Clusters are groups of companies and institutions co-located in a specific geographic region and linked by interdependencies in providing a related group of products and/or services. Because of the proximity among them – both in terms of geography and of activities – cluster constituents enjoy the economic benefits of several types of positive location-specific externalities. In the Indian context, a ‘cluster’ is the agglomeration of small and medium enterprises producing same/similar products/services or engaged in the same line of manufacturing activities or services, located within an identifiable and, as far as practicable, contiguous area. In recent years, many cluster initiatives have been launched, involving virtually all regions of the world and their number is growing. Two-thirds of European Union nations have introduced the cluster approach in their innovation policy, while several European initiatives are based on the provision of incentives and funding to boost competitive territorial advantages. The main objectives of the clustering are;

Table 10 lists the various activities for cluster of villages depending upon the resource availability, socio-economic and geographical status. Sericulture, medicinal plants and agriculture can be practiced in all villages and industries for agro processing and medicine extraction for plants can be established. Home industries such as paper bag and incense stick making, preparing food products from Ragi and garlands from flowers grown in the village can also be initiated. However, proper marketing mechanism should also be introduced to sustain the activity.  Apart from this following entrepreneurship initiative can be planned in the region;

Table 10: Cluster wise activity details