Scheme for formalization of micro food processing enterprises

Why in news?

• Pradhan Mantri Formalisation of Micro food processing Enterprises Scheme (PM FME Scheme) completed one year.

About the scheme:

• A Centrally Sponsored Scheme, PM FME,  is for the Unorganized Sector on All India basis with an outlay of Rs.10,000 crore.
• The expenditure will be shared by GOI and the States in ratio of 60:40.
• Scheme will be implemented over a 5 year period from 2020-21 to 2024-25. 2,00,000 micro-enterprises are to be assisted with credit linked subsidy.

Objectives

• Increase in access to finance by micro food processing units.
• Increase in revenues of target enterprises.
• Enhanced compliance with food quality and safety standards.
• Strengthening capacities of support systems.
• Transition from the unorganized sector to the formal sector.
• Special focus on women entrepreneurs and Aspirational districts.
• Focus on minor forest produce in Tribal Districts.

Eligibility

• Scheme is for All India basis.
• Micro enterprises will get credit linked subsidy @ 35% of the eligible project cost with ceiling of Rs.10 lakh.
• Beneficiary contribution will be minimum 10% and balance from loan.
• On-site skill training & Handholding for DPR and technical upgradation.
• Seed capital will be given to SHGs (@Rs. 4 lakh per SHG) for loan to members for working capital and small tools.
• Grant for backward/ forward linkages, common infrastructure, packaging, marketing & branding.
• Skill training & Handholding support.
• Credit linked capital subsidy will be provided.

Prelims Question

Consider the following statements regarding Scheme for formalization of micro food processing enterprises:
1.It will be implemented for a five year period.
2.It is funded fully by the union government.
Which of the statements given above is/are correct?
(a)1 only
(b)2 only
(c)Both 1 and 2
(d)Neither 1 nor 2

Answer to the Prelims Question