Auto component and assemblies MSMEs in the Hubli-Dharwad region of Karnataka will soon be able to reap the benefits of an auto cluster.
The project, called Auto Cluster Hubli Dharwad (ACHD), is being undertaken by the Auto Component Manufacturers’ Association (ACMA) of Hubli-Dharwad, and is scheduled to be ready by the end of April this year, reports The Economic Times.
Under the project, a common facility centre (CFC) will be built at ACHD, which will provide MSMEs in the area access to a wide range of manufacturing facilities and design capabilities. There are also plans to set up a training centre for imparting technical and other skills to MSME owners, in addition to an R&D centre and a raw material bank.
The Centre as well as the state government are providing financial assistance in the creation of the auto cluster. Some local businesses have also invested in the project. The cluster is being developed under the Small Enterprises Cluster Development Scheme (SME-CDS) of the Union ministry of MSMEs.
The Karnataka Council for Technology Upgradation (KCTU) is aiding ACMA in developing the cluster. The project is the brainchild of MG Salimath, ACHD secretary.
An 8,000-sq.ft. area (the shed of Artisan Training Centre) has been leased out by the state’s Industries Department for a period of 30 years.
Ninety percent of the allotted funds have already been released, while the balance 10 percent will be released on completion of the project.
The auto cluster would provide MSMEs with the latest technology under a common roof. ACHD aims at helping MSMEs overcome their shortcomings in technology, thereby improving product quality and productivity, which would, in turn, aid in increasing exports.
It will reduce dependence of the MSMEs on external facilities, as some of the jobs in the manufacturing process have to be outsourced to facilities in Bangalore, Pune and Mumbai, due to high degree of precision. This will give the Hubli-Dharwad MSMEs a higher profit margin, as there would be no need to shell out money for using external facilities.
"Over 150 SMEs are manufacturing auto components, which are free to use the facilities at the CFC. However, first preference will be given to ACMA members who have invested in the project. A nominal fee would be charged for using the facility. Prospective entrepreneurs can also utilise the facilities to design and manufacture new products before commencing mass production," stated Salimath.
He went on to state that the project would also be of great help to large companies like Tata Motors, which plans to expand its operations in Dharwad.
The proposal to set up the auto cluster was made by ACMA in the year 2008, followed by the preparation of a detailed project report. The Centre and State governments approved the INR4.85 crore project.