an analytical report on role of unido

8/9/2019 An Analytical Report on Role of UNIDO

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ASSIGNMENT

ON

An analytical report on role of UNIDO in India¶s economic development

SUBMITTED TO SUBMITTED BY

PROF.RESHAM CHOPRA GAGAN SINGH

MOHIT MALVIYA

SHAILESH PATEL

VIJAY PATEL

VARSHA NATHANI



UNIDO ± INTRODUCTION

UNIDO is the specialized agency of the United Nations that promotes industrialdevelopment for poverty reduction, inclusive globalization and environmental

sustainability.

The United Nations Industrial Development Organization (UNIDO) is aspecialized agency of the United Nations. Its mandate is to promote and acceleratesustainable industrial development in developing countries and economies intransition, and work towards improving living conditions in the world's poorestcountries by drawing on its combined global resources and expertise.

In recent years, UNIDO has assumed an enhanced role in the global developmentagenda by focusing its activities on poverty reduction, inclusive globalization andenvironmental sustainability. Our services are based on two core functions: as aglobal forum, we generate and disseminate industry-related knowledge; as atechnical cooperation agency, we provide technical support and implement

projects.

Today, the Organization is recognized as a highly relevant, specialized andefficient provider of key services in support of the interlinked challenges of reducing poverty through productive activities, promoting the integration of developing countries in global trade through trade capacity building, fostering

environmental sustainability in industry, and improving access to energy.

Our long-term vision is to aspire to a world of opportunity where progress isequitable, accessible and sustainable and where the alleviation of poverty isconsidered a common aim and global responsibility. UNIDO's role is that of aninformed institution, in tuned with the goals of its partners and capable of makingan effective contribution to industrial development and sustainable development.

UNIDO MISSION AND PRIORITIES

UNIDO's mission is to improve the quality of life of the world¶s poor through

sustainable industrial development.

We work with developing countries and economies in transition, where we promote and accelerate industrialization as a source of economic growth needed to



fight poverty. At the same time, we help protect the environment by supportingclean and sustainable industrial development.

Within this context, UNIDO mobilizes knowledge, skills, information andtechnology to deliver on the mandate given by its Member States and to contributeto the achievement of theMillennium Development Goals (MDGs). In keepingwith its mandate, UNIDO focuses its resources on projects designed to help the

poorest nations and the most vulnerable members of their societies.

UNIDO STRUCTURE

Policymaking Organs

The governing bodies of UNIDO are:

General Conference (GC): The GC determines the guiding principles and policies of the Organization,approves its budget and work programme. Every four years, the GC appoints theDirector-General. The GC also elects the members of the Industrial DevelopmentBoard (IDB) and of the Programme and Budget Committee (PBC).

Industrial Development Board (IDB):

The IDB comprises 53 members, elected for a four-year term on a rotational basisfrom all Member States. It reviews the implementation of the work programme, theregular and operational budgets, makes recommendations to the GC on policymatters, including the appointment of the Director-General. The IDB meets once inGeneral Conference years, and twice in other years.

Programme and Budget Committee (PBC): The PBC consists of 27 members, elected by the GC for a two-year term. ThePBC, which meets once a year, is a subsidiary organ of the IDB and providesassistance in the preparation and examination of the work programme, the budget

and other financial matters.

UNIDO comprises 173 Member States.

UNIDO Secretariat



Director-General (DG):

The UNIDO Constitution stipulates that the Director-General is the chief administrative officer of UNIDO and is accountable to its policymaking organs ±

the General Conference, the Industrial Development Board and the Programme andBudget Committee. Subject to the directives of these policymaking organs, theDirector-General has the overall responsibility and authority to direct the work of

the Organization. The Director-General is appointed by the General Conference.The duration of the term is four years. The current Director-General, Kandeh K.Yumkella (Sierra Leone), assumed office in December 2005 and was re-elected bythe 13th session of the General Conference for a second term in office on 7December 2009.

Deputy to the Director-General (DDG):

The Deputy to the Director-General (DDG) provides advice and substantivesupport to the Director-General in the overall management of the UNIDOSecretariat, and assists the Director-General in the effective and efficientfunctioning of the Secretariat. He or she represents and acts on behalf of theDirector-General as may be required by the Director-General. In particular, theDDG assists the Director-General in ensuring that the operations of UNIDO are

fully in line with the directives of the policymaking organs and strategies and

policies of the Organization. The DDG also supervises the work of theOrganizational Strategy and Coordination Group, the Policymaking OrgansSecretariat, the Evaluation Group and the UNIDO offices in Brussels, Geneva and

New York.

Yoshiteru Uramoto, Deputy to the Director-General, assists and advises theDirector-General in the overall management of the UNIDO Secretariat.

Programme Development and Technical Cooperation Division (PTC): The Division is primarily responsible for providing capacity-development support

and technical cooperation services to enhance the capabilities of developingcountries and transition economies to: process their agriculture-based rawmaterials, participate in international trade flows for manufactured goods; increase

investment and technology flows; and develop entrepreneurship; while also promoting environmentally sustainable production techniques; developingrenewable and rural energy for productive use; increasing energy efficiency; andsupporting the implementation of major multilateral environmental agreements. In



doing so, the Division develops, implements and monitors sectoral, cross-sectoraland thematic programmes and projects, and provides technical advisory andinstitutional and human capacity-building services.

The Division comprises the Office of the Managing Director and the Agri-BusinessDevelopment Branch; the Business, Investment and Technology Services Branch;the Trade Capacity-building Branch; the Energy and Climate Change Branch; the

Environmental Management Branch; and the Montreal Protocol Branch. Inaddition, the Division hosts the Bureau for Programme Design and KnowledgeManagement as well as the Special Programmes and LDC Group.

Dimitri Piskounov is the Managing Director of PTC.

Regional Strategies and Field Operations Division (RSF):

The Division is responsible for providing programmatic guidance and substantivesupport to the work of the Organization as well as alignment with its qualityassurance framework. It provides Member States as well as other Divisions withstate-of-the art analyses of the main determinants and trends of industrialdevelopment. On this basis, it advocates the role of industry as an instrument for

poverty reduction and environmental sustainability and provides strategic advice to

policy-makers at the national and regional levels. The Division is responsible for the identification and coordination of regional and country programmes and for managing the field structure of UNIDO. Furthermore, it is responsible for conceptualizing, developing and managing UNIDO's relationships with donor governments and other existing and potential donor organizations. Finally, theDivision acts as the focal point for security-related issues, both at headquarters andin the field.

The Division comprises the Office of the Managing Director; the Advocacy andCommunications Group; the Development Policy and Strategic Research Branch;the Regional and Field Operations Branch containing five Regional Programmesfor Africa, the Arab Region, Asia and the Pacific, Europe and the NewlyIndependent States (NIS), and Latin America and the Caribbean, as well as the

coordination functions for UN reform at the country level, security management,and UNIDO¶s field network. The Division also contains a Resource Mobilizationand Quality Assurance Branch responsible for securing, administering andcoordinating the financial resources required for UNIDO¶s programmaticactivities, and for promoting the quality of these activities. Moreover, the UNIDOfield network, comprising Regional and Country Offices, UNIDO Desks andUNIDO Focal Points, is under the substantive and administrative supervision of



the Division.

The Managing Director of RSF is Wilfried Luetkenhorst.

Programme Support and General Management Division (PSM): The Division formulates policies and procedures, and provides strategic guidance,direction and support to all entities of the Secretariat, including the offices away

from Headquarters, in the five broad areas of human resources, finance and budgets, information and communication management, operational support(procurement of goods and services, assets management and related IPSASstandards, travel, transportation, shipments, etc.), and management of the commonservices entrusted to UNIDO (buildings management services and cateringoperations) on behalf of the Vienna-based Organizations (VBOs). Through theseservices, the Division provides effective support for the Organization¶s operational

and programmatic activities within an appropriate framework of decentralization of authority, accountability and oversight.

The Division comprises the Office of the Managing Director and four subsidiaryentities: The Human Resource Management Branch, the Financial ServicesBranch, the Information and Communication Management Services, and the

Operational Support Services Branch.

UNIDO Staff: UNIDO employs 651 staff members at Headquarters and other established officesaround the world. Annually, we draw on the services of some 2,878 internationaland national experts who work on projects worldwide. Approximately 50 per centof the international and national experts are from developing countries.

Location: The UNIDO Headquarters sits alongside the Danube River in Vienna, Austria, partof the United Nations Headquarters complex.

UNIDO ROLE IN INDIA¶S ECONOMIC DEVELOPMENT



The Government of India and UNIDO signed, in late 2001, a five-year CountryService Framework focussed on four domains of cooperation: strengthening thecompetitiveness of SMEs through technology-led interventions; the promotion of foreign direct investment; cleaner and environmentally friendly technologies and

policies; and a cross-cutting initiative to alleviate poverty and promote industrialgrowth in less developed areas. In November 2006 as the five-year CSF wasdrawing to a close, UNIDO and the Government of India invited an independent

evaluation team to review the achievements of the programme, identify strengthsand weaknesses, and suggest practical measures to further sharpen the UNIDO-India partnership. The tentative conclusions of the evaluation mission weresubmitted to the Government of India in January 2007, in the form of a draftreport. A few weeks later, at the occasion of the visit to India of the Director-General of UNIDO, the two parties agreed to formulate a new five-year countrystrategy synchronized to the 11th Five-Year Plan as well as to the UN

Development Assistance Framework. India¶s involvement with the globaleconomy has been rising phenomenally in the past few years. The economy grewat a rate of 3.5 per cent per annum during 1950-51 to 1979-80. Growth, whichhovered around a little above 5.5 per cent per annum during the 1980s and 1990s,increased to 5.8 per cent during 1998-99 to 2003-04 and further to 8.6 per centsince 2004-05. India, of late, has been globally acknowledged a high growth

economy. The rate of growth stood at 9.4 per cent during 2006-07. The growth rateduring the first quarter of 2008 was an impressive 9.3 per cent over thecorresponding quarter of the previous year. During the current financial year,Indian economy expects to repeat growth rate of more than 9 per cent. If India cansustain this rate of growth, per capita income can double in about 9 years. Thishigh growth has been facilitated by an unprecedented increase in rate of investmentfrom 22.9 per cent in 2001-02 to an estimated 35.1 per cent in 2006-07. Accordingto Goldman Sachs, over the next 30-50 years, India is likely to grow fastest amongthe BRIC economies ± Brazil, Russia, China and India. McKinsey Global Institutehas predicted that India will have the world¶s fifth-largest consumer market by2025, with about 583 million people forming its middle class. This implies a hugeopportunity for further investment and enterprise. The rapidly changing sectoralcontributions to the GDP are an indication of the significant structural changes

taking place in the economy. The share of industry in GDP has increased from 25.6 per cent in 2003-04 to 26.6 per cent in 2006-07, while there has been a decline inthe share of agriculture and allied sectors from 21.7 per cent to 18.5 per cent duringthe same period. The decline in the share of agriculture in GDP has been mostlyappropriated by the services sector, which increased its share from 52.7 per cent to54.9 per cent. India exported merchandise worth US $ 126 billion in 2006-07 witha growth rate of 22 per cent. At the same time imports were US $ 185 billion with



growth rate of 24 per cent. FDI inflows in India were at US $ 19.5 billion growingat 153 per cent. FDI outflow from India was US$ 11 billion growing at 144 per cent. At the same time the World Trade in 2005 and 2006 was US $ 21.314 trillionand 24.496 trillion respectively; while FDI outflows were US $ 837.194 billion andUS$ 1.215 trillion in 2005 and 2006 respectively. The global FDI inflows were US$ 945.795 million and US$ 1.305 trillion in 2005 and 2006 respectively.The exchange rate of the Rupee against the US dollar had displayed reasonable

stability during 2005-06 and 2006-07. During the first half of the current year, the

exchange rate of the Rupee against the US dollar has appreciated sharply reflecting

mostly the copious capital inflows, the strong fundamentals, higher returns on

equity and even higher expectations. This surge in capital flows, apart from

causing volatility in the foreign exchange market, has led to an accumulation of

reserves. The foreign exchange reserves increased to US$ 199 billion at end-March

2007 and further bourgeoned to US$ 262 billion on October 26, 2007. It reveals,however, a vast potential for growth driven by manufactured exports. Some of the

main obstacles along the way are infrastructure and energy gaps, as well as degree

of capacity utilization hovering around 95 per cent (NCAER figures-the limited job

creation performance of the manufacturing industry is therefore a case of

³classical´ unemployment, where labour force absorption is constrained by

productive capacities rather than by the demand for manufactures). The

combination of these two factors makes for high incremental capital-output ratio:

sustained manufacturing growth will be expensive. The small and mediumindustries sector on the other hand offers several advantages in this context: it is

typically less capital-intensive, and more easily amenable to geographic dispersion.

The investment outlay per new job is therefore significantly lower, and jobs can be

more easily created in disadvantaged regions of the country.

The UNIDO Country Programme 2008-2012 is aimed at raising the

competitiveness of industrial enterprises through industrial policy advice,

investment and technology promotion, through technology-oriented initiatives to

increase productivity, quality, energy efficiency, occupational health and safetyand the environmental sustainability of industrial production. In line with the

organic evolution of UNIDO¶s operations in India over the past 40 years, the

Country Programme will also build on India¶s expertise, technology and know-

how to assist other developing countries; the UNIDO-India partnership to that end

was launched in February 2007 in the form of the Centre for South-South



Industrial Cooperation. But the success of the programme is not only a matter of

substance, of addressing the right issues in an appropriate way: it critically hinges

on the procedures set to facilitate its timely execution. The Country Programme

2008-2012 proposes a number of measures to streamline administrative processes,

ensure appropriate monitoring and stimulate innovation from a broad group of stakeholders while maintaining the course of a coherent strategy and capturing

integration opportunities wherever they arise. Ultimately, the performance of the

Country Programme 2008-2012 will be measured at UNIDO¶s ability to deliver a

markedly increased volume of technical services and strengthen in doing so its 40-

year old partnership with the Government of India.

The Country Programme within the Country Context

The Indian economic reforms were initiated in 1991 after a severe balance of

payments crisis leading to a combination of long term structural reforms and a

short term stabilization programme. The average economic growth rate after the

reforms in the Eighth and Ninth Five Year Plans were 6.8 per cent and 5.5 per cent

respectively1. It is expected to reach 7.6 per cent at the end of the Tenth Five Year

Plan (2002-07) and will be the highest growth rate achieved in any plan period so

far.

GROWTH RATES



Role of UNIDO

The UN Country Team in India developed in 2006 the Development Assistance

Framework 2008-2012. UNDAF 2008-2012 was submitted to the Planning

Commission on 21 December 2006, and approved by the Planning Commission on27 February 2007. It focuses on four domains of concentration: (i) country² andstate²wide governance; (ii) local governance; (iii) the attainment of the MDGs;and (iv) environment management and disaster preparedness. The followingoutline gives a more detailed overview of outcomes and outputs; shaded areasindicate the domains of concentration of the UNIDO programme within UNDAF(reference: communication from the UNIDO Representative to the UN ResidentCoordinator, 10 October 2006). Outcome 1 By 2012, strengthened policyframework and implementation capacity of large scale state and national

programmes to reduce disparities and enhance opportunities for disadvantagedgroups, especially women and girls, for the achievement of MDG related 11th PlanGoals.

y Strengthened design and implementation of national programmes and policies on poverty reduction for disadvantaged regions and groups,especially women and girls.



GoI further insisted that the forthcoming UNIDO programme in India should aimfor:

y Greater coherence for higher visibility

y Smaller number of larger projects

y Three domains of concentration: south-south, technology and clustersy Regular dialogue between DIPP and URO

y Monitoring on a quarterly basis

I.4 The strategy of the Country Programme 2008-2012

The strategy underpinning the design of the Country Programme 2008-2012 (IP08-12) is predicated on the following tenets:It builds on the recommendations of the November 2006 evaluation of the UNIDO

Country Service Framework 2001-2006;

It is aligned to the objectives of the 11th Five-Year Plan 2008-2012 and the National Manufacturing Competitiveness Strategy. It also supports, on the side of the UN, the Development Assistance Framework 2008-2012;

The overarching objective is the diffusion of best practices in sustainable industrialdevelopment. The strategy will distinguish best practices touching upontechnology aspects of production (with



emphasis on environmentally sustainable technologies, productivity improvementsand quality management) on the one hand and, on the other hand, social capital

issues encompassing human resource management and industrial organization inclusters of small and medium enterprises. Likewise, diffusion can be within India(in line with the Planning Commission¶s call for more inclusive growth²see GoI(2006)) or, at par with India¶s emergence as an economic powerhouse of globalrelevance, between India and other developing countries. The focus will be on keymanufacturing sectors with a view to enhance employment generation and ensure amore balanced and inclusive pattern of industrial growth in the country;

The key areas which strategies under the Country Programme should address arethe following:

y The induction of clean technologies. This should be done under a broadframework of ³Industry and climate change´ and should aim at developing aclean-green industry;

y Measures to introduce energy efficiency and conservation;

y Acquisition, assimilation and development of new manufacturingtechnologies;



y Water conservation practices;

Standardization and total quality management;

y Design and other Intellectual Property Rights (IPRs) issues;

y Skill development;

y Investment promotion;

The most cost-effective intervention is at the level of industrial clusters in thecountry. For this, the first activity to be conducted would be a cluster mappingwhich would inter alia identify the major SME clusters in the country and analyzethe specific interventions that need to be made in those clusters in order to enhancetheir competitiveness. The strategies should focus on areas as mentioned above. Inthe first instance, the industrial clusters which have been taken up under theIndustrial Infrastructure Upgradation Scheme (IIUS) could be looked at. Morestates, particularly the North-eastern States could be covered, in order to ensurethat the UNIDO intervention has an all-India impact;

The above approach would enhance the productivity and competitiveness of industrial enterprises through induction of cleaner technologies,

promotion/transfer, commercialization and diffusion of advanced manufacturing

technologies, design and IPR inputs, skill development programmes etc. This inturn will increase the turnover, exports and quality of products manufactured by

industrial enterprises in various clusters. The enhancement and competitiveness of enterprises is expected to generate employment and contribute towards a balancedand inclusive pattern of industrial development in the country which inter aliacould also serve as a strategy for poverty alleviation;

Two-stage integration. When designing the cooperation strategy 2001-2006,UNIDO has recommended the format of a Country Service Framework (CSF), arelatively loose association of projects within broad programmatic priorities.Indeed, it was felt that the diversity and complexity of India¶s manufacturing basemade unrealistic the tightly-knit variant of a Country Programme. In hindsightthough, the CSF instrument resulted in fragmented activities on the ground; it

failed to convey the message of a strong corporate strategy of engagement in India.Hence the alternative proposed here of two-stage integration: a champion, or flagship project in each one of the three components drives integration within

the component; furthermore through close cooperation with the UNIDO Regional

Office, the three flagship projects foster integration amongst the three components;



Reporting and monitoring. The management structure of the CSF 2001-2006 wasseen by the evaluation mission as a weakness in the execution of the programme: itdid not fulfil its oversight function, nor did it help realize synergies amongst

projects. The setup was arguably too heavy²hence difficult to mobilize²but itwas also heterogeneous as it counted in its membership institutions with rather different mandates, priorities, and visions of manufacturing progress. Thus, CP 08-

12 only features a National Steering Committee actively involving DIPP

Implementation procedures

The execution of the programme will be governed by UNIDO¶s TechnicalCooperation Guidelines (August 2006); the Field Office in Delhi will provide

appropriate briefing to the local project managers and facilitate in doing so thedelivery of services under the programme.

Funding strategy

UNIDO operations in India are funded from three sources; the graphic gives a breakdown of the respective contributions in the Country Service Framework 2001-2006:Government of India. This includes a yearly budget appropriation in excess of US$ 1m controlled by DIPP and channelled through the UNIDO Industrial

Development Fund. Other ministries and public institutions also contribute toUNIDO programmes through ad hoc Trust Funds.

The Global Environment Facility and the Montreal Protocol funded nearly half of all UNIDO operations in India during 2001-2006. This is consistent with theaggregate picture of the incidence of these two sources of funding in UNIDOoperations worldwide. In 2006, the Global Environment Facility took several stepsto streamline the management of the resources under its control, of which two areof particular relevance to UNIDO: (i) UNIDO gained direct access to GEF

resources (a 1999 decision of the GEF Council had yielded a list of sevenexecuting agencies²of which UNIDO²under the Facility¶s ExpandedOpportunities policy. Thereafter UNIDO executed GEF-funded projects throughone of the three implementing agencies); and (ii) a programmatic approach

whereby countries are expected to submit the GEF Secretariat a clear

strategy supported by a set of project proposals²and underlying executing partners²matching the announced quantum of GEF resources;



Bilateral sources. The Governments of the UK, Switzerland and Italy supportedseveral projects under the CSF 2001-2006. However, in early 2003, theGovernment of India decided to concentrate its bi-lateral ODA on six development

partners, namely the European Commission, Germany, Japan, the RussianFederation, UK and USA. Other partners were welcome to continue bi-lateralcooperation programmes provided they committed to a yearly ODA flow of delivery above a specified threshold; otherwise they were invited to channel their aid through NGOs or the multilateral system.

The Country Programme 2008-2012 will further pursue these three sources of funding through a differentiated approach:Government of India and its various departments and institutions at Central and

State level implement a range of public schemes announced in key policydocuments such as the Five-Year Plan or the yearly Budget Speech and aimed at

particular development objectives. Some, such as the National ManufacturingCompetitiveness Programme, are particularly close to UNIDO¶s mandate anddomain of competence. Building on the legacy of forty years of engagement inIndia, a multidisciplinary workforce with global exposure, a range of in-houseskills that mirrors the multi-faceted demands of industrial growth in a global



economy, and the neutrality associated to a UN Agency, UNIDO must positionitself as a reliable partner of Government institutions and supplier of qualityservices in the execution of such national development schemes. Beside theMinistry of Commerce and Industry (nodal ministry), other Ministries/Departments of Government of India will be the potential partners.

Aims, Expected Results and Structure of the Programme

The overview in the following pages distinguishes three categories of projects ineach one of the three Components of the Country Programme:The flagship programme, or resource centre in each one of the three components;

The existing stock of projects that are deemed consistent with the strategicorientation of the programme;

A tentative list of next-generation projects. The list is indicative only: it is neither exhaustive nor binding, and will be refined as the execution of the programmemoves on.

Programme Management

Coordination and monitoring

Two-tier monitoringThe coordination and monitoring structure mirrors the two-stage integrationapproach:Individual projects will be subject to their built-in monitoring mechanisms:typically a Steering Committee chaired by the counterpart Ministry and convenedon a regular basis;



However, there is a limit to the gains that can be reaped through productivityenhancing measures alone. Further progress calls for leveraging extra-UROresources through:Analyzing administrative processes with a view to transferring part of theworkload to projects (that is, TC budgets and administrative resources);

Developing a close relationship between URO and one ³flagship project´ in eachone of the components of the future Country Programme. The flagship projects areendowed with specialized expertise and implementation capacity; they will (i) actas advisors to URO within their respective domains of competence, (ii) provideconceptual and methodological guidance to other projects within their respectivecomponents, and (iii) drive integration both within the component and, incooperation with URO, amongst components;

Soliciting innovative ideas from a wider group of stakeholders (UNIDO programme managers, Indian institutions, industry, civil society etc) and select

those that are deemed to consolidate the strategy by applying a set of pre-definedcriteria.

UNIDO CORPORATE STRATEGY AND VALUE ADDED

The Country Service Framework modality has been phased out in UNIDOtechnicalVcooperation to a large extent. This raises the question, whether a CSF or the preferred UNIDO modality, the Integrated Programme (IP), should be appliedfor future cooperation in India16. The evaluation team arrived at the conclusion

that the CSF (or a similar type of programmatic framework) seems to be a goodchoice for a country like India. Some of India¶s states exceed, in terms of population, economic activity and geographical extension, the size of manynations. So even with a geographical focus, unless UNIDO¶s intervention is limitedto a very small number of states (e.g. 1 or 2), an IP would not be compatible withthe large number of stakeholders involved and the flexibility required for UNIDO¶s

cooperation in India. Furthermore, the following reasons suggest avoiding an all-India IP:

Given the accelerated dynamics of India¶s economic development, the needs of

industry change rapidly. This requires a flexible instrument that allowsresponding to new developments, while not loosing focus at the same time. A large number of Government ministries continuously develop new initiativesand programmes that require UNIDO support and that fit well into the overallgoals set by the CSF.



Recommendations

Establish a more focused geographical priority for the UNIDO India Programme,taking into account the priority regions identified by UNDAF, but also taking intoaccount the particular state of industrial development in the regions. Redefine the thematic priorities of the UNIDO India Programme. Avoid basingthematic priorities on UNIDO service modules. Use concrete development

objectives as basis for the definition components. Each component should have aclear lead counterpart agency (ministry), increasing thereby ownership andrelevance of the components to overall Government policy. Define clearly and explicitly the target groups of the UNIDO India Programmeinterventions at the component level. The element of innovation should figure more prominently among the monitoringand steering criteria applied by the future programme steering and monitoring

mechanism. Modify and revive the steering and monitoring mechanism of the UNIDO IndiaProgramme. A stronger emphasis should be put on steering and monitoring at thecomponent level to ensure involvement of all stakeholders. The monitoringfunction should be split between the NSC (progress towards overall objectives of the programme) and the component committees (progress of individual projects

under components). There is no need for a separate monitoring and advisorycommittee. A more effective mechanism for appraisal and selection of new interventionsneeds to be put in place. It is recommended that decisions on new activities betaken primarily at the component level (i.e. by the component committee). Formulate clear terms of reference for the different committees. Include Montreal Protocol and GEF projects in the overall monitoring of theUNIDO India Programme.



LEARNINGS

RELEVANCE: UNIDO needs to apply different strategies for different levels and

dynamics of industrial development in a certain region. Where growth rates andlevel of industrialization are already high, generic support to spur growth at thestate and sectoral level should not be the first priority. Instead, UNIDO cooperationin such situations should focus on less developed sub-regions or on such systemic

bottle-necks, that impede the industrial development from reaching the poor part of the population.

DESIGN: The combination in one project of direct assistance with support tocapacity building for replication is highly effective and should be applied widelythroughout UNIDO.

CORPORATE STRATEGY: Evaluation of sample projects showed that UNIDO,in the field of investment promotion, competes directly with private consultingfirms (e.g. Ernst & Young or Price Waterhouse Cooper) in the provision of services such as preparation of promotion materials, organisation of promotionalevents, preparation of investment profiles. Private consulting firms can providemarketable services more efficiently and effectively than UNIDO. Thus, UNIDOshould focus on areas of value added where no private services are available.

RESULT BASED MANAGEMENT: Longer periods without a UNIDOrepresentation in the regional/country office should be avoided. In the absence of aUR, clear procedures should exist to keep the programme steering mechanismfunctioning. For example, one of the Team Members could be the deputy for theUR with regard to his function in the Steering Committee.

TECHNOLOGY TRANSFER: UNIDO projects, unlike bilateral projects, shouldnot include major limitations with regard to the sources of technology in projectsfor technology transfer promotion. The experience has shown that such limitation

represent a major obstacle for results.

an analytical report on role of unido

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