SFURTI - Scheme of Fund for Regeneration of Traditional Industries Last Updated : 24 Aug 2019

The scheme was launched in 2005 by the Ministry of Micro, Small, and Medium Enterprises (MSME), Government of India in order to make traditional industries more competitive and productive. To support of the growth of such industries, a fund was set up for the regeneration of traditional industries.

Though the SFURTI scheme was successful, there was a need to improve the competitiveness and sustainability of the clusters when it was evaluated. Therefore, the Revamped SFURTI scheme was set up to improve the sustainability of these clusters beyond the duration of the project. The revamped scheme also added many features to its clusters.

Under the scheme, the duration by which the project must be implemented is 3 years. The working capital provided by the scheme will be 20% of the hard intervention. However, the cost of land will not be provided under the scheme. The land must be owned by the Implementing Agency.

Objectives of the Revamped SFURTI scheme

As per a notification of the guidelines by the Indian Government on 1 August 2014, the objectives of the revamped SFURTI scheme are:

  • To provide workers with improved equipment and tools, and also set up common facilities.
  • To help rural entrepreneurs and traditional industry workers get support in employment.
  • To provide training and exposure to traditional workers to improve their skills and capabilities.
  • In case there is a market infrastructure improvement, design intervention, and launch of new products, the scheme aims to help clusters by increasing the marketability.
  • To arrange traditional industries and their workers into clusters in order to make them more competitive and help in their long-term sustainability.
  • By involving the stakeholders participate in the cluster governance system so that any difficulties can be faced in a reasonable manner.
  • To improve the traditional skills, advanced processes, new models of public-private partnerships, and market intelligence so that these ideas and skills can be used in the regenerated traditional industries that are cluster-based.
  • To look into E-commerce for marketing because of its vast reach and growth in the market.

Nature of Assistance that is provided under the Revamped SFURTI scheme

The Revamped SFURTI provides financial assistance based on the different categories:

Type of cluster Number of artisans Finance Provided
Heritage 1000-2500 Rs.8 crore
Major 500-1000 Rs.3 crore
Mini Up to 500 Rs.1.5 crore

However, for clusters present in North-Eastern states and hill stations, each cluster can get a reduction of 50% on the number of artisans.

Eligible institutions and organisations

The institutions and organisations that are eligible under the scheme are:

  • Non-Government Organisations (NGOs)
  • Institutions of State and Central Government
  • Semi-Government institutions
  • Field Functionaries of State and Central Government
  • Panchayati Raj Institutions (PRIs)

Similar agencies with the suitable skills to undertake such clusters are also eligible under the scheme.

Procedure to apply

The eligible agencies or organisations must submit their proposal to the State Office, Khadi and Village Industries Commission (KVIC). The proposal must be inspected and examined thoroughly at Zonal Level and State Level before sending it for approval to the Scheme Steering Committee.

The scheme will be provided with the overall management support, coordination, and policy guidelines by the Ministry of Micro, Small, and Medium Enterprises. The Secretary of the MSME will be the chairman of the Scheme Steering Committee.

Selection of clusters

Based on the geographical concentration, the clusters are selected. Geographical concentrations must consist of about 500 beneficiary families consisting of service providers, traders, raw materials suppliers, micro enterprises, etc. The beneficiary families must also be located between one or two revenue sub-divisions in a district. The cluster can be from village, coir, and khadi industries which can include pottery and leather. While selecting the clusters under the scheme, employment opportunities and production growth will also be looked at. The distribution of clusters throughout India (a minimum of 10% in North-Eastern states) will be considered when selecting a cluster.

Different types of interventions and their activities

The different kinds of interventions under the scheme are:

  • Soft Interventions
  • Hard Interventions
  • Thematic Interventions

Activities of these interventions

1. Soft Interventions

Soft Interventions consist of the below-mentioned activities:

    • Design and product development
    • Development of institutions
    • Trust building, motivation, general awareness, and counselling
    • Capacity building and skill development
    • Exposure visits
    • Participating in training programmes, workshops, and seminars on technology upgradation.
    • Initiatives in market promotion.

2. Hard Interventions

Hard Interventions consist of the below-mentioned creations:

    • Value addition and processing centre products
    • Warehouse facility
    • Production infrastructure upgradation
    • Common facility centres (CFCs)
    • Training centre
    • Technological and tools upgradation
    • Raw material banks
    • Setting up of facilities; in case packaging is needed for various products

3. Thematic Interventions

Apart from hard and soft interventions, the scheme also helps in sector-level cross-cutting thematic interventions. The importance of these interventions is given to international and domestic markets. The activities under this intervention are mentioned below:

    • Providing institutional linkage with proposed and existing clusters.
    • Research and development initiatives
    • Innovation
    • E-Commerce initiatives
    • New media marketing
    • Brand building and promotion campaign

Nodal, Technical, and Implementing Agencies

  • Nodal Agencies: The Nodal Agencies for the scheme will be the Khadi and Village Industries Commission (for Khadi and Village Industry clusters) and the Coir Board (for Coir-based clusters)
  • Technical Agencies: National level institutions that have been established and have knowledge in small enterprise and artisanal cluster development will be designated as Technical Agencies. Technical Agencies will provide support and help in the handling of the SFURTI clusters.
  • Implementing Agencies: The Implementing Agencies under the scheme would be Panchayati Raj Institutions (PRIs), State and Central Government field functionaries, Central and State Government Institutions, Semi-Government Institutions, and NGOs. However, these agencies and institutions must have the skills to help in cluster development. Each cluster will be assigned one Implementing Agency. However, if the agency has state-wide coverage, more clusters can be assigned. Nodal Agencies will select the IAs based on their experience at the basic level as well as their reputation in the region.

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