Market Development Assistance (MDA) On Production Scheme

The Khadi industry has been prevalent in the country for quite some time now. However, as modernization seeps into the bones of the country, the material ‘khadi’ has taken a step back in the markets and the consumers’ must-have lists. This has affected the khadi set-ups of the country. To combat this concern, the government of India has introduced the Market Development Assistance (MDA) on Production Scheme.

The MDA (Market Development Assistance) Scheme will help the khadi sector to improve the production and quality of khadi and increase the artisans’ earnings. Through this scheme, the khadi set-up can register itself as a khadi institution, thereby enabling them to manufacture products that are in par with other textile goods in the market.


How does a khadi set-up benefit from this scheme?

A khadi set-up can benefit from this scheme in the following ways:

  • Uniform distribution of sales throughout the year
  • Funds released on quarterly basis
  • Fixed portion of MDA assistance to artisans as incentive/bonus
  • Flexible to produce whatever the market desires
  • Dynamic pricing
  • Total amount of funds on production distributed amongst the spinners and weavers, producing institutions and selling institutions in the ratio 25%, 30% and 45% respectively

Eligibility Criteria

What is the eligibility criteria to register as a khadi institution?

To register as a khadi institution, a khadi set-up should:

  1. Be registered under the Co-op. Society/Trust/Regd. Institution/Firm and company/any other prevailing Act
  2. Have a common work shed/building having adequate space for carrying out spinning and weaving activities
  3. Have a minimum of 25 charkhas and 5 looms to start the khadi activities
  4. Furnish the list of 25 spinners, 5 weavers and 2 supervisors 


How to register as a khadi Institution?

Prospective khadi institutions can apply for registration online here, and then fill in Annexure I to V in here.

After applying for registration, the application will go through:

  • Online verification by the state or divisional offices of Khadi and Village Industries Commission (KVIC), followed by physical verification conducted within 15 days
  • Processing of the certificate of registration post approval from Zonal Director, Directorate of KVIC, and approval for issue of khadi certificate 

Registration Fees 

The applicant needs to submit a fee of ₹15,000 for the purpose of registration by the medium of DD or at any nationalized bank drawn in the favor of the Chief Executive Officer. The registration fee will also be accepted through RTGS in the A/c no. 30693240188, State bank of India, Vile Parle (W) Branch, IFS Code: SBIN0000515.

Documents Required 

What are the documents required to apply for the scheme?

The documents required to apply for the scheme are as follows:

  • Copy of the Registration Certificate under the Society Act/ Trust Act/Firm and company Act and or under any other prevailing Act
  • List of current Managing committee/Trusties/Directors as the case may be
  • Copy of the Resolution of the institution for registration with KVIC
  • Details about common work shed/building/work place from where the activity is proposed and or is already being done
  • Copy of self-attested by laws of the Institution
  • Details of procurement of charkhas and looms, if already purchased, indicating the date of purchase
  • NOC from State Khadi and V.I.Board (if applicable)

For further queries and guidelines with regards to this scheme, click here.