Overview of Khadi

Khadi is the proud legacy of the Father of the

Nation.
Khadi is ethical as well as ethnic.
The USP of Khadi is that
It is natural, hand crafted, bio-degradable, nonexploitive and having zero carbon footprint.
KVIC was established to leverage these unique
characteristics of Khadi for economic up-liftment
of rural artisans.

About KVIC
Established under the Khadi and
Commission Act, 1956 (61 of 1956)

Village

Industries

Statutory organisation engaged in promoting and

developing khadi and village industries for providing
employment opportunities in the rural areas, thereby
strengthening the rural economy of the country.
KVIC has been identified as one of the major organisations
in the decentralised sector for generating nonfarm
employment opportunities in rural areas at low per capita
investment.

Objectives
The social objective of providing employment in
rural areas;
The economic objective of producing saleable
articles; and
The wider objective of creating self reliance
amongst people and building up a strong rural
community spirit.

Grouping of Industries
Agro Based and Food Processing Industry (Fruit and Vegetable
Processing, pulses processing ,village oil etc)
Polymer and Chemical Based Industry (Soap Industry, Leather Industry )
Forest Based Industry (Medicinal Plants Industry, Bee Keeping
Industry
)

Mineral Based Industry (Lime)

Handmade Paper and Fiber Industry (Handmade Paper Industry, Fiber
Industry)
Rural Engineering and Bio Technology Industry (Non Conventional
Energy , Electronics)
Service Industry

Organizational Set up
KVIC is functioning under the administrative control of the
Ministry of Micro, Small and Medium Enterprises,
Government of India.
The Commission is having its Head Office at Mumbai and
six Zonal Offices located in Delhi, Bhopal, Bangalore,
Kolkata, Mumbai and Guwahati and 29 State Offices to
facilitate speedy implementation of KVI programmes.
At the Head Office, different Directorates have been
established in order to coordinate the functions like
training, marketing, funding, economic research and Rural
Employment Generation Programme (REGP), etc.

Implementing Agencies
Khadi and Village Industries (KVI) programmes are
implemented through
33 States/Union Territories (UTs) Khadi and Village Industries
Boards (KVIBs)
5,000 registered institutions
30,000 cooperative societies and banks/financial institutions

The Khadi programme is implemented through

institutions registered either with KVIC or State/UT
KVIBs.
In the case of village industries, the Commission
implements the Rural Employment Generation
Programme (REGP)

Major Schemes
Rural Employment Generation Programme
(REGP): to generate additional employment
opportunities in rural areas through setting up micro
enterprises, thereby helping in reduction of migration of
people from rural to urban areas
The Interest Subsidy Eligibility Certificate (ISEC)
Scheme: is the major source of funding for the khadi
programme.
to mobilise funds from banking institutions to fill the gap in the
actual fund requirement and its availability from budgetary
sources.
Under the ISEC Scheme, credit at the concessional rate of
interest of 4 per cent per annum for capital expenditure as well
as working capital is given as per the requirements of the
institutions

 Rebate Scheme: The rebate on sales of khadi and khadi

products is made available by the Government so as to
make the price of khadi and khadi products competitive
with other textiles. Normal rebate (10 per cent) all
through the year and an additional special rebate (10 per
cent) for 108 days in a year, is given to the customers
Product Development, Design Intervention and
Packaging (PRODIP) Scheme: envisages improvement
in product quality, introduction of new designs and better
packaging of products
Under this scheme, financial assistance is provided to the
institutions or entrepreneurs affiliated to the KVIC or State KVIBs
upto Rs. 2 lakh per project per year or 75 per cent of the project
cost whichever is less.
In the case of individual entrepreneurs, assistance is upto Rs. 1
lakh or 75 per cent of the project cost whichever is less

 Rural Industries Service Centres (RISC) Scheme: to

provide infrastructural support and services to selected
units to upgrade their production capacity, skills and
market promotion
Under this scheme, financial assistance for establishing projects
upto Rs. 5 lakh is provided to KVI units. Each RISC programme up
to Rs. 5 lakh should provide benefit to 25 individuals

Khadi Karigar Janashree Bima Yojana: to provide

insurance cover to khadi artisans. scheme was
formulated by KVIC in association with the Life Insurance
Corporation of India (LIC) with annual premium of Rs.
200/- per beneficiary.
The premium is shared as - Rs. 50/- by the Central Government
Social Security Fund, Rs. 25/- by Khadi Institution and Rs. 12.50/each by khadi artisan and KVIC

Performance - last 5 years

Sliver/roving production and sales during

2014-15

(Qty. in lakh kg., Value: Rs. in

lakh)
Raw Material Godown Facilities :
CSP, Sehore: Dausa (Rajasthan), Surendranagar (Gujarat)
CSP, Etah: Bijnour (UP), Kanhewali (UK), Kurukshetra (Haryana)
CSP, Chitradurga: Metpally (AP)
CSP, Kuttur: Thrissur (Kerala), Murshidabad (West Bengal)

New Initiatives
Raw material supply and management :
KIs have been advised to procure their required raw
material from KVICs Departmental CSPs only and
approach outside agency if the raw material
required by them is not produced by CSPs.
KVIC has advised the Project Managers to provide
sliver/roving as per the requirement schedule of KIs.

 Higher capacity utilization of CSPs have brought

down the price of roving about 8 to 10%.

KVIC have requested Ministry to approve a proposal

for refurbishment of CSPs out of KRDP fund. The
refurbishment of the plants will increase their
installed capacity and also bring down conversion
charges further in the range of 10 to 15%.

 Funding KVIC has simplified the system of Khadi

budgeting to assign target of production
and sales to the institution.
The State offices have been authorized to
assign the Annual Budget and Central
office only ratifies their action.
This system has cut down the time lag in
budgeting.

Khadi Marketing
Earlier, Khadi Institutions were pricing their product as per cost
chart.
KVIC had issued guidelines allowing institutions for flexible pricing of
their product at all level
Youth Centric Khadi apparel such as Denim Jeans, Jackets, Skirts, Tshirts etc. developed. Artisans of Khadi Institutions are being trained
to further increase in the volume of such products.

KVIC is also making arrangement to institute award system to

motivate khadi institutions in their endeavor.
KVIC is working with the reputed retailers to offer suitable
platform to khadi institution for retailing their products through
digital marketing

Implementation of Khadi Mark

KVIC have introduced Khadi Mark wherein producers of

Khadi has to obtain Khadi Mark Certificate for attaching
Khadi Mark label with the Khadi and Khadi product to be
sold by them in the market.
KVIC have prescribed a one page application form, to
facilitate KIs to apply easily.
So far, 1244 KIs have obtained Khadi Mark and Khadi
Mark Labels are helping them in better marketing of their
products

Challenges
Decentralized sector and lack of adequate database relating to
Khadi artisans, spinners, weavers etc.
Lack of uniformity for institutional/bulk supply.
Low wages and low productivity discouraging new entrants to
Khadi
Absence of market intelligence and information relating to latest
fashion trend prevalent in domestic and international markets.
Opening up of market and global competition in the domestic
market offering tough competition to Khadi & Village Industries
products.

Road Ahead
Doubling Khadi production and
earning of spinners and weavers.

sales,

doubling

Modernization of existing Khadi Retail Outlets.

Opening of ten new Khadi Retail Outlets across the
country.
Display of large size Charkha at Terminal -3 of New
Delhi Airport to inculcate the ideology of Khadi.

 Opening of Khadi Retail Outlets at New Delhi and Mumbai

Airports.
Strengthening of Government Supply.
Creation of Data base of KIs, artisans and all sales outlets.
Coverage of all eligible Khadi artisans under social security
benefit schemes viz. Prime Minister Suraksha Bima Yojana
(PMSBY) & Prime Minister Jeevan Jyoti Bima Yojana (PMJJBY)

 Launching of e-commerce and introduction of

franchisee scheme to market KVI products.
Development

of

Khadi

brand

and

engage

professional consultant to create and promote

brand publicity.
Develop uniform eco-friendly packaging for KVI
products with logo and specified colour, size,
etc.

Reference
http://
msme.gov.in/Chapter%205-Eng_200708.pdf
http://www.slideshare.net/akjhaies/khadi-and
-village-industries-30122015?qid=95781bc8-9b
87-4f0a-a24a-e1e64507bce4&v=default&b=&
from_search=10
http://www.ijar.org.in/stuff/issues/v2-i2(5)/v2i2(5)a006.pdf
http://www.kvic.org.in

Thank you