CHAPTER - VII

PROMOTIONAL ACTIVITIES OF INDUSTRIAL FINANCE CORPORATION OF INDIA

LIMITED

“A development bank has the opportunity to promote enterprises, i.e.

to conceive investment proposals and to stimulate others to pursue

them or itself to carry them through, from ‘conception to realization’. In

principle a development bank is well suited to assume this kind of role.

Yet, enterprise creation is fraught with cost and risks which

development bank cannot neglect. Development banks can prudently

undertake them only when they have the requisite financial strength,

technical expertise and the managerial skill to deal with them

effectively1”.

As a part of its broader development role, IFCI Ltd has also

undertaken a wide range of promotional activities, some on its own and

others jointly with other all-India Financial Institutions.

The promotional role of a development bank involves giving not

only finance but the technical assistance and advice necessary for

filling the lacunae in enterprise and management, the helping in

establishing liaison with various agencies and sources of productive

factors and facilities and in short, developing innovative potential and

entrepreneurship among the developing communities2”.

Successful industrialization of any developing country require

several kinds of inputs like entrepreneurship, technical know-how,

efficient management, skilled man-power, well-developed

infrastructure, and of course, capital. The primary aim in the

establishment of specialized agencies called the Development Banks

ls to provide some of these necessary ingredients. Though the

principal role of a Development Bank is that of a purveyor of long-term

^ illiam Diamond . Development Banks. John Hopkins Press. Washington. I9>7.pp.6. IJ'-'n elopment Banking : Issue & options by Vasant Desai in I988.pp.6l.

finance, it has also acquired an additional role, which commonly goes

by the name of promotional activities.

Since the IFCI’s role in field of project financing is largely

confined to providing finance to medium and medium-large scale

industrial units in the corporate and co-operative sectors, for which it

was primarily set up, in its developmental and promotional role, it has

often taken, directly as well as indirectly, such steps and activities as

are regarded necessary for the acceleration of the process of

industrialization in the country in its multi-faceted form.

The promotional activities of a development bank reflect the

socio-economic environment in which it operates, as well as the

policies and priorities influencing its field of operations A feature of

IFCI’s operations is that its policies and activities are integrated with

the National plans and the Industrial Policy Statements of the Govt, of

India from time to time on matters relating to industry in general and

licensing, credit, foreign investments, foreign collaborations,

technology, imports, exports, investment policy for non-resident

Indians, development of backward areas, guidelines to sick units as

well as the targets and strategies enunciated in successive 5 Years

Plans and the new 20 Point Programme. A number of promotional

activities, however, modest in their scope, undertaken by the IFCI as

part of its developmental role , are in consonance with the measures

which aim at the implementation of the objectives of Govt’s policies

and fit in well into the overall policy frame time.

Apart from providing finance to industrial enterprises, IFCI Ltd.

as a DFI, has been playing a promotional role in the sense that it has

endeavored to fill in gaps in the institutional structure for promotion of

'ndustries and for providing the much-needed guidance in project

identification, formulation, implementation and operation etc., to the

new, small and medium scale industrial enterprises. The IFCI Ltd also

extends its technical, managerial and administrative advice / guidance

to its industrial clients. This indeed is an important service, sometimes

assuming more importance that the financial assistance in developing

countries like ours, although the value of such services can not be

quantitatively measured.

The objective of IFCI Ltd. in launching its promotional activities

has been to fill the gaps, either in the institutional infrastructure for the

promotion and growth of industries, or in the provision of the much

needed guidance in project identification, formulation, implementation

and operation, etc., to the new tiny, small scale or medium scale

entrepreneurs or, in the efforts at improving the productivity of human

and material resources. At the same time, the objective of ensuring a

better deal to the weaker and under-privileged section of society, in

consonance with the socio-economic policy requirements and,

particularly the thrust given under the 20-Point Programme of the Govt,

of India , have been duly kept in view .

To carry out its promotional role, IFCI has initiated several

subsidy schemes. For instance, there are subsidy schemes for new

entrepreneurs in rural , cottage , tiny and small scale sectors, for

meeting cost of market and feasibility studies respectively. Likewise

there are schemes for modernization of tiny, small scale and ancillary

units as well as for their revival in case they turn out to be sick 3.

Besides, there are interest subsidy schemes intended to provide

encouragement to unemployed youths and women towards

undertaking industrial ventures through financial assistance from

11(1. Promotional Scthemes (N ew Delhi. 1986). pp.4.

SFCs, IFCI bearing the burden of interest on SFC's loan assistance to

such entrepreneurs during the first year upto specified limits4 . It also

accords priority to projects envisaging the commercial exploitation of

indigenously developed technology in its project operations.

In addition to these schemes IFCI has been instrumental in

promoting the following specialized institutions to cater to the needs of

industry. :

1. RISK CAPITAL AND TECHNOLOGY FINANCE

CORPORATION LTD (RCTC).

Lack of equity capital in the hands of small and medium-sized

entrepreneurs led to the establishment of Risk Capital Foundation in

1975 sponsored by IFCI to provide assistance to new entrepreneurs,

particularly technologists and professionals by giving soft loans, so that

the techno-entrepreneurs might use the money as their equity capital

tor the projects sponsored by them. It was hoped that the, Corporation

will be making a valuable contribution by sponsoring the proposed new

organization namely the RCF which will assist new entrepreneurs in

raising the required funds towards the promoter’s shares5.

With effect from Jan. 1988, RCF ( a registered society) was

converted into a limited company under the name of Risk Capital and

Technology Finance Corporation Ltd. (RCTFC) for encouraging

schemes of technology finance. This corporation provides risk capital

to the first generation entrepreneurs and also finance for technology

development particularly for advancement, promotion, transfer or

adoption of technology. It also provides Venture Capital for potential

Annual Report (N ew Delhi)19S6. pp.71.Ml1-' Econom ic Times. New Delhi. Dec. 5. 1974 pp.l

high-profit ventures which involves innovative product/ technology/

services.

The RCTFC started its operations in June 1976. It has provided

risk capital assistance of Rs. 1532.05 millions upto the end of 31st

March 2001. A sum of Rs. 1506.28 millions was disbursed till the end

of March 2001. This is notan encouraging achievement.

2. TOURISM FINANCE CORPORATION OF INDIA LTD. (TFCI)

As part of its drive to promote tourism, the Govt, of India decided

that IFCI which had appointed as nodal agency for financing tourism

and allied activities, promote a specialized all India development

financing institution to cater to the needs of the tourism industry by

according requisite priority in funding tourism and related projects/

activities Accordingly, the TFCI, promoted by IFCI along with other All-

India Financial Institutions and leading commercial banks, was set up

as a public limited company under the Companies Act 1956 to provide

financial assistance to tourism industry. The institution became

operational on Feb 1, 1989.

TFCI provides rupee loans, underwriting/ direct subscription to

shares/ debentures, guarantees for deferred payments, equipment

basing/equipment credit for setting up and/or development of tourism-

related activities, facilities and services, which inter-alia include hotels,

restaurants, holiday resorts, amusement parks and complexes for

entertainment, education and sports, safari parks, ropeways, cultural

centers, convention halls, all forms of transport industry, air taxis, travel

and tour operating agencies, tourism emporia, sport facilities, etc. TFCI

a|so plays an advisory role for co-coordinating and formulating

guidelines and policies related to financing of such projects. Upto the

end March 2001, sanctions aggregated Rs. 2049.1 crores while

disbursements amounted to Rs. 1216.9 crores.

3. MANAGEMENT DEVELOPMENT INSTITUTE (MDI)

IFCI sponsored in 1973 an institute to provide support to

professionalization of management and upgradation of managerial

skills of practicing managers in industry and banking . The

Management Development Institute provides training in modern

management techniques to entrepreneurs and technologists starting

industries and also to executives. The Institute also undertakes

research in industrial and business management, development

banking and related matters.

4. ENTREPRENEURSHIP DEVELOPMENT INSTITUTE OF INDIA

(EDM)

In 1983, EDII was sponsored by IDBI in collaboration with IFCI,

ICICI, SBI and the Govt, of Gujarat, for training the trainers in

entrepreneurship development . EDII has been conceived of as the

principal agency for entrepreneurship development for the training of

trainers and motivators and for running model training programmes as

well as for undertaking research in the field of entrepreneurship

development in collaboration with EDII, so as to give a momentum to

the development of entrepreneurship in the country.

5. INVESTMENT INFORMATION AND CREDIT RATING

AGENCY OF INDIA LTD. (ICRA):

ICRA, a credit rating agency, was incorporated on the 16th Jan

1991, as a public limited company, sponsored by IFCI along with

selected Investment Institutions and banks. ICRA commenced

operations since the 1st Sep 19916.

It is a credit rating agency to guide investors/ creditors in

determining risk associated with debt instruments.

6. INSTITUTE OF LABOUR DEVELOPMENT (ILD)

The institute undertakes training and retraining facilities to

workers so as to create an awareness amongst workers about their

rights and obligations towards industry. ILD, a non-profit organization,

sponsored by IFCI in Jan, 1992, aims at providing, coordinating and

supplementing training at national level in the area of labour

development, up gradation of workers skills , attainments of proficiency

in work planning, improvement in efficiency and orientation of work

force in industrial units towards modern technology, quality and

productivity7.

7- TOURISM ADVISORY AND FINANCIAL SERVICES

CORPORATION OF INDIA LTD. (TAFSIL),

In Dec ’91, IFCI along with TFCI, sponsored TAFSIL as a

specialized consultancy organization for undertaking consultancy,

advisory and at a later date, financial services for tourism, tourism-

\ i i n u a l R e p o r t I F C I . 19 9 1- 9 2 .p p .1 04.

Aniuml Report IF C I. 1992-93.pp.74.

related activities, facilities and services. It undertakes micro level

project consultancy, preparation of project profits and building up of

Data Bank.

8. TECHNICAL CONSULTANCY ORGANISATIONS (TCOs).

One of IFCI’s promotional activities worth enumerating was the

setting up of TCOs which provide under one roof a total package of

consultancy services for small and medium industrial ventures, right

from concept’ to the ‘commissioning’ stage. They are also in a position

to provide counseling services for operation of units, rehabilitation and

revival of such units and so on8. The TCOs were sponsored by the all-

India Financial Institutions including IFCI, during the seventies and

eighties to cater to the consultancy needs of the small and medium

industries and new entrepreneurs with a view to making available the

technical expertise and filling up the gaps in the process of

industrialization . At present there are 17 TCOs operating in various

states some of them covering more than one state.

TCOs provide a complete package of consulting services at

reasonable rates to small and medium enterprises, individual

entrepreneurs, Government Departments and agencies, various state

level institutions, commercial banks and other institutions in their task

relating to industrial development and financing. Though initially, TCOs

focused on pre-investment studies, over the years they have diversified

their services to include (i) preparation of project profiles and feasibility

studies, (ii) undertaking industrial potential surveys, (iii) identification of

Potential entrepreneurs and providing them technical and management

assistance (iv) undertaking market research and surveys for specific

11 1 I A saga ol ,i5 years o f service to industry

products, (v) undertaking energy audit and energy conservation

assignment (vi) project supervision and where necessary rendering

technical and administrative assistance, (vii) taking up assignments on

turn-key projects (viii) undertaking expert consultancy for export

oriented projects based on modern technology (ix) offering

management consultancy services, especially for diagnostic study of

sick units or for improvement in the existing units and their

rehabilitation programes (x) conducting entrepreneurship development

programes (EDPs) and skill upgradation programmes and (xi) offering

merchant banking services.

SUBSIDIARY COMPANIES ;

Besides the above, IFCI has, in 1995, established IFCI Financial

Services Ltd., IFCI Investor Services Ltd., and IFCI Custodial Services

Ltd., as its wholly owned subsidiaries. IFCI Financial Services Ltd. will

provide merchant banking and allied services to its clients. IFCI

Investors Services Ltd. is intended to provide registrar and transfer

agent Services. While IFCI Custodial Services Ltd. will render custodial

services to its clients.

INSTITUTIONS CO-SPONSORED BY IFCI ;

IFCI has also co-sponsored the following national institutions:

(i) Stock Holding Corporation of India Ltd.

(ii) Securities Trading Corporation of India Ltd

(iii) Over the Counter Exchange of India.

(iv) National Stock Exchange of India Ltd.

(v) Bio-tech Consortium India Ltd.

(vi) AB Homes Finance Ltd.

(vii) LIC Housing Finance Ltd

(viii) GIC Housing Finance Ltd.

PROMOTIONAL SCHEMES OF IFCI LTD.

Besides directly participating in promotion and appraisal of

industrial projects, IFCI has been engaged in many promotional

activities with special emphasis on development and growth of

industries in rural, tiny and small scale sectors, providing guidance in

modernization, market research, marketing assistance etc, and also in

identification, formulation and implementation of projects in rural, tiny

and small scale sector. It works as a catalytic agent for promotion of

technological research and development.

Some of the promotional services being rendered by IFCI are ;

• Support for industrial potential surveys, particularly in No­

industry Districts (NIDs).

• Support for consultancy services through the instrumentality of

Technical Consultancy Organisations (TCOs) set up all over the

country.

• Support for entrepreneurship development through funding

Entrepreneurship Development Programmes (EDPs) and

assisting specialist institutions set up for the purpose at the apex

and state - level.

• Support for professionalisation of management and upgradation

of managerial skills.

• Support for risk capital assistance to first generation

entrepreneurs, venture capital, and technology finance to

technology-oriented projects.

• Support for providing financial assistance to enterprises for

setting up and/or development of tourism, tourism-related

activities, facilities and services.

• Support for Science and Technology Entrepreneurs' Parks

(STEPs).

• Support for research in areas of Industrial Management and

Development Banking.

• Promotional Schemes.

• Investment Information and Credit Rating Agency (IICRA)

A. CONSULTANCY FEE SUBSIDY SCHEME

Technical Consultancy Organizations (TCO's) have been

sponsored by the All India Financial Institutions, state level institutions

and banks etc, with the main objective to provide quality consultancy

services to small and medium scale entrepreneurs at a low cost. These

TCOs can be associated at various phases of project implementation

starting from project identification, formulation of scheme and its

subsequent implementation and operation. Under the consultancy fee

subsidy schemes, IFCI basically provides subsidy to TCO's to take up

assignments on behalf of small entrepreneurs to guide them on various

'ssues involved in setting up and running of projects mainly in small

sector. The IFCI at present operates the following schemes under thisgroup.

• Scheme of subsidy to small entrepreneurs in the rural, cottage,

tiny and small sectors for meeting cost of feasibility studies etc.

• Scheme of subsidy for promotion of ancillary and small scale

industries.

• Scheme of subsidy to new entrepreneurs for meeting cost of

market research/surveys.

• Scheme of subsidy for providing marketing assistance to small

scale units.

• Scheme of subsidy for consultancy or use of Non-Conventional

Sources of Energy and Energy Conservation.

• Scheme of subsidy for control of pollution in the villages and

small scale industries.

• Scheme of subsidy for control of pollution in the small and

medium scale industrial units.

• Scheme of subsidy for consultancy to industries related to

animal husbandry, poultry, farming and fishing.

• Scheme of subsidy for consultancy relating to industries based

on agriculture, horticulture, sericulture and pisciculture.

B- INTEREST SUBSIDY SCHEMES

Interest subsidy is provided to various classes of entrepreneurs and

also against loans for a few specific purposes as a promotional activity

by IFCI. The following schemes under this category are in operation at

present:

• Scheme of interest subsidy for self-development and self-

employment of unemployed young persons.

• Scheme of interest subsidy for women entrepreneurs.

• Scheme of interest subsidy for encouraging the adoption of

indigenous technology.

• Scheme of interest subsidy for encouraging quality control

measures in small scale sector.

C. ENTREPRENEURSHIP DEVELOPMENT SCHEME

• Scheme for encouraging Entrepreneurship Development in

Tourism and Tourist related Activities in the States of Goa,

Himachal Pradesh and Rajasthan.

• Scheme for encouraging self employment amongst persons

rendered jobless due to retrenchment or rehabilitation in a sick

industrial unit in the organized sector undergoing a process of

rehabilitation/revival.

• IFCI also provides support for Management Development and

Labour Development, Housing Development etc.

A. CONSULTANCY FEE SUBSIDY SCHEMES OF IFCI

I■ Scheme o f subsidy to small entrepreneurs in the rural cottage,

tiny and sm all scale sectors for meeting cost of feasibility studies,

etc.

The object of the scheme is to encourage the tiniest among tiny

and smallest among small entrepreneurs to avail themselves of the

facilities offered by Technical Consultancy Organizations (TCOs) ( with

which one or more Financial institutions or development agencies at

the state or all India level have been associated as a shareholder(s) or

as a member(s) of the Board of Management), whose primary

objective is to provide low cost but quality consultancy services to the

small and medium scale entrepreneurs, through the various phases of

the project cycle, viz., project identification, formulation, implementation

and operations.

2. Scheme o f subsidy for consultancy to industries relating to

animal husbandry, dairy farming, poultry farming and fishing.

Animal husbandry, Dairy farming, Poultry farming and Fishing

occupy an important place in the economy of the country. The pursuit

of these trades on scientific lines is in the interest of creating revenues

for self-employment and freeing the poverty stricken people from

hunger as well as poverty. With a view to developing a culture for

consultancy in these vital areas, which have an impact on the rural

society in our country, IFCI has devised a scheme of Subsidy for

Consultancy to Industries relating to Animal husbandry, Dairy farming,

Poultry farming and Fishing.

3. Scheme of subsidy for consultancy to industries based on or

related to agriculture, horticulture, sericulture and pisciculture.

Industries based on Agriculture, Horticulture, Sericulture and

Pisciculture are assuming importance day by day. With these

industries, the question of proper packaging of the product is also

involved. Particularly in the area of Horticulture, it has to be ensured

that the packaging of fruits and other products is so done that it does

n° t lead to indiscriminate exploitation of the forest wealth of the

country. With a view to developing a culture for consultancy in these

V|tal areas, which have an impact on the economy of the country, IFCI

has dev ised a scheme of subsidy for consultancy relating to industries

based on or related to Agriculture, Horticulture, Sericulture and

Pisciculture.

4. Scheme o f subsidy for promotion o f ancillary and small scale

industries.

One of the main objectives of Industrial Policy of Government is

to encourage the setting-up of industries in the small-scale and

ancillary sectors. Accordingly, IFCI has been operating as part of its

promotional activities a Scheme for Promotion of Ancillary and Small

Scale Industries.

The objectives o f the Scheme are:

(a) to encourage the setting-up of ancillary and small scale industries

which manufacture intermediate goods and components or provides

services to units in the small, medium and large sectors, according to

design, specifications and quality standards given to them by such

units and pursuant to an off-take arrangement.

(b) to encourage the setting-up of ancillary and small scale units which

are in the nature of down stream projects of the small, medium and

large industries from whom they obtain their major raw materials under

a supply arrangement; and

(c) generally to up-grade the technical capabilities and improve the

financial viability of ancillary and small scale units of the types referred

to above by provision of advice and guidance in technical, financial and

marketing areas.

5■ Scheme o f subsidy to new entrepreneurs for meeting cost o f

market research/surveys.

It has been the experience of IFCI that entrepreneurs new to

industry often do not give the necessary importance to examining the

market aspect in formulating project proposals. IFCI, in order to

encourage the commissioning of proper market research/survey report

has decided to subsidises the cost of market research/survey

instituted by the new entrepreneurs (who may be locally based or non­

resident Indians) for assessing the market for the products proposed to

be manufactured by them.

6. Scheme o f subsidy for providing marketing assistance to small

scale units.

Problems relating to marketing have often led to sickness.

Marketing assistance has been considered to be essential by various

Committees/Commissions/Study groups for the development and

growth of small scale industry on viable lines. The objective of the

Scheme of Subsidy for providing marketing assistance to small scale

units is to encourage the small scale sector units (including rural,

cottage and tiny scale sector units) to avail themselves of marketing

assistance facilities offered by Technical Consultancy Organisations

(TCOs), with which one or more Financial Institutions or Development

agencies at the State or all India level have been associated as a

shareholder(s) or as a member(s) of the Board of Management. The

Scheme involves the TCOs fully in providing marketing assistance to

the small scale sector units at an economical and competitive cost, due

to a part of its fees being subsidised by IFCI.

7.Scheme of Subsidy for consultancy on use of non-conventional

sources of energy and energy conservation measures.

The rising cost of conventional sources of energy and the fast

dwindling reserves of fossil fuels have made it imperative for the main

consumers of energy to formulate appropriate schemes to design and

develop proper systems aiming at not only cutting down the

consumption level of energy in the form it is currently available, but

also to produce and make wider application of the alternate and

renewable sources of energy. The conservation of energy by better

management has to be paid utmost attention in view of the scarcity and

increasing demand of energy for various purposes. Energy

management has to be looked into not only from the angle of the larger

national interest, but also as a means of reducing the cost of

production so as to improve or, at least, maintain the reasonable

margin of profit. A unit of energy saved is a unit of energy gained.

To meet the growing need for formulation of suitable proposals

for the use of non-conventional sources of energy and taking up

energy conservation measures, IFCI has devised a Scheme which

envisages subsidising the fees payable to a Technical Consultancy

Organisation (TCO) for the consultancy services provided by it in this

vital area.

8.Scheme o f subsidy for control o f pollution in the village and

small industries sector.

Alongside the objective of promoting industrial development in

the country, the objective of protecting the environment has also to be

kept in view. For this purpose, it is necessary that the existing industrial

units pay due importance to environmental protection measures and

ensure that-(a) industrial effluents are controlled and kept within the

limits prescribed by the regulatory authorities in every state, (b) all

steps are taken to control or abate the pollution of air, water and soil,

and the equipments proposed to be installed for the prevention and

control of pollution are not only appropriate, but wholly adequate.

In the Village and Small Industries (VSI) sector, entrepreneurs

have often been facing the problems due to inadequacy or absence of

adequate measures for controlling industrial effluents and keeping the

environment free from pollution of air, water and soil.

To meet the growing needs for formulation of suitable proposals

for prevention and control of pollution in industrial units, which meet the

approval of the competent State Authority and/or the State Pollution

Control Board, IFCI has devised a scheme which envisages

subsidising the fees payable to a Technical Consultancy Organisation

(TCO) for preparing, and, if so required, implementing a scheme of

pollution control in specific industrial units to the satisfaction of the

regulatory bodies and/or State Pollution Control Board.

B. INTEREST SUBSIDY SCHEMES Of IFCI LTD.

1. Scheme o f interest subsidy for Self-Development and Self-

Employment o f unemployed Young Persons.

The main objective of the Scheme is to introduce persons, who

are otherwise without work, to industry or industrial vocations after

developing in them entrepreneurial traits and to settle them through the

process of self-employment. The Scheme is in pursuance of the

national objectives and aims at giving a better deal to weaker and

underprivileged sections of the society.

2 Scheme o f Interest Subsidy for Women Entrepreneurs.

Entrepreneurship plays a critical role in the growth of any

society, particularly in a fast developing country like India. It has been

increasingly realised that enterprising women have vast

entrepreneurial talents which could be harnessed so as to convert

them from the position of 'job-seekers' to 'job givers'.

The main objective of the 'Scheme of Interest Subsidy for

Women Entrepreneurs' is to provide incentives to the women having

business acumen and entrepreneurial traits to contribute their mite in

the industrial development programme of the country so that the

avenues of self-development and self-employment are created for

them.

3.Scheme of Interest Subsidy for Encouraging Quality Control

Measures in Small Scale Sector.

The objective of the Scheme is to provide incentives to the small

scale sector industrial units to equip themselves with proper and

adequate testing as well as quality control equipments so that they are

able to improve the quality of their products and increase their

domestic as well as international competitiveness.

4. Scheme o f Interest Subsidy for Encouraging the Adoption of

Indigenous Technology.

One of the national objectives of industrial development in the

country is to promote scientific and technological self-reliance and

consequen tly projects based on indigenous technology are to be

encouraged. Through, the Development Financing Institutions in India

(both at State and National level) are giving priority to such projects in

sanction ing financial assistance, there is no scheme for providing

subsidy to projects which play a pioneering role in the commercial

exploitation of indigenous technology, IFCI has, therefore, instituted a

Schem e for providing subsidy to such projects.

5. Scheme for Encouraging Entrepreneurship Development in

Tourism and Tourism Related Activities.

With its rich and diversified cultural heritage, resplendent natural

resources, flora and fauna India has tremendous potential for the

development of tourism and tourism-related activities. Tourism and

tourism-related activities having been given the status of an "industry",

also afford considerable scope for self-employment generation,

particularly amongst educated unemployed youths. The main objective

of the scheme is to introduce persons, who are otherwise without work,

to tourism and tourism-related activities, after developing in the

entrepreneurial traits and to settle them through the process of self-

employment.

6. Sc hemes for Encouraging Self-Employment amongst persons

rendered Jobless due to Retrenchment or Rationalisation in a

Sick Industrial Unit in the Organised Sector undergoing a process

of Rehabilitation/Revival

Rehabilitation of potentially viable units is an arduous job. It

requires a number of sacrifices on the part of various agencies

involved with it. Very often, a scheme of rehabilitation/modernisation in

an industrial unit in the organised medium or large scale industry

sector, involves rationalisation of labour by retrenchment of otherwise

gainfully employed people. The terminal benefits allowed to such

persons, no doubt, provide some succour to them, but these, very

often, fail to become a substitute for an assured means of livelihood.

The main objective of the Scheme is to introduce such jobless persons

an assured livelihood, after developing in them entrepreneurial traits

and to settle them through the process of self-employment.

In its promotional role, IFCI has been endeavouring to take up

directly as well as indirectly such steps and activities as are regarded

necessary for the acceleration of the process of industrialization in the

country in its multi-faceted form. IFCI’s promotional role has come to

occupy a place of major significance over the years. It has been the

endeavour of IFCI to identify the gaps in the institutional infrastructure

or extension services, and to provide as well as stimulate the provision

of non-financial inputs to the extent possible, consistent with its

resources and capability. The major thrust in the area of promotional

services continued to be on providing support and momentum to the

Village and Small Industries (VSI) sector through specially designed

Promotional Schemes, provision of consultancy services,

entrepreneurship development, management development, labour

development, rural development and related activities, risk capital,

venture capital and technology finance, tourism related activities,

development of the capital market, science parks, research and

development and related research- oriented activities.