The Gazetteers Department

(1) Scheme for grant of loans and subsidies to bona fide craftsmen and their co-operative societies for purchase of tools and equipment and for working capital.

(2) Scheme for grant of loans and subsidies to backward class artisans for purchase of tools and equipment and for working capital.

(3) Scheme for assistance to educated unemployed to start or develop cottage industries, and

(4) Scheme for grants of Haskell or nutan ghanis on loan-cum-subsidy basis.

Of these, the first scheme has been in operation since 1941. Under this scheme, financial assistance is granted to: (i) deserving bona fide craftsmen who have received training in the peripatetic school or Government recognised technical institute; (ii) trained bona fide craftsmen, who are already in some business, industry or trade; and (iii) deserving individual hereditary artisans who are not trained bona fide craftsmen.

In 1950-51, the scope of the scheme was extended to accommodate individual artisans who were not covered by (i). This was done with a view to enabling the artisans to secure necessary financial accommodation to carry on their industries, especially after the money-lenders act was enforced.

Financial assistance up to Rs. 2,000 (Rs. 1,000 for tools and Rs. 1,000 for working capital) can be granted to each artisan If two or more persons apply for assistance for a joint under-taking, a maximum of Rs. 6,000 can be given. In case of trained artisans, 25 per cent of the amount as subsidy and 75 per cent as loan bearing interest at 4½ per cent and repayable in five years in equal monthly instalments are granted.

Central co-operative societies, having at least one-third of their members as bona fide craftsmen or persons following cottage industries, can be granted financial assistance up to Rs. 5,000 for the purchase of tools and equipment. Of this amount, up to 50 per cent can be treated as subsidy.

(2) The Scheme for grant of loans and subsidies to backward class artisans for purchase of tools, appliances, etc. The scheme was first sanctioned in 1943 for the improvement of backward classes. Under the scheme financial assistance up to Rs. 2,000 can be granted to backward class artisans for the purchase of tools and equipment under similar terms and conditions as obtained under (1). If the backward class artisan, however, is a trained one, the assistance is free of interest. If he is not trained, half the amount of loan that is granted, is treated as free of interest.

Industrial co-operative societies of backward class artisans are also eligible for the grant of loans and subsidies as in the case of other industrial co-operative societies. Concession in interest is given to the society if its members are trained.

(3) The scheme for grant of assistance to educated unemployed to start or develop cottage industries was first introduced in 1942. Under the scheme, financial assistance in the form of subsidy and loan can be granted up to Rs. 3,000 to educated persons who have studied up to S. S. C. Examination or passed the Regional Lang uage Final Examination and who are unemployed as well as to educated persons who are already engaged in some business, industry or trade. 25 per cent of the total financial assistance can be treated as subsidy in deserving cases only and the remaining amount is treated as a loan carrying interest at four-and-a-half per cent. The loan is repayable in five years in equal monthly instalments. Security in the form of one or two personal sure ties or the mortgage of immovable property is required under the scheme.

(4) The Scheme for grant of Haskell or nutan ghanis on loan- cum-subsidy basis. The scheme is meant to induce telis to use improved types of ghanis in preference to the old ones.

Under the scheme which was sanctioned in 1941 the ghani was to be supplied to hereditary telis. The cost of ghani was to be treated as interest-free loan from government to be repaid by the teli in monthly instalments of Rs. 5, the remaining half being treated as subsidy from the government.

The importance of developing the cottage and small-scale industries in India can hardly be exaggerated for not only do they absorb a sizable unemployed and underemployed population from the country-side but also provide a supplementary source of income to the ruralites depending solely on agriculture. Taking their position into consideration the government established a separate department known as the Department of Cottage Industries and Industrial Co-operatives, for expanding and developing these industries through various schemes.

Among these schemes, that of granting financial assistance by way of loans and subsidies to individual artisans and their cooperatives is an important one. The scheme is operated under the Rules of 1935, and under the State Aid to Industries Act and State-aid to Industries Rules. These rules have defined 'cottage' and 'small-scale' industries and have brought all such industries within their purview. In addition to the department of cottage industries, financial assistance to industries is also obtained through the All-India Handloom Board, the All-India Khadi and Village Industries Board and other agencies.

During 1960, there were 84 industrial co-operative societies in Bhir district. They included the following categories: —

Sr. No.	Societies	Year 1960
(1)	(2)	(3)
1	Handloom weavers' societies	11
2	Wool weavers' societies	8
3	Leather-tanning workers' societies	21
4	Oil and ghani workers' societies	13
5	Copper and brass workers' societies	1
6	Brick-makers' societies	12
7	Rope-makers societies	6
8	Labourers' societies	3
9	Carpenters societies	3
10	Soap-making workers' societies	1
11	District industrial board	1
12	Other types of societies	4
	Total	84

The following table gives the financial position of these societies for the years from 1956-57 to 1959-60: —

TABLE No. 12

Statistics of the working of the Industrial Co-operative Societies in Bhir District from 1956-57 to 1959-60

Serial No.	Items	1956-57	1957-58	1958-59	1959-60
(1)	(2)	(3)	(4)	(5)	(6)
1	No. of Industrial co-operative societies.	22	37	59	84
2	Members	1,034	1,592	2,245	2,680
3	Share capital	Rs. 18,200	Rs. 41,230	Rs. 81,225	Rs. 1,02,122
4	Funds	1,458	31,000	19,109	19,484
5	Loans from Govt	24,400	27,800	27,800	49,308
6	Loans from Central financing aegncies	--	16,800	63,394	8,08,394
7	Loans from Khadi and Village Industries Board.	19,300	22,505	90,778	87,292
8	Total working capital.	36,800	1,24,376	4,39,202	6,17,769

The financial assistance granted by the cottage industries and industrial co-operatives department for different purposes during 1959-60 is given below:—

	Purpose	Up to 31-3-59	From 1-4-59 to 31-3-60	From 1-4-60 to year-end
	(1)	(2)	(3)	(4)
		Rs.	Rs.	Rs.
(1)	Loans for working capital	27,800	8,000	35,800
(2)	Loans to members for purchasing shares.	--	3,827	3,827
(3)	Subsidy to purchase tools and implements. Loans	13,140 ..	500 1,500	13,640 1,500
(4)	Loans and subsidy for the construetion of godowns and sheds.	15,200	--	5,200
(5)	Subsidies for capital expenditure.	3,035	4,730	7,765
(6)	Investment of Govt. in the share capital of the society.	--	1,000	1,000
(7)	Loans to district central co-operative banks.	50,000	30,000	80,000
	Total	99,175	49,557	1,48,732

These societies were further extended assistance of Rs. 56,997, Rs. 41,118 and Rs. 98,115 during 1958-59, 1959-60 and 1960-61, respectively.

In addition to the Department of Cottage Industries and Industrial Co-operatives, financial assistance in the form of loans and subsidies is also granted by the Khadi and Village Industries Board. During 1959-60 the board granted assistance to various industries as shown in the following statements—

Financial assistance to Village Oil Industry

Purpose	On 31-3-59	From 1-4-59 to 31-3-60	From 31-3-60 to year end
(1)	(2)	(3)	(4)
	Rs.	Rs.	Rs.
Share capital (loan)	13,212	6,995	20,207
Working capital (loan)	23,500	38,100	61,600
Purchase of improved ghani (loan)	9,600	3,450	13,050
(Subsidy)	9,600	3,450	13,050
Construction of sheds (loans)	5,000	750	5,750
(Subsidy)	5,000	750	5,750
Sales Organisation (subsidy)	1,280	--	1,280
Rebate on selling oil	3,609	4,602	8,508
Oil producing Training Centre (subsidy)	1,955	--	1,955
Total	32,797	25,795	58,592
Financial assistance to tanning industry— Purchase of shares by members (loans)	4,997	1,075	6,072
Repair of tanning pits (subsidy)	1,700		1,700
Establishment of tanning industry (loan)..	11,650	9,750	21,400
(Subsidy)	8,550	8,250	16,900
Building of new pits (subsidy)	800		800
Tanning Centre (loan)	2,320	3,000	5,320
(Subsidy)	2,680	3,720	6,400
Total	32,797	25,795	58,592
Financial assistance to pottery industry— Working Capital (loan)	2,500
Share capital (loan)	1,500
Financial assistance to soap industry— (Loan)	32,850
(Subsidy)	12,350

Under the Rules of 1961, loans and subsidies are granted to the cottage industries and industrial co-operatives for the following purposes —

(a) Purchase of land required for an industry;

(b) The construction of buildings or worksheds, godowns, warehouses, railway sidings, wells and other works necessary for the industry;

(d) the erection of plant and machinery;

(e) the purchase of raw materials or for other use as working capital otherwise than as cash credit;

(f) any other specific purpose depending upon the circum stances in each case, such as, for enabling the borrower to tide over initial production difficulties, for meeting initial losses for reasons beyond the control of the industry or for payment for the services of a highly qualified technical consultant.

Under the Rules, the Secretary to Government, Industries and Labour Department, the Director of Industries, Bombay, the Deputy Director of Industries and the Assistant Director of Industries are competent to grant loans up to Rs. 1 lakh, Rs. 25,000, Rs. 5,000 and Rs. 2,000, respectively.

Loans granted up to Rs. 1,000 are secured by personal bond of the applicant and if the applicant is a firm by the personal bonds of all the partners. Loans exceeding Rs. 1,000 but not exceeding Rs. 5,000 are secured by one or more personal sureties. No loan is granted to any cottage industry unless the net value of the security offered in the form of movable or immovable property or both is not less than the amount proposed to be granted as loan.

In the case of any small-scale industry, the amount of the loan must not exceed 75 per cent of the net value of the security similarly offered.

The rates of interest at which loans may be granted under these rules are as under: —

	Amount of loan	Location of industry	Rate of interest per annum
	(1)	(2)	(3)
			Per cent
(a)	Where the amount is not exceeding Rs. 1,000.	Whole state	3
(b)	Exceeding Rs. 10,000 but not exceeding Rs. 25,000.	Do.	4
(c)	Exceeding Rs. 25,000 but not exceeding Rs. 50,000.	(i) Konkan, Vidarbha and Marathwada.	5
		(ii) Rest of the state excluding Greater Bombay and Thana.	5½
		(iii) Greater Bombay and Thana.	6½
(d)	Exceeding Rs. 50,000	Whole state	6½