Khadi Gramodyog Vikas Yojana: Khadi Vikas Yojana
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Quick Answer
An umbrella scheme by KVIC and MSME providing financial assistance, subsidies on Khadi production and interest, and infrastructure support to Khadi institutions and artisans.
- Funding amount
- ₹80,000 – ₹25L
- Funding type
- Subsidy
- Provider
- Ministry of MSME
- Application deadline
- Rolling
- Location
- Open to startups registered in India
About this subsidy
The "Khadi Vikas Yojana" is a comprehensive umbrella scheme under the broader "Khadi Gramodyog Vikas Yojana," implemented by the Khadi and Village Industries Commission (KVIC) under the Ministry of Micro, Small and Medium Enterprises (MSME), Government of India. The primary objective of the scheme is to bolster the Khadi sector by offering multifaceted support to Khadi institutions and individual artisans. This includes crucial financial assistance, initiatives for infrastructure development, reduction of interest burden on bank loans through subsidies, and extensive marketing support.
The scheme's provisions are designed to enhance the viability and competitiveness of Khadi products. It provides direct subsidies on Khadi production, making Khadi goods more affordable and encouraging their manufacture. A significant component is the interest subsidy, which alleviates the financial strain on Khadi institutions by ensuring they only bear a minimal interest rate on bank loans, with KVIC covering the difference. Furthermore, it facilitates the construction of essential worksheds for artisans, a critical need for improving working conditions and productivity. The scheme also focuses on strengthening existing, weaker Khadi institutions and modernizing marketing infrastructure, including renovating sales outlets to boost sales and reach. Beyond financial and infrastructural support, it promotes quality assurance, supports participation in exhibitions, encourages science and technology interventions for innovation, and fosters the establishment of Centres of Excellence dedicated to Khadi.
Eligibility
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Full eligibility criteria — entity type, stage, sector, founder profile and registration requirements — plus your fit for this program. Sign up to view.
Subsidy providers
The Ministry of Micro, Small and Medium Enterprises (Ministry of MSME) is the Government of India ministry for the MSME sector. It does not run one programme. It runs a set of central schemes, each with its own portal and its own route in: a credit-linked subsidy for new…
Learn moreBenefits & Funding
- Amount
- ₹80,000 – ₹25L
What You Get
The Khadi Vikas Yojana offers comprehensive assistance through various components:
- Modified Market Development Assistance (MMDA): Provides a significant subsidy of 35% on Prime Cost for Cotton/Muslin, Wool, and Polyvastra Khadi, and 20% for Silk Khadi, directly reducing production costs for institutions.
- Interest Subsidy Eligibility Certificate Scheme (ISEC): Reduces the interest burden on Khadi Institutions by ensuring they only pay a 4% interest rate on bank loans, with KVIC covering the remaining interest amount.
- Work-shed Scheme for Khadi Artisans: Offers financial assistance for constructing worksheds. Individual artisans can receive up to ₹1,20,000 or 75% of the workshed cost (90% for NER), whichever is less. Group worksheds provide up to ₹80,000 per artisan (or 75%/90% of cost, whichever is less).
- Strengthening Infrastructure of Existing Weak Khadi Institutions: Provides financial aid up to ₹15.00 lakh for the revival of Khadi institutions, covering both capital expenditure and working funds.
- Assistance for Marketing Infrastructure: Offers financial support up to ₹25.00 lakh for the renovation of departmental sales outlets operated by KVIC/KVIB and institutional sales centers, enhancing market reach and visibility. Additional support includes initiatives for Khadi Quality Assurance, Science & Technology (S&T) interventions, marketing exhibitions, and the establishment of Centres of Excellence for Khadi.
- Disbursement
- Milestone Based
- Bootstrap friendly
- Yes
Timelines & Process
Applications
Rolling basis
Selection Process
The selection process for the Khadi Vikas Yojana primarily involves an online application and verification system. Once an applicant (Khadi artisan or institution) submits their application and required documents through the KVIC online portal, the KVIC office undertakes a thorough verification of all provided information. This includes checking the institution's registration, artisan details, and adherence to eligibility criteria. Upon successful verification and approval, the Certificate of Registration (CoR) is issued. Preference is explicitly mentioned for SC/ST, women, unemployed youth, and BPL category applicants, which may influence the screening process if a quota or prioritization system is in place.
Application Process
- 1
Visit Website
Visit the official KVIC website to begin the application process.
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How to apply
Four steps from draft to disbursement — one action each.
- 1
See the questions before you start
Download every question this programme's application form asks, so you can prepare your answers offline before opening the portal.
- 2
Line up your documents
Keep every document from the checklist ready in one folder. Missing docs are the #1 reason applications get bounced.
- 3
Submit on the official portal
Use the official application link and verify all details before final submission.
- 4
Follow up
Reach out 5–7 days after submitting to confirm receipt and ask about the review timeline.
Frequently Asked Questions
What is the primary objective of the Khadi Vikas Yojana?
The scheme aims to support Khadi institutions and artisans by providing financial assistance, infrastructure development, interest subsidy, and marketing support to enhance their productivity and market presence.
Who is eligible to apply for this scheme?
Khadi artisans or Khadi Institutions registered with KVIC or KVIB are eligible. Applicants must be between 18 and 55 years old, possess a valid ID, and not have availed benefits from other government schemes for the same purpose.
What kind of financial assistance is available?
The scheme provides subsidies on Khadi production (up to 35% on prime cost), interest subsidies (reducing effective interest rate to 4%), financial assistance for artisan worksheds (up to ₹1.2 lakh), and support for institutional and marketing infrastructure (up to ₹25 lakh).
How can Khadi Institutions apply for the scheme?
Applications are submitted online through the KVIC online portal. Institutions need to register, fill in required details, upload documents, and once verified, a Certificate of Registration (CoR) is issued.
Is there any age restriction for individual artisans?
Yes, individual Khadi artisans must be between 18 to 55 years of age to be eligible for benefits under the scheme.
Sources
Data on this page is compiled from official program and provider references.
