Saturday, 29 November 2014


Compulsory Legislation for Quality Standards

Standards on Weights and Measures (Packaged Commodities) Rules, 1977

These Rules laid down certain obligatory conditions for all commodities in the packed from with respect to their quantity declaration. These Rules are operated by the Directorate of Weights and Measures under the Ministry of Food and Civil Supplies.

Prevention of Food Adulteration Act, 1954

Initiatives for Women Entrepreneurs

Women entrepreneurs have achieved remarkable success. The Micro, Small & Medium Enterprises Development Organisation (MSME-DO), the various State Small Industries Development Corporations (SSIDCs), the nationalised banks and even NGOs are conducting various programmes including Entrepreneurship Development Programmes (EDPs). To cater to the needs of potential women entrepreneurs, who may not have adequate educational background and skills, MSME-DO has introduced process/product oriented EDPs in areas like TV repairing, printed circuit boards, leather goods, screen printing etc. A special prize to "Outstanding Women Entrepreneur" of the year is being given to recognise achievements made by and to provide incentives to women entrepreneurs. The Office of DC (MSME) has also opened a Women Cell to provide coordination and assistance to women entrepreneurs facing specific problems.

MSME Policy


1.1 The Small Scale Industrial Sector has emerged as a dynamic and vibrant sector of the economy during the eighties. At the end of the Seventh Plan period, it accounted for nearly 35 percent of the gross value of output in the manufacturing sector and over 40 percent of the total exports from the country. It also provided employment opportunities to around 12 million people.

Labour Policies

The Labour Policies for Small Scale Industries is governed by comprehensive laws. The following laws and policies are applicable for Small Scale Industries in India:

The Factories Act, 1948

  • To ensure adequate safety measures and to promote the health and welfare of the workers employed in factories.
  • To prevent haphazard growth of factories through the provisions related to the approval of plans before the creation of a factory.
Scope and coverage
  • Regulates working condition in factories.

Foreign Investment Regulations

Current Account Convertibility

Under the present policy all receipts of foreign exchange under the current account both export earnings and inward receipts are fully convertible. As per the present policy of the Government all receipts of foreign exchange, under current transactions, both merchandise exports and invisible receipts, received by exporters and other recipients are required to be surrendered to an authorised dealer of foreign exchange.
The authorised dealer converts 100% of the foreign exchange received into rupee at the free market.

NRI Investment Approval

A liberal policy for permitting investment of upto 100% equity wth full repatriation facilities in industrial ventures in high priority industries by Non-Resident Indians (NRIs) and Overseas Corporation Bodies (OCBs) has been announced. It has also been decided to permit 100% NRI investment with full repatriation benefits in Export/ Trading/ Star Trading House also.
India permits free repatriation of profits after payment

National Water Policy

Need for a National Water Policy

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1.1 Water is a prime natural resource, a basic human need and a precious national asset. Planning,
development and management of water resources need to be governed by national perspectives.
1.2 As per the latest assessment (1993), out of the total precipitation, including snowfall, of around
4000 billion cubic metre in the country, the availability from surface water and replenishable ground water

Foreign Direct Investment

  • An industrial undertaking, i.e., a company with interests in industry can invest upto 24% equity in a SSI unit.
  • If the equity goes beyond 24%, the industrial unit loses its SSI status.
  • There is no restriction on the extent of equity that can be held by a Non-resident Indian (NRI) as an individual/partner in a SSI unit.
  • Investors need to file an application with the Reserve Bank of India (RBI) in the prescribed format and approval is ordinarily granted within 15 days.
  • For foreign investment outside the automatic route, clearance has to be obtained from Foreign Investment Promotion Board (FIPB).
  • Applications for setting up a 100% Export Oriented Unit are also required to be filed with the SIA.
  • For setting up a unit in an Export Processing Zone (EPZ), application has to be filed with the Development Commissioner of the concerned EPZ.
  • Under automatic procedures, foreign technology agreements are being permitted in respect of industries that are designated as high priority industries.
  • The use of foreign brand names and / or trade mark of goods is also now being permitted freely.

    Automatic permission is given for foreign technology agreements up to certain ceilings covering the same high priority areas.
    No government permission is necessary for hiring foreign technicians and full powers have been delegated to the RBI.

    Further Liberalisation in "FDI"


    It has now been decided by the Government that all companies irrespective of the extent of foreign equity in the shareholding, who have entered into foreign technology collaboration agreements may henceforth be permitted on automatic approval route to make royalty payments at 8% on exports and 5% on domestic sales without any restriction on the duration of the royalty payments. The ceiling on payment of lumpsum fee/ royalty on the automatic route would continue to apply in all cases.
    Earlier only wholly owned subsidiaries were permitted to make payment of royalty at the same rate to their offshore parent companies without any restriction on the duration of the royalty payment.

Licensing Policy

The major impact of liberalisation and globalisation of economy, which started in India in July, 1991, was to do away with the Compulsory Licensing. As of now on FOUR industries are reserved for the Public Sector and only SIX industries fall under the compulsory licensing, as detailed below:


  1. Arms and ammunition and allied items of defence equipment, Defence aircraft and warships.
  2. Atomic energy.
  3. The substances specified in the scheduled to the notification of the Government of India in the Department of Atomic Energy number S.O.212(E), dated the 15th March, 1995.
  4. Railway transport.


  1. Distillation and brewing of alcoholic drinks.
  2. Cigars and Cigarettes of tobacco and manufactured tobacco subsitutes.
  3. Electronic Aerospace and Defence equipment: all types.
  4. Industrial explosives including detonating fuses, safely fuses, gun powder, nitrocellulose and matches.
  5. Hazardous chemicals.
  6. Drugs and Pharmaceuticals (according to modified Drug Policy issued in September, 1994).
In case of the small units which employ less than 50 workers with power or less than 100 workers without power are not required to obtain any license under Compulsory Licensing Provisions.