Context: The Ministry of Micro, Small & Medium Enterprises (MSME) inaugurated 50 artisan-based SFURTI clusters, spread over 18 States, to provide a boost to the MSME sector.

• The Union Minister of MSME has said that 5,000 clusters for artisans can be started under the SFURTI scheme by fast-tracking the approval processes and reducing red-tape.

About SFURTI Scheme

• It stands for Scheme of Fund for Regeneration of Traditional Industries (SFURTI) with a view to organize traditional industries and artisans into clusters to make them competitive and increase their income.
• It is an initiative by Ministry of MSME to promote Cluster development.
• The Khadi and Village Industries Commission (KVIC) is the nodal Agency for promotion of Cluster development for Khadi.

The following schemes are being merged into SFURTI

• The Scheme for Enhancing Productivity and Competitiveness of Khadi Industry and Artisans
• The Scheme for Product Development, Design Intervention and Packaging (PRODIP)
• The Scheme for Rural Industries Service Centre (RISC) and
• Other small interventions like Ready Warp Units, Ready to Wear Mission, etc.

The SFURTI clusters are of two types

• Regular Cluster (500 artisans) with Government assistance of up to Rs.2.5 crore and
• Major Cluster (more than 500 artisans) with Government assistance up to Rs.5 crore

Objectives of the SFURTI Scheme

• To provide sustained employment for traditional Industry artisans and rural entrepreneurs
• To enhance marketability of products of clusters by providing support for new products, design intervention and improved packaging, and also the improvement of marketing Infrastructure
• To equip traditional artisans of the associated clusters with improved skills and capabilities through training and exposure visits
• To make provision for common facilities and improved tools and equipment for artisans
• To strengthen the cluster governance systems with the active participation of the stakeholders, so that they are able to gauge the emerging challenges and opportunities and respond to them in a coherent manner
• To build innovative and traditional skills, improved technologies, advanced processes, market intelligence and new models of public-private partnerships, so as to gradually replicate similar models of cluster- based regenerated traditional Industries

Significance of SFURTI Scheme

• Its primary objective is to organise traditional industries and artisans into clusters to make them competitive and increase their income.
• It provides support for creating infrastructure through Common Facility Centres, procurement of new machineries, creating raw material banks and improved packaging.

Need for revamping SFURTI Scheme

• It is required to step up the pace of formation of such clusters since only 82 of the 371 announced so far are actually functional.
• The target of 5,000 clusters is easily achievable if red-tape can be reduced.
• The government is looking to increase the share of MSME sector in the country's GDP to 40 per cent from the current 30 per cent and share of exports to about 60 per cent from 48 per cent.
• The government has set a target of creating 5 crore new jobs in the next five years in MSME.

Eligibility under SFURTI Scheme

• The institutions eligible under SFURTI Scheme are Non-Government organizations (NGOs), Institutions of the Central and State Governments, Semi-Government institutions, Field functionaries of State and Central Govt and Panchayati Raj institutions (PRIs).
• The Eligible agencies/organizations may submit the proposal to the State Office, KVIC and the same is scrutinized at the State Level and Zonal Level before submitting to the Scheme Steering Committee for approval.

Other Recent Initiatives to Promote MSME Sector

• Udyog Aadhaar Memorandum (UAM): It is a simple one-page registration form to promote ease of doing business for MSMEs in India.
• A Scheme for Promoting Innovation, Rural Industry and Entrepreneurship (ASPIRE): The scheme promotes innovation & rural entrepreneurship through rural Livelihood Business Incubator (LBI), Technology Business Incubator (TBI) and Fund of Funds for start up creation in the agro-based industry.
• Credit Guarantee Fund Scheme: To facilitate easy flow of credit, guarantee cover is provided for collateral free credit extended to MSMEs.
• Prime Minister’s Employment Generation Programme (PMEGP): It is a credit linked subsidy scheme, for setting up of new micro-enterprises and to generate employment opportunities in rural as well as urban areas of the country.
• Credit Linked Capital Subsidy Scheme (CLCSS) for Technology Upgradation: CLCSS aims at facilitating technology upgradation of Micro and Small Enterprises (MSEs) by providing 15% capital subsidy for purchase of plant & machinery.