Even as the ayurveda manufacturers in the country have been demanding to relax the norms to make the Cluster Scheme more feasible and attractive, the department of Ayush has amended the Scheme, making the norms further rigid for the Rs 100 crore project.

Ever since the scheme was announced by the government to give boost to the Ayurveda, Siddha and Unani (ASU) industry, the manufacturers have been demanding to relax the norms to make it more feasible. The response of the industry to the project can be gauged from the fact that against the proposal to set up 25 Clusters in different parts of the country, the government could attract only five proposals as the manufacturers found it well nigh impossible to implement the project at its present form.

But instead of relaxing the norms, the Ayush department has further hardened the rules. In the addendum, the Ayush department has said that the SPV (special purpose vehicle) formed by at least 15 GMP manufacturing enterprises located in an existing cluster shall be eligible for funding under the Scheme and of these at least 3 to 5 units should have annual turnover of Rs.50.00 lakhs and above and 5 units of Rs.20.00 lakhs and above to ensure the viability of the cluster.

As per initial announcement, SPV formed by at least 15 enterprises located in an existing cluster was eligible for funding under the scheme.

As per the new norms, the SPV should bring in land and other physical infrastructure as its contribution instead of the earlier condition of bringing only land as its contribution.

The Ayush department has made amendments in section (4) (b), (5) (ii), (8) (c) (ii), (8) (c) (iii) and (9) (a) (ii).

The department has amended section (4) (b) as ‘SPV’ formed by at least 15 GMP manufacturing enterprises located in an existing cluster shall be eligible for funding under the Scheme and of these at least 3 to 5 units should have annual turnover of Rs.50.00 lakhs and above and 5 units of Rs.20.00 lakhs and above to ensure the viability of the cluster.

Section (5) (ii) as ‘The project cost of the components of a common facility (such as those mentioned under core interventions), for the purpose of this Scheme, shall include Land, Building, Plant and Machinery, Support infrastructure such as water supply, electricity supply, roads, working capital margin etc. subject to the condition that it shall be the responsibility of the SPV to bring in land and other physical infrastructure as its contribution. Department of AYUSH grant will be utilized only for minor works/ plant/ machinery/ quality control equipments/ training/ market development activities and other physical infrastructure.

It has changed section (8) (c) (ii) as ‘SPV’ should represent the cluster as a whole and should have a minimum of 15 GMP certified manufacturer enterprises of AYUSH products as its shareholders, of them at least 75% should have been license holders for manufacturing of AYUSH products under Drugs & Cosmetics Act 1940 with license valid for 3 years preceding to incorporation of SPV.

Section (8) (c) (iii) has been amended as “Such enterprises shall hold at least 51% equity of the SPV and remaining may be held by any Government agency, Financial Institution/Bank, strategic partners like buyers, ASU colleges etc. as the case may be.

Section (9) (a) (ii) stands modified as In-principle approval: In-Principal approval for a project will be accorded by the SMC based on Preliminary Proposal submitted by registered SPV promoted by 15 GMP manufacturing enterprises of whom at least 10 should have an annual turnover of Rs.20.00 lakhs and above, covering the major features of the proposed project and availability of land. A Current account should have been opened in a Bank in the name of the SPV and all the members collectively should have contributed to a corpus of at least Rs.50 lakhs to demonstrate their commitment towards the Project. Such In-principle approval will be valid for a period of 6 months from the date of approval, and before that it is expected that the project would be ready for final approval. In case final approval is not accorded to the project, within 6 months, the in-principle approval will automatically lapse, unless it is specifically extended by the SMC’.