Karnataka is in talks with leading retailers for an ambitious new scheme in which the government will pump in at least Rs 500 crore on creating entrepreneurs and skills training.

Anchored by the Social Welfare department, the Samruddhi scheme will cater to aspiring SC/ST entrepreneurs who will get a seed grant of up to Rs 10 lakh to start their own retail business. This marks a move from giving entrepreneurial loans to seed grants, whose outcome Social Welfare Minister Priyank Kharge believes can be quantified.

“The idea is to ensure retailers train the beneficiaries on GST, soft skills, inventory management, last-mile logistics and so on, following which they will be certified. With that, the beneficiary can get either get employed in the retail sector or use our seed grant to own an outlet,” Kharge said.

The government has reached out to the likes of Walmart, ITC, Pepsi, Britannia, Parryware, Chai Point, Hatti Kaapi, Kajaria among other businesses where a franchisee model exists. The government is ready to sign memoranda of understanding with at least 40 companies, Kharge said. “The retailers are gung-ho about this because I’m giving them new markets at virtually zero cost. We’re skilling people in their sector so that their business grows.”

Retailers will invest at least 10% toward training beneficiaries — their “skin in the game,” Kharge said. Those who wish to become entrepreneurs by starting their own retail outlets will get two months to show that they have the land for it. “Most retail outlets will not cost more than Rs 10 lakh to set up. If it does, we will facilitate a loan for the beneficiary.”

The department has already launched the Rs 225-crore Airavata scheme where it has partnered with aggregators like Uber to create jobs for SC/STs by way of ownership of cabs and taxis. Similarly, the department flagged off the Rs 20-crore Unnati scheme to promote tech-based social startups that involve SC/STs. With Samruddhi, the government’s focus on the retail segment is the differentiator, Kharge pointed out.

“We’ve already scaled down by 25% the traditional entrepreneurial loans we give because there were concerns of misuse since it was not monitored.

“With what we are trying to do now, we can measure the outcome and directly help increase income of the beneficiaries,” he said. “It’s an honest attempt that could become India’s biggest entrepreneurship programme for SC/STs,” Kharge added.