Envisaging the critical role which the MSMEs play in Indian Economy, following recommendations having been made in 11th Financial Plan (2007-2012)

• A total of 170 Technology Business Incubators and 50 Technology Innovation Centers should be set up with a total outlay of Rs. 1100 Crore

• Enhancement in budget in all schemes promoting innovation and entrepreneurship.

• Polytechnics and Industrial Training Institutes should be encouraged to organize short-term programs for vocational training of school dropouts in a variety of multi-skilled job positions that would be available in SMEs

• TIFAC (Technology Information, Forecasting and Assessment Council) will coordinate the activities of technology profiling of MSME clusters with active cooperation and involvement of CII, UNIDO and INAE

• Making available to MSMEs Special Purpose Machines (SPM), to meet our customers' specialized and highly complex requirements

• Promoting Patenting and Quality Assurance

• Comprehensive retraining programs for the workers & employees in MSMEs be

introduced with incentives/ financial support for them

• Taxation & Duty structures for MSMEs be kept such that they encourage innovation

• Better amenities need to be provided around MSMEs or their clusters located in rural/ small town areas to check the concentration of population in urban areas

• A fund, worth Rs. 4,000 crore, will be formed out of the Rural Infrastructure Development Fund (RIDF) and provided to the Small Industries Development Bank of India (SIDBI). This fund is expected to incentivize banks and State Finance Corporations (SFCs) to extend loans to MSMEs by refinancing 50% of incremental lending to these players during 2009-10. This move will facilitate credit flow at affordable rates for MSMEs and thereby provide them the much-needed fiscal support

• Rs 144 crore for Credit Support Program to provide Guarantee cover to banks for extending loans to Small/Tiny units without collateral

• Rs 823 crore for Prime Minister’s Employment Generation Program to provide subsidy to beneficiaries’ meeting cost of training and to meet residual/ committed liabilities under Prime Minister’s Rozgar Yojana /Rural Employment Generation Program

 • Schemes for Integrated Textile Park (SITP) and Technology Upgradation Fund (TUF) to be continued in the eleventh plan period; provision for SITP being maintained at Rs 450 Crores in 2008-09; provision for TUF to be increased to Rs 1090 Crores in 2008-09 from Rs 911 Crores in 2007-08

• In Handloom sector 250 clusters are being developed and 443 yarn banks established under the cluster based approach to the development of handloom sector. Allocation being increased to Rs 340 Crores in 2008-09. Infrastructure and Production being scaled up by taking up six centers for development as mega clusters; Varanasi and Sibsagar to be taken up for Handlooms, Bhiwandi and Erode for Powerlooms, and Narsapur and Moradabad for Handicrafts. Initial provision of Rs 100 Crore made in 2008-09 for these clusters

• A risk capital fund being created in the Small Industries and Development Bank of India (SIDBI); Credit Guarantee Fund with SIDBI had extended Guarantees to 89,129 units for an amount of Rs 2479 Crores as on January 31, 2008. SIDBI to reduce the guarantee fee from 1.5 per cent to 1 per cent and the annual service fee from 0.75 per cent to 0.5 per cent for loans up to Rs 5 lacs

• Rs 2000 crores fund to be created in SIDBI for enhancing refinance capability to MSME sector