A govt scheme for MSMEs to become competitive in lean manufacturing


By Richa Chakravarty

An MSME manufacturing unit

With the changing globalised environment, the micro, small and medium enterprises (MSMEs) are facing the challenge of how to remain competitive and survive in the race. To help face these challenges, the Ministry of Micro, Small and Medium Enterprises (MSME) has launched the National Manufacturing Competitiveness Programme (NMCP) under the Eleventh Plan.

How you can benefit

Under the NMCP, 10 schemes have been conceptualised, of which the Lean Manufacturing Competitiveness scheme (LMC) is one that aims to assist Indian MSMEs to reduce their manufacturing costs through proper personnel management, better space management, scientific inventory management, improved process flows, reduced engineering time, etc. Informs RK Chowdhary, deputy director, NMCP, “Associations and groups of companies can avail the benefits of the schemes under the NMCP.” A maximum of 80 per cent of the project cost for each cluster will be borne by the government, for one year.


The LMC scheme will be implemented in a three tier structure—at the mini cluster, overseen by the national monitoring and implementing unit (NMIU) and then by a screening and steering committee (SSC). Each cluster will comprise of 10 or more companies at the lowest local tier. Only after each cluster sets up a special purpose vehicle (SPV) to own, manage and operate the cluster, will a consultant be allocated to it to guide it on lean techniques, with financial support from the government. “So far, 103 clusters across the country have cleared the first stage of forming an SPV, whereas we are aiming at 1000 such clusters,” says Chowdhary. After the SPVs are formed, the National Productivity Council will implement the scheme and monitor it.

Eligibility criteria

The LMC scheme is open only to MSME units that can participate in the scheme only by forming a mini cluster of 10 units, formalised by way of an MOU between the firms. The mini clusters are required to set up an SPV, whose form could be any of the following:

A trust, as per the Indian Trust Act, 1882 or any similar Trust Act, or a private limited company incorporated as per the Indian Companies Act, 1956

A society under the Societies Registration Act, 1860 (including any of its state equivalents)

Any similar entity approved by the screening and steering committee (SSC) from time to time

Says Chowdhary, “We are keen that industry associations or groups of MSMEs come forward to avail this scheme.” Interested should submit applications in a prescribed format to: Subrata Pal, director, National Productivity Council (NPC), Utpadakta Bhawan, Lodhi Road, New Delhi; Ph: 011 24607316.



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