A Comprehensive Guide to the to the Jyoti Gramodyog Vikas Yojana in 2024
Last year, a three-phase, continuous electrical supply to every community in the state became a reality. To fully use the advantages for the rural populace, a plan for establishing village industries is necessary. Every New Village Industry initiative based in a "rural area" is eligible for the Jyoti Gramodyog Vikas Yojana. This facility will not be available for any renovations or additions made to an existing apartment.
An Overview of Jyoti Gramodyog Vikas Yojana:
Sarkarshree's Jyoti Gramdyog Vikas Yojana provides the state's villages with a continuous three-phase electricity supply. Consequently, it has given rural residents new chances to make a living by building little houses.
The goal of the Jyoti Gramdyog Vikas Yojana (Margin Money Yojana) is to increase the level of income and entrepreneurship among rural residents and open up more and more job opportunities for young people without jobs in rural areas. These opportunities can be with individual artisans, entrepreneurs, or self-help groups in villages or towns with a population of 2000 or fewer. The District Ughog Centre approves loan applications for new projects up to Rs. 25 lakh and above Rs. 1 lakh upon bank recommendation.
Eligibility for Jyoti Gramdyog Vikas Yojana:
The eligible agencies under the scheme are:
Individual artists and entrepreneurs between the ages of 25 and 50 are among the qualified agencies under the system.
Education: 10th grade pass; currently employed from home, in the proposed project's factory or unit, or receiving training from an accredited university in the project's field.
Grade-II Active SHGs are involved in the small-scale production of goods.
Note: The scheme does not apply to partnership firms, private limited companies, Join Ventures, JT. Borrowers, Co-obligators, or HUF.
Restricted Businesses in JGVY Yojana:
The following are examples of restricted enterprises (Negative List) or ventures in which funding under the Rural Employment Guarantee Scheme is not available:
(a) Processing, packaging, serving, marketing, and manufacture of meat as well as goods that intoxicate
(b) Fishing, pig farming, crop farming, etc.
(c) Any project that violates legal restrictions or has an adverse environmental impact.
Instructions for Submission of Applications Under the Scheme
The application for this scheme must be submitted in a properly completed form, which can be obtained at the District Industries Centre.
Following receipt from their beneficiaries, boards and corporations connected to the Cottage and Rural Industries Department may submit applications to the District Industries Centre.
After inspecting the location and completing the checklist before sanction, authorized officers of the District Industries Centre, Board, and Corporations who do not fall below the rank of class II may sponsor applications to the General Manager of the District Industries Centre.
Following verification, which may include spot verification if needed, the general manager will suggest an eligible application to the bank.
Benefits of Gramodyog Vikas Yojana Scheme
The Gramodyog Vikas Yojana MSME plan offers several advantages to rural industries and artisans. Let's explore a few benefits:
Employment Generation
Since conventional businesses are primarily labor-intensive, the government wants to create jobs in rural parts of India. It focuses on creating jobs and lowering unemployment.
Rural Development Scheme
Incorporating industries into rural villages' overall development is necessary. That's precisely what GVY offers. By supporting the creation of small businesses, GVY stimulates the regional economy and encourages business ventures. Additionally, lowering migration to cities helps lessen urban overcrowding.
Promoting the use of local resources
GVY promotes the use of readily available raw materials and local resources, preserving regional culture and legacy by promoting traditional knowledge, abilities, and natural resources.
Encouraging Export
Over time, consumers began to favor manufactured goods over those crafted by hand. Presently, however, the market has entirely transformed, and consumers are willing to pay more for traditional handicrafts, particularly in overseas marketplaces. To increase trade competitiveness and help create foreign exchange gains, GVY seeks to encourage the export of certain goods.
Implementation and Inspection of the JGVY Yojana:
To be considered for this initiative, applicants must submit the appropriate paperwork to the District Industries Centre (DIC). Recipients connected to the department's Cottage and Rural Industries Board or Corporation may send applications to the DIC.
Before applying for the DIC General Manager, officers assigned to this task—those not below the rank of Class-II—from the DIC or Board/Corporation must perform site visits, finish the checklist, and get department head clearance. After confirming the application and performing any required site inspections, the general manager will suggest the bank approve the applications that meet the requirements.
The DIC officer is required to visit the unit at least once every three months throughout the acceptance of the application, the installation of the plant and machinery, and the start of production. The report and checklist must be turned in to the general manager, who will then forward a copy to the higher authorities. The authorized unit must be inspected by the DIC General Manager at least once every six months.
Financial Assistance under the Jyoti Gramodyog Vikas Yojana (JGVY):
The project has a ceiling restriction beyond Rs. 1 lakh and up to Rs. 25 lakh. In this case, the state government will contribute 25% of the project cost up to Rs. 10 lakhs as margin money; for projects costing more than Rs. 10 lakhs but less than Rs. 25 lakhs, the rate of margin money will be 25% of the project cost up to Rs. 10 lakhs plus 10% of the project's remaining costs. For women, SC/ST, and physically handicapped individuals, the percentage is 30% up to Rs. 10 lakh, with the remaining 10%.
After the initiative has been effectively conducted for two years, the recipients' accounts will be debited, and the subsidy amount will be credited.
Borrower's Contribution to JGVY Yojana:
Under this agreement, borrowers are required to contribute a minimum of 10% of the project cost from their own cash.
A minimum of 5% contribution is required from beneficiaries who belong to Scheduled Castes, Scheduled Tribes, women, people with physical disabilities exceeding 40%, and former service members.
Up to 20% of the project cost may be contributed by borrowers using their own funds.
Margin money payment in Jyoti Gramodyog Vikas Yojana:
After the bank has distributed the entire amount of the approved loan, it is entitled to the margin money. For two years, the margin money will be a government-protected deposit in the borrower's account.
After two years, the DIC General Manager will certify the unit's successful operation and provide the bank with a certificate. The bank will only then be able to credit the borrower's account with the margin funds. If the unit isn't working well, the margin money needs to be given back to the government. The borrower will no longer be responsible for that amount of interest on the loan after the margin money has been credited to the bank.
Impact of the Jyoti Gramodyog Vikas Yojana
The JGVY has resulted in a noticeable rise in entrepreneurship in rural areas. More people are inspired to launch their firms when the required tools and support are available, which boosts the local economy.
Entrepreneurs' and their families' income levels rise in tandem with the success of small firms. This increase in financial security enables families to make investments in higher-quality healthcare, education, and general living.
A multiplier effect occurs when small-scale industry expansion boosts the local economy. Growing businesses create demand for regional products and services, which promotes local business growth and economic activity.
People don't need to move to cities in quest of work because there are more job prospects in rural areas. As a result, community ties are strengthened, and the rural workforce is retained.
The Yojana focuses especially on marginalized groups, including women and Scheduled Castes (SCs) and Scheduled Tribes (STs). Through targeted support, the JGVY ensures that these groups have equitable chances in entrepreneurship and contributes to their uplift.
Conditions for Jyoti Gramodyog Vikas Yojana
Payment of Equipment Costs: The equipment provider must receive payment for the project's necessary equipment by bank check made out of the approved financing. In the margin money claim that is made to the bank, the party receiving the payment is required to include the equipment check number. Other than working capital, the bank or financial institution will only cover up to 10% of the cost of the plant and machinery (bank loan).
Task Force Committee: The Prime Minister's Employment Generation Programme (PMEGP) Task Force Committee will review applications submitted under this program. The bank will only be encouraged to approve applications that the committee has approved.
EDP Training: Before the first installment of the bank loan is paid, recipients of the approved projects under this plan are required to complete a two- to three-week Entrepreneurship Development Program (EDP) program from an accredited institution. The district industries center's general manager will handle all training-related arrangements.
Budget for EDP Training Centers: The cost of study materials, guest lectures, honorarium, lodging, and food for each trainee might range from Rs. 2,500 to Rs. 4,000 for a two- to three-week period. The Commissioner of Cottage and Rural Industries will specify the process in a circular to the District Industries Centers. The District Industries Centre will reimburse the chosen training centers/institutions for these charges.
Loan Repayment: Loans have a maximum six-year repayment period that must be fulfilled in accordance with the bank's terms.
Review of Scheme: The scheme is scheduled for review every two years.
Conclusion
The Indian government has launched a significant initiative to support rural businesses and crafts, the Gramodyog Vikas Yojana MSME scheme. By assisting creatives and business owners in becoming independent and creative and maintaining traditional skills and handicrafts, it seeks to revolutionize the rural economy. Also, JGVY provides low-interest loans, grants, and subsidies to artists so they can establish manufacturing facilities, buy raw materials, and advertise their goods. Additionally, the program provides technical training to develop business management abilities.
Additional Read:
Everything to know about the MSME Receivable Finance Scheme
Know the Future of MSME with MSME SAMBANDH
A Comprehensive Guide to the Shri Vajpayee Bankable Yojana for Entrepreneurs
Mukhyamantri Udyam Kranti Yojana 2024: Eligibility, Benefits and Online Apply
How to Apply for the Udyogini Scheme: A Complete Guide for Women Entrepreneurs
MSME Champions Portal: Comprehensive Support for Indian MSMEs
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