PMEGP

Prime Minister’s Employment Generation Programme (PMEGP) is a credit linked subsidy programme administered by the Ministry of Micro, Small and Medium Enterprises, Government of India. Khadi & Village Industries Commission (KVIC), is the nodal agency at national level for implementation of the scheme. Under this scheme, the beneficiary has to invest only 5-10% of the project cost while the government provides a subsidy of 15-35% of  the project based on different criteria. The participating banks provide the rest of the funds as term loans to the entrepreneur.

Objectives of the Prime Minister’s Employment Generation Programme (PMEGP)

The PMEGP has four-fold objectives:

  1. To create employment in rural, as well as urban areas in India by setting up new self-employment micro enterprises or projects.
  2. To provide a common ground for the widely dispersed traditional artisans and unemployed youth in both rural and urban areas to come together and create self-employment avenues.
  3. To take steps to prevent migration of rural people to cities to seek employment by giving them stable and sustainable employment. This is especially for traditional and prospective artisans and rural and urban unemployed youth who get traditional or seasonal employment and remain unemployed rest of the year.
  4. To increase the income earning capacity of artisans and focus on increasing the growth rate of rural and urban employment.

Subsidy and Funding under PMEGP:

For the manufacturing sector, the maximum limit of cost of the project will be Rs. 25 lakh. For units in the business or service sector, this limit will be Rs. 10 lakh. Additionally, the per capita investment should not be more than Rs. 1 lakh in the plains and Rs. 1.5 lakh in the hilly regions. For the manufacturing sector, the maximum limit of cost of the project will be Rs. 25 lakh. For units in the business or service sector, this limit will be Rs. 10 lakh. Additionally, the per capita investment should not be more than Rs. 1 lakh in the plains and Rs. 1.5 lakh in the hilly regions.

Beneficiary Categories Beneficiary’s Share(of Total Project) Subsidy Rate(from Govt.) – Urban Subsidy Rate(From Govt.) – Rural
General 10% 15% 25%
Special 5% 25% 35%

Eligible for the enterprises in the following sectors:

  1. Agro-based Food Processing
  2. Forest-based Products
  3. Hand Made Paper and Fibre
  4. Mineral-based Products
  5. Polymer and Chemical-based Products
  6. Rural Engineering and Bio-Tech
  7. Service and Textile