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Year End Review 2004
In India, the Small Scale Industries Sector has been growing faster than the whole of the manufacturing sector, at rates of 7% to 10% during the past decade. Hence, the targeted growth rate of 12% envisaged in the 10th Five-year Plan appears imminently attainable. SME sector’s contribution to GDP has been increasing and is about 40% now. Today, 11.4 million SSI units provide employment to over 27.1 million people contribute 40% of the country’s industrial production and 34% of the exports from the country and also produce more than 8000 products. Setting up of National Commission on enterprises, Revamping of Khadi and Village Industries, Small Industries Development Bill, Golden Jubilee of SIDO and Third All India Census of Industries are some of the highlights during the year.
Setting up of National Commission on Enterprises
To address the concerns of the unorganised / informal sector enterprises, a four member National Commission on enterprises in the unorganised /informal sector under the Chairmanship of Dr. Arjun Sengupta in the rank of Cabinet Minister has been set up on 21.9. 2004. The mandate of the Commission is to examine the problems being faced by the enterprises in the unorganised / informal sector and to provide appropriate recommendations for technical, marketing and credit support to these enterprises. The Commission will function both as an advisory body and a watchdog for the informal sector.
Revamping of Khadi and Village Industries
For revamping the Khadi and Village Industries (KVI), the Government dissolved KVIC on 14.10.2004. The Chairman and all members of the Commission ceased to hold their offices since that day. The Ministry set up a ten member Expert Committee (a) to review the existing structure, functioning and performance of the KVI since its inception (b) to review the KVIC Act, 1956, KVIC Rules, 1957 and the Regulation made thereunder and (c) to recommend other measure(s) considered necessary by the Committee to revamp the KVI and to launch new appropriate programmes/schemes.
Small Enterprises Development Bill
The Small Enterprises Development (SED) Bill has been drafted. Enactment of this Bill will remove the barriers to SSI growth by inculcating a hassle-free, user friendly environment enabling SMEs to diversify from the conventional product range. It will, thus, encourage exports and global integration and propel SSI towards the projected 12% growth target. This can help India achieve its ambition of transforming into a global manufacturing hub, a centre of excellence for small enterprise activities.
In addition to SED Bill, a major promotion package for development and promotion of SSI sector is under formulation.
Credit Rating Scheme
A Credit Rating Scheme has been introduced to encourage the SSI Units to get their credit rating done by the reputed credit rating agencies, with a view to facilitating credit flow to them and enhancing the comfort-level of the lending banks. 75% of the cost of the credit rating exercise, with a maximum limit of Rs.40, 000 per SSI unit, is now reimbursed to the SSI units availing of this one-time facility. The scheme is being implemented by the NSIC.
SME Fund
Looking to the credit needs of the SMEs in 1990, the Small Industries Development Bank of India, (SIDBI) was launched to aid and finance for small enterprises with a corpus of Rs. 2500 crores. To further improve credit availability, a SME Fund of Rs. 10,000 crores has been operationalised under SIDBI from April 2004.
Credit to SSI
In order to facilitate smooth flow of credit to SSIs, the composite loan limit for SSI entrepreneurs has been increased from Rs. 50 lakh to Rs. 1 crore.
Credit Cards
Laghu Udyami Credit Card (LUCC) Scheme has been liberalized by enhancing the credit limit from Rs. 2 lakh to Rs. 10 lakh, for borrowers who have a satisfactory track record.
SSI Clusters
16 new industrial clusters were identified and taken up under Small Industries Development Programme during this year. These are:
Food Processing, Muzaffarpur, Bihar
Steel Re-rolling Mills, Raipur, Chhatisgarh
Agricultural Implements, Karnal, Haryana
General & Light Engineering, Parwanoo, Himachal Pradesh
Readymade Garments, Bangalore, Karnataka
Gold Ornaments, Thrissur, Kerala
Readymade garments, Indore, Madhya Pradesh
Brass & Bell metal, Khurda, Orissa
Agricultural Implements, Moga, Punjab
Ball Bearings, Jaipur, Rajasthan
Leather Footwear, Agra, Uttar Rpadesh
Leather goods, Shaniniketan, Uttar Pradesh
Installation of Common Facility Centre in Brass/Bronze, Utensils, Manufacturing Cluster at Pareb, Bihar
Development of Whiteware Cluster at Khurja, U.P.
Development of Auto Parts Clusters at Phagwara, Jallandhar and Ludhiana
Development of Cane & Bamboo Cluster at Dimapur, Nagaland.
The development of these clusters is at various stages of implementation.
National Presentation on Rural Business Hubs
A National presentation on Rural Business Hubs was organised by the Ministry in collaboration with the Confederation of Indian Industries at Vigyan Bhavan on 5 November, 2004. The Prime Minister Dr. Manmohan Singh delivered the valedictory address. The presentation focussed on the number of issues including the participation of the private sector in such programmes.
Conference of States/Uts’ Ministers
A conference of Ministers (SSI, KVIC & COIR) was organised on 25 June 2004 at Vigyan Bhavan, New Delhi under the chairmanship of Shri Mahabir Prasad , Minister of SSI & ARI. Progress of implementation of various programmes of SSI/KVIC and coir industry was reviewed in the context of implementation of NCMP. The Minister stressed upon the need for a comprehensive promotional package for the SSI sector.
Golden Jubilee Year of SIDO
This year was celebrated as Golden Jubilee year of the Small Industrial Development Organisation (SIDO) along with the SSI convention on 30 August at Vigyan Bhavan , New Delhi . SIDO was set up in 1954 as an apex body for formulating and overseeing the implementation of policies for the promotion and development of small-scale industries in the country On this occasion, the Prime Minister gave away National awards for outstanding achievements in the fields of enterpreneurship, research and development, and quality product in the SSI sector. The inaugural session of function was followed by an open-house by way of an interactive session on SSI lending in which the representatives of major banks participated along with the representatives of industry and other officials.
Global Summit on SMEs
The Ministry in association with the Confederation of Indian Industry ( CII) organised `India Global Summit on SMEs –Emerging Challenges and Opportunities’ on 23-24 November, 2004 in New Delhi. Dr R. Chidambaram, Principal Scientific Advisor to the Government of India made a special presentation. The global summit facilitated networking and sharing of best international practices, in the SMEs sector, to provide a sustainable focus on the future development and the growth of the SMEs. During the summit discussions, deliberations took place on the themes of enabling policies, role of finance/ innovative finance and measures for risk sharing. Value addition through information and communication technology, global outsourcing opportunities and global small enterprises. 137 foreign delegates from 27 countries across the globe attended the summit.
Conference on `Small Business Competitiveness Development’
National Small Industries Corporation (NSIC) in collaboration with the Commonwealth Secretariat London organised a pan-commonwealth programme on `Small Business Competitiveness Development’ in New Delhi. On 15-19 November, 2004. Dr. V.Krishnamurthy, chairman, National Manufactruing Competitiveness Council delivered the key note address
Techmart India 2004
National Small Industries Corporation (NSIC) organised `Techmart India 2004’ , the 12th Internatioinal Technology Fair, during the Indian International Trade Fair 2004 at Pragati Maidan, New Delhi. More than 236 SSI units participated in it. NSIC was awarded a silver medal for `Excellence in special Display’ by the India Trade Promotion Organisation.
WTO and SMEs
Under the World Trade Organisatioin (WTO ) regime, new opportunities are being created for linkages between SMEs across the globe. The dismantling of the textile quotas is being anticipated in India with great enthusiasm. Garment export is a dominant characteristic of Indian SMEs. Other sectors, such as Biotech, IT and IT enabled services, footwear to name a few, have shown promising potential. Closer connectivity of India’s large agricultural resources affords growing opportunities for new ventures. India’s vast pool of talented and educated persons, and low-cost labour can translate into possibilities for foreign collaborations. SMEs grew by 19% last year, faster than the overall growth of the IT sector, and has expected SMEs to deliver better results in the coming years. SMEs are also engaged in cutting edge research and development activities, logistics services, back-office operations and other services.
Reservation Policy
On the recommendations of the Advisory Committee, the Government has deserved on 20.10.04, 85 items from the list of items reserved for manufacture by the small scale industries. This was done to enable the SSI sector to grow and adapt to the fast changing economic scenario.
Third All India Census
The Ministry brought out the final results of the third All India Census of small scale industries 2001-2002. The census was launched in November 2002 . The main objectives of the census were: (I) to update the frame (list) of registered SSI units.(ii) to identify sick and incipiently sick units with the reasons thereof, and (iii) to collect other useful information for policy formulation.
The State Directorate of Industries have been requested to de-register 8,87,427 SSI units found closed during the survey of the Third All India Census.
Tool Room
Tool Room & Training Centre at Guwahati was inaugurated by Minister of SSI & ARI on June 26, 2004.
Action Plan for Employment in Agro & Rural Industries
To generate more employment in the agro and rural industries sector, the Government has fixed a target of creation of 25 lakh additional job opportunities in rural areas during the 10th Plan under the Rural Employment Generation Programme (REGP) being implemented through the Khadi and Village Industries Commission (KVIC). In the first two years of the 10th Plan 8.32 lakh job opportunities have already been created under the REGP and a target of creation of 5.25 lakh jobs have been fixed for the current financial year 2004-05.
Further, a target of creation of 16.5 lakh employment has been fixed under the Pradhan Mantri Rozgar Yojana (PMRY) for the 10th Plan period. In the first two years of the 10th Plan 5.44 lakh job opportunities have already been created. A target of creation of 3.75 lakh employment opportunities has been fixed for 2004-05
Coir Industry
The 10th Plan outlay is Rs. 11500 lakhs envisaging 12% growth in production and export. The 10th programme of coir industry is aimed at overall sustainable development of coir industry trough research and development, modernisation, quality improvement, human resource development, better marketing of products and welfare of all those who are engaged in this industry.
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