Unido seeks govt nod to extend 5-year service network plan

Organisation's programme to introduce new approach to address problems of sector.

The United Nations Industrial Development Organisation (Unido), which has been promoting the small and medium enterprise (SME) sector through various modes of intervention, is in talks with the commerce and industry ministry to extend the five-year country service network programme.

The new strategy, to be implemented between 2007 and 2012, will see more intense and proactive interaction with the government while supporting the SME sector.

"The earlier programme got over in 2006 and we are in the process of discussing the new strategy with the government," said Phillipe R Scholtes, representative and regional director for South Asia operations of Unido. The new five-year plan is likely to require funds worth $32 million out of which around $5 million will be spent every year.

It has identified five focus areas for its future programmes "" rural industrial development, women entrepreneurship, environment, energy sector, as well as development of the SME sector.

The country service network programme of Unido provides support to the SME sector through trade-related technological assistance, clean and environment-friendly solutions as well as special programmes for industrially backward regions like the North Eastern states.

Unido's approach towards providing solutions to SMEs has been through a two-pronged strategy. "While on one hand we provide solutions on aspects like human resource, quality environment management, on the other hand we carry out our activities through the cluster development mode. We feel that for the effectiveness of our services it is not always appropriate and cost effective to work at the level of the enterprises," added Scholtes.

In the last five years, the organisation has helped in developing more than 20 SME clusters in India.

According to Scholtes, through the new five-year programme, Unido will seek a more proactive and intensive relationship with the Indian government. "We are in the process of putting in place a number of procedures to facilitate review as well as identification of cooperation opportunities. In addition, a newer form of joint funding of activities is also under consideration," he added.

Besides, Unido will try a new approach of blending its expertise to address problems of the SME sector. At the moment, it is trying to see if a Corporate Social Responsibility (CSR) model could be developed for SME clusters.

"For big companies, CSR is not a big issue. However, SMEs cannot overlook the importance of CSR and the cluster model will help them in addressing the issue," said Scholtes.

In India since 1967, Unido has also started evolving newer methods of supporting the SME sector. "One such method is the indirect mode of support, which we are implementing for SMEs in Orissa. In this mode, we put a local institution like a development commissioner in the front seat and ask him to develop the cluster. We provide the support as and when it is needed," Scholtes said.

HELP AT HAND

The new strategy, to be implemented between 2007 and 2012, will require funds worth $32 million, out of which around $5 million will be spent every year

The country service network programme of Unido provides support to the SME sector through trade-related technology assistance, clean and environment-friendly solutions

In the last five years, the organisation has helped in developing more than 20 SME clusters in India

Unido has identified five focus areas for its future programmes "" rural industrial development, women entrepreneurship, environment, the energy sector and the SME segment