Scheme of Fund for Regeneration of Traditional Industries (SFURTI Scheme)

SFURTI stands for Scheme of Fund for Regeneration of Traditional Industries. It is an important initiative launched by the Government of India under the Ministry of Micro, Small and Medium Enterprises (MSME) to promote the revival, modernisation, and sustainable development of traditional industries and handicrafts in India. The scheme aims to enhance the productivity and competitiveness of these industries through cluster-based development, technology upgradation, skill training, and improved market access.

Background and Launch

Traditional industries such as handicrafts, handlooms, coir, bamboo, khadi, and village industries have historically played a vital role in India’s rural economy. However, over time, these industries faced challenges due to lack of modern technology, inadequate infrastructure, poor marketing linkages, and competition from large-scale industrial products.
To address these issues, the SFURTI Scheme was first launched in 2005 by the Ministry of MSME, in collaboration with the Khadi and Village Industries Commission (KVIC) and the Coir Board. The scheme was later revamped in 2015 to include a broader range of traditional industries and to align with the government’s vision of inclusive and sustainable economic growth.

Objectives of the Scheme

The SFURTI Scheme is designed with the following key objectives:

• Regeneration of Traditional Industries: To revitalise India’s traditional and heritage industries by organising artisans and workers into self-sustaining clusters.
• Enhancing Competitiveness: To improve productivity, quality, and market potential through the adoption of modern tools, equipment, and techniques.
• Employment Generation: To create sustainable employment opportunities in rural areas, especially for artisans, women, and marginalised communities.
• Skill Development: To provide training and capacity-building for workers to upgrade their technical, managerial, and marketing skills.
• Market Linkages: To strengthen access to domestic and international markets through branding, e-commerce integration, and participation in trade fairs.
• Sustainability: To promote environmentally sustainable practices and energy-efficient technologies in traditional industries.

Implementing Agencies

The implementation of the SFURTI Scheme involves a multi-tier institutional framework:

• Nodal Agencies:
  • Khadi and Village Industries Commission (KVIC) – the primary nodal agency for khadi and village industries.
  • Coir Board – for coir-based industries.
  • Other nodal agencies such as Tribal Cooperative Marketing Development Federation (TRIFED) and National Small Industries Corporation (NSIC) may be designated for specific clusters.
• Implementing Agencies (IAs):
  • Responsible for executing cluster projects at the ground level.
  • Include government departments, NGOs, cooperatives, institutions, and private sector organisations.
• Technical Agencies (TAs):
  • Provide technical guidance, capacity building, and business development services to clusters.

Components and Structure

The SFURTI Scheme operates through a cluster-based approach, where groups of traditional industry artisans and enterprises are organised into clusters for collective growth.
1. Cluster Formation and Development:

• Clusters are formed based on geographical and product-specific concentration of traditional industries.
• Each cluster includes around 500 to 1000 artisans, depending on the industry type.

2. Financial Assistance:

• The scheme provides financial support for:
  • Common Facility Centres (CFCs),
  • Raw material banks,
  • Training facilities,
  • Packaging, branding, and marketing support.
• The maximum financial assistance under the scheme varies by cluster type:
  • Regular Cluster: Up to ₹5 crore.
  • Major Cluster: Up to ₹8 crore.

3. Infrastructure Development:

• Establishment of common workspaces, storage facilities, and production units.
• Installation of modern tools and machinery to enhance efficiency and quality.

4. Capacity Building and Skill Training:

• Conducts workshops, technical training, and entrepreneurship development programmes for artisans and workers.

5. Market Promotion and Branding:

• Support for participation in exhibitions, trade fairs, and e-commerce platforms.
• Development of distinct brand identities for cluster products.

Types of Clusters under SFURTI

• Heritage Clusters: Focus on industries preserving traditional crafts and cultural heritage (e.g., khadi, handloom, pottery, brassware).
• Major Clusters: Larger clusters involving extensive product lines and high market potential.
• Regular Clusters: Medium-sized groups of artisans producing traditional goods in rural and semi-urban areas.

Funding Pattern

The financial support under SFURTI is shared between the Government of India and the Implementing Agency, depending on the project type:

• Government Contribution: Covers 75–90% of the total project cost, including infrastructure, training, and market promotion.
• Implementing Agency Contribution: Covers the remaining portion, often through convergence with other government schemes or private investment.

Achievements and Impact

Since its inception, SFURTI has supported the development of hundreds of clusters across India, leading to the empowerment of thousands of rural artisans.

• Over 450 clusters have been approved under the revised scheme (as of the latest data).
• Traditional industries such as coir, bamboo, khadi, pottery, honey, and textiles have benefitted from modernisation.
• Improved incomes and working conditions for artisans due to better tools, design, and market exposure.
• Integration of clusters with digital marketing and e-commerce platforms such as GeM, Amazon Karigar, and Tribes India.

Challenges

Despite its achievements, the SFURTI Scheme faces several implementation challenges:

• Administrative Delays: Complex coordination between agencies and funding bodies can slow down project execution.
• Limited Awareness: Many rural artisans remain unaware of available benefits and training programmes.
• Marketing Constraints: Global competition and limited branding often restrict market access.
• Sustainability Concerns: Some clusters struggle to maintain self-sufficiency after the completion of government support.

Complementary Schemes

SFURTI works in conjunction with other MSME and rural development initiatives such as:

• A Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship (ASPIRE),
• Coir Udyami Yojana,
• Prime Minister’s Employment Generation Programme (PMEGP), and
• One District One Product (ODOP) scheme.