Introduction

Cluster-based economic development approach aids in laying the foundations of a microeconomic approach for prosperity and growth at decentralised levels. Cluster-based efforts are emerging to help economies reap the full potential of an improved macroeconomic aspects (Ketels, 2003). Group of industries and institutions co-exist at a location based on the natural resources availability and enjoy the economic benefits of location-specific externalities.

The externalities include, for example, access to specialized human resources and suppliers, necessary knowledge base, a competitive atmosphere calling for higher performance, and learnings from the close interaction with specialized customers and suppliers (Ketels, 2003). Porter (2000) observed that in the age of globalization, economic geography involving clusters of entrepreneurs/service providers would look paradoxical. Changes in technology and location have diminished many of the traditional roles of location. Yet, clusters or geographic concentrations of interconnected companies (in the author’s focus) were considered a striking feature of virtually every national, regional, state and metropolitan economy, especially in more advanced nations. Porter’s work caused a surge of interest in clusters as drivers of economic growth and hubs of innovation.

Cluster refers to the agglomeration of small and medium enterprises (in the Indian context) in 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. The cluster concept gained prominence as an economic policy tool aimed to foster innovation and growth of a competitive private sector in developing countries (Ittyerah, 2009). Donors and development agencies have been paying attention to the potential of cluster initiatives to bring about pro-poor effects. Thriving clusters can generate employment, income and opportunities for the local community and become drivers of broad-based local economic development (UNIDO, 2010). In the last two decades, hundreds of cluster initiatives have been launched involving virtually all regions of the world, and their number is growing. Two-thirds of European Union countries 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 (Oxford Research AS, 2008). Clusters are also a widespread phenomenon in developing economies and can display levels of dynamism and innovation similar to those in industrialized countries. The high-tech industry of Bangalore, India, the Chilean wine clusters and the Sialkot, Pakistan, surgical instruments cluster are few examples of many successful endeavours. These dynamic clusters have achieved high growth levels, gained a stable foothold in the international market and generated wealth and prosperity at the local level (UNIDO, 2010). Advantages of clustering are:

1. Collective efficiency gains: While the growth of individual small-scale firms is constrained by limited access to resources and inability to achieve scale and scope economies, firms within clusters benefit from collective efficiency gains, i.e. “the competitive advantage derived from local external economies and joint action” (Schmitz, H. 1997). External economies include the availability of a specialized labour force, machinery and input suppliers, the attraction of traders and buyers, as well as an industrial atmosphere where information and knowledge are easily shared. Therefore, cluster enterprises are able to achieve higher and sustained growth rates for synergies, and collaborative linkages allow them to pool resources and efforts for the achievement of shared economic goals. Collective efficiency gains can be further enhanced when the institutional and policy frameworks are responsive to the firms’ needs and supportive of their efforts (Bellandi, M. 2002). Cluster-based developmental path will also prevent migration of rural youth, provide job opportunity while practicing agriculture, improvements in the infrastructure, etc.
2. Spatial proximity effects: The achievement of collective efficiency gains is facilitated by spatial proximity such as among firms and local resources within clusters. Risk is decreased when firms know their partners and can easily gather information on their reliability. Firms have fewer incentives to engage in opportunistic behaviour since this will affect their future ability to acquire economic partners as well as attract social stigma. In general, proximity may facilitate the development of trust-based relations that lower transaction costs and support collaborative interactions (UNIDO, 2010).
3. Pro-poor growth and supports local people livelihood: A cluster approach can be a valuable tool to tackle poverty and lay the ground for a process of broad-based growth. This is partly because clusters are also socio-economic systems where the population of firms overlaps with the community of people and their families, living and working in a delimited territory. Not only do entrepreneurs and workers share similar social, cultural and political backgrounds, but also norms of reciprocity and collective practices of self-help are common among employers and employees. Overall, this accounts for a distribution of the benefits of growth that is likely to be more inclusive than in other economic systems (UNIDO, 2010). However, still a considerable number of clusters in developing countries are lagging behind, trapped in a vicious circle of unrealistic competition. Although representing substantial pockets of entrepreneurial activities and providing a living to entrepreneurs and workers, when clusters are unable to shift from stagnation to growth, their potential to contribute to the development of local communities remains largely untapped (UNIDO, 2010).
4. Objectives: Objectives of the cluster-based local development approaches are: (i) consideration and scope for harvesting local skills (such as expertise in fishery, traditional handicrafts, wildlife trails and bird watching, etc.), (ii) upgrading skills to meet challenges (through greeenskill development programmes, training programmes and awareness creation), (iii) identification of trainers and training institutes (to improve the skill base of clusters) and providing skills to match the needs of the cluster, (iv) generating economic opportunities for the poor: Promoting productive activities that facilitate fairer distribution of income than capital-intensive equipment; investing in upgrading the skills and employability of marginalized segments such as women, migrants (Gowlis for eg.), forest tribes and castes, and encouraging the production of goods and services affordable by the poor. For the participation of the poor in the decision making, NGOs, village councils, women’s federations and self-help groups will play key roles, (v) participatory approach: the adoption of a participatory approach, openly oriented at empowering the poor fringes of the society contributes to reducing their marginalization and encourages their active participation in the economic life of the cluster by improving their self-confidence and social status.
5. Economic Clustering in Ancient India

The concept of economic clustering and trade guilds in India has roots in pre-history. The cocoons and silk processing industry have traditionally existed in clusters, in places such as Banaras, Kancheepuram, Kashmir etc. In Jataka, Kasi was a principal centre of manufacturing cotton as well as silk in the 5^th or 6^th century B.C. Cotton clothes of Kasi were exquisitely woven, smooth, bleached completely white, and their fibres were fine and soft. Tradition says that when Buddha died, his remains purified with balm were wrapped with brand new cotton clothes of Kasi. Spinning and weaving of cotton was known to Harappans 5000 years ago. The Agarbatti industry had its traditional clustering in Mysore. Bidar became an important centre of alloy metal artworks, especially silver inlay on metals. Spice growing trade in general clustered along southwest India, particularly Calicut, Cochin, Nagarabastikeri, Banavasi etc. With the development of cities as industrial trade centres, various industries and enterprises clustered in the cities where different streets specialized in production or trading of different wares.

3.1 Collapse of agro-pastoral-cum-forestry clusters of central Western Ghats: Pre-colonial land use system in central Western Ghats was characterized by shifting cultivation, secondary forests and savannah lands in hilly places, fairly large sized sacred groves (kan forests), and permanent cultivation in valleys. Whereas secondary forests were used for routine biomass needs, the sacred groves preserved climax forest biodiversity. There was regulated harvest of non-timber forest products (NTFPs) like pepper, cinnamon, Caryota (Caryota urens) toddy, medicinal plants, edible fruits etc. from the kan forests. The kan forests were also the sources of perennial waters like streams, springs, ponds and lakes. These kans had prime role in recharging wells in the valley downside. The landscape heterogeneity and the forests interspersed with grassy blanks and savannahs favoured rich wildlife in the region. This traditional system of community-based landscape management suffered with the British claim over all forests including sacred groves and shifting of cultivation areas. The kans got merged with the rest of the reserved forests and lost their identity as sacred places. The locals were dependent on isolated kans in the middle of villages for firewood, leaf manure and other needs as they were not allowed access to such goods from timber-rich secondary forests. The Western Ghats Panel (2011) observed “serious deficit in environmental governance all over the Western Ghats tract” and urged that immediate steps be taken to address such issues. The Panel is impressed both by levels of environmental awareness and commitment of citizens towards the cause of the environment, and their helplessness in the face of their marginalization in the current system of governance.

3.2 Extraction pressures from forest-based industries: The 1940s witnessed escalating demands from forest-based industries such as plywood, matchwood, etc. on the forests of central Western Ghats. Dandeli Paper factory established in 1950s relied heavily on bamboo resources until almost near collapse of bamboo forests in Uttara Kannada. As choice timbers were being depleted in forests even kans were not spared from industrial felling.

3.3 Community-based NTFP harvests replaced by contract system: The British, for the first time, started auctioning forest produce such as pepper, cinnamon, shikekai (soap nut powder), honey etc. to the contractors. The system of collection of NTFP by contractors was found to be very destructive to the forests, and the village communities were hard pressed for resources. In the recent decades, the move has been strengthening to give such NTFP collection rights to the Village Forest Councils (VFCs) and tribal co-operatives.

3.4 The hazards from monoculture plantations: Over-extraction of natural teak and the stoppage of shifting cultivation saw teak trees getting scarcer in Uttara Kannada. The British launched during the later parts of 19^th century—systematic programmes to clear fell as much of natural forests—to raise teak plantations. The plantation activity became more vigorous after independence, and Eucalyptus and Australian Acacias were added to the monocultures. Very often, these plantations were infested with weeds like Lantana and Eupatorium, suppressing the native vegetation. In the heavy rainfall areas especially, the replacement of natural forests with plantations, especially along hill slopes, caused severe soil erosion and drying up of perennial streams. Also, the reduction of diverse pollinators in the nearby localities has affected the crop productivities and hence the livelihood of people.

3.5 Impact of hydro-electric projects on ecology and livelihoods: Commissioning of the Linganamakki dam and Gersoppa dam for generation of hydro-electricity in Sharavathi River resulted in increased fresh water flow in the post-monsoon and summer months diluting the salinity in the estuary to nearly fresh water conditions (<0.5 ppt) most of the year. This caused serious collapse of the estuarine fisheries, both in diversity and quantity. Accordingly, fisheries-based livelihoods declined seriously in Sharavathi estuary and the bulk of estuarine anglers went elsewhere in search of jobs. The edible bivalve (clams and oysters) based fisheries also witnessed complete collapse. Mangroves are associated with very limited species that can survive in low brackish water conditions. Whereas the adjoining estuary of Aghanashini, which is not impacted by hydroelectric projects, has nearly 90 species of fishes, Sharavathi has hardly 50 per cent of this diversity. In the Kali estuary also, because of hydel projects upstream, fish diversity is much lower than in Aghanashini and edible bivalves shifted more towards the river mouth to a restricted zone.

3.6 The bane of estuarine shrimp aquaculture: Since early 1970s, intensive shrimp aquaculture started in Uttara Kannada estuaries with least regard for environmental norms. The traditional, salt-tolerant, Kagga rice-growing gazni fields were cut up and converted into shrimp ponds with almost irreversible consequences. The mangroves were totally cleared for creating many such farms. Monoculturing of shrimps with artificial feeds drastically cut down the sustainable production of a diverse variety of fishes from the gazni rice fields. Today, due to various reasons, aquaculture is on the decline but the estuarine ecology suffered seriously from this mega-venture. Moreover, with the contract system for fish catching from gaznis and shrimp aquaculture, the traditional estuarine fisher folks are restricted to the open parts of the estuary for fishing purposes bringing greater fishing pressure on the estuarine ecosystems.