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GoI Approved New Guidelines of Micro & Small Enterprises Cluster Development Programme

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Govt approves guidelines for small business cluster development programme

The Government of India(GoI) has approved the New Guidelines of Micro & Small Enterprises Cluster Development Programme (MSECDP). This will be implemented during the 15th Finance Commission Cycle: 2021-22 to 2025-26. 

  • The new guidelines of MSE-CDP are issued in supersession of the previous guidelines (2019) and encompass inter-alia, the procedure and funding pattern.

Click here for the New Guidelines of MSE-CDP

Objective:

  • To enhance the sustainability, competitiveness and growth of MSEs by addressing issues like improvement of technology, skills and quality, market access, and others 
  • To build the capacity of MSEs and Startups for common supportive action through the integration of self-help groups, consortia, district Industry associations, etc.
  • To create or upgrade infrastructural facilities in the new or existing Industrial Areas or Clusters of MSEs.
  • To establish CFCs in Industrial areas for the testing, training centre, raw material depot, effluent treatment, and complementing production processes. 
  • To Promote green & sustainable manufacturing technology for the clusters, to enable units to switch to sustainable and green production processes and products. 

Two Components of the Scheme:

i.Common Facility Centers (CFCs): The component consists of the creation of tangible “assets” as CFCs in Industrial Estate.

ii.Infrastructure Development(ID): This component is for development of Infrastructure in new/existing notified Industrial Estate.

Funding pattern:

Components Total Project cost Funding Pattern 
Govt of

India

State

Govt

SPV
Funding Pattern of Projects 
CFCsRs 5 crore to Rs 10

crore

70%20%10%
CFCsRs 10 crore to Rs 30

crore

60%20%20%
ID – NewRs 5 crore to Rs 15

crore

60%40%
ID – Upgradation of existing InfrastructureRs 5 crore to Rs 10

crore

50%50%
Funding Pattern of Projects Located in the Aspirational Districts, NER(North Eastern Region), Hill States and islands 
CFCsRs 5 crore to Rs 10

crore

80%15%5%
CFCsRs 10 crore to Rs 30

crore

70%15%15%
ID – NewRs 5 crore to Rs 15

crore

70%30%
ID – Upgradation of existing InfrastructureRs 5 crore to Rs 10

crore

60%40%

Background:

i.Cluster Development Programme is one of the oldest schemes of the Office of Development Commissioner in the Ministry of Micro, Small & Medium Enterprises(MoMSME). 

ii.The scheme was previously revised in 2007 and in 2019.

iii.In 2007, the Cluster Development scheme, Small Industries Cluster Development Programme (SICDP) was renamed “Micro and Small Enterprises – Cluster

Development Programme (MSE-CDP)”.