 Clustering and aggregation

Clustering and Aggregation

Description Challenges Recommendations

• Cluster is a geographically proximate group of interconnected companies

• Linked by commonalities and complementarities

• Ministries administering Hard and Soft interventions to help the cluster participants

• Plays important role in inclusiveness, efficiency improvement & availability of resources

Clustering and Aggregation

Description Challenges Recommendations

• Diagnostic study of about 471 clusters with weak follow-ups

• Administration by different ministries increases with different terms and conditions procedural hurdles

• Improvement in capacity and soft skills of aggregators

• Lack of trust between participants

• Focus only on MSME, other industries not considered

Clustering and Aggregation

Description Challenges Recommendations

• A Central Cluster Cell (CCC) at apex level.

• Manual which may define Clusters to build trust, brand, identify gaps and assist
.
• Strategies for growing different types of clusters (e.g. hub-and-spoke, high tech) for different sectors

• Assistance Through DICs at district level, NGOs and other reputed institutions

• Soft interventions like capacity building, improving market linkages, product quality & credit
 Clustering and aggregation

 Promoting MSMEs

)
Promoting MSMEs

Description Challenges Recommendations

• Complements large industries as ancillary units and provide various items & support services

• Contributes about 45% of manufacturing output and 40% of total exports of the country

• Employs about 69 million persons in over 29 million units and sell over 6000 products.

• Widely spread in rural & backward areas, help in reducing the migration of workforce in urban

• 11th and 12th plan introduced which lead a growth rate of 13% on average
Promoting MSMEs

Description Challenges Recommendations

• Lack of availability of Credit and Institutional Finance

• Outdated Technology & Innovation

• Need for Skill Development & Training,

• Inadequate Industrial Infrastructure and lack of institution

• Lack of Marketing & poor procurement methods

Promoting MSMEs

Description Challenges Recommendations

• Simplification of loan procedures, easy access to credit and liberal terms. through e-platforms

• Alternative sources of capital such as private equity, venture capital and angel funds.

• Developing technologies with Public/Private R&D institutions and subsidise the industry

• Upscale the training capacities and social security to the unorganized

• Marketing through B2B portals with connectivity to international markets

• Introduction of Khadi mark, strengthening Khadi Institutions

 Clustering and aggregation

 Promoting MSMEs

 Boosting manufacturing export

Boosting manufacturing export

Description Challenges Recommendations

• Growth rate for the manufacturing sector linked with growth rate for the country's exports

• Rate of growth of manufacturing exports was 16.2% in the first four years of 11th plan

• Current level of manufacturing exports is of USD 151.15Bn

• Strategy being developed by the Department of Commerce on doubling India's exports.

Boosting manufacturing export

Description Challenges Recommendations

• Low level of production output

• Very low share of high tech exports

• Non-tariff barriers being placed by countries

• Lack of information and clarity on procedural norms and regulations of various countries
Boosting manufacturing export

Description Challenges Recommendations

• Providing world class infrastructure at ports and airports

• Reduction of transaction cost for exporters, and address non-tariff barriers being placed by countries

• Initiate study to benchmark Indian products with competitors in terms of quality and price
.
• Frequent consultations among Export Promotion Councils, Industry Associations

• Identify the sectors having high technology and high export growth potential Market access

• Conducive trade agreements need to be put in place

 Clustering and aggregation

 Promoting MSMEs

 Boosting manufacturing export

 Reforming PSEs
Reforming PSEs

Description Challenges Recommendations

• Launched post-Independence to promote rapid economic development

• Private investors not accept ventures with high risk, large investments, & long gestation periods

• CPSE’s listed on the stock exchange and few of them have been privatised

• Government increasing flexibility and autonomy to operate effectively in a competitive environment

Reforming PSEs
Description Challenges Recommendations

• Technological gap as these enterprises could not adopt up-to-date technologies

• Lack of skill among executives leading to inefficiencies

• HR policies not updated to keep employees motivated with low pay as compared to private sector

• Operational inefficiencies leading to wastages and leakages of funds in their day-to-day activities

• Lack of transparency and proper auditing leads to a lot of corruption

Reforming PSEs

Description Challenges Recommendations

• Audit of C&AG to cover important cases of indecision and / or delayed decisions

• Technology committee may be set up in every CPSE to identify the technology alternatives

• CPSE board should be empowered to select the partner for JV and companies for acquisition

• Autonomy in compensation policy with increase in variable pay

• CPSEs to prepare their plans for medium to long term recruitment through lateral hiring autonomy

• Set up a strategy and business development committee for every CPSEs

 Clustering and aggregation

 Promoting MSMEs

 Boosting manufacturing export

 Reforming PSEs

 National Investment and

Manufacturing Zones (NIMZs)
National Investment and Manufacturing
Zones (NIMZs)
Description Challenges Recommendations

• NIMZ is a concept propounded in the National Manufacturing Policy of DIPP

• Policy tool to be applied to select zones designated for promoting manufacturing

• Combination of production units, public utilities, logistics solutions, administrative services

• It has a processing area and a non- processing area

National Investment and Manufacturing
Zones (NIMZs)
Description Challenges Recommendations

• Lack of availability of land

• Long procedures for starting of the business

• Unhealthy Labour policies , no proper exit policies

• Need for the encouragement for Green products and practices

• Providing proper supply of power and other essential utilities

• No customs and sales tax or export incentives

National Investment and Manufacturing
Zones (NIMZs)
Description Challenges Recommendations

• External physical infrastructure linkages to the NIMZs including rail, road, ports, airports and telecom

• State Governments would play the lead role in setting up of the NIMZs by providing Land, Power, water

• High Powered committee scrutinizing setting of NIMZ, monitoring the progress of implementation

• Special Incentives like exemption from Central Sales ,Service Tax, single window clearance for approvals

• Low-interest loans for green plants, preference to Green units/ Green products during procurement