Zero Defect Zero Effect (ZED): Micro, Small and Medium Enterprises (MSME) are a significant part of the Indian economy in terms of innovation and employment generation. In the nineties, the Chinese economy has flourished as a massive growth of medium enterprises which were in the process of turning the china into world’s manufacturing factory. Same is the case with any economy. The main advantage of MSME is its low capital requirement and high employment generation.

As an element of his make in India initiative & clean India pledge, Prime Minister Modi has urged the MSME industry to engage in manufacture of goods in the country with “zero defects” and to ensure that the goods have “zero effect” on the environment. He said “We should manufacture goods in such a way that they carry zero defects 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”.

Zero Defect Zero Effect (ZED)

Zero Defect Zero Effect (ZED)

ZED Certification:

Under the scheme, the MSME companies which follow the guidelines and comply with the standards set by the ZED will be awarded ZED certification followed by many more benefits such as reduced wastages substantially increased productivity, expansion of their market, more IPRs, development of new products and processes etc.


1Developing an Ecosystem for Zero Defect Manufacturing in MSMEs
2To enable MSMEs for manufacture of quality products by adapting f Quality tools/systems and Energy Efficient manufacturing.
3To encourage MSMEs to constantly upgrade their quality standards in products and processes
4To drive manufacturing with adoption of Zero Defect production processes and without impacting the environment.
5To support ‘Make in India’ campaign
6To develop professionals in the area of ZED manufacturing and certification


To enable the advancement of Indian industry to a position of eminence in the global marketplace and leverage India’s emergence as the world’s supplier through the Made in India mark.


Mission: To develop and implement a ‘ZED’ culture in India based on the following principle:

1Zero Defect (focus on customer):
Zero non-conformance/non-compliance
Zero waste
2Zero Effect (focus on society):
Zero air pollution/liquid discharge (ZLD)/solid waste
Zero wastage of natural resources
Zero Defect Zero Effect (ZED) IMG 2

Major activities:

Following are the major activities that will be undertaken by the government as a part of ZED initiative.

1Awareness & Training
2Initial Development of e-Platform, On line service support and Development of Content for Capacity Building
3Accreditation, Assessment & Rating/Re-rating
4NMIU Head quarter Charges & Monitoring Cost
5Promotion & Branding

Under the scheme 22,222 MSMEs will be rated & certified under ZED Maturity Assessment Model, 5,000 MSMEs will be rated & certified under the ZED Defense Model, 7368 MSMEs will be supported for Gap Analysis, Handholding, and Consultancy for their improving rating, etc.

Benefits of ZED certification:

1Global Competitiveness:

Improve the competitiveness of the vendors in the global marketplace so that goods manufactured have no defects and thus leveraging the benefits of quality & cost optimization.

2Credible & reliable vendor database:

ZED will ensure that the companies investing in India have a ready-made & reliable vendor base to support their activities the MSMEs rated under ZED Certification Scheme

3Reducing negative effect on our environment
4Easy access to Loans:

ZED rated MSME will have an edge over the rest of the enterprises while they apply for bank loans. RBI has issued an advisory to Indian Banking Association (IBA) to incorporate information on ZED in the MSME loan application form.

5Visibility & brand recognition:

A “ZED Mark” to enable an MSME to be seen as a company with leverage over non-rated MSME units.

6Aligning with best practices:

MSMEs will get an opportunity to do benchmark study and learn the best practices across the globe under the ambit of ZED Certification Scheme

7High performing ZED units will be recognized nationally by the Ministry of MSME and QCI through an award & reward system which will help them to showcase themselves globally

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