Policy and Status Paper on Cluster Development in India

Recently, MSME Foundation has published a book on Policy Status on Cluster Development in India. The purpose of the book is take stock of the last 10 years experience of cluster development approach and its impact on the local economy especially in industrial and artisan clusters. Cluster Development Program (CDP) has become very popular in the last 10 years especially CDP of UNIDO, which started in 1996 with pilot interventions in four clusters ( Tirupur, Ludhiana, Pune and Jaipur). In the last 10 years the approach has roped in 1358 industrial and artisan clusters and till 2007 more than Rs 700 crore have been spend on different cluster based interventions.
There is no doubt that the CD approach has become very popular during this period.
The book highlights that how more than 22 countries in the world evolved their local industrial development around clusters. The approach is now believed to be used in more than 50 countries to help MSMEs in artisans and industrial clusters. It says that there is strong cluster effect in terms of higher efficiency of the firm situated in clusters.
The book suggest that on policy level there are two major challenges these are the right definition of the cluster and mapping of clusters. It suggested accessibility a main criteria for definition however local government may have their own definition of clusters. The focus of for cluster development policy should remain around inclusiveness, equity and competitiveness. The Book harp on the fact that to implement cluster development programme both soft and hard interventions are equally important. It has given 16 policy suggestions for optimum cluster development. The complete book is available at http://www.msmefoundation.org/pdf/cluster%20policy%20and%20status.pdf