The Indian Khadi Industry gets a major boost with Asian Development Bank sanctioning a grant of USD 150 million to finance reforms.

The Grant would revolutionise the khadi sector and generate lots of employment opportunities, improve productivity and provide higher wages to artisans, according to Mahabir Prasad, Minister of Micro, Small and Medium Enterprises.

The grant would benefit 300 institutions in the first phase. ADB would provide the assistance over a period of three years from 2008-09, it said.

The reform programme is aimed at introduction of modern management practices and strengthening of human resources, growth in the non-farm rural sector and resurgence of traditional village industries, the Minister further added.

The programme seeks to increase the involvement of private entrepreneurs by phasing out subsidies, professionalism in design and marketing, and enabling the use of the "khadi label".

The reform of khadi institutions would enhance quality, design, and artisan welfare. Nearly three-fourth of programme resources are being directed to supporting khadi institutions, he added.

Institutional reforms at Khadi and Village Industries Commission (KVIC) would strengthen its development role and minimise its direct production and marketing activities, he mentioned.