MSME ministry clears KVIC proposal to increase wages of artisans by over 36 percent

New Delhi: The MSME Ministry has approved a proposal by the Khadi and Village Industries Commission (KVIC) to increase the wages of artisans by over 36 percent, from Rs 5.50 per hank previously to Rs 7.50 per hank. In a statement, KVIC said Tuesday its proposal for increase in wages to Khadi spinners along with payment of government subsidy – modified market development assistance (MMDA), has been approved with effect from 15 August, 2018. [caption id=“attachment_4216555” align=“alignleft” width=“380”] Representational image. Reuters[/caption] Under the MMDA programme, 30 percent of the prime cost is paid to the Khadi institutions as production subsidy. Out of this 30 percent, 40 percent goes to artisans as wage incentives and the remaining 60 percent goes to the Khadi institutions. The wage incentives are paid by KVIC directly to the accounts of the artisans through direct benefits transfer. As a result, if an artisan makes 20 hanks in a day – he will get Rs 150 per day as wage at the rate of Rs 7.50 per hank, plus incentives like MMDA, which would be approximately 35 percent on Rs 150, that is Rs 52. “Hence, on an average, an artisan spinning minimum 20 hanks in a day will now start earning Rs 202 per day, including his wages and government incentive – after this increase. It may be noted that most of the artisans spin more than 20 hanks per day presently,” KVIC said. KVIC Chairman VK Saxena said the enhancement in wages will draw youth towards taking up spinning as a profession. “This increase will also attract new and younger artisans to Khadi – who were earlier skeptical about their income comparing it to the wages given to the daily wagers under MNREGA,” he said.