J&K Rural employment Generation Programme

To harness and divert the energy and enthusiasm of the youth of the state for establishment of the productive enterprise in micro industrial sector and to create employment opportunities in rural as well as urban areas of the state, a new credit linked subsidy programme namely J&K Rural Employment Generation Programme (JKREGP) has been approved. The programme will be implemented by J&K Khadi and Village Industries Board and the subsidy will be routed through J&K Bank for eventual distribution to the beneficiaries / entrepreneurs in their bank accounts.

   The Government of Jammu & Kashmir, through its order No.185 2015 Dated:19-07-2017 has released guidelines for the implementation of the scheme JKREGP.

Guidelines For J&K Rural Employment Generation Programme (JKREGP)

Owing to its Geographical locational disadvantage and connectivity constraints major industries could not develop in the state of J&K. The absence of developed organized industrial sector aggravates the problem of providing employment to youth of the state. Out of the youth who have registered themselves with the Directorate of Employment more than 86% are educated and 9% have received vocational training (Digest of statistics2006-07). The Village/Micro Industrial Sector, production, processing
and packaging of agricultural / horticultural products, Service Sector like transport, health care, construction related service activities etc. are the few sectors which offer the potential for sustainable industrial development and Employment Generation in the state of J&K.

There is an urgent need to catalyze and invigorate the Village Industries & Micro Industrial Sector of the state in the back drop of rampant unemployment levels prevailing
in the state. J&K Khadi & Village Industries Board has been involved in planning, promoting, developing and organizing Micro Industrial Sector in the state falling within the purview of the activities of Khadi and Village Industries Sector. From inception till ending December 2017 J&K Khadi & Village Industries Board has established 47,076 number of units thereby providing employment opportunities for more than two lakh artisans / village industries workers. The performance of the Board with regard to implementation of Rural Employment Generation Programme has been applauded at the national level and J&K Khadi & Village Industries Board has been adjudged as the best performing. The Board throughout the country in the year 2007- 2008 and has been conferred “Best KVI Board” Non NE Zone National Award-2011 for excellence in the field of Khadi & Village
Industries during the year 2010-11.The Board has the necessary paraphernalia and the requisite experience to implement the employment generation programmes effectively.

To harness and divert the energy and enthusiasm of the youth of the state for establishment of the productive enterprise in micro industrial sector and to create employment opportunities in rural as well as urban areas of the state, a new credit linked subsidy programme namely J&K Rural Employment Generation Programme (JKREGP) is proposed. The programme will be implemented by J&K Khadi and Village Industries Board and the subsidy will be routed through J&K Bank for eventual distribution to the beneficiaries /
entrepreneurs in their bank accounts. The implementing agency will associate Office of the concerned District Development Commissioners, Lead district managers, Directorate of Industries, Financing banks, Entrepreneurship Development Institute and Nehru Yuva Kendras and other relevant bodies in the implementation of the scheme, especially in the area of identification of beneficiaries, area specific viable projects and providing training in entrepreneurship development.

(i) To harness and develop the entrepreneurial skills among the rural unemployed youth of the state.
(ii) To mobilize the bank finance for establishment of Village Industries sector of the state on modern lines.
(iii) To generate employment opportunities in rural areas of the state through setting up of new self- employment ventures/projects/village industries enterprises.
(iv) To increase the wage earning capacity of artisans/workers and contribute to increase in the growth rate of rural employment.

(I) The maximum cost of the project/unit admissible under manufacturing/agriculture/horticulture & allied sectors shall be Rs. 25 lakh.
(II) The maximum cost of the project/unit admissible under service sector/trading activity shall be Rs. 10 lakh. However, under rural and public transport sector, the
upper project/ unit cost shall be admissible to the upper ceiling of Rs.20 lakhs.
(III) The project reports for the beneficiaries shall be prepared by Rural Industrial Consultancy service centers (RICS), J&K EDI, DIC or any Government owned or private
consultancy duly registered with J&K, KVIB.

Funding pattern under JKREGP:


Contribution Details

Percentage Share


Beneficiary’s contribution of project cost (Equity money)



Government Subsidy (Margin Money)



Bank Credit


(i) Any individual, between 18 to 40 years of age residing in the village/rural area of the State. Any area where population is less than 20000 persons and which is a village/rural area as per revenue records shall be considered a Village/Rural area for implementation of the scheme. Towns, District Head Quarters and Capital Cities of the State shall be excluded from area of operation of the Scheme.
(ii) There will be no income ceiling for assistance for setting up projects under JKREGP.
(iii) Assistance under the Scheme is available only for new projects sanctioned specifically under the JKREGP.
(iv) Existing Units (under PMRY, REGP, PMEGP, SJSRY or any other scheme of Government of India or State Government) and the units that have already availed
Government Subsidy under any other scheme of Government of India or State Government are not eligible.
(v) Educational Qualification for Beneficiaries and Quantum of Financial Assistance:

Educational Qualification

Sector wise Maximum Project Cost Ceiling (Rs. In Lakh)

Sector wise Maximum Project Cost Ceiling (Rs. In Lakh)

Sector wise Maximum Project Cost Ceiling (Rs. In Lakh)




Agriculture & Allied Matric













Post Graduate





4.1 Other eligibility conditions:

(i) A certified copy of the State subject has to be appended with the documents at the time of claiming the subsidy from the designated nodal bank branches.
(ii) Project cost will include Capital Expenditure and one cycle of Working Capital. Projects without Capital Expenditure are not eligible for financing under the Scheme.
(iii) Cost of the land should not be included in the Project cost. Cost ready built as well as long lease or rental Work-shed/Workshop can be included in the project cost
subject to restricting such cost of ready built as well as long lease or rental Work-shed/workshop to be included in the project cost calculated for a maximum period of 3
years only.
(iv) JKREGP is applicable to all new viable micro enterprises, Village Industries projects except activities indicated in the negative list of the activities.
(vi) Only one person from one family is eligible for obtaining financial assistance for setting up of projects under JKREGP. The ‘family’ includes self and spouse.

5.1 The Scheme will be implemented by Jammu & Kashmir Khadi and Village Industries Board (J&K KVIB) a statutory body created by the Khadi and Village Industries Board Act, 1965 passed by J&K state Legislature.

5.2 Other Agencies:

The details of other agencies to be associated by nodal agencies in the implementation of JKREGP are as under:
i) Banks/Financial Institutions.
ii) Office of the District Development Commissioner.
iii) Lead District Managers.
iv) Entrepreneurship Development Institute (EDI) / Rural Self Employment Training Institutes (RSETI).
v) Women’s Development Corporation, Schedule Caste and Schedule Tribe Corporation and Panchayati Raj Institutions.
vi) Project Consultancy Service agencies approved by J&K KVIB, Directorate of Industries and Commerce.
vii) Professional Institutions / Universities / Technical Colleges recognized by Government/ University and University Grants Commission (UGC)/All India Council for Technical
Education (AICTE) having department for vocational guidance or technical courses providing skill based training like ITI, Rural Polytechnic, Food Processing Training
Institute, etc.

i. J & K bank.
ii. J&K Grameen Bank.
iii. J&K State Cooperative Bank and its subsidiaries.
iv. Any other Bank approved by the Apex JKREGP Monitoring Committee.

The identification of beneficiaries will be done at the district level by a Task Force Committee consisting of representatives from J&K KVIB, DIC, Banks and District Development Commissioner. The Task force would be headed by the District Development Commissioner or Additional District Development Commissioner concerned. The Bankers shall be involved right from the beginning to ensure that they are able to evaluate the managerial acumen of the candidate and correct credit decisions.
However, the applications of the candidates, who have a professional degree in Business management or any professional course or have already undergone training of at least 2 weeks under Entrepreneurship Development Programme (EDP) / Skill Development Programme (SDP) / Entrepreneurship cum Skill Development Programme (ESDP) or Vocational Training (VT) shall be given preference by the J&K KVIB. Exaggeration in the cost of the project with a view only to availing higher amount of
subsidy should not be allowed. J&K KVIB will devise a score card in consultation with J&K Bank, and forward it to the District Level Task Force and other State/District functionaries. This score card will form the basis for the selection of beneficiaries. This score card will also be displayed on the websites of J&K KVIB and Ministry Industries and Commerce. The selection process should be through a transparent, objective and fair process.

8.1 The Bank will sanction 90 to 95% of the project cost (including margin money) of the beneficiary/institution, and disburse full amount suitably for setting up of the project.

8.2 Bank will finance Capital Expenditure in the form of Term Loan and Working Capital in the form of cash credit. Project can also be financed by the Bank in the form of Composite Loan consisting of Capital Expenditure and Working Capital. The amount of Bank Credit will be 60% of the total project cost after deducting 35% of margin money (subsidy) and owner’s contribution of 5% from beneficiaries.

8.3 Though Banks will claim Margin Money (subsidy) on the basis of projections of Capital Expenditure in the project report and sanction thereof, Margin Money (subsidy) on the actual availment of Capital Expenditure only will be retained and excess, if any, will be refunded to J&K KVIB, immediately after the project is ready for commencement of production.

8.4 Working Capital component should be utilized in such a way that at one point of stage it touches 100% limit of Cash Credit within three years of lock in period of Margin Money and not less than 75% utilization of the sanctioned limit. If it does not touch aforesaid limit, proportionate amount of the Margin Money (subsidy) is to be recovered by the Bank/Financial Institution and refunded to the KVIB at the end of the third year.

8.5 Rate of interest and repayment schedule Rate of interest as per applicable Marginal Cost of Lending Rate (MCLR) shall be charged. Repayment schedule may be fixed for six years after an initial moratorium as may be prescribed by the concerned bank/financial institution. The banks shall in general cover the projects established under JKREGP under Credit Guarantee Fund Programme and the Fee shall be borne by the Bank.

The scheme shall be in operation in all the 22 districts of the state of Jammu and Kashmir. Emphasis shall be laid to set up such units which are viable, produce goods and services that can be readily sold and provide employment opportunities for local people.

10.1 The applications will be invited from potential beneficiaries by the nodal/implementing agency through press, advertisement, radio and other multimedia
at periodical intervals depending on the response from the aspirant candidates and budgetary allocations.

10.2 J&K KVIB will under the guidance of the Administrative Department prepare the online web based JKREGP application filling and processing system including online release of margin money. The online system will enable direct transfer of Margin Money subsidy to the Financing Bank Branches and thus ensure quality implementation and better timely progress and utilization of funds. Online applications will be mandatory and no manual applications will be allowed.

10.3 Applicants will be provided with User ID and Password at the time of initial registration (application filing) for their use in tracking the status of their application.
Applicant will be provided with application ID on final submission.

10.4 One page online application form will have the provision for saving data entered at any stage. Guidelines for filling up of each and every column will be provided alongside the application form.

10.5 A list of FAQs about the scheme as well online filing of application will be provided. A short video showing the online filing of applications will also be provided.

10.6 There will be a provision to upload the Photograph and documents which are necessary for screening the application, before submitting the application. These documents will include the following:

i. Adhaar Card
ii. Passport Size Photograph
iii. Copy of the State Subject
iv. Project Report in PDF Format
v. Category Certificate
vi. Rural Area Certificate
vii. D.O.B Certificate
viii. Educational Qualification Certificate
ix. Technical Education Certificate

The application form/ JKREGP MIS portal will be mobile friendly. After filing the application and uploading the required documents on the portal, the applicant will
click SUBMIT button and the application will be finally submitted. The entire set of documents and application form will be electronically forwarded to J&K KVIB.

10.7 Within 5 working days of receipt of application, the nodal officer of J&K KVIB shall interact with the applicant personally on telephone or personal meeting
and confirm the receipt/ acceptance of the application for preliminary scrutiny.

10.8 The nodal officer will do all the required correction in the application in consultation/ cross checking with the applicant and also provide hand holding support to the
applicant at every stage. They will appraise the applications on same methodology as followed by Banks for approval of loan. J&K KVIB shall extend handholding support to aspirant entrepreneurs through the help desks established in all the districts.

10.9 Applications which do not conform to the scheme guidelines or which remain incomplete or irrelevant even-after consultation with the applicant will be rejected by the concerned Nodal Officer, recording reasons for rejection.

10.10 Applicant can file grievance against such rejection to the Secretary/CEO J&K KVIB.

10.11 A Task Force, consisting of the following members, will be set up to scrutinize the applications received.

District Development Commissioner


Lead District Manager


Representative of ITI/Polytechnic/RESTI


Representative from the DIC


Two Representatives from Financing Banks


Dy CEO / Executive Officer / Assistant Executive officer – J&K KVIB

Member/ Convener



Note : Task Force may also co-opt representatives of other lending institutions or any other government department

10.12 The District Officer J&K KVIB after the preliminary scrutiny will forward the finally corrected application to the District Level Task Force Committee (DLTFC) under intimation to concerned Lead District Manager (LDM).

10.13 DLTFC meetings will be held at-least once in every month, if possible on every first Monday of the Month. Dates of the meeting fixed shall be displayed on the JKREGP web portal of all Districts. DLTFC meetings will be chaired by the District Development Commissioner or in his absence by the Additional District Development Commissioner.

10.14 J&K KVIB will within 2 days of the receipt of decision of DLTFC forward the recommended applications to the concerned Banks. In case of rejection, the reasons for  rejection should be clearly conveyed to the applicant.

10.15 There shall be an On-line Grievance Portal and a Grievance Cell to be setup by the J&K KVIB. The Grievance Cell will act upon the on-line complaints within three working days and direct the concerned District Officer to take necessary action.

10.16 The Bank will appraise the projects and take their own credit decision on the basis of viability of each project. No collateral security will be insisted upon by Banks in line with the guidelines of RBI for projects involving loan upto Rs.10 lakh in respect of the projects cleared by the Task Force. However, they will appraise projects both technically
and economically after ensuring that each project fulfills inter alia the criteria of;
i. Industry
ii. Viability of the Project
iii. Own Contribution
iv. State Subject
v. Rural/Urban Area
vi. Negative List

10.17 It is essential that the applications cleared by the District Task Force also fulfill these requirements at that stage itself so as to avoid delays in approval of loans in Banks.

10.18 The Banks will sanction the application within a stipulated period. Sanction will be issued based on the online sanction letter and copies of the sanction order
will be sent to the applicant (by e-mail/hard copy) as well as to J&K KVIB within 30 days from the receipt of DLTFC recommended application from the J&K KVIB.

10.19 The sanction letter will also be automatically forwarded to the concerned Rural Self Employment Training Institutes (RSETI) for conduct of EDP training in case
where the applicant has not undergone the training. The prescribed EDP training is mandatory before releasing of loan by the Banks. Applicants need not wait for sanction of loan but can undertake EDP training at any time on their own.

10.20 The applicant will deposit his/her own contribution and copy of EDP training certificate to the financing bank within 10 days, of receiving the communication of his/her sanction of loan. Bank will release the first installment of the loan either in full or partly and submit the claim for Margin Money subsidy online through the on-line portal of Nodal Bank/ J&K KVIB Portal.

10.21 The online claim form will be automatically checked for the fulfillment of two conditions

(i) the date of release of first installment is prior to the date of filing of Margin Money subsidy claim and

(ii) the amount of first installment released is more than the Margin Money subsidy amount claimed. J&K KVIB will validate the subsidy claim and upload on to the J&K Bank portal. J&K bank will be the single Nodal Bank for all the Financing Bank branches throughout the State.

10.22 J&K Bank will transfer the Margin Money subsidy claim amount validated by J&K KVIB to the respective financing bank branch within 48 hours of the receipt of validation. Once the Margin Money (subsidy) is received in the Bank in favour of the loanee, within 24  hours it should be kept in the Term Deposit Receipt
(TDR) of three years at branch level in the name of the beneficiary/Institution. No interest will be paid on the TDR and no interest will be charged on loan to the corresponding amount of TDR.

10.23 Margin Money (subsidy) will be ‘one time assistance’, from Government. For any enhancement of credit limit or for expansion/modernization of the project, margin money (subsidy) assistance is not available. Projects financed jointly i.e. financed from two different sources (Banks / Financial institutions), are not eligible for Margin Money (subsidy) assistance.

10.24 Bank has to obtain an undertaking from the beneficiary before the release of Bank Finance that, in the event of objection (recorded and communicated in writing) by
J&K KVIB, the beneficiary will refund the Margin Money (subsidy) kept in the TDR or released to him after three years period.

10.25 J&K KVIB and Banks have to ensure that each beneficiary prominently displays the following signboard at the main entrance of his/her project site:-
………………………………..(Unit Name)
Financed By ……………… Bank),
Unit location :……….
Financed under JKREGP

10.26 Nodal officers of J&K KVIB will also visit the units atleast once in every 6 months after their setting-up in order to check their status and provide necessary guidance/ handholding & mentoring. JKREGP portal should also be able to capture details of such visits by the concerned officer.

10.27 JKREGP MIS portal should be able to capture details of the physical verification of the unit done by the third party agency as well as disbursements of Margin Money adjustment into the loan account of the beneficiary.

10.28 The portal should have proper MIS generation facility and must enable generation of various reports including category wise, rural, urban, bank wise, district wise,
year wise, industry sector wise, size of project wise etc.

10.29 State Government will provide funds under JKREGP to the nodal implementing agency, i.e. J&K KVIB. CEO, J&K KVIB with the approval of the Administrative
Secretary of the Administrative Department on the basis of population of each district and extent of unemployment and previous performance of micro industrial schemes; will fix and convey the margin money (subsidy) targets allotted to each District to the concerned District Development Commissioners, Convenor SLBC and Lead District Managers. SLBC/DLRCs will ensure that targets are accordingly allocated within each district and included in the district credit plan. 20 % of the target shall be reserved horizontally for women candidates.

10.30 J&K KVIB will carry out most of the important tasks envisaged in the forward and backward linkages, including e-tracking, web management, Bankers Committee meetings, publicity, physical verification of units, organizing EDP training programmes, awareness camps, workshops and exhibitions. J&K KVIB will submit monthly utilization report to Administrative Department in this regard.

10.31 The Task Force, under the chairmanship of District Development Commissioner/ Additional District Development Commissioner will hold quarterly meeting with the Banks at district level to review the status of the project proposals. Wherever the projects are rejected, shortcomings/reasons will be furnished by the concerned Banks to the J&K KVIB and the applicants concerned will be requested by KVIB to provide additional information/documents if required and representative of KVIB will provide assistance to the applicants in this process. Since the Bank’s representative will also be a member of the Task Force, it needs to be ensured that maximum number of projects, cleared by the Task Force, are sanctioned by the Banks. Chairman of the District Task Force will review the performance of Banks and the loan repayment / recovery status in the quarterly review meetings.

10.32 Since “Margin Money” (subsidy) is to be provided in the form of Subsidy (Grant), it will be credited to the Borrowers loan account after three years from the date of first disbursement to the borrower/institution, by the Bank on receipt of unit establishment certificate from J&K KVIB.

10.33 In case the Bank’s advance goes “bad” before the three year period, due to reasons, beyond the control of the beneficiary, the Margin Money (subsidy) will be adjusted
by the Bank to liquidate the loan liability of the borrower either in part or full on the basis of the verification report of the implementing agency. In case any recovery is effected subsequently by the Bank from any source whatsoever, such recovery will be utilized by the Bank for liquidating their outstanding dues first. Any surplus will be remitted to J&K KVIB.




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