Govt Schemes->A Scheme For Promoting Innovation, Rural Industry & Entrepreneurship(ASPIRE)

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A Scheme For Promoting Innovation, Rural Industry & Entrepreneurship(ASPIRE)

A scheme for promoting Innovation & Rural Entrepreneurship to promote rural livelihood incubator , technology business incubator and fund of funds.

I. OPERATIONAL GUIDELINES FOR LIVELIHOOD BUSINESS INCUBATOR

The main objective of LIVELIHOOD BUSINESS INCUBATOR (LBI) is to create jobs at local level and reduce un-employment by creating a favourable ecosystem for entrepreneurial development in the country.

The main focus area under the livelihood incubation is to take up those commercial activities, which are need based to create enterprises in the rural areas of the country. The LBI program will be implemented as follows:

National Small Industries Corporation (NSIC), Khadi and Village Industries Commission (KVIC) or Coir Board or any other Institution/agency of GOl/State Govt. will promote entrepreneurship and skill development and pursue live "demo projects".
Private partner institutions and entities can also set up livelihood incubation centres under PPP mode with the aforesaid institutions, namely: NSlC, KVIC or Coir Board or any other Institution/agency of GOI/State Govt.

Objectives of LBI

To set up business incubators so that eligible youth can be adequately incubated in various skills and be provided the opportunity to set up their own business enterprises
To impart entrepreneurship, and skill development training to youth
To provide mentoring and hand holding with facilitation for funding with a view to empower them to set up own business enterprises.
To promote new low-end-technology/livelihood based enterprises.

Release of Funds

In the case of Livelihood Business Incubators, the funds would be released directly to NSIC, KVIC or Coir Board or any other Institution/agency of Gal/State Govt. These designated agencies i.e NSIC, KYlC or Coir Board or any other Institution/agency of Gal/State Govt. in turn would release the fund to the PPP incubators based on the set parameters and terms of engagement with the incubators. Once the proposal for setting up of incubators submitted by the designated agencies is approved by SSC, the process for release of funds to the designated agencies would be based on achievement of milestones as under:

50% of the approved amount after approval of the incubation centre by SSC.
30% of the approved amount after installation of the Plant and Machinery at the centre.
Last installment of 20% of the approved cost will be released after commencement of Training.

The fund release to the PPP partner would happen only on the release of the matching contribution by the PPP partner for setting up of the incubators under PPP mode with the designated agencies. The funds released by the Ministry shall be kept in a separate bank account and shall not be utilized for any other purpose than the cause of the incubators.

Evaluation and Monitoring

The concerned agency will submit monthly reports as per the MIS system.

II. OPERATIONAL GUIDELINES FOR TECHNOLOGY BUSINESS INCUBATOR

Technology business incubators are a powerful economic development tool which promote growth through innovation and application of technology, support economic development strategies for small business development, and encourage growth from within local economies, while also providing a mechanism for technology transfer. The Technology Business Incubators would primarily focus on those technologies which needs support for commercialization and further proliferation. The components under the program will include mentoring support in business and technology plans, networking of business resources, entrepreneurship cum skill development, identification of appropriate technology, hands on experience on Projects, Projects/ Products selection, project report preparation, credit facilitation, seed capital assistance, marketing assistance, professional assistance to make the enterprise successful and achieve higher growth. MoMSME would support existing incubation centres currently operating under different Ministries and Departments of the Government of India or Institutions including National/Regional level institutions of GOI/State Governments to set up centres dedicated to incubation and enterprise creation in the area of Agro based Industries. MoMSMEwould be supporting Technology Business Incubators primarily in and around academic and technical institutions to tap potential technology ideas and innovations for enterprise creation by effectively utilizing expertise and existing infrastructure already available with the incubators under the aforesaid institutions. The Ministry would assist to set up new incubation centres by eligible private institutions including Industry Associations, along with the Academic Institutions, R&Dlaboratories, Universities, Government entities and Technology Parks. Region wise, Cropwise, Product wise, Process wise and Industry Vertical wise Incubation Centres will be promoted. The existing incubators under different Ministrieswould be required to provide built up covered space with electric power & water connections, any other forward / backward linkages and required manpower resources for both the centres to be created within the existing incubators and also for the new incubators.

Objectives of TBI

To set up Technology based incubators for incubation of innovative ideas/technology in the potential sectors including agro and rural based industries.
Technology Commercialization: to provide a platform for speedy commercialization of technologies developed in the host institution or any academic and R&D institution of the country.
Interfacing and Networking: to provide networking between academia, industry and financial institution.
Value Addition: to provide value added services viz. legal, financial, technical, IPR, etc. to incubatees.
New Enterprise Creation: to promote new technology/knowledge based enterprises.

Eligibility for Proposal Submission

Existing incubation centres currently operating under different Ministries and Departments of the Government of India or Institutions including National/Regional level institutions of GOI/State Governments. The existing incubator should have adequate expertise and infrastructure to support incubation activity for promoting Innovation, Entrepreneurship, Agro-based industry.
To set up new incubation centres, eligible private institutions including Industry Associations, along with the Academic Institutions, R&D laboratories, Universities, Government entities and Technology Parks, Technical institutions with a proven track record in promotion of innovative/technology based entrepreneurship in the agro-rural landscape.

Release of Funds

In the case of TBI, the funds for capital (i.e. plant and machinery) would be released directly to the incubator after execution of a bond by the TBI in case of existing and the Partner Institution in case of new TBI approved for setting up the incubator, based on the set parameters and terms of engagement with the incubators. Once the proposal for setting up of incubators submitted by the partner institutions is approved by SSC, the process for release of funds would be based on achievement of milestones as under

Release of Capital Grants for Plant and Machinery:

50% of the approved amount after approval of the incubation centre by SSCand signing of bond.
30% of the approved amount after installation of the Plant and Machinery at the centre.
Last installment of 20% of the approved amount will be released after commencement ofTraining.

Release of grants to Incubators for supporting Ideas:

INR 2.5 lakh per idea to be released after selection and submission by the Screening Committee. A minimum of 10 ideas at least need to be recommended for grant support.
INR 1.5lakh per idea to be to be released on completion or closure recommended by the Screening Committee.

For Seed Capital Fund - creation of Enterprise:

INR 50 lakh (50% of the amount of INR 1crore) to be released as first on completion of successful prototype testing.
INR 50 lakh to be released on disbursement of 80% of last installment on submission of utilization certificate.
The total release will however be limited to INR 100 lakhs and only deserving cases to be supported.

Evaluation and Monitoring

The concerned agency will submit monthly reports as per the MIS system.

OPERATIONAL GUIDELINES FOR FUND OF FUNDS TO BE MANAGED BY SIDBI

Small Industries Development Bank of India (SIDBI) has been using innovative instruments like Equity, Quasi-Equity, mezannine debt etc. both directly and indirectly through its fund of fund operations supporting Angel funds, Impact Funds, Challenge Funds and other Venture capital fund. The benchmarks for the funds set up by SIDBI focuses on value addition in the rural economy and job creation through social impact funding. Support from SIDBI thus enables ideas/innovation with creativity and scalability to come to the fore and help them convert these ideas into commercial enterprises with specific outcomes and within a specific time period.
ASPIRE Fund of Funds under SIDBI with a corpus Fund of INR 60 Cr will be augmented with an amount of INR 250 Crore, making the total corpus INR 310 Crore. This start-up promotion targets those knowledge initiatives which need support and nurturing to succeed in developing technology and business enterprise in near future in the areas of Innovation, Entrepreneurship, Forward Backward Linkages with multiple value chain of manufacturing and service delivery, Accelerator support etc in the Agro based Industry verticals either directly or indirectly.
This start-up promotion targets those knowledge initiatives, which need support and nurturing to succeed in developing technology and business enterprise in near future.

Purpose

The 'Fund of Funds' would be utilized by SIDBI to contribute to various Angel! Venture Capital Funds [currently known as Alternative Investment Fund CAlF)] for investing in Start-ups/early stage enterprises for promoting Innovation, Entrepreneurship, Forward Backward linkage with multiple value chain of manufacturing and service delivery, Accelerator support, etc. in the Agro based Industry verticals to galvanize the rural economy. IT based application/ intervention in the Agro/rural based industry verticals shall be discouraged.

Tenure of the Fund

The tenure of the Fund of Funds will be upto 12 years.

Eligibility

The fund received from ASPIRE scheme is to be invested in suitable funds falling under the Category I & II Alternative Investment Funds CAlF)registered with SEBI;
The AIFs should invest at least twice the amount of contribution received under ASPIRE Scheme in Start-ups/ early stage enterprises coming under Micro, Small and Medium Enterprises category upto 50% or Rs. 50 lakh whichever is lower;
The AIFs will further invest in equity in start-ups/ early stage enterprises belonging to Micro, Small and Medium Enterprises category up to 50% or Rs.50 lakh whichever is lower;
Fund Manager/ team should have prior track record in Fund management or prior investment experience.

Management Fee

A one-time management fee of 0.5% of the size of the fund shall be payable to SIDBI. In case allocation to the Fund is enhanced, the onetime management fee will be applicable.

Application Form Go to the Scheme

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