The Tamil Nadu Industrial Investment Corporation (TIIC) has come forward to offer a few schemes for the pharmaceutical units in Tamil Nadu to modernize and meet the Schedule M deadline.

Under the National Equity Fund (NEF) scheme, TIIC offers loans for projects up to Rs 50 lakhs, with a term loan interest rate of 11.5 per cent and soft loan interest rate of 5 per cent. The promoter's contribution needs to be a minimum of 10 per cent of the project cost and the effective interest rate for the loan is only 8.35 per cent.

Under the Technology Development and Modernization (RTDM) scheme, TIIC offers loans up to Rs 1 crore for existing units in operation for more than three years and going in for modernization/technology upgradation, and for the small-scale units/small scale units in the process of graduating to medium scale units. TIIC offers this scheme with one per cent interest subsidy with an effective interest rate of only 10.5 per cent. Under RTDM, the promoter has to contribute 20 per cent of the investment.

TIIC also offers loans under the SME fund for any type of assistance, including technology, upgradation and modernization, to SSI and MSI sector at an interest rate of 11.5 per cent. Loans are disbursed to a maximum of Rs 10 crore (inclusive of existing investment in machinery), and the promoter has to contribute about 25 to 35 per cent of the project cost.

All the three schemes can avail the Credit Linked Capital Subsidy (CLCSS) at 12 per cent on loan amount or a maximum of Rs 4.80 lakhs, eligible for induction of well established and improved technologies approved under the scheme, covering 30 products/sub-sectors in the SSI segment. Further, the Tamil Nadu Government offers an interest subsidy of one percent for prompt repayment as an incentive, informed the sources.

According to S Lakshminarayanan, secretary of the Tamil Nadu Pharmaceutical Manufacturers Association, the TIIC officials have conducted awareness programmes about the schemes, and the details have been published in the newsletter of PMA to inform the members on the schemes.