Cluster plans to get up to 50% state aid

The industries commissionerate under the aegis of the government of Gujarat will fund up to 50 per cent of the cost of projects under its scheme for assistance to cluster development programme.

Normally, the financial assistance will be around 25 per cent of the project cost in case of the training expenditure component and between 25 per cent and 50 per cent of the cost component in other areas.

"The quantum of assistance will be need-based, depending upon the type of proposal and activities covered by the associations, technical and managerial capability of the association, level of maturity, administrative set-up, track record and transparency in operations," D Rajagopalan, principal secretary, state industry and mines department, said.

However, a state-level committee will decide on the financial assistance depending upon the activities covered in the project.

The project proposed should preferably prepared by a recognised institution and should ensure that it contains essential features of a project document like details of the project, project cost and detailed break-up of costs, sources of funds, financial appraisal of the project and in case of debt, the source of revenue for debt repayment and period of repayment.

The assistance will be towards capital investment in the form of a one-time grant. No recurring expenditure will be considered and funds for this purpose should be generated by industries associations and implementing agency.

The total quantum of assistance will be normally not exceeding Rs five crore per cluster for five years. If any project has been granted assistance, subsidy, benefits under any other scheme of the state government, the benefits under the present scheme will not be available.

However, if the project has been assisted by the central government under a government of India scheme, the total benefit under both the scheme shall not exceed over 80 per cent of the project cost.

A state-level approval committee has been constituted to sanction financial assistance on proposals received for cluster development.

Principal secretary, industries and mines, will be the chairman of the committee. Secretary, finance, industries commissioner, additional secretary and deputy secretary, industries and mines will be members in the committee.