project formulation

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Need for project formulation:

Need for project formulation Selection of appropriate technology Influence of External Economics Dearth of Technically Qualified Personnel Resource mobilisation Knowledge about Government Regulations

Significance of a project formulation:

Significance of a project formulation Project formulation is the best passport for obtaining the required assistance from financial insitutions. it will also be of great assistance for obtaining necessary Government clearences and in meeting the hurdles of procedure formalities. it will pinpoint the matters for which government sanctions have to be obtained. It will provide an independent assessment of the feasibility of obtaining the sanctions based on the existing government policies.

Elements of Project Formulation:

Elements of Project Formulation Feasibility analysis Techno-economic analysis Project design and network analysis Input analysis Financial analysis Social cost benefit analysis Project appraisal

Project selection:

Project selection Economic size Status of industry or scope Raw material availability Cost of production Capital cost Utility requirements Infrastructure facilities needed Profitability government policy

Planning commission guidelines:

Planning commission guidelines General information Preliminary analysis of alternatives Project description Marketing plan Capital requirements and costs Operating requirements and costs Financial analysis Economic analysis

Preparation of project formulation:

Preparation of project formulation Preliminary study Group discussion Prepare project report Obtain government clearance Submit the application to financial institutions Implement review

3. Prepare project report Prepare primary data:

3. Prepare project report Prepare primary data Technical Estimate Cost of assets Estimate cost of inputs Prepare flow chart Marketing Demand forecast Estimate of product price Estimate product mix Personnel Identify promoters Decide organisation Plan man power reqirement Project Net Work Identify activities Prepare time Estimates Draw network diagram Phase 1

Financial projections:

Financial projections Cost of project Means of finance Estimae of working results Balance sheet and cash flow Phase 2

Economic analysis:

Economic analysis Compute payback period Internal rate of return Compute break oven analysis Senstivity analysis Debt service Coverage ratio Phase 3

Obtain government clearance:

Obtain government clearance Industrial licence Capital goods Controller of capital issues Foreign collaboration approval MRTP clearance S.G. cearance

Submit the application to financial institutions:

Submit the application to financial institutions Procure sanction Comply with terms and conditions Create security Obtain funds