What is SFURTI Scheme?
Scheme of Fund for Regeneration of Traditional Industries (SFURTI) is a scheme launched by the Government of India under the aegis of Ministry of MSME in 2005 with the intention to promote cluster development. The main objective of the programme is to make traditional industries that spread across the country to become more competitive and profitable.
The traditional industries that employ a large chunk of workers should become more productive and economically sustainable. With SFURTI scheme in place, Common Facility Centers were to be established; and the idea was to generate sustainable employment opportunities.
The sectors in focus for the SFURTI scheme are bamboo, khadi, and honey with the sole aim to support rural artisans and rural entrepreneurs.
SFURTI Scheme Insights
Objectives of the scheme
- To organize different traditional industries and local artisans into clusters. The idea is to become more competitive and promote industries for longer-term sustainability and improve the economies of scale.
- To generate sustainable employment opportunities for local artisans who are involved in traditional industries and also support rural entrepreneurs.
- To emphasize the marketing of cluster products by focusing on the development of new products, design intervention, and better packaging by building an improved marketing infrastructure.
- To provide skill development training to artisans and enhance their capabilities through better training and trips for exposure.
- To make the provision of shared facilities and provide better quality tools and other equipment to the artisans involved.
- To strengthen cluster governance through the active participation of different stakeholders. This will enable them to assess inevitable challenges and emerging opportunities and thereby take the necessary steps to benefit coherently.
- To focus on innovative and traditional skills, new technology, improved processes, market intelligence, and emerging new public-private partnership models that can be replicated gradually on similar cluster model based traditional industries.
- To look for opportunities to establish a multi-product cluster having an integrated value chain. To take a market-driven approach for the financial viability of the project and sustainability of the cluster in the long term.
- To identify potential customers of cluster products and understand their aspirations, thereby helping in establishing a production line to fulfill requirements.
- To replace supply-driven sales models with market-driven models and to focus on product mix, branding, and pricing for augmenting sales.
- To devise a strategy of selling cluster products on different e-commerce websites.
- To support and assist in the production design and quality imprisonment of products as it is necessary to meet the quality benchmarks of products.
Funding Details of SFURTI Scheme
The financial assistance to be provided under the SFURTI scheme by the government, for different projects is subjected to a maximum amount of Rs. 8 crores.
Type of clusters
Heritage clusters with 1000-2500 artisans
Major clusters with 500 – 1000 artisans
Mini clusters up to 500 artisans
Budget per Cluster
Rs. 8 crore
Rs. 3 crore
Rs. 1 crore
Note: North-Eastern states/Jammu and Kashmir and the other Hill States have the provision of 50% reduction in artisans employed in number per cluster.
- Khadi and Village Industries Commission (KVIC) became the Nodal Agency to promote Cluster development for Khadi and related rural-based industries.
- Coir Board is the nodal agency for coir based clusters.
three types of interventions that are covered under the SFURTI scheme are:
- Soft Interventions – This includes general awareness of the scheme, counselling, trust-building, and motivation. It also provides skill development of artisans, capacity building, and setting up institutions. Other measures taken are exposure visit of artisans, product design, and development.
- Hard interventions – Establishment of clusters for multiple products and packaging. Other initiatives include raw material banks, technology up-gradation, common facility centres, training centres, and warehousing facilities.
- Thematic interventions – This includes several clusters in a single sector that emphasizes on both domestic and international markets. These initiatives are supported by marketing campaigns, brand building, and reaching out to new markets and customers by collaborating with e-commerce sites.
The potential applicants of the scheme include:
- Central and State Government institutions
- Non-Government Organizations (NGOs)
- Semi-Government institutions
- State and Central Govt. field functionaries
- Panchayati Raj institutions (PRIs)
- Corporate responsibility foundations
- Private sector with special SPV
How to apply?
Eligible organizations should submit their proposals to the respective state office or KVIC. Before sending the proposal for approval to the Steering Committee, they are scrutinized by the officials at the State and the Zonal levels. – https://www.india.gov.in/spotlight/scheme-fund-regeneration-traditional-industries-sfurti
Cluster Selection Criteria
- The clusters should be located near to the concentration of around 500 beneficiary families that includes artisans, traders, service providers, raw material suppliers, etc. Moreover, these clusters should be established within one or a maximum of two subdivisions of a district.
- The clusters should be based on khadi, coir, and rural industries that include pottery, leather, etc.
- The growth potential, sustainability, and opportunity to generate employment are the other factors being considered under the SFURTI scheme.
- Another criterion for cluster establishment is the geographical distribution of the clusters across the country. At least 10% of the clusters are to be located in North-east states of India.
Under the SFURTI scheme, the government planned to develop 70 clusters with a proposed budget allocation of Rs. 149.44 crores. There is a proposal to establish 800 clusters under the 12th five-year plan from the funds sanctioned by the Central government and funding from the Asian Development Bank. The government set a three-year timeline for the implementation of the scheme related to each cluster.
From 2018 to 2020, under the SFURTI scheme, 154 clusters were approved against the earlier set target of 100 by the government.
SFURTI scheme is an aspirational scheme launched in 2005 by the Government of India to establish clusters of rural-based industries in different parts of the country. The aim is to overhaul the rural industries and offer them financial support so that they become competitive, financially viable and profitable. The government has appointed nodal agencies and allocated funds to implement the scheme. The idea is to usher in a revolution in rural-based industries and make them formidable.
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