The Khadi and Village Industries Commission (KVIC) is a statutory body created by an Act of Parliament (No.61 of 1956 and as amended by Act No. 12 of 1987) Established on 25th September 1956, it took over the former All India Khadi and Village Industries Board.

OBJECTIVES
The broad objectives that the KVIC has set before it are:

• The social objective of providing employment.
• The economic objective of producing salable articles, and
• The wider objective of creating self-reliance amongst the people and building up of a strong rural community spirit.

FUNCTIONS
The KVIC is charged with the functions of planning, promotion, organization and implementation of programes for the development of khadi and other village industries in the rural areas in co-ordination with other agencies engaged in rural development wherever necessary.
Its functions also comprise building up of a reserve of raw materials and implements for supply to producers, creation of common service facilities for processing of raw materials as semi-finished goods and provisions of facilities for marketing of KVI products apart from organization of training of artisans engaged in these industries and encouragement of co-operative efforts amongst them. To promote the sales and marketing of Khadi or products of Village Industries or handicrafts, the KVIC may forge linkages with established marketing agencies wherever necessary and feasible.
The KVIC is also charged with the responsibility of encouraging and promoting research in the production techniques and equipments employed in the Khadi and Village Industries sector and providing facilities for the study of the problems relating to it, including the use of non-conventional energy and electric power with a view to increasing productivity, eliminating drudgery and otherwise enhancing their competitive capacity and arranging for dissemination of salient results obtained such research.
Further, the KVIC is entrusted with the task of providing financial assistance to institutions and persons who are engaged in the development and operations of Khadi and Village Industries and guiding them through supply of designs, prototypes and other technical information.
In implementing KVI activities, the KVIC may take such steps as to ensure genuineness of the products and to set standards of quality and ensure that the products of Khadi and Village Industries do conform to the standards.
The KVIC may also undertake directly or through other agencies studies concerning the problems of Khadi or Villages Industries besides experiments or pilot projects for the development of Khadi and Village Industries.
The KVIC is authorized to establish and maintain separate organizations for the purpose of carrying out activities relevant to its functions and programes.

LARGE PRODUCTION BASE

• KVIC operates mainly through its implementing agencies viz., 30 Khadi & V.I Boards and thousands of Institutions and Co-operative Societies.
• The total sales of the KVIC network in Khadi and Village Industries was estimated as Rs. 7955.10 crores in 2000-2001.
• The employment generated in Khadi and Village Industries was about 65 lakhs in 2001-2002. Khadi and Village Industries sector provides a range of diverse products ranging from hand-woven and hand-spun textiles of Cotton, Silk, Woolen and Polyvastra and various Village Industry items.

INDUSTRIES UNDER THE PURVIEW OF KVIC

1. “Khadi” means any cloth woven on handloom in India from cotton, silk or woolen yarn handspun in India or from a mixture of any two or all of such yarns.
2. “Village Industries” means any industry located in a “rural area” which produces any goods or renders any service with or without the use of power in which the fixed capital investment (in plant and machinery and land and building) per head of an artisan or a worker does not exceed Rupees fifty thousands.

1. Any area classified as Village as per the revenue records of the state, irrespective of population.
2. It also includes an area even if classified as town, provided its population does not exceed 20,000.

RURAL EMPLOYMENT GENERATION PROGRAME (REGP)
To augment the Rural Employment Generation, the Govt. of India introduced REGP Scheme for viable Village Industries Projects to be implemented in the rural areas through KVIC.
The eligible agencies to take benefit of the scheme are (i) individuals (rural artisans/entrepreneurs) (ii) institutions, co-operative societies, Panchayats and Trusts for projects upto Rs. 25 Lakhs.
In case of weaker section beneficiaries viz. SC/ST/OBC/Women/Physically Handicapped/Ex-serviceman and Minority Community beneficiaries/ institutions and for Hill, Border and Tribal Areas, North Eastern Region, Sikkim, Andaman & Nicobar Islands, Lakshadweep, Margin Money grant is at the rate of 30 per cent of the project cost up to Rs. 10.00 lakhs and above this amount up to Rs. 25 lakhs, it is 10 per cent of the remaining cost of the project. 
The borrower is required to invest his own contribution of 10 per cent of the project cost. In case of SC/ST and other weaker section borrowers, the beneficiary contribution is to be 5% of the project cost.
KVIC is implementing REGP in partnership with Public Sector Banks, Regional Rural Banks sponsored by Nationalized Banks and on selective basis through Co-operative Banks and Private Sector Scheduled Commercial Banks.
The Banks sanction 90 percent of the project cost in case of general category borrowers and 95 per cent of the project cost to the weaker section beneficiaries/institution and disburse full amount of the loan.
Activities under Negative List are: (A) Meat (processing, canning and/ or serving) and Intoxicant items (Production/ Manufacture/Sale). (B) Cultivation of Crops/Plantation, Animal Husbandry, Pisciculture, Piggery, Poultry etc. and Khadi & Poyvastra and (C) Any project causing environmental problems. All projects, except those mentioned in the Negative List are eligible for availing the benefit of this programe.
For efficient functioning of the scheme, EDP training, workshops and technical training assistance, exhibitions etc. are also provided.
Hon’ble Union Finance Minister in Budget Speech for 2000-01 announced that KVIC would introduce common brand name for marketing of Khadi &Village Industry Products. Accordingly, KVIC has developed the following brands.
SARVODAYA: “Sarvodaya” products range consists of day-to-day use items like Toilet Soap, Pickles Agarbatti, Honey, etc. and is aimed at domestic consumer market. After successful market feeding, Sarvodaya brand products were launched into private channel of distribution at Mumbai on 12-10-2001 through Shri Yashwant Sinha, the then Hon’ble Union Finance Minister. The products include Neem and Sandal Toilet Soap, Honey and Pickles in the initial phase. Around 5000 retail outlets in Mumbai have been covered for distribution of Sarvodaya brand products. Sarvodaya products are also proposed to be launched into private channel at Delhi in October 2002. All the Sarvodaya brand products are as per the best quality specifications available in the market, i.e. Toilet Soap conforms to BIS Standards and is of 76 TFM, Pickles are conforming to FPO standards, Honey is as per Special Grade of Agmark, etc.
KHADI: Exclusive products like Essential Oils High Fashion Designer Garments, Herbal Products, etc. were developed under the guidance of the then MoS, Ministry of SSI& ARI, to cater to the high end market as well as exports. These products were launched under the brand name “Khadi” and marketed from exclusive sales outlets at Khan Market, Delhi and Khadi Gramodyog Bhavan, KVIC, New Delhi. It is also being launched into private channel at Delhi in October 2002.
DESI AAHAAR: The global trend is in favour of natural and chemical free organic food products and there is great demand for organic food world over. KVI sector has been known for its natural and pure products and in fitness of things KVIC decided to launch organic food ranges like Pulses, Cereals and spices powder under the brand name “Desi Aahaar” which are pure, natural and desi, in the sense of being traditional and ethnic in nature. A token launch was done through Khadi Gramodyog Bhavan, New Delhi on 14-1-2002 on the auspicious day of Makar Sankranti which has evoked encouraging response and hence it was formally launched through 14 KVI sales outlets in Delhi on 13-4-2002 (Baishakhi Day).

SCIENCE & TECHNOLOGY INPUTS IN KVIC
Since its formation, Khadi and Village Industries Commission (KVIC) consolidated itself in S&T efforts with Budgetary support from Government and interaction with premier Research Organizations under the aegis of CSIR.
Presently S&T approach by KVIC has two principal routes:

1. Through its in-house efforts.
2. Efforts through organizations with support from KVIC.

In-house Centres: 1) Jamnalal Bajaj Central Research Institute (JBCRI), renewed as Mahatma Gandhi Institute of Rural Industrialization (MGIRI) Wardha. 2) Central Bee Research Institute (CBRTI), Pune. 3) Institute of Renewable Energy (IRE), Nasik. 4) Kumarappa National Handmade Paper Institute (KNHPI) Sanganer. 5) Khadi Gramodyog Prayog Samiti (KGPS), Ahmedabad and Rajasthan.
Initiatives: 1) Strengthening of R&D Institutes, 2) Strengthening of Quality Control in KVI sector, 3) Establishment of Technical Interfaces, 4) Participation in National Fora.

The Significant Achievements of KVIC:

1. MoU with IIT, New Delhi, for setting up of MGIRI at Wardha for technology upgradation R&D for the sector.
2. MoU with NID, Ahmedabad, for design upgradation and providing market oriented designs at grass root level in the sector.
3. Umbrella Brands like “Sarvodaya” for FMCG products, “Khadi” for exclusive up market and “Desi Aahaar” for Organic Food Range launched.
4. Proposal for professionally managed Marketing Company for promoting KVIC products is under active consideration of the Ministry of ARI.
5. Thrust to Rural Employment Generation Programe. The scheme has been approved for 10th Plan by the Cabinet, Government of India and annual allocation of Rs. 250.00 Crores has been made for the Scheme.
6. UNDP capacity building projects launched in the area of Marketing, Pottery, Hand made Paper, Leather, Bee Keeping etc.
7. Mahatma Gandhi Institute of Rural Industrialization.
8. Sharp focus on ‘Artisans’ and their upliftment by all possible inputs through single window approach.
9. Convergence and co-ordination with various agencies engaged in rural development.S
10. Streamlining and strengthening of KVIC through various measures of decentralization and simplification, transparency and strict monitoring system.