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Khadi and Village Industries Commission

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The Khadi and Village Industries Commission is a non-constitutional authority set up by The Government of India under the Parliamentary Act. Its mission is to plan, encourage, support, organize, and help implement Khadi and Village industries in remote rural areas. Established under the government’s second five-year plan, there are numerous objectives and important features of the Khadi and Village Industries Commission.

Khadi and Village Industries: Meaning and Relevance:

The Khadi and Village Industries Commission is an Indian Constitutional statutory authority, which works under the responsibility of the Department of Micro, Small & Medium Enterprises. It was founded under the Khadi and Village Industries Act of 1956. This act was revised twice — once in 1965 and again in 2006. Both Khadi & Village Industries have one similar theme: they are labor-intensive.

The benefit of Khadi and Village Industries would be that it needs almost no capital to start up, making them a cost-effective alternative for the rural poor. This is particularly relevant in the context of India, given the country’s severe income, geographical, and sparsely populated disparities.

The Second Five Year Plan & Objectives of Khadi and Village Industries Commission:

According to an RTI request by the Government of India, the Khadi and Village Industries Commission was established in April 1957, during the Second Five-Year Plan, under the Act of Parliament known as the “Khadi and Village Industries Commission Act of 1956.” It is the umbrella organization for khadi and village industry in India, reporting to the Ministry of Micro, Small & Medium Enterprises. Its mission would be to “plan, promote, facilitate, organize, and assist in creating and growing khadi and village industries in remote regions in cooperation with the other organizations involved in regional development anywhere and everywhere necessary.”

The Khadi Village & Industries Commission’s major aims are as follows:

  • To increase the number of people employed in the nation.
  • To encourage the sales & marketing of Khadi products.
  • To contribute to the nation’s self-reliance through educating impoverished, remote people.

Roles and Features of the Khadi and Village Industries Commission:

  • Collaborate with several rural organizations worldwide on several programs involving khadi and village industries within remote regions.
  • It helps to promote KVI goods via craftsmen or other channels.
  • It develops, organizes, promotes, and executes Khadi and Village Industries’ development programs.
  • It contributes to the development of shared facilities and services that aid in the extraction of raw materials.
  • It establishes relationships with a variety of advertising authorities to promote and sell KVI goods.
  • It keeps a stockpile of raw commodities which can be marketed farther down the chain.
  • It establishes rules for adhering to product specifications to prevent the creation of counterfeit goods.

Schemes and Programs under the Commission:

1. Prime Minister’s Employment Generation Program:

  • In the manufacturing industry, the highest construction price is 25 lakh, whereas, in the business sector, it is 10 lakhs.
  • Recipient Subsidy Rates in the PMEGP Recipient Subsidy Rates in the PMEGP 
  • In the broad class, 15% for urban & 25% for rural, and in the special category, 25% for urban or 35% for rural.
  • Banks will supply the remaining portion of the overall project cost in the form of a credit facility and cash reserves.

2. Interest Subsidy Eligibility Certification Scheme:

  • The Interest Subsidy Eligibility Certificate Scheme is the Khadi program’s primary funding source. It was established in May 1977 to raise funds from banks to bridge the gap between the actual financial requirement and the availability of funds from budgetary sources.

3. Rebate Program:

  • The government discounts Khadi and Khadi sales revenue to keep the cost of Khadi and Khadi products compared with other fabrics. Customers receive a regular reimbursement throughout the year and a special refund for 108 days out of the year.


The Khadi and Village Industries Commission proves to be very important and beneficial since the organizations’ products are generally offered directly by them or through the government. There are 15,431 sales outlets in all, with the authority owning 7,050 of them. They can be found all over India. In addition to this, the commission also organizes worldwide shows to sell the products.

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Last Updated : 18 Aug, 2022
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