Smeda launches project 'Economic Revitalisation of Khyber Pakhtunkhwa, Fata'

Small and Medium Enterprises Development Authority (SMEDA) has launched a project "Economic Revitalisation of Khyber-Pakhtunkhwa and FATA" (ERKF) for Rehabilitation Support, up-gradation, Capacity Building and Business Development Support to SMEs, which will be completed with the total cost of US $20 million.
According to SMEDA sources, this project will provide direct support to the affected SMEs. ERKF will provide assistance in the form of matching grants to eligible enterprises. These grants may be used as working capital for reconstruction of basic infrastructure and acquiring/repairing machinery and equipment, etc.
For "Up-gradation Support", project will support the up-gradation of SMEs for improving business productivity and efficiency. Matching grants to eligible individual SMEs for projects as well as to a group of SMEs for cluster development programmes will be provided. These grants could be used for technological innovation, product development, adopting new packaging/labelling requirements, establishing common facility centers (CFCs), etc. Funds may be used for both capital investment and working capital.
SMEDA sources further pointed out that the Capacity Building and Business Development Support will support capacity building of SMEs in partnership with the Business Edge Programme of International Finance Corporation (IFC) and through procurement of business development services (BDS) required by the SMEs.
SMEDA sources explained that the Multi-Donor Trust Fund (MDTF) project 'Economic Revitalisation of Khyber-Pakhtunkhwa and Federally Administered Tribal Areas (FATA)' is a joint initiative for both Khyber-Pakhtunkhwa and FATA to provide support to the Small and Medium Enterprises (SMEs), attract Diaspora investment, and strengthen institutional capacities to foster investment and implement regulatory reforms. The project is a response to the priority interventions identified under the donor-supported Post Crisis Needs Assessment (PCNA) Report. The MDTF for Khyber-Pakhtunkhwa, FATA and Balochistan was established to support the recommendations made in the PCNA report and is being administered by the World Bank on behalf of 10 donors. The Project is going to start in November 2011 and it is divided in three components: 1) SME Development; 2) Investment Mobilisation and 3) Capacity Building to Foster Investment and Implement Reforms. Of the total project funds of US $20 million under the MDTF, USD 14 million has been earmarked for SME Development Component including Khyber-Pakhtunkhwa: $9.1 million, FATA: $4.9 million.