The MSME Ministry has approved a proposal by the Khadi and Village Industries Commission (KVIC) to increase wages of artisans along with payment of government subsidy -- modified market development assistance (MMDA), by over 36 per cent, from Rs 5.50 per hank previously to Rs 7.50 per hank. Under the MMDA programme, 30 per cent of the prime cost is paid to the khadi institution as production subsidy. Out of this 30 per cent, 40 per cent goes to artisans as wage incentives and the remaining 60 per cent goes to the 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 per cent on Rs 150, that is Rs 52. Wage enhancement will draw youth towards spinning as a profession. It 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.