workshops and seminars.
• Application can be made by MSMEs without a design company or in collaboration with a design consultant/academic institution, by submitting the proposal to the Design Clinic Centre, or online for design projects,
• You can apply for these online at http://www.designclinicsmsme.org/ or download the form from www.dcmsme.gov.in/schemes.

For more information, please click here.

The Technology & Quality Upgradation Support for MSMEs (TEQUP) Scheme

This is one of the most important schemes of the NMCP. Keeping in mind the relative dearth in availability of technology and quality, high price, and its critical role in manufacturing units, this scheme aims to implement energy efficient techniques in manufacturing via Energy Efficiency and Product Quality certifications, encouraging MSME’s to acquire licenses through international bodies, adopting techniques that adhere to global industrial standards, and setting up Clean Carbon Accreditation Centers that will encourage clean energy practices among MSME’s. The MSME ministry will identify enterprises through data and input provided by related associations, technical institutes and NGOs.

What is the eligibility criteria?

• Organisations such as PCRA, BEE, TERI, IIT, NIT, etc. and state Govt. agencies like MITCON, GEDA and the like can apply.
• Cluster/industry based associations of MSMEs along with NGOs and Technical Institutions too are eligible.

How do I apply?

• You need to obtain a product certification from national standardisation bodies such as BIS and BEE or international product certifications like CE, UL, ANSI, etc.
• In case you need reimbursement of fees, the application needs to be forwarded in the prescribed format to the MSME-DI concerned, along with the required documents.

Please visit http://www.dcmsme.gov.in/schemes/technology&quality10.pdf for more information.

Building Awareness on Intellectual Property Rights (IPR) or the IPR Scheme

This scheme is aimed at educating MSMEs on protecting their strategies and ideas, which would in the future, aid them with technology and quality upgradation. A public-private partnership model is used to help MSMEs learn the nuances of intellectual property and how to use IPR tools. Enterprises that wish to participate contribute 10% of the support that this scheme offers to avail the benefits.

What is the eligibility criteria?

• You need to either be a registered MSME unit or MSME organisations like industry associations, societies, firms, trusts, NGOs, Institutions, Universities, etc. that regularly assist MSMEs to apply.
• Agencies like consultancy organisations, research institutes, individual experts or agencies with sound technical and financial capabilities to conduct pilot studies with a minimum of five years experience and agencies such as TIFAC, Patent Facilitation Centres, NRDC, Indian Patent Office, Registrar of Trademarks, Registrar of Geographical Indications, D.B.T., Registrar of Copyrights, MoHRD, NIIPM, IITs, Law Schools, patent attorneys, individual IPR experts, WIPO, EU-TIDP, USPTO, KIPO/KIPA, IIFT, DIT, MoEF, Ministry of MSME, DSIR, etc. too can apply
• Private units that are sponsored by MSME associations and Government bodies too are eligible to apply.

How do I apply?

You can visit http://www.dcmsme.gov.in/schemes/IPR10.pdf for information on how to apply under this scheme.

Entrepreneurial & Management Development of Small and Micro Enterprises through Incubators

This aims to provide basic financial assistance and advice to innovative business ideas to help attract venture capital. This is to be done with the help of Business Incubators in the form of technical institutions that will provide ten business enterprises with workshops, facilities and expertise. Each incubator is given ₹62.5 lakhs to be divided amongst these ten ventures with each enterprise being set a ceiling of ₹10 lakh. The Technical Approval Committee accepts Business Incubator proposals while the MSME ministry has the final word. Upon acceptance, the host institute begins an agreement with the government that commences with 30% of the fund being given to the Institute, and the rest being siphoned into it in installments based on requirement.

What is the eligibility criteria?

Individuals or MSMEs with fresh ideas looking to go commercial can apply to host institutions like IIT, NIT, research institutes and the like. To view the list of host institutions, please visit http://www.dcmsme.gov.in/schemes/Institutions_Detail.pdf. Technical institutes that are looking to become host institution should apply to the office of the Development Commissioner – MSME or their nearest MSME-DI for funding support.

How do I apply?

• To become a host institution, the application can be made by the technical institution after a Request for Proposal (RFP)/ Expression of Interest (EOI) is released.
• Individuals or MSMEs can directly apply to their nearest host institution based on the list of host institutions.

For further information, you can click here.

Enabling Manufacturing Sector to be Competitive through Quality Management Standards (QMS) and Quality Technology Tools (QTT)

This scheme is one of the basic schemes of the NMCP. The scheme aims to ensure that MSMEs achieve targets by undertaking necessary activities such as Quality Management Standards (QMS) and Quality Technology Tools (QTT) through which enterprises can efficiently use energy, improve product quality, decrease the rejection of manufactured products, and reduce the amount of build-up at various stages of the manufacturing process. The scheme aims to bring awareness to these tools via courses at ITIs and via training material. The MSME Ministry decides on enterprises that require training and awareness of these tools.

What is the eligibility criteria?

Established organizations like the Quality Council of India (QCI), the National Recruitment Board for Personnel and Training, the Consultancy Development Corporation, the National Productivity Council, Standardisation Testing & Quality Certification (STQC, a Society under the Ministry of IT), Indian Institute of Quality Management, Industry Associations that have taken an active interest in QMS/QTT, Technical Institutions, Engineering Colleges, Tool Rooms and similar bodies, and SMEs can apply under this scheme.

How do I apply?

SMEs or clusters can contact the Office of the DCMSME to initiate the application process. The DC office will finalise the MSME clusters for conducting the Awareness Programme on Quality Management Stand.

Please visit http://www.dcmsme.gov.in/schemes/QMSQTT10.pdf for more details regarding this scheme.

Marketing Assistance for SME’s Scheme (BarCode)

The Marketing Assistance Scheme encourages SMEs to barcode by conducting seminars and reimbursement of registration fees for barcoding. Barcoding can increase the success of any enterprise/ company and organisation through accurate product information.

What is the eligibility criteria?

The scheme is applicable to all SMEs with an EMII registration and GS1 India registration for use of barcodes.

How do I apply?

Once you are registered with GS1 India for the use of barcode for products:

• Fill out the application form to claim reimbursement on the barcode.
• Collect the application form along with formats for supporting documents from the Director, MSME-DI, or download them from http://www.dcmsme.gov.in/
• The completed application form along with supporting documents should be submitted to the office of MSME-DI as mentioned at http://www.dcmsme.gov.in/contacts.htm#two.

You can find more information about this scheme at http://www.dcmsme.gov.in/schemes/GuidelinesBarCode.pdf.

Marketing assistance and technology upgradation scheme in MSMEs

This scheme focuses on enabling small and micro enterprises to scale up into macro enterprises through technology up gradation to maintain their position in a global economy. The National Small Industries Corporation (NSIC), a sector of the MSME ministry is the agency that implements the scheme and is also in charge of evaluating the benefits of the scheme through studies, surveys, and reports. The NSIC provides a platform for enterprises to showcase their work, explore growing markets and encourage collaborations, for which the NSIC takes 10% of implementation charges from enterprises

What is the eligibility criteria?

• Any agency mentioned in the EoI guidelines, MSMEs, Industry Associations, NGOs are eligible to apply under this scheme.

How do I apply?

SMEs wanting to participate in state/district level trade fairs:

• SSC supported by the DC-MSME will identify and approve the manufacturing MSME clusters/units that want to participate in state/district level local/exhibitions/trade fairs on the basis of responses received through MSME-DIs, Industry Associations, and NGOs.
• The MSME applying under the scheme is required to submit the claim with supporting documents to the local MSME-DI office for reimbursement in the given format. To adopt corporate governance practices, the office of the DC-MSME will identify MSME units eligible to participate in this activity based on the request received from the MSME-DIs, Industry Associations and NGOs. In the case of a reimbursement certificate, the applicant MSME unit should submit the claim in the prescribed format along with documents to the local MSME-DI office for reimbursement. The application form which is available at http://www.dcmsme.gov.in/schemes/MarkAssis.pdf should be filled and sent to the Regional MSME-DI along with the documents.

Please visit http://dcmsme.gov.in/MATU_30616.pdf for more information.

Promotion of ICT in the Indian manufacturing sector

This ICT scheme encourages and assists the manufacturing MSME clusters to adopt ICT tools and applications in their businesses. Through this, the GoI aims to improve productivity and competitiveness in national and international markets among these clusters. Under this scheme,  e-Readiness Centres (e-RCs) will be set up in identified clusters that will host commercial software/locally developed solutions specifically designed for the use of SMEs in their business operations. They will also facilitate training to MSME staff for upgrading IT skill development.

A one-time subsidy of 25% will be provided to the MSMEs on the institutional finance availed by them for procurement of hardware and software.

What is the eligibility criteria?

Under the scheme, 100 potential SME manufacturing clusters with high-quality production and export potential will be selected for implementation of the scheme.

A group of Technology Providers (TPs) from prominent IT industry organizations will be appointed to bring in their expertise/inputs, train and sensitize MSMEs on the need for ICT adoption, assist in the diagnostic mapping of selected clusters, the formation of SPVs, etc.

The technology providers will be appointed based on the following criteria:

• The agency should have a comprehensive set of technology platform
• Multiple solutions that cover operating systems, productivity software, business solutions and web technologies, specific editions designed for MSMEs and a mix of self-hosted, partner-hosted and on-premise versions to provide flexibility to MSMEs.
• The agency has worked on clusters to demonstrate commitment and experience
• The agency has an MSME focus area in its organization.

How do I apply?

The selection of clusters will be done by the Office of DC (MSME) from different sectors across the country in association with stakeholders. The selected clusters will be taken up for scheme implementation in a phased manner after due approval of the appointed Project Monitoring & Advisory Committee (PMAC).

For TPs, the interested IT can apply in response to the advertisement for EoI. The Office of Development Commissioner (MSME) will impanel Technology Providers by inviting Expression of Interest (EOI) from various IT majors/ companies, etc. The Office of DC (MSME) would design specific EOI for this purpose, which will be issued for advertisement after the approval of PMAC.

Please visit http://www.dcmsme.gov.in/schemes/ICTGL_finaldated6.8.10.pdf for more information.