ASPIRE Scheme

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Even now, the majority of India’s population is reliant on the agriculture business. Despite the fact that the government has implemented a number of creative programs, poverty and unemployment continue to plague the country. To combat this, the government launched the ASPIRE scheme, which aims to create jobs and businesses in the agricultural sector.

The Government of India’s A Scheme for Promotion of Innovation, Rural Industries, and Entrepreneurship (ASPIRE) is promoted by the Ministry of Micro, Small, and Medium Enterprises (MSME). It was established to establish incubation centers and a network of technology centers across India. The main aim of the ASPIRE Scheme is to boost entrepreneurship. Its goal is to encourage agro-industry start-ups to innovate.

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What is ASPIRE Scheme?

A Scheme for Promotion of Innovation, Rural Industries, and Entrepreneurship (ASPIRE) assists in the establishment of a network of technology centers and incubation centers in order to foster entrepreneurship and startups in the agro-industry.

ASPIRE was established to establish a network of technology centers and incubation centers in order to accelerate entrepreneurship and support start-ups in the agricultural business. The initiative is based on the Hon’ble Finance Minister’s 2014-15 budget speech. He proposed building a Technology Centre Network to boost Innovation, Entrepreneurship, and Agro Industry with a fund of Rs. 200 crore.

He also proposed putting in place a program to facilitate forward and backward linkages with multiple manufacturing and service delivery chains. Furthermore, he also proposed to launch a nationwide “District level Incubation and Accelerator Program”. The intent of these initiatives will be to incubate new ideas and provide necessary support for accelerating entrepreneurship.

ASPIRE is aimed to give the required skill set for entrepreneurs to start businesses, as well as to enable market linkages and provide hand holding for a key period to achieve self-sustainability.

Objectives of the ASPIRE Scheme

Create new jobs and reduce unemployment
Promote entrepreneurship culture in India
Grassroots economic development at district level
Facilitate innovative business solution for unmet social needs
Promote innovation to further strengthen the competitiveness of the MSME sector.

Who is Eligible for the ASPIRE Scheme?

The following entities or agencies or centres are eligible for the funding under the ASPIRE Scheme:

As an incubatee, anyone above the age of 18 can be trained.
Any entrepreneur interested in starting a business;
Any technical/research institutes/universities, especially those specializing in rural and agro-based industries;
Production Co-operative Societies and Charitable Trusts are examples of institutions registered under the Societies Registration Act of 1860.
Any government of India or state government institution or agency working in the fields of technology, rural development, entrepreneur development, or business management.
Any private company operating under the PPP model, can establish LBI.
Existing incubators.
Incubators that have previously received government subsidies for the same set of activities under incubation under any other plan of the Government of India or a state government are not eligible.
Any existing incubation centres operating currently under different agencies. Such as Ministries and Departments of the Government of India or Institutions including National / Regional level institutions of GOI / State Governments to set up such centre dedicated to incubation and enterprise creation in the area of Agro based Industries
New incubation centres to be set up by eligible private institutions including Industry Associations, along with the Academic Institutions, R&D laboratories, Universities, Government entities and Technology Parks

Components of ASPIRE Scheme

Livelihood Business Incubators (LBI)

The most crucial component is to establish Livelihood Business Incubators (LBI). The LBI will be established within the National Small Industries Corporation (NSIC), KVIC or Coir Board, or any other GOI or State Govt. institution or agency. These agencies will replicate the successful “Rapid Incubation Model” of the NSIC. The rapid incubation methodology combines “entrepreneurship promotion and skill development” with the creation of actual “demo projects.”

The institutions, namely: NSIC, KVIC, or Coir Board, or any other institution/agency of the GOI/State Govt., can also set up livelihood incubation centres under the PPP mode. The establishment under PPP mode will be with the institutions, namely: NSIC, KVIC, or Coir Board, or any other institution/agency of the GOI/State Govt.

Funding of Livelihood Business Incubators (LBI)

For incubators under designated agencies, the following funding must be provided under ASPIRE Scheme
a one-time grant of 100% of the cost of Plant & Machinery other than land and infrastructure or an amount up to Rs. 100 lakh, whichever is less,
For incubation centres to be set up under PPP mode, the following funding must be provided
a one-time grant of 50% of the cost of Plant & Machinery other than land and infrastructure or an amount up to Rs. 50.00 lakh, whichever is less, is to be provided.
The total budget given under this heading would be Rs. 62.50 crore for the establishment of 80 LBls capable of adequately skilling a targeted 104000 youth over a three-year period.

Objectives of Livelihood Business Incubators (LBI) under ASPIRE Scheme

To establish business incubators where qualified kids can be effectively trained in various professions and given the opportunity to start their own businesses;
To provide youngsters with entrepreneurship and skill development courses;
To give coaching and support, as well as finance facilitation, in order to empower people to start their own businesses.
To encourage the development of new low-end-technology/livelihood-based businesses.

Technology Business Incubators (TBI)

The next important component under the ASPIRE Scheme is to establish Technology Business Incubators (TBI). The Technology Business Incubators (TBI) must be established at two levels.

The first level will be set-up to support existing incubation centers currently operated under various agencies. Such agencies are Ministries and Departments of the Government of India or Institutions including National/ Regional level institutions of the GOI / State Governments. These centers will be dedicated to incubation and enterprise creation in the area of Agro-based Industries,

The second level will be the set-up of a new incubation centre. This centre will be set up by e-Government. Incubation Centers will be promoted based on region, crop, product, process, and industry vertical.

Existing incubators under various Ministries would be required to provide built-up covered space with electric power and water connections. These incubators must also provide any additional forward or backward linkages. Furthermore, these incubators must provide required staff resources for both the existing and future incubators’ centers.

Funding of Technology Business Incubators (TBI)

For existing incubators to set up incubators in agro-based industries, the following funding must be provided
a one-time grant of 50% of the cost of Plant & Machinery other than the land and infrastructure or an amount up to Rs. 30 lakh, whichever is less
For new incubation centres to be set up, a one-time grant of the following must be provided
50% of the cost of Plant & Machinery other than the land and infrastructure or an amount up to Rs. 100.00 lakh, whichever is less.
The Accelerator workshop program would also aid in the creation of new entrepreneurs and the expansion of the existing talent pool. The overall budget for this category is Rs. 61.50 crore, which will be used to establish up to 30 TBls.

Objectives of Technology Business Incubators (TBI) Under ASPIRE Scheme

In order to incubate creative ideas or technology in the agro-based industry, technology-based incubators will be established.
Technology Commercialisation: to establish a platform for the rapid commercialisation of innovations developed at the host institution or at any other academic or R&D institution in the country.
Interfacing and Networking: to connect academics, business, and financial institutions through networking.
Value Addition: Provide incubates with value-added services such as legal, financial, technical, IPR, and so on.
To encourage the formation of innovative technology or knowledge-based businesses.

Small Industries Development Bank of India (SIDBI)

The final important component under the ASPIRE Scheme is to establish a framework for Start-up Promotion through the Small Industries Development Bank of India (SIDBI). This must be done by utilizing innovative forms of finance such as equity, quasi-equity, angel funds, venture capital funds, impact funds, challenge funds, and others. The aim must be to enable ideas or innovations with creativity and scalability to emerge. Such ideas must be converted into commercial enterprise outcomes within a set time frame. SIDBI would establish a fund of funds for the purpose, with Rs. 60 crore set aside.

Funding of Small Industries Development Bank of India (SIDBI)

SIDBI will set up a fund of funds for the purpose under ASPIRE Scheme with Rs. 60 crore set aside for it. This start-up promotion aims to support and nurture knowledge initiatives that will succeed in developing technology and business enterprises in the near future. The funding will be in the areas of Innovation, Entrepreneurship, Forward Backward Linkage with multiple value chains of manufacturing and service delivery. Additionally, the SUDBI will provide Accelerator support in the Agro-based Industry verticals.

Objectives of Small Industries Development Bank of India (SIDBI) Under ASPIRE Scheme

Small Industries Development Bank of India (SIDBI) has used new instruments which support Angel funds and other venture capital funds. Such instruments are equity, quasi-equity, mezannine debt, and other debt instruments. These instruments are both directly and indirectly through its fund of fund activities,
The SIDBI standards for the funds focus on adding value to the rural economy and creating jobs through social impact funding.
With SIDBI’s aid, ideas or innovations with inventiveness and scalability can come to the fore. Additionally, entrepreneurs can turn these ideas into commercial enterprises with precise objectives and deadlines.
In terms of timetables for SIDBI to set up a fund of funds, it would be prudent to consider a timeline of 7-9 years. Such a timeline will allow the SIDBI to adequately leverage the Funds.
The SIDBI standards for the funds focus on adding value to the rural economy and creating jobs through social impact funding.
Along with ‘quasi-equity’ and ‘convertible-equity,”venture debt’ might be one of the essential components of the fund of funds for this plan. SIDBI money can truly boost the rural sector to fill the gap because there is so much room for mechanization in the rural economy.
SIDBI, in cooperation with the Ministry, will establish a competent monitoring mechanism for the Fund’s operation and administration.

Benefits of the ASPIRE Scheme

Agricultural techniques and operations that are related to them are being automated.
Adding value to agricultural and forest products
Agricultural pre/post-harvest waste recycling, off-farm yet farm-connected animal husbandry, and so on,
Rural-relevant business models for aggregation and value addition
Business models that create local jobs in rural locations, as well as business concepts that have a social impact

How To Apply For the ASPIRE Scheme?

An Application must be sent to the Aspire Scheme Steering Committee of the Ministry of MSME. The Scheme Steering Committee will be responsible for overall policy, coordination, and management support. The Council will be chaired by the Secretary, Ministry of MSME. However, the applicant must satisfy the eligibility criteria in order to apply for the assistance under the ASPIRE scheme. Furthermore, the applicant must provide documentation regarding the existing business or upcoming idea. An applicant can simply visit the official website and register for the scheme.

Funding Pattern of ASPIRE Scheme

ASPIRE Scheme was given a budget of Rs.200 crore in the 2014-2015 fiscal year. Under this strategy, the 2019 budget proposes establishing 80 LBI and 20 TBI in 2019-20. The following is the distribution of the corpus under the ASPIRE Scheme:

Purpose of AllocationAmountCreation, maintenance and updation of the database of the Technology Centres networkRs 2 CroreCapacity Building, including Engagement of Consultants, Surveys, Awards, Exposure Visits, Studies, Monitoring and Evaluation, etcRs 17.75 CroreFund for setting up of Incubation Centres by NSIC, Coir Board, KVIC or any other institution or agency of the Government of India/State GovernmentRs 62.5 CroreFund for setting up of Technology Incubation Centres (TBI)Rs 61.5 CroreAdministrative cost @ 10% of the item mentioned in the 3rd row of this table aboveRs 6.25 CroreFund of Funds for Start-ups to be managed by SIDBIRs 60 Crore

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