Lok Sabha Question No. 2488 (UNSTARRED), answered on 2016-05-09
Subject: SFURTI Scheme
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: PRALHAD VENKATESH JOSHI, PONGULETI SRINIVASA REDDY

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 2488 TO BE ANSWERED ON 09.05.2016

## SFURTI SCHEME

## 2488.  SHRI PRALHAD JOSHI:

SHRI PONGULETI SRINIVASA REDDY:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a)  whether  the  Government  has  revamped/proposes  to  revamp  the  Scheme  of  Fund  for Regeneration of Traditional Industries (SFURTI) with respect to the Khadi Industry in the country and if so, the details thereof;
- (b) the details of clusters set up along with the expenditure incurred thereon and the number of persons employed/benefited under the said scheme during each of the last three years, State/UTwise;
- (c)  the  output  of  such  clusters  and  the  number  and  percentage  out  of  them  engaged  in  exports during the said period, State/UT-wise; and
- (d) the details of the number of persons/ artisans in the Khadi Industry employed under the said scheme, State/UT-wise?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI GIRIRAJ SINGH)

- (a): Ministry of Micro, Small and Medium Enterprises (MSME) has strengthened the Scheme of  Fund  for  Regeneration  of  Traditional  Industries  (SFURTI)  scheme  by  launching  Revamped SFURTI scheme wherein the following major changes were brought in, namely:
- (i) The corpus of financial support for the cluster increased substantially from Rs.75 Lakh to a maximum sum of Rs.8 Crore.
- (ii) There are three kind of interventions namely, soft, hard and thematic interventions.
- (iii) The Scheme envisages leveraging resources from the following sources:
- a. Private sector participation: In case of private sector promoted SPVs the shareholding of the lead investor/private partner shall not normally exceed 50% of the total equity.
- b. Corporate Social Responsibility: CSR Trust Funds with proven track record and capability of managing MSME cluster projects, can participate either as Implementing Agency or Technical Agency.
- (iv) The role and responsibility of the Technical Agency (TA) and the Implementing Agency has been given substantial emphasis with 8% of the financial support to the TA.

(v) The creation of SPV at the cluster level with equity participation so as to make the cluster self-sustainable even after the withdrawal of the budgetary support.  Khadi institutions have been assigned the role of 'Deemed SPVs' in the scheme.

(vi) The book value of land to be taken as IA's contribution to the project.

The Revamped SFURTI guidelines were issued on 01.08.2014 with an outlay of Rs. 149.44 Crore for developing 71 clusters (including coir) with coverage of 44500 artisans (approx.) in the first phase.  Duration of the Revamped SFURTI is for 3 years and the fund earmarked and target for Mini, Major and Heritage clusters are as follows:

(Rupees in Crore)

| S. No.   | Particulars   |   No. of Cluster | Funds per Cluster   |   Total Fund |
|----------|---------------|------------------|---------------------|--------------|
| 1.       | Heritage      |                2 | 8.00                |         16   |
| 2.       | Major         |               10 | 3.00                |         30   |
| 3.       | Mini          |               59 | 1.50                |         88.5 |
|          | Total         |               71 |                     |        134.5 |

# Additional Rs 14.94 Crore earmarked for Administrative, Thematic & M&E expenses making the total required allocation Rs.149.44 Crore

The new guidelines were issued on 01.08.2014, however, many issues pertaining to the difficulties in implementation of the SFURTI scheme was noticed. The Ministry organized two national level workshops  on  SFURTI  involving  all  stake-holders  and  the  suggestions  received  have  been incorporated and revised SFURTI Guidelines are issued on 30.06.2015. The key features are:

(i) Approving  the  criteria  for  selection  of  Nodal  Agency  other  than  the  existing  2  main Nodal Agencies of KVIC and Coir Board;

(ii) Emphasis on backward and forward market linkages for traditional and village industry products and provide a market driven approach;

(iii) Release of funds for the Soft  Intervention would  be  provided  before the  Hard Interventions at the DSR approval stage before DPR;

(iv) Multiple  products  may  be  taken  up  as  far  as  possible  to  make  the  cluster  sustainable instead of earlier one product per cluster;

(v) The approval  from the  State  Government  is  solicited  before  the  DPR  approval  stage instead of obtaining the approval at the origin, so as to enable the State Governments to provide the necessary clearances, but within a period of 90 days from the receipt of the proposal.

(vi) The social security and financial inclusion measures initiated by the Union Government are to be provided mandatorily to artisans of the cluster.

(b)to (d): During 2015-16, proposals to set up 32 clusters have been granted final approval with a total project cost of Rs.87.58 crore benefiting around 30438 artisans.  9 clusters out of these have  already  been  established,  benefitting  more  than  14000  artisans.  The  scheme  has  become operationalized  from 2015-16 as the scheme guidelines were approved/circulated in 30.06.2015 after  the  approval  of  the  competent  authority.    During  2015-16,  32  clusters  (Detailed  Project Reports)  and  71  Diagnostic  Study  Reports  (DSRs)  were  approved  against  which  funds  to  the extent of Rs.30.27 crore were released to the organizations i.e. KVIC, Coir Board, IIE-Guwahati, and NI-MSME, Hyderabad for developing the said clusters as per details given below:

1. KVIC

Rs.913.215 lakh

2. Coir Board

Rs.1988.710 lakh

3. IIE, Guwahati

Rs.62.50 lakh

4. NIMSME, Hyderabad

Rs.62.50 lakh

The details of clusters approved and number of persons benefitted are given at Annexure-I.

## Annexure-I referred to in reply to part (b) to (d) of the Lok Sabha Unstarred Question No. 2488 for answer on 09.05.2016

State/UT-wise details of clusters set up/proposed to be set up and the number of persons Employed/to be employed under Revamped SFURTI

| Sl. No                              | State                               | Name of Cluster                                           | No. of Artisans                     |
|-------------------------------------|-------------------------------------|-----------------------------------------------------------|-------------------------------------|
| Khadi and Village Industry clusters | Khadi and Village Industry clusters | Khadi and Village Industry clusters                       | Khadi and Village Industry clusters |
| 1.                                  | Chhattisgarh                        | Bastar Handicraft                                         | 600                                 |
| 2.                                  | Chhattisgarh                        | Dry Flower, Raipur                                        | 389                                 |
| 3.                                  | Gujarat                             | Blacksmithy and Agri tools, Surat                         | 498                                 |
| 4.                                  | Karnataka                           | Harihara Khadi Cluster, Alappuzha                         | 501                                 |
| 5.                                  | Karnataka                           | Hudli Khadi Cluster                                       | 730                                 |
| 6.                                  | Karnataka                           | Sidhalgatta Khadi Cluster                                 | 300                                 |
| 7.                                  | Madhya Pradesh                      | Hosangabad Bamboo Cluster                                 | 474                                 |
| 8.                                  | Manipur                             | Nimongthong Reed Cluster, Imphal                          | 316                                 |
| 9.                                  | Tamil Nadu                          | Kangayam Khadi, Tirupur                                   | 514                                 |
| 10.                                 | Tamil Nadu                          | Sarkar Steel &Wooden Furniture, Salem                     | 345                                 |
| 11.                                 | Uttar Pradesh                       | Bhadohi Hand Knotted Carpet, Allahabad                    | 539                                 |
| 12.                                 | Uttar Pradesh                       | Crochet Craft Cluster, Deoria                             |                                     |
| 13.                                 | Uttar Pradesh                       | Rana Cotton Khadi &Woolen, Baghpat                        | 695                                 |
| 14.                                 | Uttar Pradesh                       | Pottery Cluster, Mau, Azamgarh                            | 332                                 |
| Coir Clusters                       | Coir Clusters                       | Coir Clusters                                             | Coir Clusters                       |
| 15.                                 | Andhra Pradesh                      | Visakhapatnam Coir cluster                                | 1200                                |
| 16.                                 | Gujarat                             | Samvedana Coir Cluster, Ahmedabad                         | 500                                 |
| 17.                                 | Karnataka                           | Attur Coir Cluster, Chikkabalapura                        | 480                                 |
| 18.                                 | Karnataka                           | Tumkur Coir Cluster                                       | 2500                                |
| 19.                                 | Karnataka                           | Kumta Coir Cluster, Uttar Kannada                         | 500                                 |
| 20.                                 | Kerala                              | Neyatinkara Kattakada Coir Cluster, Thiruvananthapuram ** | 3000                                |
| 21.                                 | Kerala                              | Balussery Coir Cluster, Kozhikode                         | 500                                 |
| 22.                                 | Kerala                              | Haripada Coir Cluster Alappuzha                           | 2000                                |
| 23.                                 | Maharashtra                         | Pendur Coir Cluster                                       | 550                                 |
| 24.                                 | Maharashtra                         | Sawantwadi Coir Cluster, Sindhudurg                       | 500                                 |
| 25.                                 | Tamil Nadu                          | Pollachi Coir Cluster                                     | 3350                                |
| 26.                                 | Tamil Nadu                          | Dindigul Coir Cluster                                     | 1330                                |
| 27.                                 | Tamil Nadu                          | Salem Coir Mat Cluster, Salem                             | 1430                                |
| 28.                                 | Tamil Nadu                          | Kangayam Tirupur Coir Cluster                             | 650                                 |
| 29.                                 | Tamil Nadu                          | Palladam Growbag Coir Cluster                             | 885                                 |
| 30.                                 | Tamil Nadu                          | Tirunelveli Coir Cluster                                  | 1330                                |
| 31.                                 | Tamil Nadu                          | Dharampuri Coir Cluster                                   | 750                                 |
| 32.                                 | Tamil Nadu                          | Madurai Coir Cluster (VAIGAI Coir cluster Pvt. Ltd)       | 2450                                |