The Scheme of Fund for Regeneration of Traditional Industries (SFURTI) is a flagship initiative of the Ministry of Micro, Small & Medium Enterprises (MSME), Government of India. Launched in 2005 and revamped in 2014, its primary objective is to make traditional industries more competitive, productive, profitable, and capable of sustained employment.
What is SFURTI Scheme?
SFURTI aims to organize traditional industries and artisans into clusters to provide them with long-term sustainability and economic scale. It focuses on a holistic development approach by addressing various aspects, including:
- Infrastructure Creation: Setting up Common Facility Centres (CFCs), Raw Material Banks (RMBs), warehousing, and training centers.
- Technology Upgradation: Providing modern tools, machinery, and production infrastructure.
- Skill Development and Capacity Building: Enhancing the capabilities of artisans through training, exposure visits, and institution building.
- Product Development and Design Intervention: Supporting new product design, quality improvement, and packaging.
- Market Promotion: Assisting with branding, e-commerce initiatives, new media marketing, and participation in trade fairs.
- Strengthening Governance: Promoting active participation of stakeholders to ensure equitable distribution of benefits.
The scheme covers traditional industries like Khadi, Village Industries, and Coir, among others, with a focus on geographically concentrated clusters.
Which organizations are eligible for the SFURTI Scheme?
SFURTI is a cluster-based scheme, and the direct beneficiaries are the artisans and traditional industry workers within a cluster. However, the scheme is implemented through various agencies and institutions.
Implementing Agencies (IAs) / Applicants: These are the organizations that directly manage and implement the cluster development projects on the ground. Eligible organizations for becoming an IA include:
- Non-Government Organizations (NGOs)
- Institutions of the Central and State Governments
- Semi-Government institutions
- Field functionaries of State and Central Government
- Panchayati Raj Institutions (PRIs)
- Corporate Responsibility Foundations (CSR arms of corporates)
- Private sector entities forming cluster-specific Special Purpose Vehicles (SPVs) – these SPVs must be registered under appropriate laws (e.g., Societies Registration Act, Co-operative Society Act, Producer Company under Companies Act, Section 8 Company, Trust).
Criteria for Clusters: A cluster must typically have a geographical concentration of at least 500 beneficiary families (artisans, micro-enterprises, raw material suppliers, traders, service providers) in one or two revenue sub-divisions in a district (or contiguous districts). For North-Eastern Region (NER) and Hilly areas, this number can be lower (e.g., 100 artisans).
Other Key Roles in the Scheme Implementation:
- Nodal Agencies (NAs): These are central coordinating bodies designated by the Ministry of MSME. The primary Nodal Agencies are:
- Khadi and Village Industries Commission (KVIC) for Khadi and Village Industry clusters.
- Coir Board for Coir-based clusters.
- Other agencies of the Government of India may also be designated.
- Technical Agencies (TAs): Experienced institutions, social enterprises, industry organizations, or NGOs that provide technical support to Nodal Agencies and Implementing Agencies. Their roles include preparation of Diagnostic Study Reports (DSRs) and Detailed Project Reports (DPRs), and providing technical expertise.
- Scheme Steering Committee (SSC): Chaired by the Secretary, Ministry of MSME, this committee provides overall policy, coordination, and management of the scheme, including approving projects.
Relevant Documents and Process for Application for SFURTI Scheme
The application process is multi-layered, involving different levels of scrutiny and approval.
Application Process (Generally follows these steps):
- Identification of Potential Clusters: Nodal Agencies (NAs) in consultation with Technical Agencies (TAs) identify potential traditional industry clusters based on geographical concentration, number of artisans, growth potential, etc.
- Preparation of Proposal / Diagnostic Study Report (DSR): An eligible Implementing Agency (IA) working in the identified cluster, often with the support of a Technical Agency (TA), prepares a detailed proposal. This typically starts with a Diagnostic Study Report (DSR) that analyzes the cluster's strengths, weaknesses, opportunities, and threats.
- Preparation of Detailed Project Report (DPR): Based on the DSR, a comprehensive Detailed Project Report (DPR) is prepared by the IA/TA. The DPR outlines:
- Project objectives and interventions (soft, hard, thematic).
- Detailed budget allocation for each intervention.
- Timeline for project implementation (typically 3 years).
- Sustainability plan for the cluster post-project.
- Details of the Implementing Agency (IA) and its capacity.
- Expected outcomes (e.g., increase in production, income, employment).
- Submission of Proposal to Nodal Agency: The IA submits the complete DPR to the respective State Office of the Nodal Agency (KVIC or Coir Board).
- Scrutiny and Vetting: The proposal undergoes scrutiny at the State Level and then at the Zonal Level by the Nodal Agency. They assess the feasibility, adherence to guidelines, and potential impact of the project.
- Recommendation to Scheme Steering Committee (SSC): If approved at the Zonal level, the Nodal Agency recommends the proposal to the Scheme Steering Committee (SSC) at the Ministry of MSME.
- Approval by SSC: The SSC, comprising high-level representatives from various ministries and expert bodies, reviews and grants final approval for the cluster project.
- Formation of Special Purpose Vehicle (SPV): After approval, the IA facilitates the formation and registration of a Special Purpose Vehicle (SPV) by the artisans/entrepreneurs of the cluster. This SPV is crucial for receiving and managing funds and for the long-term sustainability of the cluster.
- Release of Funds: Funds are released by the Ministry of MSME to the Nodal Agency, which then disburses them to the Implementing Agency/SPV based on the approved action plan and progress.
- Project Implementation: The IA, through the SPV, implements the approved interventions (soft, hard, thematic) as per the DPR.
Key Documents (Indicative, based on typical project proposals):
- Registration Certificate of IA: Proof of legal entity (NGO, Society, Trust, Company, etc.).
- Audited Financial Statements: Last 3 years' financial reports of the IA.
- Experience Certificates/Details: Documentation of previous work in community development, cluster development, or traditional industries.
- Diagnostic Study Report (DSR): Detailed analysis of the chosen cluster.
- Detailed Project Report (DPR): Comprehensive plan for interventions, budget, and outcomes.
- Resolution from Governing Body: Authorizing the application and project implementation.
- Land Availability Proof: For Common Facility Centres (CFCs) or other hard interventions (land cannot be acquired with scheme funds; it must be owned or on a long-term lease by the SPV/IA).
- Aadhaar/PAN details of key personnel: Of the IA/SPV.
- Bank Account Details: For fund disbursement.
What are the benefits to Training Organizations and Beneficiaries?
Benefits to Beneficiaries (Artisans and Traditional Industry Workers):
- Enhanced Income and Livelihoods: The core objective is to significantly improve the income of artisans through increased productivity, better market linkages, and value addition.
- Skill Upgradation: Access to modern techniques, design inputs, and digital skills through structured training programs.
- Access to Modern Infrastructure and Tools: Availability of Common Facility Centres (CFCs) with modern machinery, raw material banks, and improved tools, which individual artisans might not be able to afford.
- Improved Product Quality and Design: Support for design intervention, quality certification, and better packaging, making their products more competitive.
- Wider Market Access: Assistance in branding, marketing, participation in trade fairs, and onboarding onto e-commerce platforms (like GeM, ONDC), expanding their reach beyond local markets.
- Sustainable Employment: By strengthening the traditional industries, the scheme provides sustained employment opportunities in rural areas.
- Collective Strength: Artisans are organized into clusters and form SPVs, enabling them to leverage economies of scale, access credit, and collectively address challenges.
- Social and Economic Empowerment: Particularly for women and disadvantaged communities, the scheme fosters entrepreneurship and economic independence.
Benefits to Training Organizations (as part of Soft Interventions):
Training organizations do not directly apply for the overall SFURTI scheme, but they are crucial components of the "Soft Interventions" within an approved cluster project. Implementing Agencies (IAs) engage these training organizations.
- Remuneration for Training Services: Training organizations receive payments from the IA/SPV for conducting skill development and capacity-building programs for the artisans within the SFURTI clusters.
- Opportunity to Contribute to Rural Development: They get to play a direct role in preserving traditional crafts and empowering rural artisans, aligning with social responsibility goals.
- Visibility and Reputation: Partnering in a government-backed scheme like SFURTI can enhance their reputation and provide opportunities for future engagements with government programs.
- Expertise in Traditional Crafts: They gain valuable experience and expertise in understanding the unique needs and training requirements of traditional artisan communities.
- Building Local Capacity: They contribute to creating a skilled workforce within specific traditional industries, which can lead to further opportunities for long-term engagement in the region.
- Infrastructure Utilization: If they have existing training infrastructure, they can utilize it for SFURTI programs.
What is the role of Skill Development in SFURTI Scheme?
Skill Development is a cornerstone and one of the most critical components of the SFURTI Scheme. It falls primarily under "Soft Interventions" and is integral to achieving the scheme's overall objectives. Its role includes:
- Bridging Skill Gaps: Many traditional artisans possess invaluable traditional skills but may lack exposure to modern techniques, tools, and market demands. Skill development programs under SFURTI aim to bridge these gaps.
- Enhancing Productivity and Quality: Training in improved production processes, use of modern tools, and quality control techniques directly leads to higher productivity and better-quality products, making them more competitive.
- Design and Product Diversification: Skill development workshops focus on new product development, design interventions, and adapting traditional designs to contemporary market tastes, helping artisans cater to a wider customer base.
- Entrepreneurship Development: Training covers aspects of entrepreneurship, business management, financial literacy, and marketing strategies, empowering artisans to manage their micro-enterprises more effectively.
- Digital Literacy and E-commerce: In today's digital age, training in digital literacy and e-commerce platforms is crucial for market access. Artisans are trained to leverage online channels for selling their products.
- Capacity Building of Institutions: Beyond individual artisans, skill development also extends to building the capacity of the Implementing Agencies (IAs) and the Special Purpose Vehicles (SPVs) themselves, enabling them to manage the cluster effectively and ensure its long-term sustainability. This includes training in project management, financial management, and governance.
- Promoting Innovation: Exposure to new technologies and processes through skill development encourages innovation within traditional industries.
- Sustainability: By enhancing the skills and capabilities of artisans, the scheme ensures that the benefits of infrastructural and technological interventions are fully utilized, leading to the sustainable growth and regeneration of the traditional industries.
In summary, skill development in SFURTI is not just about teaching a craft; it's about holistically empowering artisans with the knowledge, tools, and entrepreneurial mindset needed to thrive in a modern, competitive market while preserving their rich heritage.
