The scheme works on a cluster development program with the support of different agencies.
These agencies help in setting up clusters of artisans with the financial aid provided by the Government.
Implementation of the SFURTI scheme undergoes under the following agencies:
- Nodal Agency.
- Technical Agency.
- Implementing Agency.
All these agencies are monitored by the Scheme Steering Committee (SSC), which is representative of the Ministry of MSME.
Technical Agency assists the Nodal Agency and the Implementing Agency in setting up a cluster. It assists in the preparation of the business plan, Detailed Project Report (DPR), marketing plan and plan details of the financial assistance required for a Cluster.
A Technical agency forms a bridge between the working requirements of both NA and IA. It helps in resolving issues related to the compliance and funding requirements of both agencies.
In this article, we will go into the details about the Technical Agency, its criteria for appointment and roles and responsibilities along with what kind of assistance it provides under SFURTI.
- Criteria For Appointment of a Technical Agency
- Role and Responsibility Under SFURTI
- Hand Holding Assistance by Technical Agency
- How are TAs Paid?
Criteria For Appointment of a Technical Agency
A Technical Agency (TA) is a national-level institute with proven expertise in artisanal and small enterprise cluster development.
The TA shall have experience in providing technical preparation and validation of Cluster Action Plans and do monitoring clusters and submitting reports quarterly to the Nodal Agency.
The procedure for appointing a TA begins with the publication of an Expression of Interest (EOI), seeking a proposal by the general public by NA in any leading national newspaper.
On receiving applications, the NA shortlist the candidates based on a technical evaluation of their proposal, mostly on the following terms:
- Net Worth of the organization.
- Organizational experience in implementing projects of similar nature especially artisans and micro-enterprise-based developmental initiatives.
- Competence of personnel and team;
- Geographical presence; and
- Any other parameter as deemed fit by the NA/SSC.
TA will be appointed and assigned to a specific cluster as per the evaluation made on the above criteria. However, an institute can directly approach the Ministry or any Nodal Agency to get appointed as a TA. A single TA can be appointed on multiple clusters.
Role and Responsibility Under SFURTI
As per the scheme, a TA has the following roles and responsibilities:
- Sensitization and awareness generation in the cluster about the scheme
- Identification of potential IAs
- To identify products or a mix of products for a given Cluster. Creating linkages with other available networks of clusters.
- Preparation of Detail Project Reports containing the details such as the business model for self-sustenance, skill up-gradation of artisans, acquiring of new skills, setting up of physical and financial outcome targets for the project, a percentage prediction of enhancement of productivity and earning of artisans, brand building, product segmentation, promotion and advertisement through regular publicity modes and participation in fairs and exhibitions, exploring possible export avenues with clear targets etc.;
- Assisting the IA in establishing and structuring the project-specific.
- Assist the NAs/ SSC in examining proposals for approval.
- IA will receive assistance from TA in formulating plans, getting approvals, obtaining clearances from statutory institutions, identifying suitable technologies/ equipment for value addition of products and will assist in setting up of CFC after identification of land by the IA.
- TA will assist IA in formulating a Sustainability Roadmap for the Cluster detailing the exit strategy for the IA, which is a plan for business operations of the cluster beyond the project duration.
- TA adopts a suitable business plan detailing the revenue model based on an appropriate user fee, and mechanism to enable the SPV to achieve the projected outcome in terms of production, employment, sales, wages and overall complete income generation from a Cluster as projected in a DPR.
- TA will assist the IA/SPV in the engagement of a Design House/ Designer with appropriate terms of reference and detailed scope of work for extending appropriate input of design, product processing, product development and packaging of cluster products.
- To assist IA/ SPV in the engagement of Business Development Services (BDS), which means assisting in sourcing/ improving tools and equipment, developing strategies for its efficient use and implementing best practices for credit linkage.
- TA will advise IA / CDE to make plans for procurement of raw materials, along with tools and types of machinery and other processes, as identified and mentioned under DPR. It includes the distribution of tools/kits and charkhas/implements among the artisans as a part of Cluster Level Intervention as per DPR.
- TA will formulate a marketing strategy and detailed plan in consultation with NA and IA regarding the following:
- Product development
- Product pricing
- Product positioning and promotion
- Product mix/ diversification.
- Dealer/ Distribution Network under offline marketing mode.
- Tapping the export potential through appropriate interventions.
- Other miscellaneous activities that need to be ensured by IA shall require close supervision by TA;
- Awareness and exposure visit of artisans.
- Mandatory opening of Bank Accounts by artisans under Jan Dhan Yojana.
- Health insurance of all the artisans under the cluster as applicable under KVIC rules (Jana Bima Yojana & Rashtriya Swastya Bima Yojana wherever applicable.)
- Enrolling under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), which will offer a renewable one-year life cover of 2 Lakh to all savings bank account holders in the age group of 18-50 years, covering death due to any reason, for a premium of Rs 330 per annum or as applicable.
- Enrolling under the Pradhan Mantri Suraksha Bima Yojana (PMSBY) which will offer a renewable one-year accidental death-cum-disability cover of 2 Lakh for partial/permanent disability to all savings bank account holders in the age group of 18-70 years for a premium of Rs 12 per annum per subscriber or as applicable.
- Issue of Aadhaar-based Identity card to artisans mentioning the benefits, privileges, and rights as well as their specific responsibilities along with necessary undertakings regarding the implementation of the program.
- The Atal Pension Yojana (APY) will focus on the unorganized sector and provide subscribers with a fixed minimum pension of Rs.1,000, Rs.2,000, Rs.3,000, Rs.4,000 or Rs.5,000 per month, starting at the age of 60 years, depending on the contribution option exercised on entering at an age between 18 and 40 years. Pension and similar other financial benefits as applicable to be provided Aadhaar is linked.
- Periodic training of Artisans.
- Self Help Groups (SHGs) members may also be extended to these general and miscellaneous supports as extended to the artisans under the Cluster
- TA will assist IA / SPV in the implementation of thematic interventions focusing on branding, e-marketing, new media marketing, innovation, research and development etc. for further expansion of Clusters.
- Assisting the SPV in mobilizing additional funds for the project. The assistance will aid SPV in the preparation of proposals and claims from relevant schemes by the Government apart from tying up loans from the bank.
- TA will facilitate a Technical Consultant in designing appropriate technologies for the cluster within the allocation ceiling for the respective cluster type.
- TA will assist in the identification of training institutions and will define course duration, fees and other requirements for a cluster.
- Provide assistance to NA seeking approval from the State Government / UT before submission of DPR to SSC for final approval.
- TA shall create a system for online reporting of progress to NA, as well as to the Ministry of MSME on a monthly & quarterly basis.
- At the end of the project, the TA will prepare documentation covering entire activities, preparation of case studies and photo/ video documentation along with an end-project report articulating the outcomes in terms of productivity and sales.
- To prepare an exit strategy for the IA and plan a sustainability roadmap for a cluster with a business plan for the next five years beyond the project duration.
Also Read: How Funding of a SFURTI Cluster Works?
Hand Holding Assistance by Technical Agency
A Technical Agency will provide support via ‘handholding’ to NA and IA. It includes assistance in the preparation of DPR, Diagnostic Study Report (DSR), validation of Cluster Action Plan, and conducting training for Cluster Development Executives (CDEs).
By handholding support of TA, the NA and IA receive the following assistance:
- Preparing business plan
- Cluster development plan
- Making provisions for financial assistance.
- Helping IA in compliance & departmental issues with the Government or Ministry.
- Helping NA with the marketing of products.
- Preparing a sustenance model for the cluster
- To develop an exit plan for the cluster.
How are TAs Paid?
A Technical Agency is paid for its professional services and administrative expenses imposed upon it. The payment of services is made by the Nodal Agency after sanctioning funds by the Scheme Steering Committee.
It is the responsibility of NA to make payments to TA on a per-cluster basis. The payment methodology will encourage a successful fee-based model, linked to milestones achieved.
A TA is paid 50% of the cost to be accrued by it on the approval of the project.
Thereafter, on submission of the Utilization certificate and use of 2/3rd of the released amount, the remaining 50% of the cost to TA is released by the Nodal Agency.
Technical Agency is involved in providing necessary services in cluster development. For context, if a Nodal Agency is the body, then the Implementing Agency is the arms and legs of the body and the Technical Agency is the spine.
These three agencies work in synergy, in their respective fields for cluster development.
We have understood in length that the TAs play an important role after the identification of the cluster to prepare the roadmap for generating business and leveraging the market opportunities for the cluster. The primary task is to carve out a plan for identifying the product, the market scope and the method of generating the sales plan for the cluster.
The TA also helps in providing proper training to the artisans and craftsmen by providing them with market-specific designs suitable for meeting the demand. They further help in establishing CFC (Common Facilities Centres) for providing proper training by use of machines and modern-day technologies and raw materials.
SF Consultant works as a Technical Agency under the SFURTI.
As of now, it has assisted in the creation of multiple clusters with different Nodal Agencies such as COHANDS, KVIC, and FMC. We have a team of top-notch professionals engaged in managing and developing SFURTI-related projects.
To avail our services, please send us your details and requirements, and we will be glad to assist you in your venture.