Gujarat has scope for 16 new SME clusters: ASSOCHAM

As against the existing six clusters in Gujarat recognised by the Ministry of Micro, Small and Medium Enterprises (MSME), the Associated Chambers of Commerce and Industry of India (ASSOCHAM) has suggested the development of 16 new clusters which could accommodate 32,000 small and medium enterprises and provide 6.5 lakh jobs directly and indirectly.

In a study released by the Gujarat Council of ASSOCHAM on Wednesday, the industry body has suggested allocation of Rs 500 crore to provide basic and essential infrastructure in the proposed clusters.

"Cluster development not only creates the huge employment at the lowest cost but also brings prosperity and inclusive growth around these regions because the growth in cluster development aids growth in catchment area by way of increased demand of consumer goods and services, increase in the per capita earning and availability of resources of social infrastructure," said Sunil Kakkad, chairman, ASSOCHAM Gujarat Council.

The chamber has also recommended creation of statutory body of Cluster Development Authority (CDA) for the purpose of proper utilisation of fund for development and to assist them in gearing up their growth space. The 16 clusters suggested by the ASSOCHAM include those in Rajkot, Surat, Ahmedabad, Gandhinagar, Gondal, Wankaner, Mehsana, Jamnagar, Morbi, Dhoraji, Bhavnagar, Ankleshwar, Vijapur, Choryasi, Savarkundla and Kalol.

"The MSME sector contributes around 40 per cent to GDP with an estimated value of goods and services around Rs 20 lakh crore for the year 2009-10. The number of clusters assisted by the government are around 450 as against unassisted clusters of around 6,000. The clusters play a major potential role in creation of jobs, cost competitiveness, better quality, enhanced productivity, improved infrastructure, wider export market and face overseas competition head on," said DS Rawat, national secretary general, ASSOCHAM.

Meanwhile, in a sample survey covering five clusters in five locations, it has been assessed that assisted clusters showed 20-30 per cent overall improvement in income generation, social welfare, product quality and raw material consumption and skill improvements.

Moreover, due to non-availability or access to government assistance to majority of clusters, the monetary loss could be around Rs 1,000 crore on account of loss of manufacture of goods and services and job loss of around 2-3 lakhs in a single year.