Support for Value Addition in Coffee Industry: R&G Units Subsidy Scheme

The “Support for Value Addition – Support to R&G Units” scheme is a sub-component of the Integrated Coffee Development Project launched by the Coffee Board under the Department of Commerce and Industry, Government of India. This scheme aims to enhance the quality of coffee products and achieve value addition by introducing improved technologies in roasting, grinding, and packaging. The initiative is targeted at boosting domestic coffee consumption and fostering entrepreneurship in non-traditional coffee-drinking areas.

Objectives

Enhance Product Quality:
Improve the technological processes in coffee roasting, grinding, and packaging to elevate the quality of coffee products.
Value Addition:
Increase the market value of coffee products through advanced processing and packaging solutions.
Entrepreneurship:
Encourage small players and new entrepreneurs to venture into the coffee sector, particularly in non-traditional regions.
Economic Upliftment:
Boost domestic coffee consumption and create opportunities for employment and local entrepreneurship.

Benefits

Subsidy Support:
- Roasting Units, Gourmet Roasting Units (1 Kg to <10 Kg per batch), and small roasting units with a capacity of less than 25 Kg are eligible.
- For general applicants, a subsidy of 40% of the machinery cost is provided, capped at ₹10,00,000.
- For SHGs, women entrepreneurs, SC/ST, minorities, and differently-abled beneficiaries, the subsidy rate is 50% of the machinery cost, with the same cap of ₹10,00,000.
Technology Focus:
Support for gourmet roaster units facilitates the production of specialized blends in smaller quantities.

Eligibility

Applicant Type:
- Individual units, partnership firms, self-help groups (SHGs), or growers’ collectives interested in establishing coffee roasting units.
Establishment Requirement:
- The scheme is applicable only for establishing new R&G units (roasting, grinding, and packaging units).
Licensing:
- The applicant’s unit must hold a valid business license issued by the respective statutory authorities.
Exclusions:
- Applicants who have availed subsidy support under previous XI, XII, or MTF plan periods are not eligible.
- The scheme does not apply to R&G units installed and commissioned before the notification date (07-04-2022).
- It is not applicable for upgrading existing facilities.

Eligible Machinery Combinations

The subsidy supports the establishment of new R&G units with any of the following machinery combinations:

Roasting machine, grinding machine, and packaging machine.
Roasting machine and packaging machine.
Grinding machine and packaging machine.

Note: The scheme does not cover more than one unit of each type of machinery.

Disbursement

Process:
Subsidy is released directly to the applicant’s bank account via the PFMS, after:
- Completion of the application with all required documents.
- Approval based on a post-installation inspection report by the Coffee Quality Division, Coffee Board, Bengaluru.

Application Process

Mode: Offline

Obtain the Application Form:
- Download the prescribed format of the application form from the official Coffee Board website or relevant guidelines.
Complete the Form:
- Fill in all mandatory fields.
- Paste a passport-sized photograph (signed across, if required).
- Attach self-attested copies of all mandatory documents.
Submission:
- Submit the duly filled and signed application form along with the documents to:
  
  The Divisional Head – Coffee Quality Division,
  Coffee Board,
  No.1, Dr. Ambedkar Veedhi,
  (Alternatively, email to: [email protected] / [email protected]).

Post-Application Process

Scrutiny & Feasibility Assessment:
- The provided information undergoes scrutiny, and a physical inspection is conducted if necessary. Feasibility assessments are carried out on a case-by-case basis by Coffee Board officers.
Procurement & Installation:
- Once the feasibility report is received, the applicant may proceed with the procurement, installation, and commissioning of the coffee machinery.
Support Claim Submission:
- After successful installation and commissioning, submit a support claim application.
- A physical site inspection is conducted, and if approved, the subsidy is disbursed.
- If the application is unfit, reasons for rejection are communicated.

Documents Required

Blueprint/Layout Plan:
Copy of the blueprint/layout plan for the proposed R&G unit/facility.
Identity Proof:
Copy of Aadhaar, Ration Card, PAN, Passport, Driving License, or Election Photo ID.
Invoice & Bills:
Original copy of the Tax Invoice/Cash Bill from the supplier; attested copies of bills for freight, installation, commissioning, and insurance (if applicable).
Warranty Certificate:
Copy of the warranty certificate for the machinery.
Premises Documentation:
Notarized copy of the lease/rent agreement or ownership document for the premises.
License:
Copy of the business license from municipal authorities.
Bank Details:
Copy of the bank passbook or cancelled cheque with details (name, branch, account number, IFSC).
Photographs:
Photographs of the new machinery installed (for which subsidy is claimed).
Beneficiary Certificates:
For SC/ST and differently-abled applicants, a valid caste/community/disability certificate (with at least 40% disability) from the competent authority.
Additional Proofs:
- Proof of maintaining separate books of account for R&D expenditure.
- Documentation of fixed capital investment as per the scheme provisions.
TPQA Details:
Details of the Third Party Quality Assurance agency along with an appointment letter and agreement (if applicable).
PAN Card:
Copy.
Undertaking:
Notarized undertaking for fulfilling conditions in the sanction letter with a relevant board resolution (in prescribed format).

Frequently Asked Questions (FAQs)

Is there a subsidy limit for roasting units?
Yes, subsidy support is 40% of machinery cost (₹10,00,000 ceiling) for general applicants, and 50% for SHGs, women, SC/ST, minorities, and differently-abled beneficiaries.
What machinery combinations are eligible?
Eligible combinations include:
a) Roasting, grinding, and packaging machines together;
b) Roasting and packaging machines;
c) Grinding and packaging machines.
How are applications prioritized?
Applications are considered on a first-come, first-served basis, provided they are complete and funds are available.
How is the subsidy disbursed?
The subsidy is released directly to the applicant’s bank account via PFMS after a satisfactory post-installation inspection by the Coffee Quality Division.
Can existing units upgrade using this scheme?
No, the scheme is applicable only for establishing new R&G units.
What happens if bribery or coercion is involved?
Any fraudulent activity will lead to disqualification.
What is the eligibility criterion for smaller roasting units?
The scheme specifically targets units with capacities in the range of 1Kg to <10Kg per batch (gourmet roasters) and small roasting units with capacity less than 25 Kg.
Are there exemptions on fees or charges?
Specific fee exemptions are subject to the detailed guidelines provided by the Coffee Board.
Can procurement begin before the feasibility report?
Procurement and installation may commence only after receiving a satisfactory feasibility report from the Coffee Board.
Is there a timeline for subsidy release?
Subsidy will be disbursed once the complete application and satisfactory inspection report are submitted, subject to processing within the standard timeframe.
Are units installed before the scheme notification date eligible?
No, only new R&G units installed after the scheme notification date (07-04-2022) are eligible.
What actions can lead to rejection?
Incomplete applications, non-compliance with eligibility criteria, or submission of fraudulent documents will result in rejection.