Scheme of Fund for Regeneration of Traditional Industries (SFURTI)

Central Sector Scheme titled the “Scheme of Fund for Regeneration of Traditional Industries (SFURTI)” was approved at a total cost of Rs 97.25 crore. The Scheme was implemented by the Ministry of Micro, Small and Medium Enterprises (MSME) and its organizations (Khadi and Village Industries Commission-KVIC and Coir Board), in collaboration with State Governments, their organizations and non-governmental organizations.

Planning Commission’s Working Group on XII Plan has recommended continuation of SFURTI with its existing components like: replacement of equipment, setting up of common facilities, support for development of new products, designs, packaging, market promotion, capacity building activities, etc.

It has also been recommended that a number of KVI schemes hitherto being implemented by KVIC in Khadi and Village Industries sectors with similar or overlapping objectives, be merged in SFURTI and give flexibility to Implementing Agencies to choose their own basket of components as per need.

Thus the following schemes are being merged into SFURTI:

The Scheme for Enhancing Productivity and Competitiveness of Khadi Industry and Artisans, the Scheme for Product Development, Design Intervention and Packaging (PRODIP), the Scheme for Rural Industries Service Center (RISC) and other small interventions like Ready Warp Units, Ready to Wear Mission, etc. run by KVIC during XI Plan from Khadi Grants and VI Grants.

Revised Guidelines for Scheme of Fund for Regeneration of Traditional Industries (SFURTI)

  • India has a rich heritage of traditional industries. This sector not only plays a crucial role in providing large-scale employment opportunities at comparatively lower
    capital cost, but also helps in industrialization of rural & backward areas, thereby reducing regional imbalances, assuring more equitable distribution of income and
    wealth. The eco-friendly products of traditional industries have great potential for growth in production and export developing niche products for domestic and export
  • Broadly, „traditional industry‟ means an activity which produces marketable products, using locally available raw material and skills and indigenous technology.
    Traditional Industry Cluster, in the context of this document, refers to a geographical concentration of a sizable number of artisans or micro enterprises, suppliers of raw
    materials, traders, service providers, etc. producing processing and servicing the same or similar types of products and facing common opportunities and threats.
  • The traditional industries are broadly categorized into Khadi (comprising of hand-spun and hand-woven cotton, woolen, muslin and silk varieties), Coir Based
    Industries and Village Industries (including non-timber forest produces-NTFPs, handmade paper, agro based goods, textiles based products and other miscellaneous
    microenterprises as detailed in Annexure 1).
  • With a view to making the traditional industries more productive and competitive and facilitating their sustainable development, the Govt. of India
    announced setting up of a fund for regeneration of traditional industries, with an initial allocation of Rs 100 crore. Pursuant to this announcement, a Central Sector Scheme
    titled the “Scheme of Fund for Regeneration of Traditional Industries (SFURTI)” was approved at a total cost of Rs 97.25 crore. The Scheme was implemented by the
    Ministry of Micro, Small and Medium Enterprises (MSME) and its organizations (Khadi and Village Industries Commission-KVIC and Coir Board), in collaboration with
    State Governments, their organizations and non-governmental organizations.
  • Separately, with a view to revitalizing the Khadi and Village Industries (KVI) sector, the Government of India, with the assistance of Asian Development Bank
    (ADB), had in 2009-10, introduced a comprehensive Khadi Reform and Development Programme (KRDP) which inter alia aimed at developing 5 thrust areas of traditional village industries such as herbal products, honey, handmade paper, leather and agro based industries through a cluster-based approach.
  • Planning Commission‟s Working Group on XII Plan has recommended continuation of SFURTI with its existing components like: replacement of equipment,
    setting up of common facilities, support for development of new products, designs, packaging, market promotion, capacity building activities, etc. It has also been
    recommended that a number of KVI schemes hitherto being implemented by KVIC in Khadi and Village Industries sectors with similar or overlapping objectives, be merged in SFURTI and give flexibility to Implementing Agencies to choose their own basket of components as per need. Thus the following schemes are being merged into SFURTI: The Scheme for Enhancing Productivity and Competitiveness of Khadi Industry and Artisans, the Scheme for Product Development, Design Intervention and Packaging (PRODIP), the Scheme for Rural Industries Service Center (RISC) and other small interventions like Ready Warp Units, Ready to Wear Mission, etc. run by KVIC during XI Plan from Khadi Grants and VI Grants.
  • Despite the success of the SFURTI scheme, an independent evaluation of the SFURTI clusters highlighted the need to improve the sustainability and competitiveness of these clusters. The recommendations include enhanced allocation per cluster, increased responsibility of the Technical Agencies (TAs), critical financial appraisal and development of robust business plans and convergence of programs at the cluster level.
  • As mentioned in the Budget announcement made by Finance Minister for 2013- 14, 800 clusters of khadi, village industries and coir are to be developed during XII
    Plan with an outlay of Rs 850 crore to cover 4 (four) lakh artisans. Assistance from Multilateral Development Banks is also to be leveraged, to extend support under
    SFURTI to 800 clusters during the XII Plan.
  •  Clusters have gained increasing prominence in debates on economic development in recent years. Governments worldwide regard clusters as potential drivers of enterprise development and innovation. Cluster initiatives are also considered to be efficient policy instruments in that they allow for a concentration of
    resources and funding in targeted areas with a high growth and development potential that can spread beyond the target locations (spillover and multiplier effects).
  • Clusters are defined as “geographical concentrations of inter-connected enterprises and associated institutions that face common challenges and opportunities”. This definition highlights two essential features of clusters: they consist of a critical mass of enterprises located in geographical proximity to each other and
    enterprises within them share many common features. 

The objectives of the Scheme are as follows:

i. 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;

ii. To provide sustained employment for traditional industry artisans and rural entrepreneurs;

iii. To enhance marketability of products of such clusters by providing support for new products, design intervention and improved packaging and also the
improvement of marketing infrastructure;

iv. To equip traditional artisans of the associated clusters with the improved skills and capabilities through training and exposure visits;

v. To make provision for common facilities and improved tools and equipment for artisans to promote optimum utilization of infrastructure facilities;
vi. To strengthen the cluster governance systems with the active participation of the stakeholders, so that they are able to gauge the emerging challenges and opportunities and respond to them in a coherent manner;

vii. To build up innovated and traditional skills, improved technologies, advanced processes, market intelligence and new models of public-private partnerships, so
as to gradually replicate similar models of cluster-based regenerated traditional industries;

viii. To look for setting up of multi-product cluster with integrated value chain and a strong market driven approach for viability and long term sustainability of the

ix. To ensure convergence from the design stage with each activity of the cluster formation and operations thereof.

x. To identify and understand cluster‟s target customers, understand their needs and aspirations and develop and present product lines to meet the requirement.
Substantial focus should be on the buyer segment that places a premium on natural, eco-friendly, ethically sourced and the uniqueness of the Khadi and VI

xi. To develop specific product lines out of the currently offered diversified basket of heterogeneous products based on the understanding of the target consumer
segment. A brand unification exercise also needs to be done to maximize the value.

xii. To make a paradigm shift from a supply driven selling model to a market driven model with the right branding, focus product mix and correct positioning and
right pricing to make the offering holistic and optimal for each of the focus categories.

xiii. To tap the E-Commerce as a major marketing channel given the outreach and the growing market penetration of E-Commerce, there is a need to devise a quick
strategy to make its presence felt in the E-Retail space.

xiv. To make substantial investment in the area of product design and quality improvement. There is a need to standardise the quality of inputs and processes
so that the products meet the quality benchmarks. Research need to be done to develop new textures and finishes to cater to the prevailing market trends.

The Scheme would cover three types of interventions namely „soft interventions‟, „hard
interventions‟ and „thematic interventions‟.

3.1 Soft Interventions

Soft Interventions under the project would consist of activities such as 

i. General awareness, counselling, motivation and trust building;
ii. Skill development and capacity building/ for the entire value chain different skills need to be imparted;
iii. Institution development;
iv. Exposure visits;
v. Market promotion initiatives;
vi. Design and product development;
vii. Participation in seminars, workshops and training programmes on technology up-gradation, etc.

3.2 Hard Interventions

Hard interventions will include creation of following facilities:

i. Multiple facilities for multiple products and packaging wherever needed;
ii. Common facility centres (CFCs);
iii. Raw material banks (RMBs);
iv. Up-gradation of production infrastructure;
v. Tools and technological up-gradation such as charkha up-gradation, toolkit distribution, etc.
vi. Warehousing facility;
vii. Training center;
viii. Value addition and processing center/multi-products.

Note: The assistance for raw material bank (RMB) shall be leveraged with
financial institution for enhanced credit.

3.3 Thematic interventions

In addition to the above mentioned hard components and soft components, the scheme will also support cross-cutting thematic interventions at the sector level
including several clusters in the same sector with emphasis on both domestic and international markets.

These will primarily include:

i. Brand building and promotion campaign
ii. New media marketing
iii. e-Commerce initiatives
iv. Innovation

v. Research & development initiatives
vi. Developing institutional linkages with the existing & proposed clusters

Note: These interventions are illustrative in nature and the project may cover
any of the other felt needs of the cluster (as detailed in the DPR and approved by
SSC), that will enable the cluster enterprises in improving their competitiveness.


Given the challenges and wide geographical coverage of the Scheme, an efficient scheme management structure and delivery mechanism has been proposed.

4.1 Scheme Steering Committee (SSC)
The Ministry of Micro, Small and Medium Enterprises (MSME) will be the coordinating Ministry providing overall policy, coordination and management support
to the Scheme. A Scheme Steering Committee (SSC) will be constituted under the chairmanship of Secretary (MSME), as detailed in Annexure-2. The SSC may co-opt
representatives of industry associations, R&D institutions and other private sector expert organizations as members/ special invitees, depending on functional needs. The
SSC will consider the proposals of clusters and the Implementing Agencies (IAs) submitted by Nodal Agencies (NAs) and shall extend approval to the cluster proposals.
The cluster proposals will include the details of TA and IA proposed by NA. The SSC may make intra-sectoral adjustments of activities and corresponding funds without
affecting the basic objectives and thrust of the Scheme.

4.2 Nodal Agencies (NAs)
The scheme will have Nodal Agencies (NAs) which are national level institutions with sectoral expertise in the major sub-sectors of the Traditional Industries.

4.2.1 Khadi & Village Industries Commission (KVIC) shall be the NA for Khadi and Village Industry clusters and Coir Board (CB) shall be the NA for Coir based clusters.
4.2.2 To spread the outreach and to establish competence in cluster development, project management and facilitation of market access of the revamped SFURTI, new
Nodal Agencies (NAs) need to be selected and appointed by the SSC. The selection of NAs shall have to be a reputed national, regional level institution with sectorial
expertise in the major sub-sectors of the Traditional Industries, competence in cluster development, project management and facilitation of market access and who are
operating in the field of cluster development for the last five years. The institutions could be any of the following:
i). a Society registered under Societies (Registration) Act, 1860;
ii). a Co-operative Society under an appropriate statute;
iii). a Producer Company under section 581C of Companies Act 1956;
iv). a Section 8 Company under The Companies Act, 2013 (18 of 2013); or
v). a Trust.
Such NA will be assigned clusters which are not assigned to KVIC, Coir Board or others.
4.2.3 Suggested Guidelines for new NA to be appointed by the SSC:

A. Submission of Proposal
Proposal (one hard copy and one soft copy) in the prescribed proforma as in Annexure3 as required along with necessary enclosures and endorsement from the Head of the
Institution/Agency/Trust/Company desirous of being empanelled as Nodal Agency for anchoring Cluster development may be sent to the following addressee:-

The Joint Secretary (ARI Division),

Ministry of Micro, Small & Medium Enterprises,

Room No.171 Udyog Bhawan, New Delhi-110011.

Telephone (011) 23061543 Telefax: (011) 23062858

E-mail: [email protected]

B. Appraisal and Approval:
The proposals for engaging the Nodal Agency will be appraised based on the track record, merit and strategies of the entity in promoting cluster development. The
appraisal will be done by the Scheme Steering Committee, constituted by the MoMSME. The SSC shall take a final decision for approval of designated Nodal Agency.
Continuation of support to the NA will be entirely performance oriented and subject to approval. The performance will be monitored both at quantitative and qualitative
aspects by the Scheme Steering Committee. In case of significant shortfall in the progress, the support may also be terminated mid-term with approval of SSC.

C. Terms and Conditions for Grants-in-Aid for new Nodal Agencies:

Agencies except those funded by Ministry of MSME or any other Ministry is provided under Annexure-4.

4.2.4 A Project Screening Committee (PSC) shall be constituted under each of the NAs, chaired by the Chief Executive of the NA for the management and implementation
of the Scheme. Nodal Agencies other than KVIC and Coir Board shall also constitute a PSC comprising of 3 Cluster Experts (2 from TAs & 1 from IA), representative of bank,
and marketing & financing experts. [Details in Annexure-2.1 ]

4.2.5 Role of the NAs: The role and responsibility of NAs includes the following:

i. Program fund management including NA shall be responsible to ensure timely disbursement of funds to the IAs on recommendation of TA to ensure time
bound completion of projects;

ii. Empanelment & engagement of TAs. NA would duly notify and inform all concerned stakeholders including the industry, State Governments, concerned
Ministries / organizations of Government of India and Financial Institutions, about the appointment of TA for implementation of SFURTI;

iii. NA shall extend all support required to TA for implementation of the scheme as may be required such as obtaining Government Approvals, Environment
Clearances etc for setting up of Clusters;

iv. Preparation of strategy and implementation plan for sub-sector thematic

v. Appraisal of PPRs and DPRs received from TAs based on due-diligence methodology that clearly establishes the project viability, output, outcomes,
impact and sustainability;

vi. Seek and obtain approval from competent authority of the State Government/UTs for the cluster in partner with the Technical Agency before
submission of DPR to the SSC for final approval;

vii. Shortlist and recommend proposals to SSC for approvals;

viii. Recommend selection of IAs to SSC;

ix. Review performance of the TAs;

x. Monitoring and evaluation of the cluster projects being implemented; and

xi. Any other tasks assigned by the SSC.

5.1 Web-Based Project Management System (PMS)

5.1.1 In order to effectively manage the scheme of such scale and coverage it is proposed to set up a dedicated SFURTI website enabled with Project
Management System (PMS) to manage projects on-line from inviting proposals to screening of applications and concurrent monitoring of progress till
completion. The proposed PMS will have in-built systems for online application, MIS tracking, monitoring of physical & financial progress, sharing of reports and
other tools for project management. The system will enable all the associated institutions and stakeholders to monitor the progress of projects and work
collaboratively to ensure successful implementation of the Scheme. The webbased PMS would help to address various implementation issues such as time
overruns, inadequate coverage, and other risks & quality issues.

5.1.2 The web platform would also provide the option to the potential Nodal Agencies to apply and upload their credentials so as to enable the SSC to take a suitable
call to enroll the agency as a Nodal Agency.

5.1.3 The web platform would also have a built in module to screen, sort and filter the received applications State wise and forward the same to the State Governments
in real time to save any delay in implementation. The system would also send reminders periodically to the State Governments till such time the approvals are

5.1.4 All enrolled NAs, TAs would be listed on the web portal so as to provide the available options to the potential IAs to approach them accordingly.

5.1.5 The system would also act as a web based monitoring system to provide necessary inputs for any kind of delays and non-processing at any stage in the
entire work flow.

5.2 Identification of tentative list of clusters

i). Nodal Agencies will first draw up a State-wise list of potential clusters in consultation with Technical Agencies with clear identification of Implementing
Agency who shall be local operative for managing the cluster and looks after the day-to-day affairs of the cluster.

ii). A market driven approach should be adopted for identification and structuring of the projects so as to ensure viability and long term sustainability of the project
activities. The Cluster should be so selected where the products have huge potential market demand and the Cluster can be developed to scale up activities
and produce high value products for the market.

iii). The SFURTI Clusters should preferably be existing clusters (Brownfield) and new clusters (Greenfield), should however be carefully selected after a thorough
study of the cluster dynamics and potentiality of the products.

iv). In addition to Khadi, the Clusters should cover traditional rural industries and village industries which should be in conformity with the KVI Act and norms.

v). The SFURTI project should aim to adopt the Growth Pole concept for triggering growth of the traditional village industries. A cluster of clusters approach must
be adopted for the project to create cascading positive externalities with the scope of extension of the activities in a larger contiguous area.

vi). Multi-product Clusters must be promoted, particularly in the case of Heritage Clusters for greater project coverage and economic viability/ sustainability of the cluster. Products which are complimentary to each other need to be selected for
Multiproduct Clusters.

vii). The Clusters and the activities must have a critical mass, for ensuring economies of scale. Projects under SFURTI should be integrated value chain based and the
project should be structured with interventions to address the gaps along the entire value chain.

viii). End to End product clusters will enhance viability of the clusters. The project must ensure that substantial value addition takes place at the village/Cluster
level for greater value capture and higher unit value realizations.

ix). It must be ensured that as far as possible the entire value addition should be done at the cluster itself, so that maximum realization is done.

x). The project design and structure should specifically provide a plan for sustainability of the project activities, especially beyond the project period along
with exit plan.

xi). The project must be so structured such as to promote optimum utilization of infrastructure facilities through a range of activities. In case of multi-product
Clusters, the possibility of setting up specialized CFCs for each product line, closer to the raw material base, could also be explored.

xii). The project should allow involved and active participation of all members of the Cluster. NER projects should focus on the challenges in the region and came out
with solution for these. 

5.3 Engagement and appointment of TAs

As a large number of clusters located in various parts of the country, need to be covered under the program in a time-bound manner; it is required to empanel as many
technically competent cluster development organizations as possible, as a pool of Technical Agencies (TAs) to assist in the implementation of the projects.

5.3.1 An Expression of Interest (EoI) will be published by the NA in leading national newspapers requesting for proposals. The TAs will be shortlisted by NA based on
technical evaluation of their proposals, mostly in terms of-
i. Net worth of the organization;
ii. Organizational experience in implementing projects of similar nature specially artisans and micro-enterprise based developmental initiatives;
iii. Competence of personnel and team;

iv. Geographical presence; and
v. Any other parameter as deemed fit by the NA/SSC.

Based on the above criteria, TAs would be appointed and assigned to specific clusters. Any other eligible institution may approach the Ministry of MSME or any of the Nodal
Agencies for enrolment as a TA and the SSC shall be the final authority for due approval of the proposal for appointing any institution with eligibility and competence.
It may be noted that TAs will be grouped at the cluster level whereby a single TA can be assigned to multiple clusters, not exceeding 50 clusters per TA.

5.4 Approval from SSC

The SSC shall be responsible for approval of the projects and monitoring of their implementation. There would be two-stage process for approval of the projects: Inprinciple
approval and final approval.

5.4.1 In- Principle Approval:

In-principle approval for a project/cluster will be accorded by the SSC based on recommendation of NA and evaluation of the Preliminary Project Report (PPR) as per
the standard template as provided under Annexure-5 submitted by the TA assigned to the cluster. The PPR should broadly cover the major features of the proposed project
including baseline information, tentative interventions, proposed implementation framework and a list of potential IAs. Such In-principle approval will be valid for a
period of 6 months from the date of approval, and before that it is expected that the project would be ready for final approval. In case final approval is not accorded to the
project, within 6 months, the in-principle approval will automatically lapse, unless it is specifically extended by the SSC.

5.4.2 Final Approval:

The project will be accorded final approval by the SSC subject to fulfilment of the following conditions:

i. Preparation of DPR as per the standard template as provided under Annexure-5 with specific details of interventions with cost estimates and timelines;
ii. Identification of IA and formation of project specific SPV;
iii. Execution of shareholders agreement and other related agreements between the IA and the members; and

iv. Arrangement of requisite land for construction of common facilities by the IA in terms of registered sale or lease deed in the IA‟s name.
v. Approval by the Secretary, Department of Industries and Commerce of the State Govt./Union Territories, who is the competent authority to issue the consent for
setting up of the cluster before the DPR is put up for final approval by the SSC at the apex level. State Governments, District Administrations and local PRIs may
be involved in the entire process of State level approval. This shall ensure the involvement of local administration for smooth implementation of the SFURTI
programme at cluster level and helps in dovetailing of the schemes of the State and Central Governments to strengthen the local governance system at the
cluster level. Through this process, the legal entity, constitution and existence of the IA are being confirmed and authenticated by the Government machinery to
avoid any kind of duplication and non-existence of operatives resulting in gross misuse of precious public funds. The NA and TA shall have to act diligently in
co-ordination with the respective State Governments to ensure timely approvals for the proposals at the DPR stage in order to obtain final approval from the
SSC. As the total time provided for the valid project proposal in the DPR format after in-principle-approval is six months or 180 days, the projects must obtain
the State level clearances within a maximum period of 3 months or 90 days from the date of in-principle-approval.

5.5 Pre-requisites for Release of Funds

Once the DSR/PPR is approved by MoMSME, the process for release of funds under soft-intervention would initiate after ensuring the following preparatory actions at the
level of the Nodal Agency:-

I. The Implementing Agency and Technical Agency are appointed;
II. Action initiated for formation of SPV at the IA level;
III. Proposal for the Cluster gets in-principle-approval from the SSC.

5.6 Release of Funds to NA

i) The cost of project shall include hard interventions and soft interventions. The project cost shall also include the cost of services of a professional TA and costs
incurred by the IA for engaging a competent CDE and other administrative expenses incurred by the TA, which needs to be paid by the Nodal Agency.

ii) Proposal for release of funds will be submitted by NAs cluster-wise to Ministry of MSME. The release of funds to NAs will be based on approved Plan of Action (PoA) and
progress of expenditure.

iii) The funds will be released to the NAs on receipt of UC and Progress Report, and the NAs shall in turn, release the fund to the cluster as per the approved Cluster/ Annual
Action Plan.

iv) Funds to NA will be disbursed under two heads:
i. SFURTI Programme Fund
ii. SFURTI Administrative Fund

v) The NA shall maintain two separate accounts for each of the above mentioned heads and will be subject to audit. All expenses relating to monitoring and management of the
Scheme and national level activities will be met out of SFURTI Administrative Fund and rest from SFURTI Programme Fund.

5.7 Release of Funds to IA

On obtaining final approval, a sanction order will be issued by NA and 1st installment for the hard intervention will be released by NA in the dedicated bank account opened
in the name of the IA. Whereas release of fund by NA to IAs for soft-intervention shall be need-based and a part component of the same is released to the IA after inprinciple-approval of the SSC, the following schedule will be adopted for release of scheme funds for hard interventions:

i. 1st instalment of 40% of the hard intervention as advance on IA arranging land;
ii. 2ndinstalment of another 40% on utilization of 2/3 of 1stinstalment; and
iii. Balance 20% as 3rdand final instalment, as reimbursement.

6.1. The cost of project shall include hard interventions and soft interventions detailed in Paragraph 3. The project cost shall also include the cost of services of a
professional TA and costs incurred by the IA for engaging a competent CDE and other administrative expenses incurred by the TA.

6.2. The financial assistance provided for any specific project shall be subject to a maximum of Rs 8 (eight) crore.

Type of clusters                                                  Per Cluster Budget Limit
Heritage Clusters (1000-2500 artisans)               Rs 8.00 crore
Major Clusters (500-1000 artisans)                      Rs 3.00 crore
Mini-Clusters (Upto 500 artisans)                         Rs 1.50 crore


7.1. Project Coverage

The target is to cover more than 800 clusters across the country during the scheme implementation, wherein approx. 4 lakh artisans/beneficiaries are proposed to be
covered under the various scheme components. The scheme shall be implemented in all States of India. The geographical distribution of the clusters throughout the country, with at least 10% located in the North Eastern Region (NER), J&K and hilly states, will also is kept in view.

Clusters will be selected under three categories based upon type and coverage of artisans in the cluster in the 1st Phase:

Type of clusters                                                 No. of Clusters under the Scheme        Approx. Artisan Coverage
Heritage Clusters (1000-2500 artisans)                       2                                                                 5000
Major Clusters (500-1000 artisans)                              10                                                               10000
Mini-Clusters (Upto 500 artisans)                                59                                                                29500      

 7.2. Project Duration

The time frame for the implementation of project will be 3 years. The DPR would provide year-wise phasing of the interventions and requirements of funds.

8.1. Substantial investments are being made for strengthening of rural clusters and the livelihood base of the poor. In order to optimise the efforts and maximise impact &
sustainability, it is imperative to ensure convergence and bring in synergies between different private initiatives and government schemes in terms of planning, process and
implementation. The Scheme envisages leveraging resources from the following sources:

i. Private sector participation: The scheme shall encourage participation of private sector retailers with proven track records and established retail
networks. Retailers specializing in products sourced from khadi &village industries, coir & other industries may participate as Implementing Agency or
Technical Agency. In cases where private sector agency is the implementing agency, the private partner shall contribute at least 50% of the project cost
excluding the cost of land.

ii. Corporate Social Responsibility: The corporates of public and private sector can participate in the SFURTI program by way of providing additional financial
support and professional operations & management support to the projects funded under the Scheme as part of their CSR. Such CSR foundations with
proven track record and capability of managing MSME cluster projects, can participate either as IA or TA.

iii. Participation by Private Equity (PE)/Impact Funds: To leverage the increasing trend of financial institutions floating funds to support clusters that are in
nature of social investments, such funds will be encouraged to participate in the SPVs, subject to the condition that their shareholding shall not exceed 50% of
the total equity. In case of debt support, patient capital with extended moratorium, low rate of interest and flexible repayment options shall be

iv. Other schemes of State and Central Government: IAs will be encouraged to dovetail funds from other various state and central government schemes over
and above the funds sanctioned for SFURTI scheme, provided that there is no duplication of a specific project component being funded from one source.

v. Funds from Multi-lateral Development Banks (MDBs): It is envisaged that the funding from the scheme will leveraged to secure additional financial assistance
from the MBDs to ensure sustainability and competitiveness of the clusters.

8.2. The participation of stake holders as illustrated above is indicative. Any such participation or support needs to be detailed out in the DPR and subject to approval
from the SSC.

8.3. TAs and NAs must therefore ensure that convergence is built into implementation framework right from the stage of project design. For example, the
banks and RSETI expressed the need to involve them at the stage of DSRs and Action Plan formulation. Convergence with private sector buyers in the value chain and other
key stakeholders must be built into project design. Funding from public and private agencies should also be ensured at early stage. In order to ensure convergence, linkages
should also be made through reporting to SLBC and District committees chaired by the Collector.

ANNEXURE-1: Categorization of Traditional Industries



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Phone: 0194-2493590, 0191- 2477552

Email: [email protected]