About Khadi And Village Industries Commission

About Khadi And Village Industries Commission


In accordance with the Parliamentary "Khadi and Village Industries Commission Act of 1956," the Government of India established the Khadi and Village Industries Commission (KVIC) in April 1957. Regarding khadi and village industries in India, it is the apex organization under the Ministry of Micro, Small and Medium Enterprises. Its mission is to plan, promote, facilitate, organize and assist in the establishment and development of khadi and village industries in the rural areas. It also coordinates with other agencies engaged in rural development wherever necessary. It takes over the duties of the previous ‘All India Khadi and Village Industries Board’ in April 1957.
While its six regional offices are located in Delhi, Bhopal, Bengaluru, Kolkata, Mumbai, and Guwahati, the company's head office is in Mumbai. For the implementation of its numerous programs, it has offices in 28 states in addition to its zonal offices. 

Facts Regarding Khadi And Village Industries Commission:

•    Type - Public
•    Founded – 1957
•    Headquarter - Mumbai, India
•    Area served - India
•    Owner - Ministry of Micro, Small and Medium Enterprises [MSME]
•    Website - www.kvic.gov.in

Key Phrases Explained:


"The livery of freedom, according to Mahatma Gandhi
Hand-spun and hand-woven clothing is referred known as khadi. The basic ingredients are spun into threads on a charkha, which can be cotton, silk, or wool (a traditional spinning implement).In 1920, Khadi was introduced as a political tool in Mahatma Gandhi's Swedishi movement.
According to its raw materials, khadi is sourced from different regions of India. While the cotton variety originates from Andhra Pradesh, Uttar Pradesh, Bihar, and West Bengal, the silk type is sourced from West Bengal, Bihar, Odisha, and North Eastern provinces. Gujarat and Rajasthan are recognized for spinning khadi poly, while Haryana, Himachal Pradesh, and Jammu and Kashmir are known for the woolen type. In Uttarakhand, a variety of Khadi personal care products are produced. 


"Khadi" and "Khadi India"[trademark] are owned exclusively by Khadi and Village Industries Commission. The argument made by a private business that "Khadi" is a generic name was denied by the National Internet Exchange of India Domain Dispute Policy (INDRP) Arbitration Tribunal in New Delhi.

Village Industry:

Any sector of the economy that is based in a rural location and whose fixed capital investment per artisan (weaver) does not exceed Rs. 100,000. The Government of India has the right to modify the Fixed Capital Investment whenever necessary. 

Goals of The Commission:

The commission's operations are guided by three key goals. These includes-
•    The social goal is to create jobs in rural areas.
•    The economic goal is to produce items that can be sold.
•    The Overarching Goal is to empower individuals with self-reliance and foster a strong sense of community in rural areas.
The commission runs and oversees a number of initiatives and schemes in an effort to accomplish these goals.

The Execution of Plans And Initiatives:

The Ministry of Micro, Small and Medium Enterprises, which is the administrative head of the programs, is where the process of implementing schemes and programs begin. For the purpose of carrying out programs pertaining to Khadi and Village Industries, the Ministry gets funding from the Government of India and transfers it to the Khadi and Village Industries Commission.
The Khadi and Village Industries Commission then uses these funds to carry out its programmes directly through its 29 state offices, by providing direct funding to Khadi and Village institutions and co-operatives, or indirectly through 33 Khadi and Village Industries Boards, 
which are statutory organizations established by the state governments of India, with the aim of promoting Khadi and Village Industries in their respective states. In turn, Khadi and Village Institutions/Co-operatives/Entrepreneurs are supported by the Khadi and Village Industries Boards.
The commission's development programmes are currently carried out by a total of 95 lakh persons, 30,138 cooperative organizations, and 5,600 registered institutions.

Schemes And Initiative of The Commission:

About Khadi And Village Industries Commission

Prime Ministers Employment Generation Program (PMEGP)

•    The Prime Minister's Rojgar Yojana (PMRY) and The Rural Employment Generation Programme (REGP) were combined to become The Prime Minister's Employment Generation Programme (PMEGP).
•    In addition to receiving up to 35% in rural regions and 25% in urban areas for SCs, STs, OBCs, minorities, and women among other special categories, rural beneficiaries also receive up to a 25% margin compensation in rural areas and 15% in urban areas for the general category.

Interest Subsidy Eligibility Certification Scheme (ISEC)

•    For the Khadi programme, the Interest Subsidy Eligibility Certificate (ISEC) Scheme is the main source of funding. It was first implemented in May 1977 to raise money from financial institutions to bridge the gap between the real amount of money needed and what was available from budgetary sources.
•    Loans are given by the banks to the participants in this plan so they can meet their fixed and working capital needs. These loans are offered at a 4% annualized concessional interest rate. Under the "grants" head of its budget, the commission is responsible for paying the difference between the real interest rate and the concessionary rate. To be qualified for this programme, a member must produce Khadi or Polyvastra (a kind of Khadi).

Rebate Scheme:

To make Khadi and Khadi goods' prices competitive with those of other textiles, the government offers a rebate on sales of Khadi and Khadi products. Customers receive a regular discount of 10% throughout the year as well as an additional special discount of 10% for 108 days. Only sales made at establishments/centers managed by the Commission/State Boards as well as at sales centers managed by registered institutions involved in the manufacturing of Khadi and polyvastra are eligible for the reimbursement.
Recently, the finance ministry requested that the ministry of micro, small, and medium enterprises revise its rebate programme for village and Khadi industries. In its opinion, the "Instead of requesting that the programme be extended year after year, the ministry should contact the plan commission. Additionally, it has requested that the MSME ministry modify the programme so that it will now benefit the artisan rather than the vendor, as has been the case in the past." Regarding this, the government is taking into consideration a proposal that was received from the commission to introduce Market Development Assistance as a potential replacement for Rebate on Sale.

Financial Assistance To The Commission:

The Union Government gives funds to the Commission under the headings of Plan and Non-Plan through the Ministry of Micro, Small, and Medium Enterprises. The commission distributes the cash supplied under the "Plan" Head to its implementing organizations. The money allocated under the "Non-Plan" section is primarily used for commission administrative costs. Grants and loans are the main sources of funding.


A significant portion of the Khadi grant is used to pay sales rebates, which are regarded as promotional expenses. Other costs falling under this heading include: Under the ISEC programme, training, marketing, and interest subsidies are provided for bank loans.


Working capital expenditures and fixed capital expenditures fall under this category of expenditures. Additionally, expenditures on - are included in fixed capital.
A) Equipment: 1,000,000 
B) Implements: 500000 250000, etc. 250000
c) Work sheds: 250000
D) Sales Outlets: 250000

Sales of Products Made In Khadi And Village Industry: 

Either directly or through regovernment, the institutions sell the goods they generate. There are 7,050 sales outlets owned by the commission out of a total of 15,431 sales outlets. These are dispersed throughout India.
Additionally, the products are marketed abroad during exhibitions that the commission organizes.

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