msme.gov.in CDP Scheme Cluster Development Programme : Micro, Small & Medium Enterprises

Organisation : Ministry of Micro, Small & Medium Enterprises
Scheme Name : Cluster Development Programme Scheme
Applicable States/ UTs : All India
Home Page : http://msme.gov.in/
Terms & Conditions : https://www.statusin.in/uploads/37596-CDP.pdf

MSME CDP Scheme

The Ministry of Micro, Small and Medium Enterprises (MSME), Government of India (GoI) has adopted the cluster development approach as a key strategy for enhancing the productivity and competitiveness as well as capacity building of Micro and Small Enterprises (MSEs) and their collectives in the country.

Related : MSME TREAD Trade Related Entrepreneurship Assistance & Development Scheme : www.statusin.in/37591.html

A cluster is a group of enterprises located within an identifiable and as far as practicable, contiguous area and producing same/similar products/services.

The essential characteristics of enterprises in a cluster are :
(a) Similarity or complementarity in the methods of production, quality control and testing, energy consumption, pollution control, etc
(b) Similar level of technology and marketing strategies/practices
(c) Channels for communication among the members of the cluster
(d) Common challenges and opportunities.

Objectives of the Scheme

i. 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.

ii. To build capacity of MSEs for common supportive action through formation of self help groups, consortia, upgradation of associations, etc.
iii. To create/upgrade infrastructural facilities in the new/existing industrial areas/ clusters of MSEs.

iv. To set up common facility centres (for testing, training centre, raw material depot, effluent treatment, complementing production processes, etc).

Strategy and Approach

Given the diverse nature of the MSEs in terms of both geographical location and sectoral composition, the MSE-CDP scheme aims at addressing the needs of the industries, through well defined clusters and geographical areas.

This will enable achieving the economies of scale in terms of deployment of resources as well as focusing on the specific needs of similar industries.

The capacity building of associations, setting up of special purpose vehicles (SPVs), consortia, etc. which are integral part of the scheme would enable the MSEs to leverage their resources and also to have better access to public resources, linkages to credit and enhance their marketing competitiveness.

Diagnostic Study

The first and foremost activity in the cluster development process is to conduct a diagnostic study.

The objective of conducting diagnostic study in a cluster is to map all the business processes of the cluster units viz. manufacturing processes, technology, marketing, quality control, testing, purchase, outsourcing, etc to find out its strengths, weaknesses, threats and opportunities (SWOT), problems and impediments, suggestions and a welldrawn action plan for enhancing competitiveness of the units of the cluster and to position the cluster on a self sustaining trajectory of growth.

Diagnostic Study Report (DSR) is very important document and the study should be conducted with special attention.

The Study should focus on enhanced competitiveness, technology improvement, adoption of best manufacturing practices, marketing of products, employment generation, etc.

There has to be direct linkages between the problems highlighted in the report and the measures suggested for improvement.