Govt to provide grants to industrial clusters

KOLKATAP: The government has made one more move to beef up infrastructure of industrial clusters for micro, small and medium enterprises. The ministry of micro, small and medium enterprise development (MSMED) has revised the Small Industries Cluster Development Programme (SICDP) to fast-track infrastructure development of such clusters.

The new fund will flow to clusters over and above the ministry’s commitment to provide grants for technology upgradation, capacity building, training, skill and market development for individual units and creation for common facilities within each cluster. Jawhar Sicar, development commissioner under the ministry, told ET that henceforth “the Centre will bear 40% of the project cost for infrastructure development of clusters, which will be provided by it as outright grant”. So far, central assistance has been available for technology upgradation, common facility centres, market development and all programmes relating to skill development and capacity building.

With demand for central grant for infrastructure development of clusters growing, the finance ministry’s contribution to total project cost for this purpose should “ideally not exceed Rs 10 crore per cluster”, feel sources in the ministry.

At present, central fund for infrastructure development is available through the Integrated Infrastructure Development (IID) scheme, which is being implemented by the Small Industries Development Bank of India (Sidbi). Under the scheme, the project cost for this purpose is capped at Rs 5 crore. Of which, Rs 2 crore is available from the government as grant.

However, consequent to the revision in SICDP, the IID scheme has lost its relevance. Apart from infrastructure development, central assistance in the form of grant will continue to flow to industrial clusters for other purposes including creation of common facilities centre, capacity building, technology upgradation et al.

The MSMED ministry has also decided to raise the grant amount up to 90% for infrastructure development of those industrial clusters, which will be exclusively dedicated to women entrepreneurs.