ASPIRE Scheme for Promoting Rural Area Entrepreneurship
ASPIRE Scheme or Scheme for promotion of innovation, entrepreneurship and Agro-Industry is promoted by the Ministry of Micro, Small and Medium Enterprises. In the 2014-15 Budget, the Hon’ble Finance Minister announced that “To establish Technology Centre Network to promote Innovation, Entrepreneurship and Agro-Industry, I propose to set up a fund with a corpus of Rs.200 crore.” and ”A nationwide “District level Incubation and Accelerator Programme” would be taken up for incubation of new ideas and providing necessary support for accelerating entrepreneurship.”. The ASPIRE Scheme is a result of that announcement aimed at promoting innovation, Entrepreneurship and agro-industry.
ASPIRE Scheme Background
Development of the rural economy has been one of the prime concerns for Government of India. Accordingly, efforts have been made on a continuous basis for improving the economic and social well-being of people in rural areas on a sustainable basis. Despite the sincere efforts, the problems of poverty, unemployment, drudgery and migration still exist in rural economy. There is a need to address these problems by creating employment opportunities in the rural areas and this could be done by setting up of small enterprises in the Agro- based industry sector more so as nearly 56 % of the population is still dependent on agriculture. There is ample scope for innovation, value addition and entrepreneurship development in this sector. This is possible only by skill up-gradation, handholding, mentoring, incubation and credit support aimed especially at rural youth and women providing them employment opportunities in rural areas. The ASPIRE Scheme is aimed at solving this problem and creating employment opportunities through entrepreneurship in rural areas.
Objective of ASPIRE Scheme
The main objectives of the ASPIRE scheme are to:
- Create new jobs and reduce unemployment;
- Promote entrepreneurship culture in India;
- Grassroots economic development at district level;
- Facilitate innovative business solution for un-met social needs; and
- Promote innovation to further strengthen the competitiveness of MSME sector.
The ASPIRE Scheme fund has a Rs.200 crore corpus, which will be dedicated for the following uses:
- Automation of agricultural practices and activities related thereto;
- Value addition to agriculture and forest produce;
- Recycling of agricultural pre/post-harvest wastages, off farm but farm linked, animal husbandry etc.,
- Business models for aggregation and value addition relevant for rural areas;
- Business models for creation of local employment in rural areas; and
- Business models for social impact.
Utilization of Rs.200 Crores ASPIRE Scheme Corpus
The Rs.200 crore corpus of the ASPIRE Scheme will be utilized as follows:
Fund of Funds Creation with SIDBI – Rs.60 Crores
A fund of Funds will be created under Small Industries Development Bank Of India (SIDBI) and Rs.60 Crores will be allotted for the same. SIDBI by using innovative means of finance like Equity, Quasi-Equity, Angel fund, Venture capital fund, Impact funds, Challenge funds etc. will have to enable ideas / innovation and convert these into commercial enterprises. This fund targets mainly those initiatives which need support and nurturing to succeed in developing technology and business enterprise in near future. Areas of focus for the fund with SIDBI will be forward backward linkage in chain of manufacturing, service delivery and accelerator support for agro based Industries.
Support & Setting up of Incubation Centers – Rs.16.00 Crores
The incubation centers assistance will be of two types, i.e. supporting existing incubation centers or setting up of dedicated incubation centers in the area of Agro based Industries. Plans have been made to support 20 existing incubation centers [Rs.30 lakh x 20 Centers = Rs. 6 Crores]. Setting up of new incubation centers in the area of Agro based Industry [INR 1 Crore x 10 Centers = Rs.10 Crores].
Incubation of Ideas – Rs.13.50 Crores
Support would be provided for incubation of ideas at the inception stage, each idea would be provided financial support of Rs.3 lakh per idea to be paid up front to the incubator to nurture the idea. Such innovative and successful ideas which are ready for commercialization through developing prototype or proof of concept (PoC) or test marketing/ validation in case where PoC already exists will be supported by the incubator out of the Seed Capital Revolving Fund. 450 ideas to be supported at the inception stage at Rs. 3 lakh each [INR 3 lakh x 450 Ideas=INR 13.50 crores];
Creation of Business Enterprise out of Innovative Ideas – Rs.30 Crores
A one time grant of Rs 1.00 crore will be provided to the eligible incubator as Seed Capital. The Incubator will invest as Debt/ Equity funding upto 50% of total project cost or INR 20 Lakh per start up whichever is less for setting up of the start-ups to the incubatee for commercialization of the innovative and successful ideas. The returns will be ploughed back to the Seed Capital Revolving Fund. 150 such innovative and successful ideas to be supported for business enterprise creation after successful incubation [Rs. 20 lakh x 150 start-ups = Rs.30 Crores];
Accelerator Programme for Incubates – Rs.2 Crores
For creation of successful business enterprises in the domain of agriculture and rural industrialization, the available accelerators would be providing one stop holistic support to the incubates to make them leapfrog to the next level by conducting regular workshops, mentoring support under this sub component. Rs. 2 Crores for Accelerators to hold 10 workshops for incubates [10 workshops x 20 lakh per workshop = Rs. 2 Crores];
Livelihood Business Incubation (LBI) – Rs.62.50 Crores
The main objective of this component of the Scheme is to set up business incubators to incubate, impart entrepreneurship, skill development training to youth, mentoring and hand holding with facilitation for funding with a view to empower them to set up own business enterprises. The prime focus of these incubators 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 already established to create enterprises on a large scale. 80 Livelihood Business incubators are planned with an investment of Rs.1 crore per incubator in case of Government owned Incubation Center. In case of a incubation center having Public-Private Partnership Model, Rs.50 lakh investment per incubation center is envisaged.
To start or manage a business in India, visit www.complianceindia.co.in.