Indien: Beruf und Existenzgruendung

70 % der Inder arbeiten in der Landwirtschaft, womit sie den größten Anteil der Arbeitskraft in Indien darstellen.

Die wichtigsten Firmen sind im Bereich Bergbau (Kohle, Eisen) tätig. Weiterhin gibt es viele wichtige Firmen im Bereich Naturgas, Zementindustrie, Softwareindustrie, chemischer Industrie zur Herstellung von Düngemitteln, Automobilindustrie, Stahlbau, Tourismus und Gesundheitswesen.

Bedarf an Arbeitskräften

Der Bildungssektor ist einer der Hauptarbeitgeber im Land, da für viele neue technische Bildungseinrichtungen Lehrer benöigt werden. Vor allem im Ingenieurwesen sind Lehrkräfte stark nachgefragt.

Im Dienstleistungssektor werden zur Zeit viele Verkaufskräfte eingestellt. Verkäuferinnen sind ein neues Phänomen in Indien. Bis vor 20 Jahren waren Frauen hauptsächlich im Haus beschäftigt. Trotz der neuen positiven Entwicklung sind viele Frauen nach wie vor unterbezahlt.

In den klassischen technischen Berufen sind Arbeitskräfte stark nachgefragt. Der derzeitige Mangel an fähigen Arbeitskräften in diesem Bereich stellt ein großes Problem dar, da durch neue Infrastrukturmaßnahmen (z, B. im Bereich Wasser und Elektrizität) diese Arbeitskräfte, vor allem Elektriker und Klempner, stark nachgefragt sind. Auch im Bereich Straßenbau werden viele ausgebildete und einfache Arbeiter gesucht.

Im sozialen Bereich sind vor allem Krankenschwestern in privaten Krankenhäusern nachgefragt. Zwar werden sie dort schlechter bezahlt als in staatlichen Krankenhäusern, jedoch sind sie nicht als unterbezahlt zu bezeichnen.

Die Tourismusbrache und der Hotelsektor blühen. Diese Bereiche bieten Arbeitsplätze für mehrere Tausend Menschen an.

Im Bereich Texilindustrie werden Arbeitskräfte benötigt. Auch in der Nahrungs- und Genussmittelindustrie sind Arbeitsplätze vakant. Auch im Transportwesen werden Arbeitskräfte, vor allem Taxifahrer und Fahrer gesucht.

Letztlich bietet auch das Militär sehr gut bezahlte Arbeitsplätze für vor allem junge Menschen an.

Arbeitslosigkeit

Bereiche wie Banken und Eisenbahnen brauchen derzeit keine neuen Arbeitskräfte. Das hängt maßgeblich mit der Automatisierung und dem Einsatz von moderner Technik und Computern zusammen.

Die tatsächliche Arbeitslosenzahl ist nicht genau bekannt, da viele, als arbeitslos gemeldeten Menschen bei privaten Firmen Anstellung gefunden haben.

Es gibt in allen Regionen Indiens Arbeitslose; in manchen Regionen ist die Arbeitslosenzahl jedoch besonders hoch. In Goa, Kerala und Tamil Nadu liegt sie beispielsweise bei 10 %. In armen Regionen wie Uttar Pradesh, Rajasthan und Bihar ist die Arbeitslosenzahl statisch gesehen nicht sehr hoch. Dort leiden die Menschen aber aufgrund des tatsächlich niedrigen Einkommens.

Der Anteil der Frauen, die ohne Arbeit sind, liegt bei 6,3 %, unter Männern sind etwa 5,9 % arbeitslos. Die Dunkelziffer wird als viel höher angenommen.

Berufliche Wiedereingliederung

Support during job seeking time

In India there is no insurance available for jobless. But there exist two assistance schemes, as stated below.

Unemployment Assistance Scheme

Through a government notification /circular called Unemployment Assistance Scheme every young person above the age of 21 years is entitled for unemployment pension till he attains the age of 35.

Terms and Conditions
The candidate must have passed the S.S.L.C. examination (10 years of schooling). He must be between 21 years 35 years of age. His personal income per month shall not be above Rs. 100. His family income shall not be more than Rs. 12,000 per year. He must have registered his name in an Employment Exchange Office and renewed it from time to time. To get this unemployment pension, he or she must apply at the local self government called either Panchayat or Municipality.

If all these conditions are fulfilled he will get a monthly pension of Rs. 120. Certain categories of people who are socially backward and so declared by the government gets 2 years age relaxation. Such persons need only to appear for the S.S.L.C. examination.

Self Employment Scheme

The age group of 21 to 40 years can apply for this scheme. The age limit for socially backward is 45 years. The scheme is arrangement with the Bank. On the recommendations of the Employment Exchange the person gets a maximum of Rs. 50,000 as Bank loan of which 20 % is given as subsidy.

Terms and Conditions
The family income must be below Rs. 24,000 per year. The personal income must be below Rs. 500 per month.

Anmeldung beim zuständigen Employment Exchange

Die Employment Exchange sind die Arbeitsämter der Regierung. Um eine Stelle im öffentlichen Dienst zu bekommen, muss man dort registriert sein. Nach dem Employment Exchanges (Compulsory Notification of Vacancies) Act von 1959 müssen jedoch nicht nur alle Einrichtungen des öffentlichen Dienstes, sondern auch die meisten Einrichtungen des privaten Sektors ihre offenen Stellen dem zuständigen Employment Exchange melden. Letzteres wird jedoch nicht überprüft und so tun dies nur wenige private Firmen, was die Effektivität der Employment Exchange mindert.

Die Employment Exchanges werden verwaltet von den Directorate of Employment and Training, die dem jeweiligen Arbeitsministerium des Einzelstaates unterstellt sind. Einige von ihnen sind auch on-line zugänglich und Arbeitssuchende können sich dort registrieren.

In den Großstädten gibt es für Arbeitssuchende mit universitären Abschlüssen wiederum eine andere Anlaufstelle, nämlich University Employment Information and Guidance Bureau, die den Universitäten angeschlossen sind. Für Körperbehinderte gibt es in den Großstädten spezifische Special Employment Exchange for Physically Handicapped.

Processing of Application

Applying for job in a Private Firm

Just like the public sector undertakings including governmental organisations they may publish the vacancies existing in their firms in newspapers or in internet or in their own publications. They may also give model application forms and the conditions one has to comply and the qualifications for the said job.

Generally they announce the vacancies only. In that case the applicant applying for the job has to prepare the application form himself. The applicant has to prepare the application form himself showing all the relevant matters and also enclosing all the documents (preferably photo copy of the document with attestation, which is made by Gazetted Officers.

There is also another form of sending application form to a private firm. Some firms never announce job vacancies. In such a case, a qualified applicant can apply directly to the Firm with all relevant documents showing his experience, if any, in any field of activity.

To get to know about job vacancies in private firms one cannot simply depend on newspaper advertisements alone. In many cases, they never publish job vacancies in newspaper. There are employment consulting companies which operate in almost every city and function as a job provider for business establishments, industries and households. There are also internet-sites which give out job vacancies. The applicant has to refer to the daily newspapers, internet sites or government owned publications like employment news, and also he can directly go to the firms and present his applications. Many firms will keep these application forms for long time and they will call the applicant as and when required.

Application Papers

Generally with the announcement of job vacancies in government departments and public sector undertakings model application forms will be issued by the said Department. To fill in the blanks and send them is an easy affair. Normally one can use Photostat copies of those application forms.

If the said Department insist on original application form one has to obtain it from them by remitting the required fees by cash or money order or Demand Draft. The qualifications required to apply for the said job will also be notified by them. The candidate must send duly filled up application forms along with the duly attested copies of certificates and Bank drafts and two Photos to the concerned officer in time.

Candidate applying for competitive tests of Union Public Service Commission can get the application forms from any of the Post Offices situated any where in India.

There are two different ways for preparing an application form. The old version is in the form of a letter containing all relevant details of the applicant. But it is no longer used.. So, as a remedy to this practice, a detailed Curriculum Vitae (CV) and a short Cover letter is preferred. In Curriculum Vitae one can narrate all his qualifications and experience and expertise in a tabular form.

In some places the term Bio data or Resume is used which means also curriculum vitae. Curriculum Vitae means only that pertinent or relevant matters pertaining to the candidate applying for the job should be given clearly, exactly and it should also be precise. The candidate must be able to communicate and convince the firm Director that he is the right qualified and experienced man for the said job and that he possesses all the necessary attributes that the job demands.

The curriculum vitae should contain the name and address, the telephone number, e-mail address, educational qualifications, experiences if any of the applicant. He can also point out his own performances and special abilities he possesses or interest he has, hobbies and also the names and addresses of two respected persons who would speak of the applicant (say referrers) can also be given.

There are applicants who write their C.V in calendar order, i.e. every event is described according to their happenings. This is not generally followed now a days. The one who reads C.V. is generally interested in the last obtained examinations results only. Educational qualification, job (work) experience, attained results and hobbies and so on can be shown with small headings in bold letters to attract the attention of the reader.

One should not send the same Curriculum Vitae for all purposes and to all places. According to the nature of the job and management, Curriculum Vitae can also be re-written to suit different needs. In Curriculum Vitae one should paste his photograph also. At the time of interview he must have with him a copy of the Curriculum Vitae he has send.

Written Tests

Once the application is submitted by the candidates they will be called upon to write a written test at such places as notified by the government. A candidate who reads employment newsletters and the like can gather a lot of information regarding written tests. General questions as well as subjectwise questions are asked in the test. Classes are also offered by many private institutions to help the candidate face these tests.

Group discussion

Group discussion is also important. Group discussion helps to know some of the qualities of the candidate. E.g. leadership qualities of the candidate, whether he is a patient listener, respect for opposing views, whether he entertains opposing arguments with equanimity, the ideas and impulses he possesses, ability to express and convey; ability to respond to new and unheard ideas and his ability to deal with all such situations in all calmness. There are institutes which train applicants for group discussions.

Interview

Once the application is accepted, and in the case of governmental and semi-governmental undertakings the candidate has passed the written test the candidate will be called in for an interview. Generally there will be more than one interviewer in an interview session.

To prepare for an interview there is a long way to go. There are institutes which prepares students for this purpose. To study in these institutes one has to pay a lot of money. There are courses of short term period as of equally long term courses. Short term courses are weekend courses lasts for about 50 hours. Also there are long term courses of several year duration These two or three year courses definitely teaches the candidate not only interview techniques but also other relevant subjects to qualify for certain categories of jobs.

In the interview or personality test general knowledge is very important. The topic is being considered not to test the knowledge of the candidate alone but to know how for he is informed and the interest he has got in matters happening around him.

Vorbereitung auf die Aufnahmeprüfung

Für eine Reihe von Arbeitsplätzen im öffentlichen und halböffentlichen Dienst sind Aufnahmeprüngen (Sercive Exams) vorgesehen, z. B. für die Verwaltung, für nationalisierte Banken, für die Armee etc.

Further Reading

How to find a Job

Announcements of Positions Wanted

The charges vary from newspaper to newspaper depending upon the circulation of each newspaper. The price example is an announcement in a daily newspaper called Malayala Manorama:

Announcements of Vacancies

Generally vacancies are announced in newspapers. Each Firm announces its vacancies in one or more newspapers where they find it interesting. Other placement services are

Generally, not all Firms publish vacancies coming up in their firms. So one has to believe the hear say evidence given by somebody. So one has to seek the help of friends, co-workers, relatives, ex workers of the firm, professional institutions, clubs, social and charitable organisations through which one can gather information about jobs. One should establish good and cordial relationship with the professionals of his or her trade. Many a good firms give due weightage to the recommendations of officers in the firms.

In den meisten Tageszeitungen und Magazinen werden Stellenanzeigen veröffentlicht. Einige Tageszeitungen haben neben den täglichen Stellenanzeigen auch eine wöchtentliche Beilage mit Informationen zum Arbeitsmarkt und weiteren Stellenanzeigen von großen Firmen.

Manchmal wird in der Stellenanzeige einen Termin oder mehrere Termine für "Walk-In"-Interviews genannt, bei dem die Bewerber sich direkt persönlich mit ihrem Lebenslauf vorstellen können.

In der Wochenzeitung Employment News, die in English, Hindi und Urdu erscheint, sind neben Stellenanzeigen des öffentlichen Dienstes (Zentral und Staatenregierung) auch Artikel mit Informationen zum höheren Bildungswesen und Ausbildungsmöglichkeiten zu finden. Weiterhin werden dort auch Angaben zu den unterschiedlichen Service Exams gemacht.

Im Internet gibt es unzählige Websites, die Stellen vermitteln. Bei vielen von ihnen kann man seinen Lebenslauf kostenlos einschicken und dann passende Angebote erhalten. Bei anderen wiederum kann man Stellenangebote von großen Firmen sowie deren Profile einsehen.

Employment Agencies

Public agencies

Employment Exchanges are situated in every District. Union Public Service Commission selects candidates for the government of India, conducts examinations, and announces job vacancies.

State Public Service Commission are situated in every State. They select candidates for the needs of each Department of the State. It conducts examinations, announces job vacancies, select candidates for various Departments of the State government.

These are all constitutionally established government agencies which selects the recruiters for different government services except military and Railway. These government agencies charge nothing but for application form and information one may have to pay. In the last day announcement for the Navy recruitment they demanded Rs. 20.

Private agencies

Private Agenencies are Placement Agencies whose addresses can be found in the Yellow Pages of the Telephone Directory. They get employment vacancies from Firms registered with them. These Firms give information regarding new and existing job openings (opportunities). They train these candidates (job seeking) to appear for the tests and to face interviews. The Firms who registers by them need not pay to these agencies. But the employees who get a job through these agencies should pay one month salary to them.

How are these agencies used and accepted?

Private Firms who do not have own establishment can get help from these agencies. Firms need only to register the vacancies and the placement agents canvass employees for them. It is an inexpensive way to canvass employees. Companies do not pay. Moreover the companies get employees from a wide circle.

Direct Contact to Companies

It is possible to contact companies personally and it is useful also. Established Firms with much working capital generally work with the staff they are having. Such Firms generally do have a Human Resource Department and they will contact the candidate as and when they need someone. One can send his bio-data to the Firm concerned with his contact address and telephone number showing his expertise, knowledge, skill and ability.

Spezifikation für Rückkehrer

Benötigte Dokumente

Bei einer ersten schriftlichen Bewerbung reicht es, den Lebenslauf mit einem Anschreiben einzusenden. Beim persönlichen Bewerbungsgespräch können dann die übrigen Dokumente mitgebracht werden.

Anerkennung von Abschlüssen

Für die offizielle Anerkennung von ausländischen Universitätsabschlüssen ist die Association of Indian Universities AIU) zuständig. Genaue Inhalte und Dauer des Studiums werden dort evaluiert und ein Equivalence-Certificate (gegen Gebühr, ca. 5.000 Rupien) ausgestellt.

Eine offizielle Anerkennung ist notwendig, wenn ein Studium an einer indischen Universität fortgeführt werden soll oder wenn man sich für eine Stelle im öffentlichen Dienst bewirbt, direkt oder durch Aufnahmeprüfung (s. unten).

In der Privatwirtschaft werden in der Regel keine Equivalence-Certificate verlangt.

Im Handbuch "Equivalence of Foreign Degrees – 1987", herausgegeben von der AIU, können Informationen nachgeschlagen werden.

Rückkehrer-Organisationen

ECO-Center ICNEER

ECO-Center ICNEER (International Center for Networking, Ecology, Education and Reintegration)
Dr. Shirin Gadhia und Dipl. Ing. Deepak Gadhia
86, Old G.I.D.C. Gundlav
Valsad 396 035
Tel. und Fax: +91-2632-236703

Das Eco-Center ICNEER berät und unterstützt Akademiker und Arbeitnehmer, die nach Indien zurückkehren und sich niederlassen möchten.

Rückkehrerforen im Internet

Im Internet finden sich Foren von Indern, die meist in den USA ansässig sind und eine Rückkehr nach Indien planen oder vollzogen haben.

Regulierung der Arbeit

Arbeitsvermittlungen

Die größten Arbeitsvermittlungsagenturen sind die Union Public Service Commission (UPSC) und die State Public Service Commissions (PSC) in jedem Bundesland. Diese Kommissionen führen Prüfungen durch und auf deren Basis werden Menschen für Jobs in verschiedenen Regierungsbehörden und anderen Institutionen rekrutiert.

Der sogenannte Employment Exchange bietet temporäre Jobs an. Es gibt außerdem noch weitere Jobvermittlungsagenturen für den privaten Sektor. Deren Einfluss ist aber sehr gering.

Arbeitsvertrag

Es gibt eine Vielzahl von Arbeitsgesetzen in Indien. Diese sind die Grundlage für Arbeitnehmer und Arbeitgeber. Es sind beispielsweise Mindeslöhne und Lohnausgleich festgeschrieben. So gibt es wenig Spielraum in den individuellen Arbeitsverträgen, meist im Bereich von zusätzlicher Entlohnung für zusätzliche Aufgaben.

Arbeitszeit

Die wöchentlichen Arbeitsstunden für Arbeitskräfte in der Industrie und im Dienstleistungsbereich liegen bei 48 Stunden. Eine Arbeitswoche hat 6 Arbeitstage mit 8 Arbeitsstunden.

Schulen und Bildungseinrichtungen arbeiten generell montags bis freitags von 10 bis 16 Uhr. Regierungsbehörden arbeiten montags bis freitags von 10 bis 17 Uhr. Im Landwirtschaftsbereich wird 6 Tage die Woche gearbeitet.

Mindeslöhne

Der Mindestlohn im Landwirtschaftssektor beträgt Rs. 80 pro Tag. Tatsächlich bekommen die Arbeit jedoch mehr Geld. Im Industrie- und Landwirtschaftssektor ist ein jährlicher Bonus üblich.

Sozialleistungen

In den meisten Firmen und in der Landwirtschaft erhalten die Angestellten als zusätzliche Serviceleistung die Kosten für medizinische Betreuung zurückerstattet.

Darüber hinaus erhalten Angestellte Prämien. Diese werden aus dem Durchschnittseinkommen berechnet. Wenn ein Arbeiter 30 Jahre in einer Einrichtung tätig war, erhält er ein 15-Monat-Gehalt als Prämie.

Arbeitnehmer zahlen 10 bis 12 % ihres Gehaltes in einen Rententopf ein. Bei Eintritt in den Ruhestand erhalten sie dieses Geld zurück. Jedoch arbeiten viele Menschen in einem nicht auf diese Art organisierten Bereich. Diese erhalten dann auch keine Renten.

Quelle: Informationen durch den Assistant Labour Commissioner und durch die Labour Acts

Setting up a business

India is a federal state with the Central government ruling the entire country and there are federal state governments ruling over each state. In the Central government there is a Ministry called Industries and Commerce. Equally every state government is also having an Industry and Commerce Ministry. So, the general polices regarding industries are created by the Union and State governments together.

There is a distinction between public sector and private sector companies. Some industrial activities are reserved exclusively in the public sector. It means activities relating to such industries can be undertaken only by the government e. g. Mining, Minerals, Defense items, Atomic plant etc. All other industrial activities which are not reserved in the public sector are open for all (private entrepreneurs also).

Advice, information and resources

It is the District Industries Centre situated in every District which gives information regarding setting up of businesses and offering courses to the entrepreneurs. There are also other centers which promotes special products.

Industries related to Rubber one must meet the Rubber Board Office which is situated at Kottayam in Kerala. The Rubber Board offers assistance and even subsidies to Rubber based Industry.

STED is an informer for undertakers. It conducts classes for undertakers. They help entrepreneurs by giving advice as to what industry is best suited to a locality. They have current knowledge about several hundreds of small scale industries, the cost calculation of industry and so on.

Addresses of Institutions

The following institutions help develop identification of project ideas. They give technical consultancy, help with preparation of project reports, conducts managerial and technomanagerical training programmes, imparts practical training in work shop practice, arranges loans etc.

Furthermore, there is a Credit Guarantee Fund Scheme for small industries. The objective of Credit Guarantee Fund Transfer for small industries is to help the new and existing industrial units in SSI, units in information Technology and Software Industry to access credit without the hassles of collateral security.

Another factor nowadays coming up are industrial centers. Those places are exclusively reserved for industries. The government takes the initiative to construct industrial areas like Techno Park in Trivandrum, Rubber Park in Perumbavoor, IT centers etc. Further information regarding industrial activity can be found at the District Industry Centre and Taluk Industry centre.

Suggested literature and useful websites

A government publication called Vyvvasaya keralam which costs Rs. 200 per year.

Legal Forms of a Company

In India industrial activity has been divided into 3 groups according to the capital investment in each category:

Proprietorship

The entrepreneur is the sole custodian of the business;´. He is the manager, financer, and controller all in all.

Partnership

Partnership is formed under the Indian Partnership Act 1932. A partnership can be formed with a minimum number of 2 persons and a maximum number of 10 persons if it is engaged in Banking business and 20 persons if it is engaged in trading. Its merits are it is very easy to manage, minimum government control, easy to raise capital and it has minimum legal formality for registration and running.

Its demerits are that the members are personally liable (unlimited liability)´, it is not a legal person, difficulty to raise capital beyond a limit and the shares are not transferable.

Partnership comes into force only after an agreement entered into between the partners. A partner cannot transfer his interest in the firm to a stranger without the consent of all partners. A partner is always responsible for the loss it sustains. Here partners bring forth the share.

Co-operative societies

Co-operative societies are creatures of legislatures. The law relating to co-operative societies has been framed with a view to provide for the orderly development of co-operative movement. Co-operative Society is described as the activities of a group of people joined together to achieve a common end or to secure economic benefits.

The working capital of the society is achieved by the distribution of shares. The members purchase shares. The government exercises much control over co-operative societies. Actually speaking only small activities or businesses purely of co-operative nature can be conducted under it.

It is not advisable to register a firm under the co-operative societies Act. Firstly it is because of the political influence it is subjected to and perhaps of the political interference it is not capable of functioning in a Business like manner. Secondly the characters of the people involved in it are unpredictable.

Co-operatives have been successful in many fields including the processing and marketing of farm products, procurement of credit facilities, purchase of equipments, raw materials and the like to be of common benefit to the members. Financial institutions in the form of Banks are registered under the Kerala Co-operative Societies Act of 1969 and are doing good service to the society as a whole.

Company

A Company can be formed with 7 or more persons, according to the Companies Act of 1956. If it is a private limited company the maximum number of share holders is limited to 50 and a public limited company has no maximum limit.

Merits: The clear advantage of the company is that its members are not personally liable. Company is a separate personality. Company can acquire, transfer dispose of its property. There is no limit to raise capital provided the Registrar of Companies gives his consent. In a public limited company there is no upper limit as to membership. The shares can be transferred. Efficient management is possible because management of the company could be delegated to efficient managers.

Private limited companies can have a maximum of 49 members only. Public limited companies have no such restriction.

Demerits: There is maximum government control over a company. Compulsory audit of final account is compulsory. Registration and raising of capital is rather complex, expensive and time consuming.

Partner options

How to find business partners?

Through advertisement in newspapers and e-mail or web-sites, personal contact, joint group action etc one can find business partners. Please check chapter How to find a Job for more information.

Role of chambers of commerce

Chamber of commerce3 conducts orientation classes and resorts to publicity especially in import and export matters. It does much liaison work, they get involved in governmental activities. It is generally said that it is an association of entrepreneurs. It acts as a pressure group.

Business licences

What is required to apply for a business licence?

To apply for a business licence, one has to go to the local self-government (Panchayat, Municipality or Corporation) with the building plan and the project report. Project report means one has to prepare a detailed report including constitution of the unit, location, products sold, raw materials, availability of raw materials, staff + labour, demand and sales.

Once the licence is received one should apply for KGST registration (Kerala Government Sales Tax Registration) and if necessary for Central Sales Tax Registration (if the purchase and sale of goods are conducted in between several States).

Where to submit application papers?

One can submit the application forms to the local body. (Panchayat, Municipality or Corporation) To make it easy for the entrepreneur to get all licences from a single office (with regard to Industry), the government of Kerala has by an enactment created a separate Board called Single Window Clearance Board. These Boards are constituted in every District with the District Collector as the Chairman and General Manager of District Industries Centre as Convener and representatives of all Licencing Departments as Board members. Once the application is received by the said Board they will quickly pass the matter to the concerned Departments and a decision will be reached immediately.

There is innumerable number of Departments issuing licences. It depends upon for what one is applying for. A few examples, if one is employing labour he should obtain a Labour licence from the Labour Department or he needs a Factories and Boilers Licence , or Food licence(depending upon articles of sale), or Weights and measures Licence (Packed Commodities Act), approval from the Chief Town Planner, if it handles explosives it needs a licence from the Explosives Department and also the Rubber Board Licence from the Rubber Board etc.

Estimated time and costs of licensing approval?

The estimated time necessary for working out the application form is one week to three months. Within this period the local body has either to issue licence or reject it.

Preparation to start an Industry

To start an industry apply for temporary registration with Building Number or if no Building exist then apply with the survey number of the plot by the Industries Department which is situated in District Headquarters of each State. With this temporary registration number one can apply for electricity and water connection. If the said industry is causing pollution one has to get no objection certificate from the Pollution Control Board. One can also apply for loan on the basis of the temporary registration he received from the Industries Department.

Then the Taluk (local) Industries Officer makes a spot (local) inspection and recommends that the industry can either be set up or cannot be set up. When the Industry starts production it gets a permanent registration number from the department of industry. There are several programs initiated by the government to help entrepreneurs (micro project)

Small Scale Industry

Small Scale Industry means an industry where in the capital investment for plant and machinery does not exceed one crore rupees (10,000,000) (The sum does not include land and building). In such units the maximum number of workers to be employed is limited. (An industry run with the help of power (electricity, oil etc) maximum number of workers who could be employed is limited to 50. An industry runs without using power maximum number of workers to the employed is limited to 100. Such any industry coming within this definition is called a Small Scale Industry.

Before starting an SSI (Small Scale Industry) unit the entrepreneur should obtain a provisional Registration certificate from the Industries Department. After starting the business the provisional registration is converted into a permanent registration. The permanent registration once granted cannot be revoked.

Again the entrepreneur has to get a no objection certificate from the local self government. It should ensure that the said industry is working in accordance with the law. There are certain stipulations under which the industry has to work. The industry should be placed at a distance hereunder explained. (To put it simply no industry should be built or erected in the vicinity of the following institutions. The minimum distance that should be kept between the industry and educational institution is 25 meters, from a hospital it is 30 meters, religious cum workshop building it is 25 meters, Tanks and Canals it is 10 meters. If the industry causes pollution it should be 150 meters away from residential building. If the factory is situated in a residential area wherein the distance between the industry and the residents is less than 150 meters, it must get No Objection Certificate (NOC) from the people of the locality (residents).

Again, industry using power up to 5 Horse power (HP) does not need a licence from the local government. If a factory is working with the aid of power and is employing less than 10 workers or if the factory is running without the aid of power and is employing less than 20 workers, then for the construction of factory building it is not necessary to refer it to the town planning department.

Special incentives for Women

Incentives are given for women to start industry so that they could get financial independence and financial stability for themselves, for their family and lastly to the society as a whole they live in. There are several agencies which assist them in starting industry. Women should be of age between 18 and 45.

They get for the construction of the building and installation of machinery a maximum sum of 125,000 Rs. as subsidy. Rent for the building as grant a maximum sum of 750 Rs. per month for 4 years on tapering basis, e. g. for the 1^st year 100 % per month; 2^nd year 75 %; 3^rd year 50 % and for the 4^th year 25 %. Technical experts and managers in firm get a maximum of 750 Rs. as grant for 4 years on tapering basis. A trainee gets 500 Rs. as stipend for 6 months as part of training. Even Co-operative societies run by women get these subsidies.

State Investment Subsidy

To attract investment in industrial sector the government is providing assistance in the form of incentive based on the fixed capital investment made. All new units, tiny, small, medium or large industrial units can use this subsidy.

Application for subsidy shall be made directly to the District Industries Centre by the applicant himself.

Margin Money Loan

It is to assist deserving entrepreneurs in setting up small scale industrial units by way of providing soft loan to raise the required equity insisted by the financing institutions. The maximum limit of margin money loan is 2,50,000 Rs.

For a Non-resident Indian if he sets up a business in India, margin money loan shall be limited to 20 % of the cost of project or of the working capital requirement. The maximum limit under this scheme is 5,00,000 Rs. (The advantage of margin money loan is that one has to pay only lesser interest). Even in the matter of repayment a Non-resident Indian is at an advantage against his Indian counterpart. He needs to repay it in 24 equal quarterly installments.

Application for margin money shall be given to the general manager of the District Industries Centre along with duly filled up recommendation of the financial institution within one month from the date of availing first installment of the loan.

Prime Minister’s Rosgar Yojana (PMRY)

This program is widely used in India because it is free from (say more or less) bureaucratic hindrances. This scheme is known among the people as PMRY program.

The objective of the scheme is to provide self employment opportunities to educated unemployed youths. The candidate must have passed the 8^th standard, age between 18 to 35 (for women up to 45) and family income per year shall not exceed 40,000 Rs. For individuals up to 1,00,000 Rs. for business related projects and 2,00,000 Rs. for other projects.

There is a monthly magazine called "VYAVASAYAKERALAM" which appears in local language. It costs 200 Rs. per year.

Trade mark rights/ Patents/ Copyrights

Enquiry about patents

For enquiries one can contact the concerned offices. But it is advisable to seek the help of Patent Attorney’s or Trade Mark agents while dealing with these offices.

Establishing a Business Account

Account fees

No fee is charged to maintain an account with a Bank. But the Banks demand a minimum balance amount of money as cash balance in every account (Say Rs. 1,000 with regard to all important Banks in India but some foreign Banks demand a minimum balance amount of Rs. 5,000 in every account). If this minimum balance amount is not kept in the account they will impose a fine upon the account holder (Say every third month a fine of Rs. 200).

Overdraft fees

Overdraft is allowed against the stock. About 25 % to 30 % of stock in addition should be kept there to the overdraft drawn. There is no such fee as Over Draft fee. Here the fee charge is called Processing fee which varies from Bank to Bank. (By Federal Bank Ltd it is 0.15 % plus interest for the sum taken as loan.) By renewal every year one has to pay the Processing fee.

Who can get the authorisation for the disposal of the account?

The Board of Directors of the Company or governing body can decide as to who can operate an account. Generally it is either the Secretary or the Managing Director either jointly or severally who can dispose of the accounts with a Bank

Usage of Offices

Offices can be found through newspaper advertisements, or through information by friends. In front of vacant offices are board signs saying that this office can be rented.

Contract

There is an Act called Rent Control Act. It fixes the fair rent. (Now this provision regarding fixing of fair rent has been struck down by the Courts. So a new legislation in this regard can be expected very soon.) Moreover the whole thing can be negotiated between the parties. The Contract Act of 1871 and the Registration Act of 1965 has also got its application.

Common prices

The Rent Control Act fixes the fair rent. The prices are determined depending upon the basis of location, area, commercial importance, which floor one is hiring, whether it is having electricity and water connection, road frontage etc.. Moreover, one is required to pay several months rent as advance money or as security for which there is no upper limit. In a big city like Cochin the rent is Rs. 8 to Rs. 12 per square feet.

Tax System

The Sales Tax and Central Sales Tax is existing now in India. The government is trying to implement the Value Added Tax system in India. The sales Tax is almost the same as value added Tax.

The rates under Sales Tax Act various from item to item. It ranges from 8 % to 16 %. For the sales Tax already paid some states are charging an additional sales Tax of 15 %.

Central Sales Tax aims at Taxing the Inter state Sale and Purchase of goods. India is a federal state with several State governments. Purchase and sale of goods passing from one State to another attracts the provisions of Central Sales Tax Act. The rate of Central Sales Tax shall be 10 % of the value of the goods purchased or sold. There exist no turnover or wage Tax. Income Tax is charged on the income of the individual.

Taxes that have to be paid

Insurance Coverage

Compulsory and Optional Insurance

The industry must insure against Burglary and Fire if it is having a Bank loan. In that case, this insurance is compulsory.

The industry can insure against natural calamities, earthquakes, breakdown of machinery and equipment etc.

The industry must insure the workmen or labourer under the Workmen’s Compensation Insurance Act of 1924. The Parliament has enacted a law called the Workmen’s Compensation Act 1924. Employee’s state insurance is a compulsory one. The dependents of the employee get pension.

Transportation

Transit Insurance is available. It can insure goods till it reaches the destination or till the material is erected. To put it simply raw materials, equipments and end product can be insured during transit. Particular (each) consignment can also be insured.

The Public Liability Insurance Act 1991

Duty of owner to take out insurance policies, where death or injury to any person or damage to any property has resulted from an accident, the owner shall be liable to give such reliefs as is specified in the Schedule for such death, injury or damage. Every owner shall take out before he starts handling any hazardous substance, one or more insurance policies providing for contracts of insurance whereby he is insured against liability to give relief such as in cases where one meets with death or injury or damage to property.

Suggested insurance agents

The General Insurance Company still controlled by the government is the reliable one in India. Under the General Insurance Company there exists 4 Insurance Firms called the

In addition to this, insuring Life is the exclusive prerogative of the Life Insurance Corporation of India. Moreover International Insurance Companies have set their foot in India, just like the German Insurance giant Allianz.

Staff

How and where to find staff

Types of Employment

Permanent employment with all social benefits was the greatest wish of every young man and woman in India for a decade ago. Now even the Government is avoiding permanent employment. They give work on the basis of contract. These people are employed for a limited period with a limited purpose. Some other types of employment are production linked. The employees are employed only till the assignment or work is over. Then the other type of employment is part time jobs.

Social Expenditures

The employees get Provident Fund Benefits and Gratuity (capital forming) and Old Age Pension.

The object of Provident Fund Act of 1925 is to facilitate the Constitution of Provident Funds whose stability may be assured by government approval for the benefit of persons employed by governments or local authorities. Now these benefits have been extended even to employees of private firms. The Firm that employs more than 20 persons is bound to contribute to the Provident Fund Scheme.

One of the objects of the Provident Fund is that people should in case of retirement, have something to live on. Into the Provident Fund Scheme the employer and the employee deposit the same amount. It is 12 % of the salary that must be deposited by each into the Provident Fund Scheme. At the time of retirement the employee get the amount back. When he is in service he can take loan on the guarantee of Provident Fund.

According to the Payment of Gratuity Act 1972, gratuity is another amount an employer has to pay. An employee who has completed 5 years of work in a firm is entitled for gratuity. The gratuity amount is decided on the basis of the last drawn salary. An employee is entitled for 15 days salary multiplied by the number of years he has served in the firm.

Where more than 10 persons are employed in a firm the Payment of Gratuity Act 1972 finds application. For an employee, for every completed year of service 15 days salary shall be given to him as Gratuity benefits based on salary last drawn (Section 4). Gratuity payable to an employee shall not exceed Rs. 100,000/ (Section 4 (3)). Penalties for avoiding payment of Gratuity is imprisonment for a period of 6 months and fine up to Rs. 10,000.

For pension 8.33 % from Provident Fund account will be transferred to the pension account.

This is becoming popular. Especially the employees in the unorganised sector are the beneficiaries. This a model scheme followed in Kerala. Kerala is a model state in social legislation. These are some of the existing funds:

Reference Book:
All India Publishers Ltd; New Delhi; "The employees Pension scheme 1995" (Law publisher’s (India) Pvt.Ltd. ALLAHABAD)

Termination of Employment

Section 25F of the Industrial Disputes Act of 1947 lays down the procedure to be followed in case of closure of a company.

Employees’ Rights

The employees have the right to form associations, trade unions and collective bargaining.

Old Age Pension and Social Security Schemes

Provident Fund Scheme

Old age pension is available only to the government employees. It is being given by the government. Those who are working in private firms do get pension. They refer to the Provident Fund Scheme. Provident fund is a contributory scheme. There is contribution from both sides. The employer pays 12 % and 12 % pays the employee. From this 12 % + 12 % contribution 8.33 % goes to the pension scheme. From this 8.33 % the private firm employees get their pension.

Employees State Insurance (ESI)

Another scheme is Employees State Insurance (called ESI) Under this scheme the dependants get pension. Both employer and employee have to contribute.

The Central government has enacted a law called The Employees Pension Scheme, 1995 with Employees Pension (second amendment) scheme 2001.

The pensionable service of the member shall be determined with reference to the contributions received on his behalf in the Employees Pension Fund.

The pensionable salary shall be the average monthly pay drawn during the contributory period of service in the span of 12 months preceding the date of exit from the membership of the Employees Pension Fund.

Every employer shall serve a list of the employees to the Commissioner who can become a member of the Employees Pension Fund.

Reference Book:
All India Publishers Ltd; New Delhi; "The employees Pension scheme" 1995 (Law publisher’s (India) Pvt.Ltd. ALLAHABAD), with Employees Pension (Second Amendment) Scheme 2001

Start Up Costs for Business

A short note: Industry is a state subject not a matter that concerns the Central government. So every federal state can follow its own industrial policy. There are mainly three types of industries. One is called Tiny Industries, the other is called Small Scale Industries and the third category is called Large Scale Industries.

For tiny industry the total investment for plant and machinery shall not be more than twenty-five lakhs (25, 00,000), for small scale industries the upper limit for plant and machinery shall be more than Rs. 25,00,000 and less than one crore Rupees (Rs. 10,000,000). For large scale industry the minimum investment shall be more than Rs. 10,000,000. There is no upper limit.

Cost for the start-up period

Long term investments

Nowadays the government is developing Industrial Areas or Industrial Parks with water and electricity connections, roads, to say the least with all modern facilities. Here property can be acquired on Hire Purchase agreement or by lease by paying 30 % of the cost. The rest 70 % money can be paid in installments.

The cost for electricity for SSI unit is Rs. 3.25 per unit and for Commercial storm per unit it is Rs. 7 to Rs. 8.25.

There are also subsidies available from government for the following activities:

Land, Building, machinery and equipment directly related to production only is considered as fixed capital investment forgetting incentives. Subsidies are allowed only for fixed capital investments.

One should conduct business as per the specifications of the BIS (Bureau of Indian Standards). One can also obtain the international system certificates like ISO 9001-2000 (but it is not compulsory).

This information is obtained from industries departments Thodupuzha, Idukki and also from pamphlets received from there. Moreover, for the growth of industries in Kerala a new Industrial policy is being formulated, the contents of which are not yet known to the general public. Certainly it will come out within a few months time.

Bank- and Credit-System

Microfinance Credits

Banks provide loans to industries and businesses. Banks provide term loan and working capital loans in order to assist or help industrial sector.

Term loans: acquisition of fixed assets like building, plant and machinery etc. Repayments shall be in monthly / quarterly installments for a period of 5 to7 years with suitable moratorium period.

Working capital loan: maintaining the optimum level of current assets for the smooth functioning of the unit.

Requirements

Conditions and Services

Service charge is around 0.75 % to 1 %. Norms as to how credits are availed and the period of loan are generally decided by mutual contract and agreement between the parties.

Security

Terms of Repayment

Short term credits are to be redeemed as early as possible. Generally credits are sanctioned for a period ranging between 1 year to 5 years and 1 year to 15 years or to 20 years.

On demand the loan account will be a running account and the drawings in the account would be regulated through stocks / receivables statement to be submitted by the borrowers every month. The drawing power would be arrived at after deducting the margin from the fully paid stocks / receivables.

Assessment method

The working capital limits up to Rs. five crores from the banking systems would be assessed as per norms. As per the norms the units are eligible for working capital up to 25 % of the projected annual turn over. The unit should bring in 5 % of the projected annual turn over as their margin. The working capital requirements as per traditional method will also be computed and the higher limits will be sanctioned.

Banks and their programs

Kerala Financial Corporation

Consultancy service for project ideas, selection and development, liaison surveys and feasibility reports. Finance for seed capital and Term Loans for industrial units, Hospital, Geneset etc. Assistance to Women Entrepreneurs (Mahila Udyam Nidhi) and Ex-Servicemen (Semfex Scheme). Special schemes for Technocrat SC/ST, Single Window Scheme provides Term Loan and working capital to new tiny & SSI units where project cost is up to Rs. 10 lakhs (Rs. 10,00,000) excluding margin money for working capital and the total requirement is up to Rs. 5 lakhs (Rs. 500,000).

Industrial Development Bank of India

Provides technical and administrative assistance for promotion or expansion of industry. Extends direct assistance to Public Limited Companies & Co- operative Societies and Private Limited Companies in exceptional cases for financing new projects and also for expansion and diversification of existing ones. Normally assistance is confined to projects with investments over Rs. 300 lakhs. Provides soft loan assistance for modernisation. Operates Technical Development fund scheme.

Small Industries Development Bank of India (SIDBI)

Branch office, Mercy Estate, 2nd Floor
M.G. Road, Ravipuram
P.O.Box 1672
Kochi – 682 015

Principal financial institution for the promotion, financing & development of Industries in the small-scale sector and for co-ordination of the institution engaged in similar activities.

Industrial Financial Corporation of Indian (IFCI)

Provides direct financial assistance for setting up medium-large industrial projects to Ltd. Companies in Public, Joint, or Private Sector or Co-operative Societies projects with capital cost of over Rs. 300 lakhs only.

Industrial Credit & Investment Corporation of India (ICICI)

Assists Industrial enterprises by providing finance in both rupee & foreign currencies in the form of loans or medium term loans or equity participation etc.

Industrial Credit & Investment Corporation of India Ltd. (ECGC)

Provides a range of credit risk (Commercial risks & Political risks) insurance covers to exporters against loss in export of goods and services. Offers guarantee to banks and financial institutions to enable exporters to obtain better facilities from them.

Board for Industrial and Financial Reconstruction (BIFR)

III Floor, Ansal Chambers
II Bhikaji Came Place
R.K. Puram
New Delhi – 110 066

National Bank for Agriculture and Rural Development (NABARD)

Extend refinance facilities to Banks for extending term loans for setting up small village and tiny industries in the rural areas. Also extend grant assistance to registered voluntary agencies, charitable institutions to take up promotional schemes.

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