The District Industries Centre (DIC) in Erode has surpassed the subsidy target of Rs. 2 crore set for it under the New Entrepreneur-Cum-Enterprise Development Scheme (NEEDS) for 2013-14.

For the 14 first-generation entrepreneurs – eight men and six women – identified so far, the DIC is in the process of disbursing front-ended subsidy amounts totalling Rs. 135 lakh for the women beneficiaries and Rs. 111.75 lakh for men.

The scheme requires DIC in each district to identify 20 beneficiaries, ideally 10 prospective entrepreneurs each from women and men applicants.

But, there was no restriction on identifying more than 10 women beneficiaries in a district, M. Raju, General Manager, DIC, Erode, said, adding that priority would be accorded for women applicants for the remaining quota of beneficiaries.

The 14 beneficiaries were chosen by a selection committee chaired by the District Collector V.K. Shanmugam out of 31 project proposals received by the DIC.

The applicants ranged from ITI and diploma qualified youths to those with MBBS, BE and MBA qualifications. There were also applicants with B.Com, B.Sc, MSW, BBA and MA qualifications.

There were a couple of innovative proposals: for recycling old tyres and converting them into furnace oil, combustible gas and carbon powder that could be used as a colouring agent; and manufacture of solar photovoltaic products.

The rest of the project proposals pertained to setting up garment units, manufacturing amla products, yarn units, rig services, establishing modern rice mill, starting hospital, software development, setting up fly ash brick units, and biomass briquetting units, Mr. Raju informed.

Awareness about the scheme is up to the desired level, but the applicants are initially keen on availing maximum subsidy benefit.

The applicants require expert guidance on the extent of assistance that could be utilised for asset creation and how much has to be deployed for installing equipment and meeting other overheads.

The maximum limit permitted under NEEDS for asset creation is 25 per cent of the financial assistance.

Depending on the nature of the project, the overall project cost could go up to Rs. 1 crore. Of this, the promoter’s share is only five per cent. The remaining 70 per cent is provided as bank loan.

The prospective entrepreneurs are made to understand that starting ventures in rented buildings was ideal since the operations could be started without delay. Timely power connection and other amenities are ensured through Single Window System, Mr. Raju said.

As advised by the DIC, a garment unit sanctioned under NEEDS in 2012-13 has been functioning successfully since April in a rented built up space at Vettukattuvalasu in the city.

The proprietor S. Dinesh Kumar acknowledges that the priority ought to be to make the unit functional and profitable rather than asset creation in the initial stage. He has in his unit that does job work for exporters 40 sewing machines and nearly 30 workers.

Since the dues have to be settled within seven years under the scheme, repayment of bank loans has to begin at the earliest, says Mr. Dinesh.