Abstract

The presence and competitiveness of industrial clusters has been recognized as a source of job growth, industrial productivity, innovation and regional competitiveness. This paper is an attempt to examine this issue and identify the measures to convert Indian clusters into globally competitive clusters. First, the paper discusses the clusters, their evolution, and the role of inter-firm collaboration. It is followed by a discussion on the determinants of innovation in clusters and presents two innovative clusters - Silicon Valley in USA and ICT cluster in Finland. Finally, the existence of clusters in India, case study of ICT cluster Bangalore and the role of government policy and institutions in supporting clusters in India is examined. The paper concludes with certain observations having policy implications.

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