Analysis of Problems and Prospects of Small Scale Industries in India

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NEW DELHI

THESIS

ON

“ANALYSIS OF PROBLEMS AND PROSPECTS

OF SMALL SCALE INDUSTRIES IN INDIA”

SUBMITTED TO:

EXTERNAL GUIDE:

IIPM, NEW DELHI

Mr. Lawanya Kr. Agarwal

Designation- CEO of Assam Industries

SUBMITTED BY:

NAME: PRATEEK AGARWAL BATCH: FW

SESSION:13-15/SS/FW

Mob no: 9999566530

Email Id- [email protected]

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ABSTRACT

Agro based industry is regarded as the sunrise sector of the Indian economy in view of its large potential for growth and likely socio economic impact specifically on employment and income generation. Some estimates suggest that in developed countries, approximately 15 per cent of the total work force is engaged in agro-processing sector directly or indirectly. However, in India, only about 4.5 per cent of the work force finds employment in this sector revealing its underdeveloped state and vast untapped potential for employment. There is no denying that India has to live with the problem of unemployment for many years to come. Therefore need arises to make all over development among all sections of the society especially in rural agro based industrial units. The present paper is an attempt to find out the status of agro based units such as rice mill industry in the Patiala district of Punjab and to analyze the various problems being faced by them. It has been found that Rice mill industry in Patiala district is in the crisis and facing the various problems regarding lack of financial assistance, improper marketing channel, high degree of breakdown of finished products and non availability of research lab for quality control. However, if this sector will be properly developed, it can make state Punjab a major player at the global level for marketing and supply of processed food for billion plus mouths to feed. All over the world, the unorganized manufacturing sector is known as Small and Medium Enterprises (SMEs) while in India this is known as SSI defined in terms of investment in plant and machinery. During last 50 years, the limit of investment has changed from Rs. 5 lacs in the sixties to Rs. 100 lacs in 2008 to 10-50 crore in 2014. Within the SSI sector, two sub segments have been created. : one for Tiny Units having investment in plant and machinery up to Rs. 25 lacs and the other for industry Related Service and Business Enterprise (SS and BE) sector defined as having investment in fixed assets excluding land and building not exceeding Rs. 10 lacs. The SP Gupta Study Group on Small Enterprises in its interim report has recommended that the time is ripe to move from Industry to Enterprise and also to include Medium Enterprises within the SSI sector. This is essential in order to bring Indian SSI sector at par with the global Small Medium Enterprises (SMEs) sector.

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CERTIFICATE OF ORGINALITY

This is to certify that the thesis titled “Analysis of Problems and Prospects of Small Scale Industries in India” is prepared and submitted by me to Indian Institute of Planning & Management, New Delhi in partial fulfillment for the award of the Post Graduate Diploma in Business Administration, and this report has not been submitted elsewhere.

Date: 1-10-2015 PRATEEKAGARWAL BATCH: PGP/SS-2007-09

SESSION:13-15/SS/FW IIPM, NEW DELHI Mob no: 9999566530

Email Id- [email protected] [email protected]

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ACKNOWLEDGEMENT

The present work is an effort to throw some light on “Problems and Prospects of Small Scale Industries in India” . The work would not have been possible to come to the present shape without the able guidance, supervision and help to me by number of people.

With deep sense of gratitude I acknowledged the encouragement and guidance received by Mr Lawanya Kr Agarwal who helped and supported me during the course, for completion of my thesis.

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THESIS SYNOPSIS

DETAILS OF THE STUDENT:

Name : Prateek Agarwal

Batch : 13-15/SS/FW

Specialization : Marketing and Finance

Section : FAB

Phone No : 9999566530

Email Id : [email protected] , [email protected]

DESIRED AREA OF RESEARCH: Marketing TITLE OF THE THESIS:

“Problems and Prospects of Small Scale Industries in India”,

Research objective:

1 To understand the concept of Entrepreneurship

2 To understand its applicability to the small scale sector in India.

3 To study the crtical role of entrepreneurship in Small Scale Industry in India 4 To study the present status and future prospects of Small Scale Industry in India 5 To study the evolution of Special Economic Zones in India, with particular

reference to Small Scale Industry in India

Introduction to the area of research:

Since the time of the independence in 1947, a significant feature of the Indian economy has been the rapid growth of the small industry sector. The small industry sector is considered to have a major role in the Indian economy due to its 40 percent share in the national industrial output along with an 80 percent share in industrial

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employment and nearly 35 percent share in exports. The small scale industries sector has been assigned an important role in the industrialization of the country by the previous and current governments of India.

There are no clear official definitions of small. Small scale industries are usually distinguished from the large-scale and medium-scale industries on the basis of size, capital resources and labor force in the units. At one time the government of India had grouped small-scale industrial undertakings into two categories - those using power but employing less than 50 persons and those not using power and employing less than 100 persons. However, capital investment on plant and machinery by units is considered as main criteria for distinguishing between the large and small industries. An industrial unit can be classified as a small-scale unit only if it meets the capital investment limits set by the government of India (GOI). These limits have been steadily increased over the years. In 2005, the investment limit for small-scale industry (SSI) was raised from $6 million to $30 million. Production units that are ancillary to large-scale units are also considered as small if they sell not less than 50 percent of their manufactured products to one or more industrial units.

The present research study is an attempt to study and highlight the implications, role, and importance of entrepreneurship in the light of small scale sector in India.

SCOPE OF THE STUDY:

The scope of the study will be limited to undersatnd, what does the term Small Scale Sector means in the broader sense in India.

 To critically analyze the Financial Incentives available to the Small scale sector in India

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RESEARCH METHODOLOGY:

Research Methodology defines the purpose of the research, how it proceeds, how to measure progress and what constitute success with respect to the objectives determined for carrying out the research study.

The appropriate research design formulated is detailed below.

Exploratory research: this kind of research has the primary objective of development of insights into the problem. It studies the main area where the problem lies and also tries to evaluate some appropriate courses of action.

The research methodology for the present study has been adopted to reflect these realties and help reach the logical conclusion in an objective and scientific manner.

The present study contemplated an exploratory research.

NATURE OF DATA

Secondary data:- Data which is already available through various books, journals , magazines, internet etc.

TOOLS AND TECHNIQES

Analysis of data has been done with help of various statistical tools like the tables and graphs.

Justification for Choosing a Particular Research Proposal

There seems to be considerable inertia in the supply of entrepreneurs. One reason is that the culture affects the supply, and the culture itself changes only very slowly. Entrepreneurship is one of the major avenues of social and economic advancement,

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along with sport and entertainment. But the Horatio Alger myth that the typical entrepreneur has risen from rags to riches disguises the fact that as Frank Taussig and others have found, many of the most successful entrepreneurs are the sons of professionals and entrepreneurs. They owe much of their success to parental training and inherited family contacts. Thus, in most societies there is insufficient social mobility for entrepreneurial culture to change simply because of the changing origins of the entrepreneurial elite. In any case, "self-made" entrepreneurs often adopt the culture of t he elite, neglecting their business interests for social and political activities and even (in Britain) educating their children to pursue a more "respectable" career.

In the long run, though, changes can occur that have profound implications for entrepreneurship. In modern economies large corporations whose shares are widely held have replaced the family firm founded by the self-made entrepreneur. Corporations draw on a wider range of management skill than is available from any single family, and they avoid the problem of succession by an incompetent eldest son that has been the ruin of many family firms. Corporations plan large-scale activities using teams of professional specialists, but their efficiency gains are to some extent offset by the loss of employee loyalty that was a feature of many family firms. Loyal employees do not need close supervision, or complex bonus systems, to make them work, because they are self-motivated. Historically, family firms have drawn on two main sources of "cultural capital": the paternalistic idea that employees are adopted members of the founder's family, and the founder's own religious and moral values. The first is effective only within small firms.

DETAILS OF THE EXTERNAL GUIDE Guide Name: Mr Lawanya Kumar Agarwal

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Designations: CEO

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PIN CODE-782435

CHAPTER-1

INTRODUCTION

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INTRODUCTION

BACKGROUND

Since the time of the independence in 1947, a significant feature of the Indian economy has been the rapid growth of the small industry sector. The small industry sector is considered to have a major role in the Indian economy due to its 40 percent share in the national industrial output along with an 80 percent share in industrial employment and nearly 35 percent share in exports. The small scale industries sector has been assigned an important role in the industrialization of the country by the previous and current governments of India.

There are no clear official definitions of small. Small scale industries are usually distinguished from the large-scale and medium-scale industries on the basis of size, capital resources and labor force in the units. At one time the government of India had grouped small-scale industrial undertakings into two categories - those using power but employing less than 50 persons and those not using power and employing less than 100 persons. However, capital investment on plant and machinery by units is considered as a main criteria for distinguishing between the large and small industries. An industrial unit can be classified as a small-scale unit only if it meets the capital investment limits set by the government of India (GoI). These limits have been steadily increased over the years. In 2005, the investment limit for small-scale industry (SSI) was raised from $6 million to $30 million. Production units that are ancillary to large-scale units are also considered as small if they sell not less than 50 percent of their manufactured products to one or more industrial units.

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However, there is a clear distinction between the traditional and modern small industries. The traditional small industries include khadi and handloom, village industries, handicrafts, sericulture, coir, etc. Modern small industries manufacture a wide variety of goods from simple items to sophisticated items such as television sets, electronics control system, various engineering products, particularly as ancillaries to large industries. The traditional small industries are highly labor-intensive, while the modern small industries use highly sophisticated machinery and equipment. The term small-scale industries is mostly used to represent modern small industries. The SSIs manufacture many items which include rubber products, plastic products, chemical products, glass and ceramics, mechanical engineering items, hardware, electrical items, transport equipment, electronic components and equipments, automobile parts, bicycle parts, instruments, sports goods, stationery items and clocks and watches. The small scale industry sector output contributes almost 40% of the gross Industrial value-added 45% of the total exports from India (direct as well as indirect exports) and is the second largest employer of human resources after agriculture. The development of Small Scale Sector has therefore been assigned an important role in India's national plans.

In order to protect, support and promote small enterprises as also to help them become self-supporting, a number of protective and promotional measures have been undertaken by the Government.

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The promotional measures cover

Industrial extension services institutional support in respect of credit facilities, provision of developed sites for construction of sheds, provision of training facilities, supply of machinery on hire-purchase terms,

3 Assistance for domestic marketing as well as exports, special incentive for setting up enterprises in backward areas etc. technical consultancy & financial assistance for technological up gradation.

While most of the institutional support services and some incentives are provided by the Central Government, others are offered by the state governments in varying degrees to attract investments and promote small industries in varying degrees to attract investments and promote small industries with a view to enhance industrial production and to generate employment in their respective States.

The small-scale industries (SSI) constitute one of the vibrant sectors of the Indian economy in terms of employment generation, the strong entrepreneurial base it helps to create and its share in industrial production and exports. The Government created the Ministry of Small Scale Industries and Agro and Rural Industries (SSI&ARI) in October, 2008 as the nodal Ministry for formulation of policy and co-ordination of Central assistance relating to promotion and development of the small scale industries in India. The Ministry of Small Scale Industries and Agro and Rural Industries (SSI&ARI) was bifurcated into two separate Ministries, namely, Ministry of Small Scale Industries and Ministry of Agro and Rural Industries in September, 2010.

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Taking into account the high potential for growth in the SSI sector in terms of output, employment and exports, the role of the Ministry of Small Scale Industries is to strengthen the SSI sector, to enable it to remain competitive in market-led economy and generate additional employment opportunities. For achieving these objectives, the endeavor of the Ministry is to provide the SSI sector proper and timely inputs like:

1 Adequate credit from financial institutions/banks;

2 funds for technology up gradation and modernization;

3 adequate infrastructure facilities;

4 Modern testing facilities and quality certification laboratories;

5 Modern management practices and skill up gradation through advanced training facilities; marketing assistance; and level playing field at par with the large industries sector;

LITERATURE REVIEW

A leading, industrially advanced developing country, India has large, medium and small industrial units of production in almost all branches of the industry.

Since Independence, the growth and development of the small-scale sector has been favored by the GoI on the following grounds: (1) generation of employment opportunities by SSIs, (2) mobilization of capital and entrepreneurship skills, (3) regional dispersal of industries and (4) equitable distribution of national income. The policies pursued by the GoI over the years have helped in the growth of the SSIs to a considerable extent.

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Statistics on SSIs

The total number of SSI units increased from 2.082 million units in 2000-01 to 2.724 million units in 2004-05. During the same period, at constant prices, the production increased from nearly $1.6 billion to approximately $2.2 billion. The total number of persons employed in SSIs increased from 12.9 million to 15.2 million. According to Second All-India Census of Registered SSI units, 42 percent of the units were functioning in rural areas, 48 percent in urban areas and 10 percent in metropolitan areas. 62.2 percent of the units were located in backward areas. The rate of growth of this sector has been higher as compared to the whole industrial sector.

In terms of the above mentioned development, the progress of the SSI sector is considered impressive by experts. But the SSIs are mostly effected by a number of problems that have hampered its absolute gwoth. According to the Seventh Five Year Plan (1985-90) the growth of the SSIs has been constrained by various factors ``including technological obsolescence, inadequate and irregular supply of raw materials, lack of organized market channels, imperfect knowledge of market conditions, unorganized nature of operations, inadequate availability of credit, constraint of infrastructure facilities including power etc. and deficient managerial and technical skills.''

Small-Scale Industry Policy

The government of India (GoI) has taken many measures for the growth and development of the SSI sector. It has followed a policy of reservation of items for exclusive manufacturing by the small-scale sector. Over the years, the number of items on the reserved list have increased reaching 836 items in 2005. However, 14 of

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these items have been dereserved by the 2006-07 Union Budget. For the past several years the GoI has recognized the need for the modernization of the SSI and has initiated measures towards this end. It has put in place an infrastructure consisting of many institutions both at the national as well as state and district levels to work for the modernization of the SSIs. Some of these institutions will now be discussed in brief.

Small Industries Development Organization (SIDO)

One of the most important initiative undertaken by GoI is the establishment of the SIDO in 1954. This organization is headed by a Small Industries Development Commissioner (DCSSI). SIDO is placed under the jurisdiction of the Ministry of Industrial Development and has its headquarters in New Delhi, India. The branch offices of the DCSSI that are spread all over the country take care of the establishment, operation and growth of the SSIs. The organizations under the control DCSSI, at central and state level, organize various types of activities including training, seminar, plant visits, and group discussions. Some of the major programs of the SIDO are technology development, energy conservation, pollution control, ISO-9000 etc. They help the SSIs by providing them with raw materials that are not readily available in the market when needed. (Earlier, the small industries were mostly depedent on local raw materials. However the modern small-scale industries manufacturing more sophisticated and new products are using imported raw materials. Sometimes problems arise in procuring the right quality of raw materials in time, for operating their production plans and delivery schedules, due to foreign exchange crisis or other reasons such as working capital problems.) The DCSSI branch offices also assist the SSIs in collecting outstanding dues from their customers. The SIDO is

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an umbrella organization under which a number of institutions operate. These are the service institutes, the district industries centers and the information banks.

Small Industries Service Institutes (SISIs)

As of 2000, there were 26 SISIs, 32 branch institutes and 39 extension centers under the DCSSI. These institutions are fully devoted to provide assistance to the SSIs in all phases of their operation. These organizations help the SSIs in identifying items for manufacturing, provide information on technologies, feasibility studies, training, organization of workshops and seminars and other such programs. SISIs have a program for stocking up spare parts and other supply items not readily available in the market but necessary for the small-scale industries. The SISIs also have `reasonably well-equipped' workshops and labs that offer testing services to small-scale industrial units which are not equipped or have no proper personnel.

Directorate of Industries

The Directorate of Industries is an apex body for promoting industrial development in the states. The Development Commissioner (Industries) heads the institution which is supported by 6 regional and 30 district level establishments. The regional offices in each state are headed by the Joint Director of District Industries Centers. The important functions of this agency is the implementation of the small-scale industry promotional schemes.

District Industries Centers (DIC)

The idea of District Industries Centers (DIC) was introduced by the Industrial Policy Statement of December 1977. These DICs were established in each district to `provide

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and arrange a package of assistance and facilities for credit guidance, raw materials, training, marketing, etc. This program began in May 1979. As of 2005, there are 422 DICs operating in 431 districts in the country.

National Small Industries Corporation (NSIC)

The National Small Industries Corporation (NSIC) was formed to assist the small industrial units by providing equipment on hire-purchase basis. The supplied machines are used in various industries such as plastics, leather, printing and stationery, automobile componenets and spares, electronic equipment etc. NSIC projects to promote SSIs include finanacial services, technology upgradation, technical training and marketing assistance. NSIC has prototype development and testing centers at three places in the country to make available improved machine designs and to give advanced technical training to personnel from the small industry. Most states in the country have an industrial infrastructure corporation that provides buildings, sheds and developed plots to small industrial units and small industries marketing boards to assist in marketing. These corporations in some state are separate for certain industries such as the electronics, leather, and ceramics.

National Institute of Small Industry Extension Training (NISIET)

The National Institute of Small Industry Extension Training (NISIET) was established as an autonomous society by the Government of India, at Hyderabad in 1962. The principal activities of the Institute are the training, research and consultancy in the four related fields of small industry development, management, extension and information for development. In 1970, the Small Enterprises National Documentation

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Center (SENDOC) was set up at NISIET to assist the small industry in its information needs.

Small Industries Development Bank of India (SIDBI)

The Small Industries Development Bank of India (SIDBI) was set up by GoI under a special act of the Parliament in April 1999. It is a wholly owned subsidiary of the IDBI. SIDBI has a network of 33 offices (5 regional and 28 branch offices). The Bank was instituted to ensure the increased flow of financial assistance to SSIs. It assists the SSIs through direct assistance schemes as well as indirect assistance such as refinancing.

Role and Problems of Small Units in India

As industrialization gathered momentum so did the increase in small-scale industries. Small units play an important role in the Indian economy, as they are labour intensive and create job opportunities. Small companies are defined as those with less than US $180,000 in capital equipment (US-AEP, 2005). They offer a higher productivity of capital than capital intensive enterprises, as they have low investment per worker. They help in dispersal of industries, rural development, and the decentralisation of economic power. All this is required to increase and disperse economic growth.

In addition, small companies support entrepreneurial talent and skills, stimulate personal savings, and help in developing innovative and appropriate indigenous technology, providing dynamism and contributing to competition (Rajendran, 1989). Therefore these industries are supported by the government and have been actively encouraged; no public or private enterprise with more than 100 employees has been

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allowed to go out of business (US-AEP, 2005). The government to support this sector, not only for employment generation but also to enhance their competitive strength has undertaken several policy initiatives and procedural simplifications. The government has also provided measures such as greater infra-structural support, more and easier availability of credit, lower rates of duty, technology up-gradation, assistance to build entrepreneurial talent, facilities for quality improvement, and export incentives (Parthasarathy, 2005).

Contributions of small-scale industries (SSIs) to India's industrial production, exports, and employment are significant. About 3 million SSI units employing nearly 16.7 million persons account for 35% of India's total exports and about 40% of industrial manufacture (SIDBI report on small scale industries sector, 2008, 2008, p. 6). In real terms, the small-scale sector recorded a growth rate of 10.1% in 2003-04 as against 7.1% in 2002-03 and 5.6% in 2001-02. By the year 2025, if not controlled, this sector will grow even more rapidly (Parthasarathy, 2005).

 The government’s prime role has been to encourage growth of these industries, often neglecting environmental considerations. Industrial effluent largely comes from the 3 million small- and medium-sized units that are scattered throughout the country, particularly in the production of paper, sugar, leather, and chemicals. Unfortunately, only about half the medium- to large-scale industries have partial or complete effluent treatment. Fourfold industrial growth from 1963 to 2000 resulted in sixfold growth in toxic releases. Heavy industries like iron and steel producers contribute nearly 70% of the toxic wastes released but only 20% of industrial output. Industrial disposal of polluted effluent occurs via open drains

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into streams and reservoirs or through underground injection. Most industrial estates lack wastewater treatment systems (US-AEP, 2005).

 Besides pollution problems, small-scale industries also have other kinds of problems. One is internal, that is, the techno-managerial and financial problems that they encounter, and the other is the external problems that they confront due to non-compliance with regulatory and legislative measures.

Techno-Managerial and Financial Problems

Small industries by comparison with large industries lack environmental commitment, technical expertise in environmental management, and the financial capabilities to address environmental problems. Nor do they have standards or effective treatment opportunities and services (Nyati, 1988). Interestingly, one would imagine that because small industries are heavily supported by the government, availability of finance and obtaining finance for pollution control measures should not be a problem.

Small industries also lack additional space for pollution control facilities. There are difficulties in obtaining the technical assistance of knowledgeable consultants. Since most of the units are dispersed, they find it difficult to come together for a joint or common treatment plant. The concern of depressed profit margins and decline in competitiveness prevents these units from using pollution control measures. More emphasis is laid on new investments, production, and other return oriented opportunities. Soft loans for pollution control measures are not lucrative. There are subsidies offered for investments in pollution control as incentives, but the impact of these incentives on these units is little or nothing, for they do not alter the cost-benefit analysis in favour of pollution control investments (Nyati, 1988).

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Regulatory Problems

Research done by Pargal, Mani, and Huq (2006) on industrial plants in India, indicated that high levels of pollution elicit a formal regulatory response in the form of inspections, but these inspections appear to have no impact on the emissions. Inspections are probably ineffective in bringing about desired changes in behaviour because of bureaucratic or other problems, including the probability that enforcement is low and that the penalty for non-compliance is not stringent enough to act as a deterrent. They suggest that Indian policy makers and regulators thus need to explicitly recognize the trade-off in environmental quality of the existing regulatory bias towards the small- and medium-scale sector.

Regulatory compliance has been a major issue for these units. Environmental legislation in India, although seemingly as tough as that in major developed nations, is not well enforced. Though multinationals and the large domestic companies are monitored, poorly funded regulatory bodies find it nearly impossible to police the millions of small- and medium-scale units. Bribing poorly paid inspectors is reported to be common (Roberts, 2004).

Environmentalists have viewed enforcement as lax, despite the regulatory framework and oversight authority of the Central and State Boards. There have been no incentives to invest in the pollution control effort because of weak monitoring and enforcement of environmental regulations. It is mainly small industries that continue to lack incentives to set up treatment equipment or to operate equipment, if it already is installed, because operating that equipment has been more expensive than non-compliance (Dasgupta, Laplante, & Mamingi, 2007). Obviously, in India, scarcity of

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natural resources is less a concern than misuse of them. The pressure for profits predominates. Porter and Linde’s (2004) suggestion that environmental regulations can spur innovations that increase product value and a decrease total cost seems appropriate. The trade-off between economy and environment for production processes, customer needs, and technology is dynamic and complex. Porter and Linde suggest that innovation-friendly regulations can improve resource productivity and competitiveness, but the problem is getting small industries to co-operate and to view it as a long-term solution rather than a short-term goal.

Environmental Pollution Laws

India began to develop distinctive forms of environmental laws and regulations in the 1970s. The first of India’s modern environmental laws was the Water (Prevention and Control of Pollution) Act of 1974, which established the Central and State Water Pollution Control Boards; the Water Cess Act of 1977; the Air (Prevention and Control of Pollution) Act of 1981; and the Environment (Protection) Act of 1986. The latter is umbrella legislation designed to provide a framework for central government. The problem envisaged here is not insufficient laws or pollution control boards that can control pollution but, as the World Bank has stated, that these boards have been plagued “by poor enforcement due to political interference . . . whereas as with other enforcement activities in India, corruption is pervasive" (US-AEP, 2005).

Another point worth noting is that the mandate of the Central Pollution Control Board (CPCB) is to set environmental standards for all plants in India, lay down ambient standards, and coordinate the activities of the State Pollution Control Boards (SPCBs). Unfortunately, the implementation of environmental laws and their

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enforcement are decentralized and so is the responsibility of the SPCBs (Mani, Pargal, & Huq, 2005). This is another haphazard method of addressing the issue.

In addition, pollution laws have achieved little success. The courts have been slow to respond to enforcement actions sought by state pollution boards. The boards themselves have been poorly funded and charges of corruption have been regular and widespread. Large industries have achieved pollution compliance more easily than small industries (US-AEP, 2005). The reason is that they are afraid of taking risks. Lau and Srinivasan’s (2006) research on identifying the driving force for better environmental performance found results that implied the current effort in environmental management is driven largely by a fear of the penalty that can be imposed by the government when environmental laws are violated. However, Cornell and Shapiro (1987) explained that a firm's value depended on the cost of explicit and implicit environmental claims. Explicit claims of the shareholders can be recognized, but the implicit claims of the firm cannot be ignored. If the firm refuses to comply with its social responsibility and quality service, parties to implicit contracts, like consumers or regulatory agencies, can force burdensome explicit contracts on the firm. Cornell and Shapiro’s explanation applies widely to large industries, but in the case of small firms it is apparent from the literature above that this can be totally dismissed by resorting to other means.

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CHAPTER – 2

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LITERATURE REVIEW

Due to rapid pace of technological developments and intensified competition, small and medium enterprises in India have started realising the significance of improving their productivity levels more than ever before. In this context, the present chapter reviews the literature relating to the study so as to formulate the problem precisely and develop a rationale for its undertaking. The basic objective is to indicate in a general way the type of work done in this direction rather than to give exhaustive review of all the research work done on the problem. The review of various studies done in this chapter provides a broad spectrum about the productivity and efficiency analysis of small scale industrial sector which would be helpful to design the appropriate methodology for the present study.

Various empirical studies have been conducted from time to time to examine the different aspects of growth pattern and performance of small scale industrial sectors in India and in this context, important studies are reviewed below in a chronological order. For this purpose, the chapter has been divided into three sections, Section -I highlights the review of studies relating to the performance evaluation of small scale industrial sector at All India level, whereas, Section-II focuses on the studies pertaining to the performance evaluation of the small scale industrial sector at regional level. However, the last section is concluding in nature and pinpoints the rationale of undertaking the present study.

Habib (1972) through his study came to the conclusion that small scale industries play an important role in the economic development by providing numerous chances of income generation and improving the standard of living of the masses. Habib

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emphasized that it is only the small scale sector through which economic prosperity can reach the remotest sections of the society. From the very beginning since the process of economic development started, the small scale sector has been providing handsome employment opportunities to millions of job seekers in the country. Further, small scale industries use local raw materials, employ local people and thus help in generating employment opportunities for the community.

National Council of Applied Economic Research (1972) conducted a study to examine the economies of selected number of small industrial units operating in different parts of the country. A sample of 159 units spread over 22 industrial groups was selected, of the selected units, 48 were manufacturing consumer products, 76 capital goods and 35 intermediate products. The study showed that besides other problems, the under-utilisation of capacity among most of the units was due to the problems of production as well as marketing. The problems of production were closely associated with scarcity of raw material and inadequate finance. The problems of marketing are by and large attributed to such factors as limited size of operation, practically little or no control over quality, price and weak financial base, restricting the scope for engaging in sustained sales promotion. The problem of sales is more acute where the area of operation is large particularly in case of consumer products or capital goods, where after-sale service is essential. In most of the cases the entrepreneurs are found to be dependent on middlemen for the marketing of their products.

Banerjee (1975) examined the relationship between capital intensity and productivity in the context of Indian manufacturing industry. The analysis has been carried out for manufacturing sector as a whole and five individual industries (viz. cotton textiles,

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Jute textiles, sugar, paper and bicycle) by using ASI data for the period 1946-64. The study highlighted that the performance of the manufacturing sector was sluggish over the period 1946-64. While labour productivity showed a significant upward trend during this period, but this sector did not indicate the presence of any ‘technical progress’. The hypothesis of constant returns to scale was not rejected. It has been found that elasticity of substitution between capital and labour is near unity in almost all the industries.

The Vidarbha Industries Association (1976) made an empirical survey of sick units in the region and dealt specifically with the major problem of finance, policies and procedures of credit agencies as well as the difficulties that were being faced in marketing. The study asserted that most of the difficulties of small scale sector arise from financial, administrative control, frequent interest changes and recession in demand these tends to make the units sick. Further, the requirements of credit of small scale industries located in far away places are greater than those located at an industrial centre because the former has to maintain higher inventories. The study made specific observations on the low and weak equity base of the units, the unrealistic gestation period allowed by state financial corporations, inadequate loans by commercial banks and these factors emerged as the major causes of sickness in the small scale sector. The study suggested that the moment a danger of sickness appears, action should be initiated and dues of a sick unit should be converted into a long term loan. The study also revealed that financial agencies have not been able to play their role in the development of small scale sector in the under developed regions. It has, therefore, been recommended to set up a regional development corporation which may finance sick units and help them in marketing their products.

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Jain (1980) discussed the increasing role of small scale industries in industrial structure of the country along with export potential of small scale industries. The various measures undertaken by the government agencies such as guidance formation, financial support, export house scheme etc. to develop the formation of the consortia for the benefit of the small industries have also been expressed. It has been observed that the operational results of existing consortia may not be very substantial but encouraging. Therefore, a potential of growth of such consortia look immensely favourable.

Mehta (1980) attempted to analyse productivity trends for 27 Indian industries by using ASI data for the period 1953-65. The results revealed that there was a considerable diversity in the experience of different industries regarding trends of labour and capital productivity. Labour productivity was found to have increased significantly in industries like vegetable oil, chemical, glass and glassware and insignificantly in matches, iron and steel and cement industries. However, capital productivity has not increased appreciably, rather the reverse was true in most industries. The total factor productivity of Indian manufacturing sector have declined over a period of time. The study noticed that most industries exhibited the presence of constant returns to scale and diseconomies of scale had not set in. The study demonstrated that there were inter industry differences with respect to ease of capital-labour substitution which primarily explained the inter industry growth differentials. The elasticity of substitution was found to be significantly different from zero in many industries.

Papola (1981) studied the impact of concessional finance on industrial development and emphasised that in order to make concessional finance effective, it will be

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necessary to plan and develop a minimum threshold level of industrial activity preferably with strong inter-relationship between the financial institutions, promotional institutions, state and district administration and potential industrial entrepreneurs, especially for more backward districts. He further emphasised that almost one half of the fixed and working capital requirements of the units studied have been met by institutional financing and most of the fixed capital financing has been met through concessional finance especially in the backward districts. Units availing concessional finance have experienced a higher rate of growth in output than those without it.

Goldar (1983) examined productivity trends in Indian manufacturing sector and estimated Total Factor Productivity (TFP) by applying Solow index and Translog index using firstly 1951-65 data covering all Census of Indian manufacturing industries except “general engineering and electrical engineering” industry for 1951-58 and Annual Survey of Industries (ASI) data for 1959-65 and secondly, during the period of 1959-78 based on ASI data. This analysis shows a rising trend in labour productivity and capital intensity and a falling trend in capital productivity during this period. Growth in TFP seems to have been rather sluggish and its contribution to output growth is quite small. The observed rise in labour productivity and fall in capital productivity may accordingly be attributed to increasing capital intensity. Substitution of labour by capital seems to be the main feature of industrial growth. The result of Cobb-Douglas function estimation favours the assumption of constant returns to scale implicit in the TFP indices which is in broad agreement with the results of TFP indices especially in terms of the direction of TFP growth. The study has pointed out that the general industrial situation was not conducive to productivity

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growth. Under-utilisation of capacity, shortage of fuels, power and transport facilities and deteriorating industrial relations had a significant depressing effect on productivity growth. Moreover, gestation lags in the basic and capital goods industries, which accounted for a dominant part of investment in post 1956 period, must have had a depressing effect on productivity growth. A pronounced rising trend in capital intensity was found, which implied that the growth in industrial employment has seriously lagged behind the growth in industrial investment and output. To some extent this is a result of the changing industrial structure in favour of basic and capital goods industries. It has been observed that metals, chemicals, rubber, petroleum and machinery industries are among the lowest ranked in terms of TFP growth, since these are the industries in which import substitution has been attempted on a considerable scale. Though the policy of import substitution contributed much to the objective of self reliance, yet it has been inimical to productivity growth.

Ethiopia (1984) evaluated the importance of small scale industries for providing employment and income generation in the African countries. The focus of the study is on the analysis of efficiency of production and employment and results showed that the artisan and small scale industrial sector are important component of the Ethiopian economy in terms of generation of income and employment. The empirical evidence of factor intensity and production also indicates that many small enterprises are efficient in utilizing scarce resources such as capital and foreign exchange. Small scale industries have also reasonable demand for their products, but strengthening of the linkage between small scale industry and the agriculture sector appears to be necessary. The study revealed that institutional, social and economic constraints impede the development of this sector.

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Qommen (1972) conducted a survey of randomly selected 45 small scale units in Kerala to investigate the marketing assistance provided by the government to this sector along with assistance of finance and services. The study undertook to examine the modernisation, industrial estates programmes and rural industries project with regard to small scale industries in Kerala. It has been observed that 44 percent of the units sell their products throughout India, 28 percent at state level and remaining 28 percent sell their goods in the local market. Most of the units sell their products through retailers, wholesalers, commission agents, government, ancillaries, sub-contracting etc. The study also revealed that there are various marketing assistance schemes such as marketing research, quality marketing, ancillary development, export promotion and direct government purchase programme, but small units could not take desired advantage of these programmes due to ignorance and lack of communication. It has been observed that the state of Kerala faces a peculiar marketing problem of 'distant cost' in the purchase of inputs as well as sale of output and so special strategy is desirable in this regard.

Brahma and Subas (1979) examined the development of small scale industries in India with special reference to its development in Pune region. In this regard the data was collected from 276 modern units and 98 traditional units. The main focus of the study was to find out the problems of development of small scale industrial units, along with other problems, the study indicated that the problems of raw material and marketing by small scale units are the major problems. The irregular supply and low quality of raw material are very common, with regard to marketing, delay in payment and exploitation at the hands of middlemen are the other noteworthy problems mentioned in the study.

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Kaur (1982) conducted a study of Haryana during the period 1966-78 and found that there was overwhelming concentration of industrial units and employment opportunities in Gurgaon, Ambala and Sonepat districts and the relative change in the number of units, output and employment observed during the study period. further, author indicated that inter district disparities in the growth of industries had widened and with the help of location quotient and coefficient of localisation, a high degree of spatial concentrations was observed in wool, silk and synthetic fiber, wood and wooden products, food manufacturing, beverages and cotton textile industry group.

Mohanty (1983) examined the marketing structure of small scale industrial products by taking a sample of 178 small units of Cuttack. The study revealed that 64 percent of the units sell their products directly to the consumers, while 36 percent sell their products through distributive agencies. It has been further observed that if marketing cost is taken into consideration, it constitutes only a small percentage of the total value of production of small units which indicates that small units do not take pains to develop market for their products, further, it was found that Director General Supplies and Disposal and other Government stores do not purchase items from small units.

Amin (1999) focused on the regional spread and structural set up of small scale industries in Gujarat and examine the regional share of small scale industries in the industrial sector of the state. Further, the author attempt to make an overall assessment of the performance of the industries among three homogenous regions of the state during the period 1965-1985: the study found that the spread of small scale industrial sector across the industrially homogenous regions is positively influenced by basic economic characteristics of the concerned region. The pattern of regional distribution of the SSI sector suggests the growth prospects of SSI sector over a period of time.

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PROBLEM CONTEXTS INDUSTRY/ ORGANIZATION/

PERSPECTIVES/ IMPLICATIONS

The Ministry of SSI designs policies, programmes, projects and schemes in consultation with its organizations and various stakeholders and monitors their implementation with a view to assisting the promotion and growth of small scale industries. The Ministry also performs the function of policy advocacy on behalf of the SSI sector with other Ministries/Departments of the Central Government and the State and Union Territories.

The implementation of policies and various programmes/projects/schemes for providing infrastructure and support services to small enterprises is undertaken through its attached office, namely the Small Industry Development Organization (SIDO) and the National Small Industries Corporation (NSIC) Ltd., a public sector undertaking under the Ministry.

SMALL INDUSTRY DEVELOPMENT ORGANIZATION

(SIDO)

The Office of the Development Commissioner (Small Scale Industries) is also known as the Small Industry Development Organization (SIDO). It is an apex body for assisting the Ministry in formulating, coordinating, implementing and monitoring policies and programmes for the promotion and development of small scale industries in the country and is headed by the Development Commissioner (SSI).

In addition, the SIDO provides a comprehensive range of common facilities, technology support services, marketing assistance, etc., through its network of 30

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Small Industries Service Institutes (SISIs), 28 Branch SISIs, 7 Field Testing Stations (FTS), 4 Regional Testing Centres, 2 Small Entrepreneur Promotion and Training Institutes (SEPTI) and 1 Hand Tool Design Development and Training Centre. The SIDO also has a network of Tool Rooms, Process-cum-Product Development Centres (PPDCs) and technology and training support institutes which are run as autonomous bodies registered as societies under the Societies Act.

NATIONAL SMALL INDUSTRIES CORPORATION (NSIC) LTD.

The National Small Industries Corporation Ltd. was set up with a view to promoting, aiding and fostering the growth of small scale industries in the country with focus on commercial aspects of these functions. NSIC continues to implement its various programmes and projects throughout the country to assist the SSI units. The Corporation has been assisting the sector through the following schemes and activities:

 Supply of both indigenous and imported machines on easy hire-purchase terms Composite term loan scheme Procurement, supply and distribution, of indigenous and imported raw- materials Marketing of small industries products

 Export of small industries products and developing export-worthiness of small scale units

 Enlisting competent units and facilitating their participation in Government Stores Purchase Programme

 Training in several technical trades

 Sensitizing SSI units on technological up gradation through Software Technology Parks and Technology Transfer Centres

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 Mentoring & advisory services

Technology business incubators. Setting up small scale industries in other developing countries on turnkey basis Other areas & international co-operation Over the years, the Corporation has made significant contribution to the growth of the SSI sector in India. The Corporation has also set up a large number of turnkey projects in a number of developing countries. The Corporation is an ISO: 9001-2009 Company.

SMALL SCALE INDUSTRIES BOARD

SSI Board is the apex non-statutory advisory body constituted by the Government of India to render advice on all issues pertaining to the SSI sector. The Minister incharge of the SSI Ministry is the Chairman of the Board. Members of the Board, include inter alia State Industries Ministers, selected Members of Parliament, Secretaries of various Departments of the Central Government, Heads of Financial Institutions, Representatives of Industry Associations and Eminent Experts.

 The SSI Board provides to its members a forum for interaction to facilitate co-operation and inter-institutional linkages and to render advice to the Government on various policy matters, for the development of the sector.

 The Board was first constituted in 1954. Its term is for two years. The Board was last constituted on 18th_{January 2012, with 101 members and held its 48}th

meeting on 17 January, 2013.

NATIONAL INSTITUTES FOR ENTREPRENEURSHIP

DEVELOPMENT

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As entrepreneurship development and training is one of the key elements for the promotion of small scale industries, the Ministry has established three National Institutes, viz. the National Institute of Small Industry Extension Training (NISIET) at Hyderabad, the National Institute of Entrepreneurship and Small Business Development (NIESBUD) at NOIDA and the Indian Institute of Entrepreneurship (IIE) at Guwahati as autonomous bodies. These Institutes are responsible for development of training models and undertaking of research and training for entrepreneurship development in the SSI sector.

NATIONAL COMMISSION FOR ENTERPRISES IN THE

UNORGANIZED SECTOR

The National Commission for Enterprises in the Unorganized Sector was constituted in September, 2013 under the chairmanship of Dr. Arjun K. Sengupta, an eminent economist. It has three full-time Members and two part-time Members and an Advisory Board consisting of 11 eminent experts from different fields relating to the unorganized/informal sector. The Commission will recommend measures considered necessary for bringing about improvement in the productivity of the informal sector enterprises, generation of large scale employment opportunities on a sustainable basis, particularly in the rural areas, enhancing the competitiveness of the sector in the emerging global environment, linkage of the sector with institutional framework in areas such as credit, raw material, infrastructure, technology upgradation, marketing and formulation of suitable arrangements for skill development.

In accordance with its terms of reference, the Commission and its Advisory Board have held several rounds of deliberations on a host of issues relating to the

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unorganized/informal sector enterprises. In the light of these deliberations, the following issues have been identified so far by the Commission for detailed consideration and recommendations: notion of growth poles for the informal sector in the form of clusters/hubs, where external economies need to be provided to spur employment generation and productivity enhancement and the feasibility of integrating the initiatives and programmes of various Ministries in this domain; skill formation in the informal sector and potential for public private partnership in providing the required skills; provision of micro finance and related services to the informal sector enterprises and strengthening of the institutional framework in this area; and issues concerning social security for the workers in the informal sector and instrumentalities for achieving this objective.

Employment

SSI Sector in India creates largest employment opportunities for the Indian populace, next only to Agriculture. It has been estimated that 100,000 rupees of investment in fixed assets in the small-scale sector generates employment for four persons.

Generation of Employment - Industry Group-wise

Food products industry has ranked first in generating employment, providing employment to 0.48 million persons (13.1%). The next two industry groups were Non-metallic mineral products with employment of 0.45 million persons (12.2%) and Metal products with 0.37 million persons (10.2%).

In Chemicals & chemical products, Machinery parts except Electrical parts, Wood products, Basic Metal Industries, Paper products & printing, Hosiery & garments,

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Repair services and Rubber & plastic products, the contribution ranged from 9% to 5%, the total contribution by these eight industry groups being 49%.

In all other industries the contribution was less than 5%.

Per unit employment

Per unit employment was the highest (20) in units engaged in beverages, tobacco & tobacco products mainly due to the high employment potential of this industry particularly in Maharashtra, Andhra Pradesh, Rajasthan, Assam and Tamil Nadu. Next came Cotton textile products (17), Non-metallic mineral products (14.1), Basic metal industries (13.6) and Electrical machinery and parts (11.2.) The lowest figure of 2.4 was in Repair services line.

Per unit employment was the highest (10) in metropolitan areas and lowest (5) in rural areas. However, in Chemicals & chemical products, Non-metallic mineral products and Basic metal industries per unit employment was higher in rural areas as compared to metropolitan areas/urban areas. In urban areas highest employment per unit was in Beverages, tobacco products (31 persons) followed by Cotton textile products (18), Basic metal industries (13) and Non-metallic mineral products (12).

Location-wise Employment Distribution - Rural

Non-metallic products contributed 22.7% to employment generated in rural areas. Food Products accounted for 21.1%, Wood Products and Chemicals and chemical products shared between them 17.5%.

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As for urban areas, Food Products and Metal Products almost equally shared 22.8% of employment. Machinery parts except electrical, Non-metallic mineral products, and Chemicals & chemical products between them accounted for 26.2% of employment. In metropolitan areas the leading industries were Metal products, Machinery and parts except electrical and Paper products & printing (total share being 33.6%). State-wise Employment Distribution.

 Tamil Nadu (14.5%) made the maximum contribution to employment.

 This was followed by Maharashtra (9.7%), Uttar Pradesh (9.5%) and West Bengal (8.5%) the total share being 27.7%. Gujarat (7.6%), Andhra Pradesh (7.5%), Karnataka (6.7%) and Punjab (5.6%) together accounted for another 27.4%. Per unit employment was high - 17, 16 and 14 respectively - in Nagaland, Sikkim and Dadra & Nagar Haveli. It was 12 in Maharashtra, Tripura and Delhi. Madhya Pradesh had the lowest figure of 2. In all other cases it was around the average of 6.

Year Target (lakh nos.) Achievement (lakh nos.) Growth rate 2005-06 128.0 134.06 3.28 2006-07 133.0 139.38 3.28 2007-08 138.6 146.56 5.15 2008-09 144.4 152.61 4.13 2009-10 150.5 160.00 4.88 2010-11 165 167.20 4.50 2011-12 170.1 171.58 2.61 2012-13 175.4 177.3 3.33

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Export

SSI Sector plays a major role in India's present export performance. 45%-50% of the Indian Exports is contributed by SSI Sector. Direct exports from the SSI Sector account for nearly 35% of total exports. Besides direct exports, it is estimated that small-scale industrial units contribute around 15% to exports indirectly. This takes place through merchant exporters, trading houses and export houses. They may also be in the form of export orders from large units or the production of parts and components for use for finished exportable goods.

1 It would surprise many to know that non-traditional products account for more than 95% of the SSI exports.

2 The exports from SSI sector have been clocking excellent growth rates in this decade. It has been mostly fuelled by the performance of garments, leather and gems and jewellery units from this sector.

3 The product groups where the SSI sector dominates in exports, are sports goods, readymade garments, woollen garments and knitwear, plastic products, processed food and leather products.

4 The SSI sector is reorienting its export strategy towards the new trade regime being ushered in by the WTO.

Year Exports

(Rs.Crores) (at current prices) 2008-09 29,068 (14.86)

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2010-11 39,249 (7.61) 2011-12 43946 (11.97) 2012-13 48979 (10.2) 2013-14 53975 (10.2)

Major Export Markets

 An evaluation study has been done by M/s A.C. Nielsen on behalf of Ministry of SSI. As per the findings and recommendations of the said study the major export markets identified having potential to enhance SSIs exports are US, EU and Japan. The potential items of SSIs have been categorised into three broad categories.

Export Destinations

 The Export Destinations of SSI products have been identified for 16 product groups.

Opportunity

The opportunities in the small-scale sector are enormous due to the following factors:  Less Capital Intensive

 Extensive Promotion & Support by Government

 Reservation for Exclusive Manufacture by small scale sector  Project Profiles

 Funding - Finance & Subsidies  Machinery Procurement  Raw Material Procurement

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 Manpower Training

 Technical & Managerial skills  Tooling & Testing support

 Reservation for Exclusive Purchase by Government  Export Promotion

 Growth in demand in the domestic market size due to overall economic growth

INCREASING EXPORT POTENTIAL FOR INDIAN

PRODUCTS

Growth in Requirements for ancillary units due to the increase in number of greenfield units coming up in the large scale sector. Small industry sector has performed exceedingly well and enabled our country to achieve a wide measure of industrial growth and diversification.

By its less capital intensive and high labour absorption nature, SSI sector has made significant contributions to employment generation and also to rural industrialisation. This sector is ideally suited to build on the strengths of our traditional skills and knowledge, by infusion of technologies, capital and innovative marketing practices. This is the opportune time to set up projects in the small-scale sector. It may be said that the outlook is positive, indeed promising, given some safeguards. This expectation is based on an essential feature of the Indian industry and the demand structures. The diversity in production systems and demand structures will ensure long term co-existence of many layers of demand for consumer products / technologies / processes. There will be flourishing and well grounded markets for the same product/process, differentiated by quality, value added and sophistication. This

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characteristic of the Indian economy will allow complementary existence for various diverse types of units. The promotional and protective policies of the Govt. have ensured the presence of this sector in an astonishing range of products, particularly in consumer goods. However, the bugbear of the sector has been the inadequacies in capital, technology and marketing. The process of liberalisation coupled with Government support will therefore, attract the infusion of just these things in the sector. Small industry sector has performed exceedingly well and enabled our country to achieve a wide measure of industrial growth and diversification.

By its less capital intensive and high labour absorbtion nature, SSI sector has made significant contributions to employment generation and also to rural industrialisation. This sector is ideally suited to build on the strengths of our traditional skills and knowledge, by infusion of technologies, capital and innovative marketing practices. So this is the opportune time to set up projects in the small scale sector. It may be said that the outlook is positive, indeed promising, given some safeguards. This expectation is based on an essential feature of the Indian industry and the demand structures. The diversity in production systems and demand structures will ensure long term co-existence of many layers of demand for consumer products / technologies / processes. There will be flourishing and well grounded markets for the same product/process, differentiated by quality, value added and sophistication. This characteristic of the Indian economy will allow complementary existence for various diverse types of units. The promotional and protective policies of the Govt. have ensured the presence of this sector in an astonishing range of products, particularly in consumer goods. However, the bug bear of the sector has been the inadequacies in capital, technology and marketing. The process of liberalisation will therefore, attract the infusion of just these things in the sector.

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Analysis of Problems and Prospects of Small Scale Industries in India

NEW DELHI

THESIS

ON

“ANALYSIS OF PROBLEMS AND PROSPECTS

OF SMALL SCALE INDUSTRIES IN INDIA”

SUBMITTED TO:

EXTERNAL GUIDE:

IIPM, NEW DELHI

Mr. Lawanya Kr. Agarwal

Designation- CEO of Assam Industries

SUBMITTED BY:

ABSTRACT

CERTIFICATE OF ORGINALITY

ACKNOWLEDGEMENT

THESIS SYNOPSIS

Research objective:

Introduction to the area of research:

SCOPE OF THE STUDY:

Justification for Choosing a Particular Research Proposal

TABLE OF CONTENTS

CHAPTER-1

INTRODUCTION

INTRODUCTION

The promotional measures cover

Small-Scale Industry Policy

Small Industries Development Organization (SIDO)

Small Industries Service Institutes (SISIs)

Directorate of Industries

District Industries Centers (DIC)

National Small Industries Corporation (NSIC)

National Institute of Small Industry Extension Training (NISIET)

Small Industries Development Bank of India (SIDBI)

Role and Problems of Small Units in India

Techno-Managerial and Financial Problems

Environmental Pollution Laws

CHAPTER – 2

LITERATURE REVIEW

PROBLEM CONTEXTS INDUSTRY/ ORGANIZATION/

PERSPECTIVES/ IMPLICATIONS

(SIDO)

NATIONAL SMALL INDUSTRIES CORPORATION (NSIC) LTD.

SMALL SCALE INDUSTRIES BOARD

NATIONAL INSTITUTES FOR ENTREPRENEURSHIP

DEVELOPMENT

NATIONAL COMMISSION FOR ENTERPRISES IN THE

UNORGANIZED SECTOR

Employment

In all other industries the contribution was less than 5%.

Per unit employment

Location-wise Employment Distribution - Rural

Export

Major Export Markets

Export Destinations

INCREASING EXPORT POTENTIAL FOR INDIAN

PRODUCTS

CHAPTER -3