Prime Minister’s Employment Generation Programme (PMEGP)

This topic of “Prime Minister’s Employment Generation Programme (PMEGP)” is important from the perspective of the UPSC IAS Examination, which falls under General Studies Portion.


The Prime Minister’s Employment Generation Programme (PMEGP) is a credit-linked subsidy scheme launched in August 2008 to generate employment opportunities through the establishment of micro-enterprises in the non-farm sector.


The scheme is administered by the Ministry of Micro, Small and Medium Enterprises (MSME).

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  • Margin Money Subsidy: Funds are allocated for disbursement of Margin Money subsidy for setting up new micro-enterprises/units.
  • Backward and Forward Linkages: 5% of the total allocation under BE for a financial year against PMEGP is earmarked for funds under backward and forward linkages.
  • Priority will be given to persons affected by natural calamities/disasters in the areas declared as affected by “disaster” by the Ministry of Home Affairs.


  • Individuals above 18 years of age are eligible to set up new projects under PMEGP.
  • Assistance under the scheme is available only for new projects sanctioned specifically under the PMEGP.
  • Existing units under PMRY, REGP, or any other scheme of the Government of India or State Government and those that have already availed of government subsidy under any other scheme are not eligible.

Implementation Strategy:

  • The Khadi and Village Industries Commission (KVIC) is the single nodal agency at the national level for implementation of the scheme.
  • The scheme is implemented through State offices of KVIC, State Khadi and Village Industries Boards (KVIBs), District Industries Centres (DICs), Coir Board (for coir-related activities), and Banks.

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