The Tamil Nadu government has chalked out major plans for the state's micro, small and medium enterprises (MSMEs), including private industrial clusters, single-window clearance and a subsidy for an entrepreneurship development programme.
Tamil Nadu Chief Minister O Panneerselvam, who also holds the finance portfolio, has allocated Rs 365.91 crore for the MSME sector in the state Budget for 2015-16.
The MSME sector is a major source of jobs in the state, providing employment to 6.3 million people, and plays an important role in its economy.
The government is extending up to Rs 30 lakh as 25 per cent capital subsidy and an interest subvention benefit of three per cent to MSMEs. "This government is also supporting the promotion of private industrial clusters to develop their infrastructure," the chief minister said in his Budget speech.
A common investment portal for MSME investors will be created in 2015-16, to serve as single-window clearance mechanism and improve the ease of doing business, according to state government sources.
The Budget provides Rs 80 crore as capital subsidy, Rs 42 crore as generator subsidy, Rs 12 crore as interest subvention and Rs 60 crore as infrastructure support for new industrial estates in 2015-16.
The New Entrepreneur-cum-Enterprises Development Scheme (NEEDS) to assist educated youth to become first-generation entrepreneurs has received good response from educated youth, particularly from women, said officials.
A total subsidy of Rs 77.17 crore has been sanctioned towards new ventures so far. In 2015-16 Rs 100 crore will be provided for continuing this scheme.
A sum of Rs 15 crore has also been provided as subsidy under the Unemployed Youth Employment Generation Programme (UYEGP) in the Budget.
Meanwhile, to facilitate the growth of entrepreneurship in the state, the government plans to establish an Entrepreneurial and Business Acceleration Centre (EBAC) in public-private partnership, jointly with the Entrepreneurship Development Institute and the Confederation of Indian Industry (CII).
An initial amount of Rs 3 crore has been sanctioned for this purpose. This centre will provide mentorship, training and other support services for the development of entrepreneurial ventures.
VAT on air compressors, pump sets up to 10 hp and their parts will be reduced from the present levy of 14.5 per cent to five per cent to encourage the MSME sector and to benefit agriculturists in the state.
The Tamil Nadu Vision 2023 Document unveiled by Jayalalithaa in 2013, when she was chief minister, had envisaged the imparting of employable skills to two crore youth. State government sources said that under this initiative, 1.24 lakh youth have been trained during 2014-15. These initiatives will continue in the coming year and two lakh youth will be imparted skill training.
The allocation to the Tamil Nadu Skill Development Corporation for the Skill Development Mission has been enhanced from Rs 100 crore to Rs 150 crore in the Budget.
Jawahar Vadivelu, president, Southern India Chamber of Commerce (SICCI) said that SICCI welcomed the government's announcement on creation of a common portal for MSME investors to improve ease of doing business.
He said the generator subsidy, interest subvention and infrastructure support for new industrial estates would promote industrial activity, generate employment and growth, and increase manufacturing activity. The announcement of mentorship, training and support services for the development of entrepreneurial ventures will facilitate the growth of Tamil Nadu's MSME sector, Vadivelu said.
