Evaluation Study MSE Cluster Development - Ministry of Micro ...

Chapter No: 5– The Special Purpose VehcileAs seen in Table 5.3, we have carefully identified eight major factors that affectparticipation and involvement and compiled the responses obtained on these factors.These factors include risk aversion, financial constraints, awareness regarding thebenefits, lack of contact, skepticism regarding the viability and sustainability of the CFC,fear of the monopoly and dominance of strong and more influential players, the free riderproblem, and the appropriateness of the CFC.Table No.-5.3: PARTICIPATION AND INVOLVEMENT IN SPVsSl. Factors AffectingParticipation% Distributionof ResponsesResponses ofSPVsResponsesof ClusterActors1. High Risk Aversion 10 90.90 29 93.54% Distributionof Responses2. Financial Constraints 9 81.81 26 83.873. Lack of Awareness 7 63.63 23 74.19regarding Benefits4. Lack of Contact 5 45.45 15 48.385. Skepticism andDoubts regardingViability6. Fear of the Monopolyand Dominance of afew7. Free Rider Syndrome(or benefitting bythe effort of others)8. Common Facility NotAppropriate (notevolved on the basisof concerns)11 100.00 28 90.323 27.27 25 80.658 72.72 14 45.162 18.18 23 74.19As seen in the table there is a fairly high degree of agreement among the two sets ofrespondents on some factors such as risk aversion, financial constraints, lack ofawareness, skepticism regarding viability, and the free rider problem. The highestdegree of agreement on the above issues is on factors such as skepticism regardingviability, risk aversion, the free rider problem, and the lack of awareness regardingbenefits. The highest degree of disagreement is seen to exist on factors such as theappropriateness of the CFC and the fear of monopoly and dominance of a few strongplayers. The identification of these factors should enable the policy makers tospecifically direct efforts that will effectively lower the impact of such factors, if notremove them altogether. The most feasible policy strategy to effectively solve some ofthese rather intractable problems would be to permit and support the formation of subclusters and SPVs in order to lower the effects of homogeneity based on size and scale ofindividual units. However this would only apply to large and dense clusters with a highdegree of viability and sustainability. It should also be emphasized that the guidelinesand norms related to the SICDP and particularly those related to the role and functionsof the SPV in the creation, management and sustenance of the CFC should be99