Promotion of MSME Clusters



Promotion of MSME Clusters

The Ministry of Micro, Small and Medium Enterprises has adopted cluster development approach as a key strategy for enhancing productivity and competitiveness as well as capacity building of Micro & Small Enterprises (MSEs) through implementation of two important schemes (i) Micro and Small Enterprises - Cluster Development Programme (MSE-CDP) and (ii) Scheme of Fund for Regeneration of Traditional Industries (SFURTI).




SFURTI Scheme has been revamped in the XII plan and 71 clusters with an outlay of Rs. 149.44 crore are proposed to be developed in the Ist phase. It is envisaged under the revamped SFURTI to have 3 types of clusters as follows:


*Rs. 14.94 crore also kept for thematic interventions, administrative, scheme management, monitoring and evaluation.

The objectives of the scheme under MSE-CDP are to support the sustainability and growth of MSEs by addressing common issues such as improvement of technology, skills and quality, market access, access to capital, etc., build capacity of MSEs for common supportive action, create/upgrade infrastructural facilities in the new/existing industrial areas/ clusters of MSEs and to set up common facility centres (for testing, training centre, raw material depot, effluent treatment, complementing production processes, etc.).

Under the Scheme of Fund for regeneration of Traditional Industries (SFURTI) the objectives are to organize the traditional industries and artisans into clusters to make them competitive and provide support for their long term sustainability and economy of scale by imparting necessary skills, improvement in marketing infrastructure, by making provision for common facilities centre and providing improved tools and equipments for artisans etc.

There are no criteria fixed for selection of location for the said purpose as the schemes are demand driven and depend upon the availability of clusters.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Lok Sabha here today.


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Promotion of Traditional Industries

The Ministry of Micro, Small and Medium Enterprises has been implementing various schemes for the promotion of traditional artisans through Khadi and Village Industries Commission (KVIC) and Coir Board, which include:

(i)                 Workshed Scheme for Khadi Artisans for providing assistance for construction of worksheds for better work environment.

(ii)               Khadi Reform and Development Programme (KRDP) to revitalize the khadi sector with enhanced sustainability of khadi, increased incomes and employment for spinners and weavers, increased artisans’ welfare and achieve synergy with village industries.

(iii)             Market Development Assistance (MDA) under which assistance is provided@ 20% of value of production khadi and polyvastra to be shared among artisans, producing institutions and selling institutions in the ratio 25:30:45.

(iv)             Khadi Karigar Janashree Bima Yojana to provide insurance cover to khadi artisans

(v)               Mahila Coir Yojana envisages distribution of motorised ratts for spinning coir yarn to women artisans after being trained.

(vi)             Coir Udyami Yojana(CUY)  to provide financial assistance for replacement of outdated ratts/looms and for construction of worksheds so as to increase productivity/production and earnings of workers.

(vii)           Coir Worker’s Group Personal Accident Insurance Scheme to provide insurance cover to coir workers.

In addition, a specific cluster-based scheme named Scheme of Fund for Regeneration of Traditional Industries (SFURTI) is being implemented by the Government in the Ministry of MSME for promotion of traditional industries, under which khadi, village industries and coir clusters have been taken up for development by providing them with improved equipments, common facilities centres, business development services, training, capacity building and design and marketing support, etc. 101 clusters (29 Khadi, 47 Village Industries and 25 Coir clusters) have been developed under this scheme.

SFURTI Scheme has been recently revamped with a target of 71 clusters for the development across the country including Rajasthan and Gujarat with an outlay of Rs.149.44 crore in the Ist phase. Under the revamped SFURTI, there would be 3 types of clusters as follows:



*Rs. 14.94 crore has also been kept for thematic interventions, administrative & scheme management expenses, monitoring and evaluation of the scheme implementation.

The proposals have been sought from the States/UTs for implementation of revamped SFURTI Scheme. The time frame for the implementation of project is 3 years.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Lok Sabha here today.


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Promotion of Manufacturing Sector

The MSME Manufacturing sector has great potential to create more jobs in the country. As per the results of Fourth All India Census of Micro, Small & Medium Enterprises (MSME) and Economic Census 2005, the number of working enterprises (activities excluded include mainly major service activities e.g. wholesale/retail trade, legal, educational & social services, hotel & restaurants, transports and storage & warehousing (except cold storage)) in MSME sector was 361.76 lakhs in the year 2006-07 and was 467.56 lakhs in the year 2012-13 projected in Annual Report 2013-14,  showing Compound Annual Growth Rate (CAGR) of 4.37% for last 6 years. The employment in MSME sector was 805.24 lakhs in the year 2006-07 and was 1061.52 lakhs (projected) in the year 2012-13 showing Compound Annual Growth Rate (CAGR) of 4.71% for last 6 years. Hence, employment in MSME manufacturing segment is growing in tandem with the growth in the number of enterprises. The growth rate of Entrepreneurship Memorandum (Part –II) (MSME) in the last three years is as follows:

Period Growth Rate of EM-II (MSME)

2010-11 12.23

2011-12 18.64

2012-13 13.91

2013-14 11.45


Considering the fact that there is a steady annual growth rate of over 10% in the registration of new MSME units (mostly in manufacturing) as indicated by the growth rate of EM-II, employment is also likely to rise in the MSME manufacturing segment.
                     
The Ministry of MSME is implementing a number of schemes and programmes for the benefit of MSME Manufacturing sector across the country relating to credit, infrastructure development, technology upgradation, etc. The major schemes include Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme, Performance and Credit Rating Scheme, Cluster Development Programme, National Manufacturing Competitiveness Programme and Prime Minister’s Employment Generation Programme. With greater emphasis on better implementation of these Schemes all over the country, the Government proposes to boost manufacturing activities with the objective of creating more jobs.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Lok Sabha here today.


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Research and Development by KVIC

Khadi and Village Industries Commission (KVIC) together with Mahatma Gandhi Institute for Rural Industrialization(MGIRI) have taken a number of steps in research and development for promotion of khadi which include establishment of design centre for khadi/textile garments, quality assurance manual for khadi, low cost hank dyeing machine, improved dyeing process for khadi fabric, development and popularization of e-charkha, technology for soft and stiff finish of khadi fabric and technology package for value added products using local wool or blend of local and imported merino wool, etc.

Besides, KVIC has been implementing a specific programme for cluster development, namely, Scheme of Fund for Regeneration of Traditional Industries (SFURTI), under which assistance for replacement of obsolete equipments, setting up of common facilities centres, product development, market promotion and other supports are provided. SFURTI Scheme has been revamped in XII plan and 71 clusters with an outlay of Rs. 149.44 crore are proposed to be developed in the Ist phase.

With a view to popularize and promote khadi and village industries (KVI) products, KVIC has been organizing District, State and National level exhibitions in collaboration with State/UT Khadi and Village Industries Boards. During the last three years (2011-12 to 2013-14), KVIC has organised a total of 103 such exhibitions/events in the country. KVIC also focuses on quality participation in international exhibitions to tap new/ emerging markets for KVI products.

KVIC has initiated a number of steps to re-vitalize the khadi sector. These include a comprehensive reform package for the khadi sector, namely, the Khadi Reform and Development Programme (KRDP), which includes capacity building of 300 khadi institutions and improved marketing. KRDP is being implemented with an assistance of US$ 150 million from Asian Development Bank (ADB). Government has also introduced in 2009-10, a scheme for ‘Strengthening of Infrastructure of Existing Weak Khadi Institutions and Assistance for Marketing Infrastructure’, which provides assistance for revitalization of sick and problematic khadi institutions and helps in renovation of sales outlets.

A KVI Programme has also been launched in the Hill, Border & Left Wing Extremism (LWE) affected areas in respect of 100 institutions with financial assistance amounting to Rs.76 crores i.e. Rs.76 lakh/institution under KRDP, in which relaxation has been given in criteria of selection of institutions and in minimum number of artisans associated with the institutions of Hill, Border & LWE affected areas.

Government has introduced, a flexible, growth stimulating and artisan oriented Market Development Assistance (MDA) Scheme, in place of the erstwhile system of Rebate. Under MDA, financial assistance is provided to institutions @ 20% of the value of production of khadi and polyvastra, to be shared among artisans, producing institutions and selling institutions in the ratio 25:30:45. MDA provides institutions a flexibility to use the assistance for improving the outlets, products and production processes, besides giving incentive to customers, etc. and is also directed towards revitalizing the sector.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Lok Sabha here today.

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Financial Assistance for MSME

The Ministry of MSME has been implementing various schemes and programmes for promotion of Micro, Small and Medium Enterprise (MSMEs). The major schemes/ programmes include  Prime Minister’s Employment Generation Programme (PMEGP), Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme (CLCSS),  National  Manufacturing Competitiveness Programme, Cluster Development Programme, Marketing Development Assistance, Skill Development Programmes, International Cooperation Scheme etc. The details of fund allocated and utilized under various schemes of the Ministry at all India level during the last three years and the current are, as under:-
                                                                                                                              (Rs. in crore)



This Ministry takes various steps to ensure optimum utilization of the budget viz. periodical review of expenditure, enhancing awareness for demand driven schemes etc.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Lok Sabha here today.


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Encouragement of Solar Power Projects

The Government encourages setting up of solar power projects through various measures like:-

(i)    Grant of subsidy on off-grid applications.
(ii)   Provision for renewable purchase obligation for solar has been made in the National Tariff
         Policy.
(iii)   Concessional Import duty/Excise duty exemption for setting up of solar power plants,
        accelerated depreciation and tax holiday.
(iv)   Generation based incentive and facility for bundled power for Grid connected Solar Power
        Projects through various interventions announced from time to time.
(v) Several R&D efforts have been initiated for new technologies and improvement in efficiency.

Government of India has accorded in-principle approval for setting up Solar Parks in the State of Gujarat, Andhra Pradesh, Uttar Pradesh, Meghalaya, Rajasthan, Madhya Pradesh, Tamil Nadu, Karnataka, Punjab and Telangana.  Projects under Central/State Schemes shall come up in these Solar Parks. This was stated by Sh. Piyush Goyal, Minister of state for Power, Coal & New and Renewable Energy (Independent Charge) in a written reply to a question in the Rajya Sabha today.

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Encouragement of Solar Power Projects

The Government encourages setting up of solar power projects through various measures like:-

(i) Grant of subsidy on off-grid applications.

(ii) Provision for renewable purchase obligation for solar has been made in the National Tariff Policy.

(iii) Concessional Import duty/Excise duty exemption for setting up of solar power plants, accelerated depreciation and tax holiday.

(iv) Generation based incentive and facility for bundled power for Grid connected Solar Power Projects through various interventions announced from time to time.

(v) Several R&D efforts have been initiated for new technologies and improvement in efficiency.

Government of India has accorded in-principle approval for setting up Solar Parks in the State of Gujarat, Andhra Pradesh, Uttar Pradesh, Meghalaya, Rajasthan, Madhya Pradesh, Tamil Nadu, Karnataka, Punjab and Telangana. Projects under Central/State Schemes shall come up in these Solar Parks. This was stated by Sh. Piyush Goyal, Minister of state for Power, Coal & New and Renewable Energy (Independent Charge) in a written reply to a question in the Rajya Sabha today.

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Establishment of Solar Power Plants


The Government has launched various schemes to set up grid-connected solar power plants. The details are as under:

i.          Setting up of 25 Solar Parks and Ultra Mega Solar Power Projects of aggregate capacity of 20,000 MW in various States.

ii.         Pilot-cum-Demonstration Project of capacity 100 MW for Development of Grid Connected Solar PV Power Plants on Canal Banks and Canal Tops.

iii.        Grid-Connected Solar PV Power Projects by Defence Establishments under Ministry of Defence and Para Military Forces - 300 MW (with Domestic Content Requirement).

iv.        Scheme for setting up 1000 MW of Grid-Connected Solar PV Power Projects by Central Public Sector Undertakings (CPSUs) under various Central/State Schemes with Viability Gap Funding (VGF) under Batch-V of Phase-II of JNNSM.

v.         Grid Connected Solar PV Power Projects with VGF (750 MW).

vi.        Grid Connected Solar PV Power Projects (3300 MW) by NTPC and other PSUs.

            All states have been requested to identify land for establishment of Solar Park.  No proposal has been received under this scheme from the State of Haryana.  This was stated by Sh. Piyush Goyal, Minister of state for Power, Coal & New and Renewable Energy (Independent Charge) in a written reply to a question in the Rajya Sabha today.

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Clean Energy Co-Operation Between India and US

India and USA have undertaken new initiatives to enhance clean energy cooperation as follows:

i. Launched “Innovative Finance Forum”.

ii. Established “PACESetter Funds” to support innovative clean energy access projects.

iii. Both the countries desire to expand current Partnership to Advance Clean Energy Development (PACE-D).

iv. Renewed commitment to expanding Partnership to Advance Clean Energy Research (PACE-R).

A Joint Indo-US PACESetter Fund has been established with a contribution of US$ 4 million (INR 25 crores) from each side for providing grants for seed capital for innovative clean energy projects. There is no financial commitment from Government of India for PACE-D and PACE-R. This was stated by Sh. Piyush Goyal, Minister of state for Power, Coal & New and Renewable Energy (Independent Charge) in a written reply to a question in the Rajya Sabha today.

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Electricity from Paddy Straw


The Ministry of New and Renewable Energy (MNRE) is promoting generation of electricity from various agro-residues including paddy straw. A target of 400 megawatt biomass power projects for the 12th Plan period and 100 megawatt during the current financial year i.e. 2014-15 have been set by MNRE. This was stated by Sh. Piyush Goyal, Minister of state for Power, Coal & New and Renewable Energy (Independent Charge) in a written reply to a question in the Rajya Sabha today.

The Minister further stated that fiscal incentives such as accelerated depreciation, concessional customs duty, excise duty exemption, income tax holiday for 10 years and preferential tariff are provided for biomass power projects. In addition, the Central Financial Assistance of Rs.25 lakh per megawatt in special category states and Rs.20 lakh per megawatt for other states with a cap of Rs.1.50 crores per project is being provided by MNRE for setting up of the biomass power projects.  Besides, state of Punjab is providing financial support to farmers for procurement of equipment such as reapers and bailer for collection and compaction of paddy straw etc, the Minister added.

The State-wise details of biomass power projects set up so far is given below:-

State-wise list of commissioned Biomass Power Projects as on 31.01.2015




Promotion of MSME Clusters Promotion of MSME Clusters Reviewed by Ajit Kumar on 2:55 PM Rating: 5

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