Paper mills reel under power crisis

Ambika Sharma
Solan, July 9

http://www.tribuneindia.com/2010/20100710/himachal.htm#10

With the Himachal Pradesh State Electricity Board failing to grant uninterrupted power, several paper mills
are facing production losses ranging from 50 to 90 per cent every month.
Frequent trippings ranging from five to 40 minutes are a routine. As if this was not enough, the investors
rued that fresh load restriction schedules have been imposed.
Ruing deteriorating power scenario, Rajesh Aggrawal of Rupana Paper Mill at Nalagarh said, “The board has
now directed to impose 60 per cent load restriction every eighth day. Every tripping of five minutes costs us
production loss of at least two hours and we have suffered as much as 50 per cent production loss since April
due to erratic power supply.”
Facing the worst power crisis was the case of two paper mills at Tahliwaal - Sainsons Paper and Pulp Limited
and Saber Paper Mills - where the two investors who had initiated operations in February with partial loads of
less than 50 per cent and incurring Rs 2 crore for laying a 14-km line, Rs 2 crore for purchasing a
transformer and another Rs 1.22 crore as infrastructural charges each failed to get even 50 per cent of the
load even after a gap of three months now.
Ramesh Saini of Sainsons Paper and Pulp Limited, said, “We have failed to run the unit for even five hours
since the past three months in the absence of even 4-MW load as against the full load of 7.5 MW. It has
become difficult to bear the overhead monthly expenditures after investing Rs 100 crore. Though we have
been assured time and again that a bay required to streamline the system will soon be put in place, it has
been delayed inordinately making it difficult to even initiate proper production.”
Similar situation is being faced by Ruchira Paper Mill at Kala Amb where frequent tripping caused production
losses of 20-25 per cent per month, opined JM Singh.
Director, Power Regulation, Suneel Grover said there was no shortage of power but the heavy reactive load
drawn from the northern grid owing to the paddy season by farmers to run their tubewells in other states
was causing low voltage which was a matter of concern.

Man gets 10-year RI

Our Correspondent
Sundernagar, July 9
Additional Sessions Judge-cum-Special Magistrate DS Khanel, while holding circuit
court at Karsog, today sentenced Inder Kumar of Mahog village, Karsog tehsil of
Mandi district, to undergo rigorous imprisonment for 10 years and to pay a fine of Rs
1 lakh for possessing 3.750 kg of charas and 300 gm of opium.
In default of the payment of fine the convict has to further undergo imprisonment
for one year. For possessing 300 gm of opium, the convict has to undergo rigorous
imprisonment for one year and to pay a fine of Rs 10,000, which is punishable under
Section18 of the NDPS Act. Both sentences shall run concurrently.
A police party nabbed the convict on June 28, 2009, on Kelodhar-Chelari road as he
 tried to run away by seeing the police and on his search the contraband was found
from his possession, the report said.
The court based the conviction on the testimony of official witnesses (police officials)
and turned down the plea of the defence that the convict was falsely implicated.

Seminar held on animation

Hamirpur, July 9
MAD Arts and Jaspal Bhatti Film School, Chandigarh, organised a seminar on Career
Avenue in Animation and Film Making at town hall here today. Savita Bhatti, famous
TV actress and wife of comedy producer-director Jaspal Bhatti, CEO of the school,
was the main speaker.
The basic purpose of this seminar was to provide career counselling to students
completing their plus 2 exams and looking for better career avenues in emerging
area like animation and film making.
Speaking on this occasion Savita Bhatti said, “Hamirpur has vast potential for
becoming a great learning centre of this region and our basic aim is to apprise the
students about acting, direction, camera handling, editing and animation film
making.”
Bhatti said according to a report the Indian Animation industry is going to grow to
the tune of Rs 3900 crore by 2013 and there would be a large gap between demand
and supply creating vast scope for new entrants in this field.
Speaking on this occasion head of the animation department of the school Gaurav
Garg explained technical terms of animation films like 2D, 3D and clay animation. —
TNS

Two held for murder bid

Our Correspondent
Nurpur, July 9
Following the complaint of Sheela Devi of Bhol village, the Jawali police has arrested her
husband Rajinder Singh and father-in-law Munshi Ram, residents of Nadolli, late last night
for allegedly making an unsuccessful attempt to murder her and torturing her for bringing
dowry.
Jawali DSP Badri Singh said the complainant had married to Rajinder Singh two years ago.
In her complaint to the police, she said her in-laws used to torture her. A case under
Sections 307, 498 (A) and 34, IPC, has been booked against him and his father.
He said the accused had tried to set Sheela on fire by sprinkling kerosene on her on
Wednesday but she foiled their attempt by giving them the slip and reported the matter to
the police. The accused were produced in the judicial court at Jawali this afternoon. The
court sent the accused to three-day police remand.
 Industrial Scenario

Industrial Development
Report of the State-level Committee to recommend a policy framework for the Chandigarh Periphery
Companies in Punjab Controlled Area and regulating constructions therein.
1. INTRODUCTION
Multinational Companies
in Punjab 1.1 The Chandigarh Periphery Controlled area was created with the twin objectives of ensuring a planned
future expansion of the New Capital City and to prevent mushrooming of unplanned construction around it.
District wise status The Punjab New Capital (Periphery) Control act, 1952 accordingly aimed at regulating the use of land and
preventing unauthorized and unplanned urbanization in a 16 kilometre periphery.
Industry wise status
1.2 Since then, planned satellite townships of SAS Nagar (Mohali) and Panchkula have come up in the
Periphery in addition to a large cantonment. Further in 1990, the State Government declared an area of
Commodity wise exports 10,000 Acres near Dera Bassi, falling within 23 villages of Patiala district, to be a Free Enterprise Zone
from Punjab (FEZ), where the setting up of industries was to be permitted.

District Wise exports from 1.3 Notwithstanding the regulatory framework, enforcement has been patchy. Appreciating the emerging
Punjab ground realities, the Punjab Government had in 1998 decided to permit an across-the-board regularization
of all unauthorized constructions, which had already come up within the Periphery up to and including
Punjab's Strength 7.12.1998. Simultaneously, it was also decided to evolve a policy framework which would permit the setting
up of institutions related to education, health etc., with low density of built-up area, within the Periphery,
apart from permitting activities related to leisure and tourism.
Mega Project
2. THE COMMITTEE
Mega Project
2.1 Accordingly, a Committee headed by the Chief Secretary was constituted by the State Government in
Assisting Organizations its order of September 10, 2003 to suggest an appropriate and transparent policy framework for the
Periphery.
Udyog Sahayak
2.2 Taking cognizance of this Committee, the Hon’ble Punjab and Haryana High Court in Civil Writ Petition
PSIDC No. 14357 of 2002 directed:

PFC that the Committee should critically examine the problems and bottlenecks in the proper development of
Periphery and to suggest a policy framework which would ensure planned development of the area;
PSIEC
that the issue of regularization of unauthorised constructions which have already come up in Periphery
should also be examined by this Committee;
PICTC
that on the basis of the recommendations made by the Committee the State Government shall take a
PAIC decision whether or not to regularize such constructions;

PEDA that the State Government shall also examine the reasons for the coming up of unauthorized
constructions, rationale for their regularizing and steps to stop such construction in future including
Govt.Policy imposition of exemplary fine and setting up of Special Courts to deal with such illegal constructions;

Policies to fix responsibility of the officers/employees responsible for abetting such constructions and setting up
a Tribunal headed by a retired Judge of the High Court to deal with the cases of illegal constructions.
Notifications
2.3 Further, in Civil Writ Petition No. 7187 of 2003 the Hon’ble Punjab and Haryana High Court has also
Notifications sought the views of the State of Punjab about extending the abadi deh area/lal lakir of the villages in
Periphery, and this issue was also referred to the Committee.
Downloads 3. THE DELIBERATIONS – BROAD POLICY FRAMEWORK
Download Documents 3.1 The Committee held numerous meetings and also formally obtained the comments of relevant
Departments of the Government such as Revenue, Industries, Housing and Urban Development and Local
RTI Manuals Government. Views of the public at large were also sought through placement of advertisements in news
papers to which there was considerable response.
RTI Manuals
3.2 At the outset the Committee observed that it was first necessary to take into account the changing
INTRODUCTION:
The PFC has been established under the State Financial Corporation Act,1951,for providing medium and
long term loans to small and medium scale industrial undertakings in the state of Punjab under various
schemes.
It generally grants term loans for creation/acquisition of fixed assets like land ,building, plant and
machinery, provides guarantee against deferred payments for the purchase of capital goods and offers
underwriting facility on issue of stocks and shares to companies. The Corporation also provides financial
assistance for setting up of Hotels, Nursing Homes/small hospitals, IT Industries, development of industrial
estates and purchase of transport vehicles etc. The Corporation has sanctioned (effective) and disbursed
loans of Rs.1096 crores and Rs.1060 crores respectively upto 31st March 2003 more than 13596 units. The
break-up is as under:-
Amount : (Rs.in Percentage
crores)

Small Scale Sector 1052 96.0

Other than small scale

44 4.0
sector

Total: 1096 100.00

* 1 Crore=10 millions

The performance of Corporation in the key areas of operation for the last two financial years is under:
(Rs.in crores)

2002 2003
2004 -2005
-2003 -2004
Sanction (Gross) 41.50

Disbursement 39.65

Recovery 111.04

The Corporation has a decentralized setup comprising of nine district offices having power to sanction and
disburse loans upto Rs.30 lacs. The loans above Rs.30 lacs and upto Rs.240 lacs are processed at Head
Office. The Corporation may also finance cases more than Rs.240 lacs with the permission of SIDBI on
case to case basis.
PURPOSE OF THE LOANS:
The Corporation grants loans for setting up new industrial concerns, expansion and modernization of
existing concerns and rehabilitation of sick industrial concerns, which have been assisted by it. The loans
are generally granted for creation of fixed assets such as land, building and machinery . However, it also
grants composite loan for meeting working capital requirements to new tiny and small units with project
cost upto Rs.200 lacs under Single Window Scheme. The Corporation also associates itself with Punjab
State Industrial Development Corporation (PSIDC), commercial banks and other Financial Institutions for
financing industrial project costing upto Rs,.12 crores.
ELIGIBILITY CRITERIA:
The public limited companies, private limited companies, cooperative societies, partnership firms, sole-
proprietorship firms of HUF concerns engaged in, or proposing to be engaged in any one or more of the
following industrial activities in the State of Punjab, are eligible for financial assistance from the
Corporation.
ACTIVITIES ELIGIBLE:
Besides providing financial assistance for industrial units, engaged/to be engaged in manufacturing
,processing, preservation, packaging of a product, PFC also provides assistance for the following
activities:-
TOURISM : Hotels ,restaurants, motels ,tourist bungalows, tourist service agencies, cultural centers,
convention centers, amusement parks, health clubs, etc.
HEALTH : Hospital, nursing homes, poly-clinics, diagnostic laboratories & for purchase of electro medical
equipment’s.
TRANSPORT: Vehicles for transportation of passengers goods, ropeways lifts, tourist coaches etc.
SERVICE ESTABLISHMENT - Repair & maintenance workshops computer centers, weighing bridge,
communication facilities, Fax, E-mail, Telecommunication, Public Call, Office etc. etc.
R & D Engaged in providing technical know-how, consultancy for promotion of industrial
projects/products.
INFRASTRUCTURE: - To set up industrial parks, estates, areas, construction, maintenance, development of
roads, bridges etc. Earth moving equipment, tube well boring, zigs and tools.
MARKETING: Construction / Arrangement of sales outlets of for renovation of existing sales, outlet
,purchase of mobile sales van.
AGRO- Tissue culture, floriculture, pisciculture, poultry and hatchery.
EXPLANATION:
a) The expression "Processing of goods" includes any art of process for producing, preparing of making
an article by subjecting any material to a manual, mechanical chemicals electrical or any other like
operation (s). However , the industrial companies/concerns with paid up capital, equity and free reserves
exceeding Rs.10.00 crores are not eligible for financial assistance.
b) The above list is only illustrative and by no means exhaustive and PFC looks forward to assist
technically and financially sound new industrial projects.
LIMIT OF LOANS:
The Corporation provides loans upto the following limits fixed under the SFCs Act,1951:
(Rs.in lacs)

- Public limited company/private limited company/co-operative

240
society

- Partnership/sole proprietorship/others 120

- The Corporation in participation with the Punjab State Industrial

Development Corporation, Commercial Banks and All India
Financial Institutions, finances projects costing upto Rs.12 crores.

RATE OF INTEREST:
The Corporation is charging interest at the following rates:-
(a) Loans upto Rs.0.50 lacs 11.75%

(b) loans above Rs.0.50 lacs upto 2.00 Lacs 12.25%

(b) loans above Rs.2.00 lacs upto 25.00 Lacs 13.25%*

(b) loans above Rs.25.00 lacs 13.75%*

(c) Under TDM & ISO-9000 Schemes 13.00%*

 (d) For non-SSI Units 15.50%*

* 1% Rebate on timely payment

NOTE: The above rate of interest is subject to change and exclusive of interest tax & after providing rebate
of timely payments.
SECURITY:
Loans are advances against first registered mortgage of fixed assets of the industrial concerns. The
Corporation also accepts personal guarantee of the partners of the concern or of the directors in case of a
limited company wherever it is considered necessary. It may also accept when it is considered necessary,
the immovable properties in the State of Punjab owned by the individual partner (s) or by the members of
the Hindu Undivided family, as the case may be, as on addition security.
Loans for the purchase of generating sets and transport vehicles are granted against hypothecation of the
assets purchased with the financial assistance, In case of transport vehicle the loanee or his guarantor has
also to offer immovable property in the State of Punjab as Security in addition to hypothecation of the
vehicle.
Loans under Single Window Scheme are granted against first charge on the entire assets of the concern
both immovable and movable and collateral security of immovable property equivalent to 125% working
capital loan. In case of loan to small scale units set up in rented premises, hypothecation of plant &
machinery and other equipment and personal guarantee of promoters is obtained . Further Third party
guarantee of reputed, resourceful person(s) or collateral security is to be obtained.
PERIOD AND MODE OF REPAYMENT:
Period of repayment of loan is upto 10 years However, the exact period of repayment in each case is fixed
keeping in view the repayment capacity of the concern. The interest and installments of principal are to be
repaid quarterly further, moratorium in repayment of principal is provided for one to two years.
PROCEDURE FOR SEEKING FINANCIAL ASSISTANCE:
An Entrepreneur/industrial concern interested in seeking financial assistance from the Corporation is
required to applied or contact the Head Office or any of the District Offices of the Corporation for requisite
application forms. The entrepreneur is required to give brief information of the scheme. constitution and
the amount of loan required while requesting for application forms. The application forms are supplied free
of cost. The Corporation ,however, charges one time non-refundable fee from applicants seeking
assistance for more than Rs.5.00 lacs for the processing of loan applications. The borrower will have to pay
the processing fee @0.25% of the loan amount applied for. The amount so payable shall be deposited by
bank draft drawn in favour of the Punjab Financial Corporation in two installments as under:-
a) 50% of the processing fee is to be deposited alongwith the loan application.
b) Balance 50% of the processing fee is to be deposited with 15 days from the date of issue of the sanction
letter.
The processing fee is non-refundable. There is no processing fee of the loan upto Rs.5.00 lacs.
The applicant is required to fill in the forms and comply with formalities, after going through the check list
which is supplied with the application forms. The check list enumerates the documents/information which
should be enclosed with the application forms. The Corporation assists the applicant in filling up the
application forms and renders any other related guidance.
INFORMATION REQUIRED WITH THE LOAN
APPLICATIONS:
i) Required loan application forms in duplicate, duly filled in alongwith processing fee mentioned above.
ii) Regarding Promoters.
a) Detailed bio-data of the promoters, age, attested photographs, educational and provisional
qualifications, past experience and experience obtained in the particular industry, residential address and
relationship with other promoters.
b) List of total movable and immovable assets owned by each promoter and the liability there against
alongwith proof of assets.
c) Income tax and wealthy tax details of the last three years specifying those assessed and paid alongwith
the copies of assessment orders/returns filled.
d) Credit worthiness report from the bankers for all promoters
iii) Sister Concerns:-
a) Name & brief history of other concern(s) in which the promoter(s) are interested.
b) Copies of the audited balance sheets and profit and loss accounts for the last three years for each of the
above mentioned sister concern(s)
c) Copy of the instructions issued to the bankers to give full information, above your concern on request
from the Corporation.
iv) Regarding Govt. approvals:-
a) Certified copy of the registration as small scle industrial unit from District Industries Center or
registration with Secretariat of Industrial Development, Government of India, for other than small scale
units.
b) Memorandum and Articles of Association (if company "s case)
c) Certified copy of the certificate of incorporation ( if company’s case).
d) Certified copy of partnership deed (if partnership concern).
e) Certified copy of registration certificate issued by the Registrar of Firms on Form A & C (if partnership
concern).
f)Registration with the Tourism Department, Punjab and license for the earning house (incase of hotel
industry).
g) Permission /Licensee should be produced from the competent authority (in case of textile/drugs/food
/etc.unit).
h) Details of the power requirement and tie up arrangements with PSEB.
i) Effluent Treatment Scheme/Permission from Pollution Control Board.
j) Permission from Director, Housing & urban Development Punjab, Chandigarh, in respect of units to be
located in Patiala and Ropar Districts.
V) The Proposal:-
a) Cost of project including cost of land, building, machinery miscellaneous items, preliminary and
[preoperative expenses, margin money for working capital and means of financing.
b) Certified copy of the recent date balance sheet.
c) Certified copies of the audited balance sheets and profit and loss accounts for the last three years (if
existing concern).
d) Details of the existing building, if any.
e) Details of the existing machinery complete with name, specifications, year of purchase, price and
make /supplier (if any).
f) Details of land alongwith certified copy of sale deed of land underneath the factory building (The land
should be in the name of the sole-prop/firm/company). Details of land in the prescribed Performa should be
submitted.
g) Details of the building proposed to be constructed alongwith the building plant duly approved by the
Competent Authority of the area.
h) Details of the machinery proposed to be purchased complete with name, specifications, price and
make/supplier alongwith the basis of selection of the machinery, supplier like catalogues of each
machinery, name of the concerns to whom machinery have been supplied with name and complete
addresses.
i) Three quotations in respect of each item of plant and machinery proposed to be purchased.
j) In case of imported machinery, a copy of capital goods clearance alongwith the basis of selection of
machinery suppliers and agreement made with them be supplied.
k) List of Senior Persons to be engaged by the concern like Technical Administrative and Managerial
Persons and organization chart relating to the proposed management structure of the concern, be
provided.
l) Statement of working capital requirements for three years.
m) Details of various raw materials alongwith name, specifications, consumption, present price and name
of supplier.
n) Details of specification of the product/product mix proposed to be manufactured with installed capacity
of each and basis determining the installed capacity of the product.
o) Details of the manufacturing process.
p) Justification of improvement of working results in case of expansion, diversification and replacement
project,
q) Details of profitability and case flow statement of the scheme. for ten years.
r) Details of the proposed selling arrangements.
s) In case of collaboration for technical know-how with outside agencies, furnish the details of their
reputation, past experience in the proposed line and copy of the proposed agreement.
t) Marketing and development scope of the proposed project, specifically and regained alongwith demand
and supply data, existing capacity, users of the proposed product and their requirement. A copy of the
Market Study conducted in connection with the project be submitted.
u) In case of execution of projects on turn key basis by outside agency, furnish the details of their
reputation ,past experience, list of similar projects executed, qualifications and strength of its staff and a
copy of proposed agreement.
PROJECT APPRAISAL SCRUTINY OF LOAN APPLICATIONS AND ARRANGING INSPECTION:
Loan application for assistance upto Rs.30 lacs are processed by the district offices in respect of the
districts within their jurisdiction Loan applications for assistance more wherever necessary and
preliminary discussions are held with the promoters for conceptualization of the project. The applications
for loan above Rs. 30 lacs are processed at Head office.
After preliminary scrutiny of loan application, the case is placed before the Screening Committee which is
normally held twice a month, which discusses the case with the promoters and satisfied itself regarding
viability projects and the norms of the appraisal . Thereafter, the Corporation arranges appraisal of the
project. Efforts are made to ensure that applications are processed expeditiously, information’s sought
form the parties Machinery loading chart in order to justify the plant and machinery proposed to be
purchased.
Various aspects of project appraisal are discussed during appraisal.
A) TECHNICAL APPRAISAL:-
- Product mix ,manufacturing process and installed capacity
- Technology,
- Location/site selection and infra-structural facility.
- Size of the plant and the project.
- Building requirement
- Selection and procurement of plant and machinery.
- Raw material cost and availability.
- Implementation schedule/gestation time.
B) COMMERCIAL AND ECONOMIC APPRAISAL:-
- Demand data
- Supply data
- Distribution
- Pricing, government policies and permission
- Competition
- Employment generation
- Promoters, manpower and soundness of the proposal
- Appraisal of management and management problem
C) FINANCIAL APPRAISAL:-
- Capital cost of the project and means of financing
- Financial projection like profitability estimates, cash flow and sensitivity analysis.
- Analysis of the working of sister concern, cash flow and working of the existing concerns for the last
three years.
- Analysis of various rations and break even point, IRR and NPV etc.
FEW SCHEMES BEING OPERATED
1. COMPOSITE LOAN SCHEME:
(a) Eligibility Borrowers: Artisans Village & Cotton industries and small scale industries in tiny sector.
(b) Purpose : Assistance for equipment and working capital and also for work sheds.
(c) Norms: Loan upto Rs. 5 lac is given under the scheme with nil promoters contribution and repayment
period is between 3 to 10 years with a moratorium period of 12 to 18 months..
2. SINGLE WINDOW SCHEME :
a) Eligible Borrowers: Entrepreneurs setting up new projects in SSI/Tiny Sector as well as to existing units
for modernization, technology-upgradation and socially viable sick units undertaking rehabilitation
scheme.
b) Purpose: To provide both term loan for fixed assets and loan for working capital through some agency.
c) Norms: A total project outlay including total working capital requirement should not exceed Rs. 200.00
lac under the scheme.
3. MAHILA UDYAM NIDHI SCHEME:
a) Eligible Borrowers: Women entrepreneurs for setting up new projects in tiny/small scale sector and
rehabilitation of viable sick units excluding transport operators.
b) Purpose : To meet th gap in the equity.
c) Norms: The capital cost of project including margin money for working capital not to exceed Rs. 10.00
lac. The soft loan limit is 25% of the cost of project subject to maximum of Rs. 2.5 lac per project. The soft
loan will carry service charges @ 1% PA.
4. TRANSPORT INDUSTRY:
a) Eligible Borrowers: Small road transport operators.
b) Purposes: For purchase of truck/bus/auto rickshaw, mini bus for transportation of goods or passengers
by road. Secondhand vehicles are not eligible for assistance.
c) Norms: The quantum of loan is need based (maximum 20 vehicles per operator including existing
vehicles).
5. Self-employment for Ex-Servicemen:
a) Eligible Borrowers: Ex-servicemen (including windows of ex-servicemen ) sponsored by Director
General Re-settlement, Ministry of Finance, Govt. of India.
b) Purpose: For setting small industrial projects including service industry and satisfied transport activities
which are eligible for financed as per ISI norms.
c) Norms: Cost of project not to exceed Rs. 15.00 lac. The assistance will include soft loan to meet the gap
in equity to Rs. 2.25 lac per project. Soft loan will carry service charge @ 1% PA during the moratorium
period. Therafter, interest @ 6% PA.
6. NATIONAL EQUITY FUND SCHEME:
a) Eligible Borrowers: Small entrepreneurs for setting up new projects in tiny/small scale sector and
rehabilitation of potentially viable sick units. The sick existing tiny and small scale industrial unit and
service entrepreneurs include all industrial units and service industry except road transport operator.
b) Purpose: To meet the gap in minimum prescribed promoters contribution and or equity.
c) Norms: Cost of project not to exceed Rs. 50.00 lac. Soft loan limit is 25% of the cost of project subject to
a maximum of Rs. 10.00 lac per project. The service charge on soft loan will be 5%. The repayment period
for soft loan is 7 years including moratorium period of three years.
7. EQUIPMENT REFINANCE SCHEME:
a) Eligible Borrowers: Sole proprietorship, partnership, co-operative Societies, Private & Public Ltd.
Companies.
b) Purpose: The assistance of the scheme would be available for acquiring capital goods, equipment
(imported/indigenous) not related to any specific project at 22.5% margin. The loan is repayable in three
years depending upon repayment capacity of borrowers.
c) Norms: The unit should have been in operation for minimum 4 years (for automobile and electronic units
minimum period is two years) and earned profit/declared dividend during the two years proceedings
financial year and should not be in default with any financial institution.
8. SCHEME FOR ASSISTANCE FOR MARKETING :
a) Eligible Borrowers: Sole proprietorship, partnership, cooperative Societies, Private & Public Ltd.
Companies.
b) Purpose: For setting up of new outlets of existing concerns for marketing products of small, cottage and
village industry.
c) Norms: The cost of project should not exceed Rs. 25.00 lac including land, building, showroom facilities,
office equipment, margin money for working capital and reasonable expenses to be incurred on publicity.
the proposed sale outlet shall mainly stock and sale the products of small, cottage and village industry.
9.SCHEME FOR ASSISTANCE TO SCHEDULED CASTES/SCHEDULED TRIBES ENTREPRENEURS:
a) Eligible Borrowers: SC/ST persons.
b) Purpose: Assistance for purchase of equipment and or making capital, sole proprietor as well as
partnership.
c) Norms: The maximum limit of loan under the scheme is Rs. 15.00 lac.
10. SCHEME OF TECHNOLOGY DEVELOPMENT & MODERNIZATION (TDM):
a) Eligibility Borrowers: Sole proprietorship, partnership, co-operative Societies, Private & Public Ltd.
Companies.
b) Purpose: Assistance under the scheme would be available for meeting the expenditure on purchase of
capital equipment, need based civil works and acquisition of additional land. Acquisition of technical know-
how, designs, drawings and fashion forecast where relevant to specific product group. Upgradation of
process technology and products with thrust on quality improvement comparable with acceptable
domestic and international standards. Improvement in packaging. Cost of TOM and acquisition of ISO 9000
series certification. Need based additional incremental margin money for working capital.
c) Norms: Total project outlay not to exceed Rs. 100.00 lac preliminary and pre-operative expenses shall
not be covered as part of the cost of project. The prevailing rate of interest is 13.00% with 1% Rebate on
timely payments.
11. GENERAL LOAN SCHEME:
a) Eligible Borrowers: All forms of organizations in the small scale sector (i.e. proprietary, partnership,
company, co-operative society etc). For infrastructure development-all forms of organizations such as
public/(p) Ltd. Cos. partnerships, sole proprietary, municipalities.
b) Purpose: For setting up new small scale units or expansion, modernization, diversification, etc. of
existing units and for all activities eligible for assistance under the scheme including professional
practice/consultancy venture and service sector units such as tourism related activities/hospitals/nursing
polyclinics/hotels/restaurants/marketing and industrial infrastructural projects.
c) Norms: The cost of project in respect of service sector unit not to exceed Rs. 10.00 crore and in case of
manufacturing units Rs. 12 crores.
12. SCHEME FOR ACQUISITION OF ISO 9000 SERIES:
All existing units under SSI sector having good record for past performance and sound financial position,
provided the unit is in operation for a period of atleast 4 years and have earned profits during preceding
two financial years are eligible under this scheme for the acquisition of ISO 9000 series.
Expenses of consultancy, documentation, audit certification, equipment and other instruments required
would be taken into account for determining the directly/indirectly or and have plans to manufacture
product for export under this scheme. The concessional rate of interest @13.00% with 1% Rebate on timely
payments is charged under this scheme.
13. SCHEME FOR TEXTILE INDUSTRY UNDER TECHNOLOGY UPGRADATION:
Eligible Borrowers: Sole proprietorship, partnership, co-operative Societies, (P) & Public Ltd. Companies in
the textile and cotton ginning and pressing industries, The textile industry comprises of the following
activities:
Silk reeling and twisting.
Wool scouring and combing.
Synthetic filament yarn texturising, crimping and twisting
Spinning.
Viscose filament yarn (VFY).
Weaving, knitting including non-wovens, fabric embroidery and technical textiles.
Garment/made up manufacturing.
Processing of fibres, yarns, fabrics, garments and made-ups.
b)Purpose: Assistance under the scheme would be available for meeting the expenditure on:
Purchase of capital equipment, need based civil works and acquisition of additional land.
Acquisition of technical know-how, designs, drawings and fashion forecase where relevant to specific
product group.
Upgradation of process technology and products with thrust on qualify improvement comparable with
acceptable domestic and international standards.
Improvement in packaging.
Cost of TQM and acquisition of ISO 9000 series certification.
Need based additional/incremental margin money for working capital.
c) Norms: To provide encouragement to textile industrial units (including units in the Cotton Ginning and
processing sectors upgradation and to modernize their production facilities. Assistance is available for
installation of specified types of machinery and for eligible activities in a new unit or in an existing unit by
way of replacement of existing machinery and/or expansion. New units must set up their entire facilities
only with the appropriate eligible technology. A unit can undertake one or more activities listed by GOI.
However, multiple activities can be undertaken only in an integral manner i.e. by way of forward or
backward integration. It is however, clarified that weaving/knitting and garment manufacturing or
weaving/knitting and processing or garment manufacturing and processing will be considered and integral
activities.
The scheme would be in operation for a period of five years from April 1, 1999 to March 31, 20004.
The scheme envisaged interest incentive of 5% and/or cover for exchange rate fluctuation upto 5% p.a. on
the loans availed by small scale units from primary lending institutions. Refinance is availed from SIDBI is
not compulsory. However, where refinance is availed form SIDBI such proposals shall conform to norms
and parameters stipulated by SIDBI, in addition to the guidelines prescribed by Govt. of India.
Details including the list of machinery are furnished in Technology Upgradation Fund Scheme booklet
issued by GOI.
14. QUICK FINANCE SCHEME:
This scheme is meant to serve the existing business concerns and the concern financed by the
Corporation in the past by providing Quick Finance by way of working capital facility upto Rs. 50.00 lacs
and term loan facility upto Rs. 240 lacs.
ELIGIBILITY CRITERIA:

1. The unit should be in production for period of three years.

2. The unit should be making book profit i.e. profit tax for 2 out of last 3 years.
3. The unit should have minimum earning per share more than two in case of limited companies or positive
cash accruals in case of proprietary or financial concerns ; and
4. The unit should be regular in repayment of dues of financial institutions.
5. Fees

Cost of the forms of application Rs.100 /-

Processing fee 0.5% of the assistance applied for

On acceptance of the simplified form, the process of sanction under the above scheme shall be completed
within 7 days and the disbursement can start immediately thereafter depending upon the requirements of
the concern. No application after receipt shall take more than 15 days.
15. SCHEME FOR SHORT TERM ASSISTANCE:
The availability of adequate funds for the smooth running of the industrial unit is most vital for its growth in
the small and medium scale sectors . The scheme for short term financial assistance with the following
main features has been given as under:-
ELIGIBILITY CRITERIA:-
a) The scheme is meant for small scale unit and medium scale industrial units financed by the Corporation.
b) The units financed by the Corporation are in existence for a minimum period of three years. having
earned profits during the last two years and not in default with PFC/Bank/other financial institutions.
c) The assistance above Rs.10 lacs and upto Rs.50 lacs per unit shall only be considered.
ELIGIBLE LOANS
The short term loan will be given for the purchase of raw materials and imported materials in bulk or to
meet the peak season demand of consumable and for execution of specific orders and/or to meet the short
term requirements of the eligible concerns.
a) RATE OF INTEREST: 17.5% per annum.
b) REPAYMENT PERIOD: The repayment period varying between 8-11 months supported by advance
cheques.
c) SECURITY:
i) The personal guarantee of the directors/promoters
ii) Extension of charge on the existing assets and also collateral security if required so that total assets
mortgaged with the Corporation should be twice the amount of existing and proposed loans. The margin
on security shall be retained at 50% minimum in favour of the Corporation for the proposed short term
assistance.
d) COMPUTATION OF SHORT TERM LOANS: The proposed term loan shall be restricted to 25% of the
projected level of sales minus assistance for working capital sanctioned by the commercial bank subject to
a maximum of Rs.50 lakhs.
e) PROCESSING FEE: 0.5% of the assistance applied. In addition 1% shall be charged as up-front fee if the
assistance is sanctioned and accepted by the borrower. The assistance sanctioned to the concern shall be
reviewed annually for which fee of Rs.5,000/- shall be charged on renewal basis.
f) GENERAL CONDITIONS:

a) The disbursement of the loan shall be made through a online account maintained with the principal bank
of the concern.
b) The bank of the concern shall be associated while deciding the maximum limit of the short term loan and
a copy of the sanction and conditions of sanction shall be conveyed to the Principal Banker of the concern.
NOTE: The financial parameters are as at present and subject to change.
g) DEBT EQUITY NORMS:-

a) For small scale units:-

I) Loans upto Rs.10.00 lacs 3:1

ii) Loans above Rs.10.00 lacs 2:1

b) Other than small scale units 1.5:1

16. SCHEME FOR FINANCING COMMERCIAL COMPLEXES:

a) Objective: The objective of the scheme is to provide financial assistance for establishing Commercial
Complexes, Showrooms, Sales, Outlets, Departmental Stores and Shopping Malls etc

b) Eligibility Criteria: Sole Proprietorship firms, Partnership concerns and Companies fulfilling the
following conditions :-
(i) The land and building should be in the name of Sole Proprietor, Partners or Company.
(ii) Location of Commercial Complexes, Showroom etc should be within the approved area of the
respective competent authority.
(iii) Assistance for renovation for the existing commercial complexes may also be considered under the
scheme.
(iv) Proposal where land is on lease are not eligible.
(v) Minimum Promoter's contribution shall be 40%.
(vi) Minimum Collateral Security shall be 30%.

c) Terms of Assistance
(i) Interest Rate : As applicable in case of SSI units.
(ii) Repayment Period : The loan shall be repayable in 8 / 10 years including moratorium period of 12
months.
17. SCHEMES FOR FINANCING WARE HOUSES / PLINTHS
a) Objective: This scheme is aimed at providing financial assistance for construction of Warehouses /
Plinths for storage of food grains in the State.

b) Eligibility Criteria: Sole Proprietor / Partnership concerns fulfilling the following conditions :-
(i) The land is owned by promoter.
(ii) All those concerns which proposes to built ware houses under Guaranteed Land Scheme of PSWC,
PUNSUP, MARKFED, PAIC or any other Government Agency.
(iii) Promoter's contribution shall be 40%.
(iv) Collateral Security shall be 50% to 60% of the amount of term loan.

c) Terms of Assistance
(i) Interest Rate : As applicable in case of SSI units. (Subject to change)

(ii) Repayment Period

a) 8 - 10 years in case of godowns
b) 3 - 5 years fin case of plinths
c) The moratorium period will be 12 months or upto the date of receipt of first rent which ever is earlier.
18. SCHEMES FOR ASSISTANCE TO INFORMATION TECHNOLOGY AND SOFTWARE DEVELOPMENT
SECTOR
a) Objective: To fulfill financial requirements for the Information Technology and Software Development in
the State.
b) Eligibility Criteria: All new Industrial units are eligible for assistance under the scheme from the
corporation. However, preference will be given to the units established by persons with sufficient
experience, expertise and exposure in software development.
c) Terms of Assistance
(i) Interest Rate : Rate of interest as applicable to General Term Lending Scheme.
(ii) Repayment Period : Repayment period not exceeding 5 years including the moratorium period of 12
months where the premises are owned by the promoter and six months in case of rented premises or
premises on lease.

d) Promoter's Contribution: Promoter's contribution shall be 30%

POWERS TO SANCTION LOANS:

i) Executive Committee upto Rs.125.00 lacs.

ii) Board of Directors above Rs.125.00 lacs
MERCHANT BANKING ACTIVITIES
The Corporation is registered as Category ‘I’ Merchant Banker with the securities and Exchange Board of
India (SEBI) and sponsoring member of over the counter Exchange of India (OTCET) .The Corporation
offers facilities like public issue management, project counseling, merchant banking appraisal,
participation in bought out deal, under-writing of Public Issue, Bills Discounting etc.
In addition, it provides quick and timely need based finance to the existing profit making concerns with
good track record. The corporation offers the following innovative schemes for concerns satisfying the
eligibility criterion:-
i) The units are in small scale/medium scale sector.
ii) Units are in existence for minimum three years and having earned profits during the last two years.
iii) Regular in repayment /payment of dues of Financial Institutions.
PFC-LINE OF CREDIT SCHEME:
The annual plan of industrial concern for term credit for purchase of machinery/equipment can be
sanctioned in the form of Line of Credit, while disbursement can be availed on identification/selection of
equipment/machinery at a later date. This scheme is meant for the existing financed units by the
Corporation. The term finance available under the scheme shall be repaid within a period of four years, rate
of interest shall be one percent above the normal rate.
DISBURSEMENT OF LOANS:
After the loan is sanctioned by the competent authority a letter of sanction is issued to the loanee concern.
The letter of sanction contains the general terms and conditions which the concern is required to comply
with before the disbursement of the loan.
OFFICES OF PFC
HEAD OFFICE : PUNJAB FINANCIAL CORPORATION,
95-98,BANK SQUARE, SECTOR 17-B.,
CHANDIGARH .
PHONE: +091 - 172 - 2708420, 2709295, 2709296, 2709298, 2704805, 2702425
FAX: +091 -172 - 2709297
Email: pfcchd@sify.com

Website : http://punfincorp.nic.in

DISTRICT OFFICES: PHONE

1. PUNJAB FINANCIAL CORPORATION, 504217,22504217
PLOT NO. 2, DISTT. SHOPPING CENTRE,
RANJIT AVENUE,AMRITSAR.
2. PUNJAB FINANCIAL CORPORATION, 2212746, 2217806
A-6, CIVIL LINES, BATHINDA
3. PUNJAB FINANCIAL CORPORATION, 220060, 225753
DISTRICT INDUSTRIES CENTRE,
MALWAL ROAD, FEROZEPUR
4. PUNJAB FINANCIAL CORPORATION, 2253419
SCO 6,INDUSTRIAL DEVELOPMENT
COLONY, JALANDHAR ROAD, HOSHIARPUR.
5. PUNJAB FINANCIAL CORPORATION, 2227414, 2242654
MAIN GARHA ROAD,
ABOVE BANK OF INDIA, ,JALANDHAR
6. PUNJAB FINANCIAL CORPORATION, 2538502, 2539312
ABOVE BANK OF MAHARASHTRA,
LINK ROAD, LUDHIANA.
7. PUNJAB FINANCIAL CORPORATION, 2362357, 2362494
BUILDING NO.1,1ST FLOOR,
DUKHNIVARAN ROAD,
NEAR SANDHU HOSPITAL,
PATIALA.
8. PUNJAB FINANCIAL CORPORATION, 2214055-56
SCF 41, 1ST. FLOOR, PHASE IX,
MOHALI DIST. ROPAR.
9. PUNJAB FINANCIAL CORPORATION, 2-34374, 2-36556
DC OFFICE ROAD,
SANGRUR

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NOC Status Act, 1974, City / Area Heari Waste
Laboratory Structure Specific ng
Renewal Status Amended Recycled
List of Tests Guidelines
1988 Job Plastic
Delegation of
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Powers to Grant Water
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Activities of the Board (Preventio Insurance
n& Act
Management & Organization
Control of Public
Pollution) Hearing
Procedure
Act, 1981

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(Protection
) Act, 1986

Public
Liability
Insurance
Act, 1991,
amended
1992
Rules

Water
(Preventio
n&
Control of
Pollution)
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1978

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Hazardou
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1989

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1998
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 c Guide Guidelines for Location of Industry

delines for Location of City/Area specific siting guidelines

ustry
The Government/Board has laid down city/area specific sitting guidelines for the following
General Guidelines towns/areas:
ndustry Specific 1. Ludhiana
Guidelines 2. Mandi Gobindgarh
3. Capital Periphery Zone (CPZ)/Free Enterprise Zone (FEZ)
City / Area Specific
Guidelines 4. M.C. limits of Towns/Cities
• Restriction of setting up of industries within 25 km from the Standard Urban
zen's Guidelines limit of Ludhiana city:
As per provisions of notification dated 25.07.1991, of Government of India, large and medium
Citizen's Charter
industries can not allowed to be located within 25 Kms. from the periphery of standard urban a
RTI Act 2005 of cities having population of more than 10 lakh according to the 1991 census. The Ludhiana is
such city in Punjab. This condition however, will not apply to electronics, computer softwares,
lic Liability Insurance industries and other non-polluting industries that may be notified by Govt. of India for this purp
from time to time. Substantial expansion of existing units will also be subject to the locational
conditions set out as above.
lic Hearing Procedure
The details of designated industrial areas where industry is permitted in and around Ludhiana c
given as under:
Sr. Name of Industrial Area Block
No.

1. Industrial Area-A Within Municipal Limits

2. Industrial Area-B Within Municipal Limits

3. Industrial Estate/IDC Within Municipal Limits

4. Focal Point Dhandari Kalan Phase- I to VII Phase- I to V are within

Municipal Limits

5. Focal Point on G. T. Road, Ludhiana and Within Municipal Limits and

Chandigarh Road also in Ludhiana Block

6. Hambran Sidhawan Bet Block

7. Focal Point, Samrala Samrala Block

8. Free Enterprises Zone Mangat and Sidhwan Bet Block

 • Setting up of Industrial units within M.C. limits of Mandi Gobindgarh
The criteria for establishment of the new industries within M.C. limits of Mandi Gobindgarh w
follows:
1. All industries requiring CSA and / or SAC clearance and environmental cleara
from Government of India under EIA notification should be allowed to establ
zone no. 2.
2. All industries except mentioned at Sr. No. 1 above should be allowed to esta

zone no. 1
However, the Board vide its decision dated 30/3/2005 has decided that all the indu
proposed to be established in the industrial area (Zone – I & II) as per Master Plan
Mandi Gobindgarh may be allowed to establish and no further sub-zoning of indust
area is required.
• Capital Periphery Control Area/Free Enterprise Zone (FEZ)
As per the Capital Periphery Control Act and Sub-Regional plan of Punjab State, no industrial
can be undertaken within periphery of Chandigarh and its sub-Region except the following area
have been exempted through notifications mentioned as under:
Sr.N Name of the Area
o.

1. Free-Enterprise Zone (FEZ) in Dera Bassi-Mubarkpur Belt, in Chandigarh

Periphery and its Sub-Region in State of Punjab vide Notification No.3/4/98-
3IBI/311, dated 9/1/1990.

2. Setting up of Tiny Industrial Units with investment of Rs.5 Lacs on plant and
machinery within abadi area of all villages falling in Chandigarh Region
Periphery controlled Area, FEZ, in the permissible industrial use zones in the
Master Plan and Regional Towns, with the exception that no industrial unit is to
be permitted within the Abadi Area of village falling within SAS Nagar New
Master Plan area vide notification No.Sur/ST/184/64/Periphery/tiny/ 16831-B,
dated 28th September, 1992.

• General guidelines for location of industries within M.C. limits of the towns/c
The Board vide its notification No.Admn/SA-2/F.No.178/2001/98 dated 11/11/2001, has decid
the cases of the industries for grant of consent to establish/consent to operate in non-designated
the State shall be decided as per the following policy:
1. No new industry of any category shall be allowed in the approved residentia
of any town of the State of Punjab. The approved residential area shall be
designated either by PUDA/Municipal Corporation/Improvement Trust or any
designated authority of the State and it should be duly reflected in the Mast
2. No new red category industry shall be given consent to establish within mun
limits except in the designated industrial area of the State.
3. The Board may continue to grant consent to establish to green category of
 industries which are proposed to be located in the mixed category areas or
predominantly industrial areas within municipal limits of a town/city after
clarification of the area by CTP/STP/DTP.
4. The Board may grant consent to operate to the entire existing green catego
industries in mixed category areas or predominantly industrial area.
5. The Board may grant consent to operate to old red categories of industries
operating in the approved residential areas or mixed areas but required to b
shifted, if they have installed adequate effluent treatment plants and air pol
control devices.
• Initial consent to operate shall be for a period of one year with the condition
will shift to the designated industrial area within the stipulated period.
• The Board may further extend this period on merit after the expiry of one ye
the rarest of the cases subject to the approval of the Board of Directors.
*The above clause (5) regarding grant of consent to operate to the industries in the non-designa
of the State will be restricted only to 5 cities namely Ludhiana, Jalandhar, Amritsar, Batala and
Gobindgarh.

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