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Introduction

India is one of the top producers of coir in the world along with Sri Lanka. Together, they both produce about 90% of the world’s coir fibre. This renewable resource is still deemed underutilized by economists and experts alike. This industry employs around 5.5 lakh persons. The exports from this industry are around Rs. 70 crores every year.

The government has taken cognisance of this industry and has introduced various schemes and support in the recent 5-year Plans. These schemes concentrate on increasing productivity through mechanisation and modernisation of the production techniques currently used in the coir industry. These supports look for incentives for installation of modern equipment and providing seed capital assistance.

What is Coir Udyami Yojana?

Coir Udyami Yojana is a flagship programme from the Coir Board. It is a credit linked subsidy scheme for setting up of coir units with project costs of up to Rs.10 lakhs plus one cycle of working capital, which shall not exceed 25% of the project cost. 40% of the project cost is available as a subsidy. However, working capital needs will not be considered for subsidy.

What are the objectives of Coir Udyami Yojana?

  • Modernizing the Coir Industry by embracing modern technology in production and processing of coir and coir products
  • The scheme aims at upgrading the current production and processing technologies for improving the productivity, quality and product diversification
  • It aims at increasing the efficiency and productivity of the business units to enhance the earnings of the workers engaged in the sector
  • It strives to enhance the utilization of coconut husk and increase the production of coir fibre and coir products
  • The goal is to generate employment in the rural areas of coconut producing States / Union Territories
  • The scheme will strive to provide more employment opportunities for women in the rural sector for gender empowerment
  • The scheme wants to achieve enhanced socio-economic conditions of the producers/workers engaged in the industry
  • The objective is to contribute to inclusive growth of vulnerable sections of beneficiaries, especially those belonging to Scheduled Castes (SC), Scheduled Tribes (ST) and North Eastern Region (NER)
  • To provide sufficient training to the rural youth of the coconut producing states with the objective of attracting them into the coir industry
  • To serve as a backward/forward link to the unit holders to whom assistance is given under the Scheme.

What kind of credit facility is provided through the Coir Udyami Yojana?

The Coir Udyami Yojana primarily offers financial support for projects: 

  • Maximum admissible cost of the project is Rs.10 lakhs plus working capital, which shall not exceed 25% of the project cost
  • Bank credit of up to 55% of the project cost
  • 40% of the project cost as subsidy from the Govt. of India
  • Working capital will not be considered for subsidy and the beneficiary’s contribution should be 5% of the project cost.
  • The banks might consider a composite loan instead of a term loan to cater to the working capital requirements also.

Beneficiary’s contribution (of

Project Cost)

Bank credit

Rate of Subsidy (of

project cost)

5%

55%

40%

Who are eligible to apply for assistance under the Coir Udyami Yojana?

Any individual above 18 years of age with Indian citizenship can apply for assistance to set up a project

Only one person from one family is eligible for obtaining financial assistance for setting up of projects under Coir Udyami Yojana. The ‘family’ includes self and spouse.

No income ceiling for assistance under Coir Udyami Yojana

The Scheme offers assistance only for projects set-up for the production of coir fibre /yarn/products etc. that are approved under the coir sector.

Assistance under the Scheme will be made available to Individuals

  • Companies
  • Self Help Groups
  • Non-Governmental Organizations
  • Institutions registered under Societies Registration Act 1860
  • Production Co-operative Societies
  • Joint Liability Groups and Charitable Trusts

However, the units that have already availed Govt. subsidy under any other Scheme of Govt. of India or State Govt. for the same purpose are not eligible to claim subsidy under the scheme.

Certified copy of the caste/community certificate issued by the competent authority in the case of other special categories, is required to be produced by the beneficiary along with the application form.

A certified copy of the bye laws of the institution is required to be attached along with the application wherever necessary.

The project cost will include capital expenditure, that is Building and Machinery

If the beneficiary is already having the work shed, the component of required machinery alone will constitute the project cost as per the scheme.

How do I apply for assistance under the Coir Udyami Yojana?

Applicants can apply online on the official Coir Board website. They can also submit the filled in application form at their nearest Coir Board Field Offices or through the DICs. Application forms are available at the following places –

  • Coir Board Offices
  • District Industries Centres
  • Coir Project Offices
  • Panchayati Raj Institutions 
  • Nodal Agencies approved by the Board for this purpose

What are the documents I need to submit along with the application form?

The following documents shall be along with a duly filled in application: 

  • Copy of Title Deed of the property on which the unit is proposed to be setup/already located
  • Proof of coir industry experience
  • Proof of training availed from Coir Board
  • Machineries proposed to be purchased along with invoice
  • Industrial Establishment Certificate issued by DIC
  • Plan & Estimate for construction of work shed duly certified by Chartered Engineer
  • Project Profile of the proposed project
  • In case of SC/ST, copy of Caste Certificate
  • Any other supporting documents

What is the Rate of Interest offered on the scheme?

The Rate of Interest is based on the base rate of the banks. 

What is the Repayment Tenure?

Repayment schedule may not exceed 7 years. An initial moratorium may be offered by the concerned Bank/financial institution based on their internal guidelines. The moratorium period is to enable the beneficiaries to complete their project.

Security / Collateral

The loan would be covered under Credit Guarantee Trust Fund Scheme, which is implemented by the Ministry of MSME. However, the guarantee fee for the coverage will be borne by the beneficiary or the Bank. The term loan shall be offered without collateral / third party guarantee and it is mandated that under no circumstances should the banks insist on such documents.

Entrepreneurship Development Programme (EDP)

The Coir Board conducts an Entrepreneurship Development Programme (EDP) to provide orientation and awareness pertaining to various managerial and operational functions like finance, production, marketing, enterprise management, banking formalities, bookkeeping etc.

The EDP will be conducted either directly by the Coir Board or through the Nodal Agencies approved by the Coir Board or Ministry of MSME, Rural Development and Self Employment Training Institutes (RUDSETI) reputed NGOs, and other organizations / institutions, identified by Coir Board from time to time. The duration of the EDP shall be 5 days. EDP will be mandatory for all Coir Udyami Yojana beneficiaries.

CUY Marketing Assistance

The Coir Board will give assistance to establish a marketing consortium. The objective of the consortium is to provide handholding support towards the marketing efforts of the CUY beneficiaries.

Nature of assistance under CUY Marketing Assistance

  • Establishing Marketing consortium
  • Participation in Fairs/Exhibitions
  • Hiring Spaces in the Showrooms
  • Hiring Premises for office
  • Reimbursement of salary of consortium employees

Who can apply for this Consortium?

All CUY Beneficiaries can apply to become a member of this Consortium. 

How do I apply for this Consortium?

CUY Beneficiaries can apply online through the Coir Board official portal.

Coir Udyami Yojana FAQs

1. Which are the financial institutions empowered to provide assistance under the CUY Scheme?

All the Scheduled Commercial Banks listed in the 2nd schedule of the RBI Act. All Regional Rural Banks. Co-operative Banks who are Member Lending Institutions (MLIs) of the Credit Guarantee Trust Fund for MSME as well as through SC/ST/OBC Finance and Development Corporations

2. How are beneficiaries identified under the Coir Udyami Yojana?

The beneficiaries are identified at different regions by a committee consisting of representatives of the Coir Board, DIC, Coir Project Office, Banks, Panchayati Raj Institutions etc.

3. What is the importance of the Entrepreneurship Development Certificate (EDP)?

The objective of the Entrepreneurship Development Programme (EDP) to provide orientation and awareness pertaining to various managerial and operational functions like finance, production, marketing, enterprise management, banking formalities, bookkeeping etc.

4. What is the repayment tenure?

Repayment schedule may not exceed 7 years. An initial moratorium may be offered by the concerned Bank/financial institution based on their internal guidelines. The moratorium period is to enable the beneficiaries to complete their project.

5. What is the CUY Marketing Assistance?

The Coir Board has established a marketing consortium with all the CUY beneficiaries as members. The objective of the consortium is to provide handholding support towards the marketing efforts of the CUY beneficiaries.

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