This research explores how zonification in Pune’s bamboo ecosystem influences the socio-economic dynamics of local communities involved in bamboo-related professions. It examines whether Michael E. Porter’s findings on clustering, specifically competitive advantage, mutual benefit, and innovation in corporate environments apply to decentralized, individual networks like Pune’s bamboo ecosystem. Through field research, case studies, and secondary data, the study provides a comprehensive understanding of bamboo’s socio-economic significance in India and its operational dynamics in Pune. By analyzing interactions between traders, laborers, and artisans, it reveals the intricate networks of clusters within the city. Zonification refers to the co-existence of related knowledge clusters in proximity, fostering interdependence and supporting mutually beneficial competitive advantages, as described by Porter. The research addresses a notable gap in the literature: while Porter’s work on clustering emphasizes competitive advantages in corporate entities, there is little research on how clustering functions in non-corporate decentralized networks of individuals. Unlike corporate organizations, these ecosystems consist of independent individuals working together in interdependent networks. This study aims to understand how zonification influences socio-economic conditions, and whether the competitive effects of zonification observed in corporate settings are mirrored in decentralized networks, like Pune’s bamboo ecosystem. This research contributes to a better understanding of the socio-cultural and economic practices of the communities involved. It offers actionable insights for government organizations, designers, NGOs, and policymakers to address the challenges and leverage the advantages of zonification, enabling more informed decision-making to strengthen and uplift local communities within Pune’s bamboo ecosystem.