Aimed at increasing the competitiveness and productivity of micro and small enterprises, the Centre’s micro and small enterprises cluster development programme (MSE-CDP) has a completion rate of just over 50 per cent in the last six financial years. As per the data from the Ministry of MSME, around 153 of the total approved projects have been completed under the programme since the financial year 2017-18 (FY18). In FY24, 40 out of 46 approved projects were completed.
As per the data, the rate of completion witnessed a slowdown from FY20 to FY23. During the financial year 2020, 22 projects were completed out of 73 approved projects. The situation remained similar in FY21 and FY22 when only 36 projects were completed against the approval of 99 projects. In FY23, out of 28 projects, only 3 were finished by the end of the year.
The completion rate picked up in FY24 as 40 out of 46 approved projects were completed during the year. The budget estimate for the year was Rs 150 crore, which proved to be insufficient against the total expenditure of Rs 178.96 crore.
Under the scheme, the Centre not only provides financial grants to set up common facility centres (CFC) in existing clusters but also helps in creating new or upgrading existing industrial areas and factory complexes.
To set up CFC, the Centre provides financial assistance on two fronts. If the overall cost of the project is between Rs 5 to 10 crore, the centre provides grants of up to 70 per cent of the cost. On the other hand, if the project cost ranges between Rs 10 to 30 crore, the grant by the government is up to 60 per cent. However, if the cost exceeds Rs 30 crore, the financial grant is given after taking into account the maximum eligible cost of the project (Rs 30 crore).
As far as infrastructure development is concerned, the grant is limited to 60 per cent of the project cost in case the estimated cost to set up a new industrial estate ranges between Rs 5 to 15 crore.
