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Cluster Development Scheme

1.What it is the definition of Cluster?
A group of enterprises located within an identifiable and as far as practicable, contiguous area, producing same/similar product/ services.
2. What are the features of the cluster?
1. Clusters have common challenges and opportunities
2. Similar level of technology and structures
3. Similarity or complementarity in the methods of production, quality control and testing, energy consumption, pollution control etc.
3. Pl. Explain the scheme.
Govt. of India, Ministry of MSME has announced the scheme for Micro and Small enterprises for enhancing their productivity and competitiveness as well as capacity building. The name of scheme is Micro and Small Enterprises- Cluster Development Programme.- MSE-CDP
4. Who implement the Cluster Development Programme?
Cluster projects are implemented by Special Purpose Vehicles (SPV) consisting of the actual/ likely cluster beneficiaries/ enterprises organised in any legally recognition, like co-operative society, registered society, trust, company etc.
5. What are the main steps in cluster development?
The main steps are :
1) Selection of Cluster
2) Selection of CDE
3) Trust Building
4) Diagnostic study
5) Preparation of action plan
6) Approval of budget and leveraging of funds from various institutions.
7) Implementation of action plan
8) Monitoring and evaluation
9) Handing over and exit
10) Self management phase.
6. What are objectives of Cluster Develop Programme ?
To conduct the soft activities and hard activities under soft and hard interventions for following objectives :
1. To enhance the productivity and competitiveness of micro and small enterprises.
2. To facilitate economies of scale in terms of deployment of resources.
3. To built capacity of MSEs through formation of SHG, Mutual credit guarantee funds, BDS development etc.
7. Which are the main activities in cluster Programme?
In cluster Programme there are following two main activities
1. Soft activity : This includes interventions for soft activities viz capacity building, market development activities, management development and technology up gradation .
2. Hard Activity : This includes intervention for hard activities viz. Establishment of common facility center (CFCs) etc.
8. Who will make available land for cluster projects?
Cluster developing agencies, Special Purpose Vehicle (SPV) has to arrange suitable and viable land for cluster project by their own.
9. Are there any priority for special categories?
Cluster should have suitable presence of
(1) Women entrepreneur
(2) Entrepreneur belongs to SC/ ST/ OBC/ Minorities etc.
(3) Micro enterprises.
10. What are the special benefit for micro & Village enterprises?
Clusters of micro and village enterprises have the provision of enhancing financial support by 10%
11. What is the time duration for completion of cluster project?
As per existing guidelines project duration for cluster is 3 years.
12. What is the role of CDE in cluster scheme?
CDE- cluster Development Executive plays very important role in the project. He is the officer from the Govt. agencies and one of the member of SPV. He conceptualises the overall developmental strategy of the cluster, co-ordinates the activities and initiates implementation.
13. Specify the financial support from GOI under MSE-CDP scheme in the cluster.
Contribution of Ministry of MSME (Govt. of India) will not exceed 80% of the total project cost. Subject to a ceiling of Rs. 10 crore per project including Rs. 10 lakh for soft activities under soft interventions.
14. Is there any contribution from beneficiaries in cluster scheme?
Scheme expects at least 10% contribution from stake holders/ beneficiaries of the cluster projects.
15. What will be the ultimate result due to cluster projects?
1. Increased income, investment, capacity utilisation, cost deduction, community empowerment, energy conservation, pollution control.
2. Infrastructure creation and linkage through govt. scheme.
3. Enhance collective economic efficiency
4. Developing culture of co-operation and team work
5. Strengthened local governance strength.
6. Creation of competitive market.