Small Industries Development Bank of India (SIDBI), the principal financial institution engaged in the promotion, financing and development of micro, small and medium enterprises (MSMEs), has launched various initiatives focused on cluster development, under its developmental ambit.

SIDBI has been supporting MSMEs through its focused cluster development initiatives, such as support for technology upgradation/modernisation, skilling/re-skilling/up-skilling and market linkages. Its cluster development strategy has gradually evolved over a period of time, and now caters to over 600 MSME clusters through its offices and supports the entire value chain (micro finance, missing MSMEs). Some of the unique engagements in clusters include EU Switch Asia in 18 clusters of 9 states, cluster outreach programmes, followed by setting up of project management units (PMUs) in 11 states, with thrust on clusters and state cooperation, state rural livelihood missions (SRLM), artisanal clusters and engagement in one district one product (ODOP) districts of Uttar Pradesh.

SIDBI has been regularly releasing publications, policy papers etc. on MSME development. On Monday Debasish Panda, secretary in the department of financial services at the Union ministry of finance, launched the first of SIDBI’s information series aimed at kindling cluster development, titled “Diagnostic mapping of cluster - Charting the path ahead through intervention”. The book marks the commencement of SIDBI’s focused attention on its clustering strategy, aimed at building and supporting sustainable growth of MSMEs. It compiles findings that emerged out of diagnostic studies in 30 clusters and contains recommendations and action plans for financial and non-financial issues, interventions suggested at the level of policy, cluster and unit. SIDBI is geared to undertake diagnostics of 100 clusters and plans engagement in 15 clusters.

On this occasion, Sivasubramanian Ramann, CMD, SIDBI, said, “SIDBI has identified a multi-pronged strategy to impact local, regional, national and global value chain through MSE clusters. We are giving a thrust to hard infrastructure support to state governments. DFS GoI and RBI have supported us in setting up the SIDBI Cluster Development Fund. The soft infrastructure engagement shall complement the hard infrastructure. In line with cluster experts, we have initiated the mapping exercise of 100 clusters such that implementation by SIDBI and other institutions can lead to sustainable growth of clusters.”

Since the typology of cluster development generally involves hard and soft infrastructure aspects, SIDBI has launched business development services intervention programme in 5 clusters — J&K (Tourism Cluster); Delhi-NCR (Innovation Cluster); Jodhpur (Wood Furniture Cluster); Sambalpur (Textile Cluster); Chennai (Leather Cluster) today. The holistic aim of the intervention is to strengthen clusters to evolve as model clusters, and to increase MSMEs’ access to services, thus help them rise up the value chain.