India is gearing up to raise output of MSE sector significantly by introducing various development programmes to derive clear competitive advantages. One of the peculiar characteristics of this sector is the existence of clusters for decades and centuries. The formidable challenges created for the MSME sector after the liberalisation has generated a great deal of interest on novel approaches to development. In this endevour, UNIDO in 1996 initiated a Cluster Development Programme (CDP) in collaboration with MSME Development Organisation to intervene in the process of promoting MSE networking and to improve the competitiveness of clusters. The objective of this paper is to study the genesis of cluster interventions and developmental changes occurred in the MSEs through CDPs. For this purpose, author studied four clusters under the CDP programme to measure the total factor productivity change. The paper concludes with benefits of CDPs on MSMEs in many aspects. Keywords: MSME, MSE, Cluster Interventions, Cluster Development Program (CDP), Special Purpose Vehicle (SPV), Common Facility Centre (CFC).