ZED Scheme: Over 44,000 MSMEs Certified For Sustainable Manufacturing

The Ministry of Micro, Small, and Medium Enterprises has informed that under the Zero Effect, Zero Defect (ZED) scheme, over one lakh registration have been received since its inception in April 2022. ZED scheme aims to promote environment-friendly manufacturing practices among MSMEs.

Additionally, more than 44,000 enterprises have successfully obtained certification under the scheme. “The initiative is proving to be instrumental in helping businesses reduce manufacturing wastage, raise their environmental consciousness, conserve energy, and expand their market reach. On the call of Prime Minister Narendra Modi, enterprises across the country are actively striving toward achieving the goal of ‘Zero Defect and Zero Effect’ in their manufacturing processes with a focus on environmental impact,” Union Minister Narayan Rane posted on social media.

As of October 18, a total of 1,02,403 MSMEs have enrolled in the scheme. Among these, 44,166 have achieved bronze certification, 234 have received silver certification, and 231 have been recognized with gold certification. The financial support provided to these MSMEs through the scheme amounts to a total of INR 60.8 crore, as per the information available on the ZED Dashboard. These three levels of certification are determined based on performance in 20 key parameters, including quality management, on-time delivery, process control, waste management, etc.

Significantly, MSMEs are required to pay INR 10,000 for bronze certification, INR 40,000 for silver certification, and INR 90,000 for gold certification. However, the scheme extends its support by providing financial assistance covering up to 75 per cent of the total certification cost, with a maximum subsidy limit of INR 50,000.

Moreover, the scheme includes provisions for additional support, with up to INR 2 lakh available for handholding and consultancy services aimed at helping businesses achieve the next certification level. For technological advancement, the scheme offers assistance of up to INR 3 lakh to facilitate the transition toward zero-effect solutions, pollution control measures, and cleaner technologies.

Zero Effect, Zero Defect

Prime Minister Narendra Modi, while addressing the nation on India's 68th Independence Day, had urged the industry, especially the micro, small, and medium enterprises (MSMEs), to manufacture goods with ‘zero defects’ and to ensure that the goods have ‘zero effect’ on the environment.

"We should manufacture goods in such a way that they carry zero defect and that our exported goods are never returned to us. We should manufacture goods with zero effect that they should not have a negative impact on the environment," the Prime Minister had said.

In April last year, the government introduced a significant overhaul of the scheme, reducing the number of certification parameters from 50 to 20. Under the revamped scheme, bronze certification evaluates MSMEs based on five key parameters, including workplace safety and quality management. Silver certification, in contrast, includes 14 parameters that MSMEs must meet, while gold certification involves a comprehensive assessment across all 20 parameters.

As outlined in the scheme's details, bronze-certified manufacturers will benefit from an 80 per cent cost reduction, silver-level MSMEs will receive a 60 per cent subsidy, and gold-certification holders will enjoy a 50 per cent subsidy. Notably, there will be a joining incentive of INR 10,000, effectively making bronze certification an expense-free endeavor.

Furthermore, an extra subsidy of 10 per cent is designated for MSMEs owned by women, SC/ST communities, those situated in the northeastern region, Himalayan regions, Island territories, and aspirational districts.