10 Questions
What is the primary function of SIDBI in the small scale industry sector?
To provide direct assistance to small units
What is the maximum total cost of projects in the services sector that are eligible for SIDBI's financing?
Rs. 250 million
What is the primary goal of SIDBI's development and support services?
To support the growth of the industrial sector
What is the name of the institution that provides financial assistance to small scale industries?
Small Industries Development Bank of India (SIDBI)
What is the number of primary lending institutions that SIDBI provides indirect assistance to?
913
What is the purpose of SIDBI's industrial infrastructure projects?
To support the growth of the industrial sector
What is the significance of the small scale industry sector in the Indian economy?
It is a vibrant and dynamic sector
What is the term used to describe the financial assistance provided by SIDBI to primary lending institutions?
All of the above
What is the role of SIDBI in promoting the growth of the industrial sector?
To promote the growth of the industrial sector through financing and support services
What is the main objective of SIDBI's financial assistance to small scale industries?
To support the growth of the industrial sector
Study Notes
The Industrial Finance Corporation of India (IFCI)
- Established in 1948 as the first Development Financial Institution in India to address the scarcity of long-term finance plans in the industrial sector.
- Primary focus is to provide long-term financial benefits to various sectors in Indian industry.
- Key contributions include:
- Improvement of Indian industry
- Export promotion
- Import permutation
- Development in business
- Pollution control measures
- Energy preservation
- Rendering direct and indirect employment
Sectors benefited from IFCI
- Capital and intermediate goods industry (e.g., electronics, synthetic plastics, synthetic fibers, and miscellaneous chemicals)
- Service industries (e.g., hotels and hospitals)
- Consumer goods industry (e.g., textiles, paper, and sugar)
- Infrastructure sector (e.g., power generation and telecom services)
- Basic industries (e.g., cement, iron & steel, fertilizers, and basic chemicals)
Financial Disbursements
- Sanctioned funds of Rs. 462 billion to 5707 companies
- Disbursed Rs. 444 billion in total
- Refinance disbursement under Investment Credit: Rs. 9046.27 crore during 2007-08
- Disbursed Rs. 8034.93 crore through the Rural Infrastructure Development Fund (RIDF) during 2007-08
Rural Development Initiatives
- A cumulative amount of Rs. 74073.41 crore sanctioned for 280227 projects as on 31 March 2008
- Projects include irrigation, rural roads and bridges, health and education, soil conservation, drinking water schemes, flood protection, and forest management
- Watershed Development Fund: Rs. 613.71 crore as on 31 March 2008, benefiting 416 projects in 94 districts of 14 states
- Kisan Credit Cards: 714.68 lakh cards issued, providing hassle-free access to credit and security for farmers
- Farmers' Club Programme: 28226 clubs formed, covering 61789 villages in 555 districts, providing access to credit, technology, and extension services
Small Industries Development Bank of India (SIDBI)
- Established in April 1990 as the principal financial institution for Promotion, Financing, Development of industry in the small scale sector
- Assists the entire spectrum of SSI Sector, including tiny, village, and cottage industries, through suitable schemes
- SIDBI's financial assistance has three major dimensions:
- Indirect assistance to primary lending institutions (PLIs)
- Direct assistance to small units
- Development and Support Services
SIDBI's Channels of Assistance
- Indirect Assistance: credit to SSIs through a large network of 913 primary lending institutions (PLIs) with a branch network of over 65000
- Assistance is provided through refinance, bills rediscounting, and resource support in the form of short-term loans/Line of Credit (LoC) in lieu of refinance, etc.
Test your knowledge about the Industrial Finance Corporation of India (IFCI), a development financial institution established in 1948 to address the scarcity of long-term finance plans in the industrial sector.
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