SFURTI – Scheme of Fund for Regeneration of Traditional Industries

SFURTI - Scheme of Fund for Regeneration of Traditional Industries

What is the SFURTI scheme?

This scheme is a support scheme by MSME, which promotes traditional industries, artisans, and producers by organising them into clusters and helping them becoming functional.

What are the key objectives of the SFURTI scheme?

SFURTI scheme provides artisans from traditional industries, with sustainable employment using financial help, infrastructure upgradation, and equipping them with relevant skills and equipment.

In this scheme, value-added products and services are also promoted through E-commerce platforms like Amazon, Flipkart, etc apart from marketing tie-ups.

Various modern technologies whose importance has become apparent in businesses and industries across the globe are implemented under the SFURTI scheme. Some of such technologies are:

Industry 4.0 is a technology that is used to manage and enhance manufacturing processes and supply chains to improve efficiency and production.
Blockchain is a technology that is used to safely store data in a Peer to Peer network which does not allow any third party to access or manipulate the data.
The Internet of Things allows the physical object with sensors, processing abilities and communication hardware, to be interconnected in a single network which allows communication between the devices and enables easy monitoring of those objects.

SFURTI scheme not only supports the marginalised communities like SCs, STs, OBCs, etc but also focuses on accessing North-East districts, Hilly districts, Aspirational districts, etc. for setting up traditional industry-based clusters and preserving endangered art and crafts which these areas are famous for.

Project duration:

The timeframe for the implementation of the project will be 12 months for Regular Clusters and 18 months for Major Clusters.

Aside from Government bodies, any private entity, NGO, Farmer Producer Organisations and Special Purpose Vehicle companies are eligible to apply for the SFURTI scheme.

Implementing Agencies are organisations with prior experience in handling cluster development activities in one or more sectors.

An Implementing Agency can apply for the SFURTI scheme after submitting a concept proposal and fulfilling the required criteria.

Special Purpose Vehicle is an entity that is created to look after cluster operations and ensure its sustainability after the project implementation period is over.

An Implementing Agency can apply for the SFURTI scheme by filling out the application form on the SFURTI portal followed by submission of the concept proposal to any Nodal Agency of their choice.

Nodal Agencies are national-level organisations with expertise in various sectors of the Traditional Industries.

Once the Proposals are selected the Nodal Agency can engage an approved Technical Agency to work with the Implementing Agency and develop a Detailed Project Report as per the guidelines issued by the Ministry.

A Technical Agency is an entity with expertise in artisanal and small enterprise cluster development. It provides handholding support to the SFURTI clusters during the project implementation and technical support to their respective Nodal Agency as well as the Implementing Agencies.

After fulfilling all the regulations, the Detailed Project Report shall be appraised and approved by the Scheme Steering Committee, constituted under the chairpersonship of the Secretary (MSME).

The total cost of the project shall include Hard Interventions cost, Soft Interventions cost, cost of services of Technical Agency and costs incurred by the Implementing Agency for hiring a Cluster Development Executive as well as other administrative expenses incurred by the Technical Agency.

Cluster Development Executive is an agent engaged by the Implementing agency who is responsible for the implementation of the project in the cluster as per the guidelines in the Detailed Project Report.

Soft Interventions are activities such as general awareness, training, skill development, capacity building, exposure visits, marketing tie-ups, and other initiatives that are undertaken for cluster development.

Hard Interventions are activities such as the construction of Common Facility Centres, Procurement of machinery and Raw Material Bank, tool upgradation and other activities to facilitate the production under the SFURTI project.

The maximum/total financial assistance shall be subject to Rs. 5 Crores per cluster for Major clusters (more than 500 artisans) and up to Rs. 2.5 Crores per cluster for Regular Clusters (up to 500 artisans).

For Soft Interventions, a financial limit equal to 10% of the Hard intervention cost or Rs. 25 lakhs, whichever is less, is set for each approved project.

Up to 90% of the funds approved for Hard Interventions are provided by the Government of India while the remaining 10% has to be contributed by the respective Implementing Agency or Special Purpose Vehicle.

In the case of North East Regions, Jammu & Kashmir, and Hilly areas, 95% of the funds approved for Hard Interventions are provided by the Government of India while the remaining 5% has to be contributed by the respective Implementing Agency or Special Purpose Vehicle.

Up to 5% of Hard Interventions cost or Rs. 15 lakhs, whichever is less, is allotted to Technical Agency for its services. In the case of North East Regions, Jammu & Kashmir, and Hilly areas, it can go up to 6% of Hard Interventions cost or Rs. 18 lakhs, whichever is less.

Up to 8% of the Hard Interventions cost or Rs. 20 lakhs, whichever is lesser, is allotted to IA for its services, including the appointment of a Cluster Development Executive.

After the project approval by the Scheme Steering Committee 50% of the Soft Intervention, 50% of the Hard Intervention, 50% of the Implementing Agency cost and 50% of the Technical Agency cost are released to the Nodal Agency.

Once 2/3rd of the released amount has been utilised for the interventions as per the DPR, the remaining 50% of the Soft Intervention, 50% of the Hard Intervention, 50% of Implementing Agency cost and 50% of the Technical Agency cost is then released to the Nodal Agency, following the submission of a utilisation certificate.

Disclaimer: This is the scheme outline prepared for informational purposes only. Please refer to the ministry website, latest notification, and documents for details. Nisarg Foundation would not be liable for any accuracy in this document.

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