Khadi: Need to introduce corporate structure in KVIC: Nitin Gadkari

New Delhi: The government must adopt a commercial and “corporate” approach to the operation of the Khadi and Village Industries Commission (KVIC) to market khadi products and increase their exports, Union Minister Nitin Gadkari told parliament on Thursday.

“KVIC is doing a good job, but with a renewed vision, we have to establish a business structure commercially,” Gadkari said during a discussion on the functioning of the MSME ministry in Rajya Sabha.

“Only then will its exports increase,” Gadkari said.

Gadkari said KVIC’s revenue in FY19 was Rs 75,000 crore and is expected to be Rs 1 lakh crore in FY20, adding that the government plans to increase it to five lakh crore over the next five years.

“You have to think about marketing khadi products, there is enormous potential,” he said.

ET reported on January 19 that the government was seeking to corporatize KVIC’s marketing wing.

Gadkari also said on Thursday that MSME payments should be disbursed within three months in order to be successful. “If they get those payments, only then will they go ahead, otherwise small businesses will suffer,” he said.

A panel led by the Reserve Bank of India in its report on the MSME sector recommended such a step last year.

“The committee recommends that KVIC be corporatized with emphasis on promotional work. The commercialization function can be separated and also privatized to enable private participation and enable (the) use of khadi in the private sector,” the panel’s recommendations had stated.

The Khadi and Village Industries Commission Act 1956 allows the KVIC “to promote the sale and marketing of khadi or the products of village industries or handicrafts and, for this purpose, to establish links with marketing agencies established whenever necessary and feasible”.