$5 trillion economy: Govt sets up these many MSME clusters as it aims 50% GDP from small businesses

The Narendra Modi government is laying emphasis on boosting the MSME sector to help India achieve the -trillion economy target by 2025.

Micro and small enterprises — Cluster Development Programme (MSE-CDP) under the MSME Ministry to boost productivity and competitiveness of MSMEs developed 35 clusters including 17 clusters during the financial year 2019, up from 13 clusters in FY18, only five in FY17 and nil in FY16, according to the data shared by the MSME minister Nitin Gadkari in Rajya Sabha on Thursday. The Narendra Modi government is laying emphasis on boosting the MSME sector to help India achieve the $5-trillion economy target by 2025. Gadkari has aimed at boosting its GDP share from current 29 per cent to 50 per cent in five years along with adding 5 crore additional jobs to the existing 11 crores.

The programme which also focused on developing infrastructure projects (ID) in new and existing MSME clusters and setting up common facility centres (CFC) completed development of 169 IDs and 75 CFCs as on October 18, 2019, according to Development Commissioner, MSME ministry portal. The government had allocated Rs 227.90 crore for the cluster development programme for FY20.

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The states where these new clusters have been developed since FY16 included Tamil Nadu (12), Maharashtra (8), Karnataka (5), West Bengal (4), Kerala (2), Andhra Pradesh (1), Haryana (1), Uttar Pradesh (1), and Odisha (1). The type of clusters varied from textiles, garments, ceramics, electronics, printing and packaging, auto, engineering, gold jewellery, rice etc. The government had earlier accorded approval to set up 50 clusters in FY19 and FY20 powered by solar charkhas for spinners, weavers and artisans. The MSME ministry had also launched a project called TechSaksham in partnership with CII and technology companies including WhatsApp, Dell, Intel etc. to help small businesses with technology adoption and handhold them in its deployment at multiple industrial clusters in India.

Gadkari also shared the FY20 budget allocation under seven MSMEs schemes apart from the cluster development scheme. The combined allocation stood at Rs 4,322 crore for Scheme for Promoting Innovation, Rural Industry & Entrepreneurship, Scheme of Fund for Regeneration of Traditional Industries, Prime Minister’s Employment Generation programme, Credit Guarantee Scheme for Micro and Small Enterprises, Credit Linked Capital Subsidy and Technology Upgradation Scheme, Interest Subvention Scheme for Incremental Credit to MSMEs, and Tool Rooms & Technology Institutions.