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TN: Meet to discuss small-scale sector woes on Aug 24-25

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CHENNAI, Aug. 11

INCREASED interaction between industry associations and the State Government, decentralisation of responsibilities and provision of escort services in marketing and technology upgradation are crucial to the success of the small scale sector, according to Mr A. Selvaraj, President, Tamil Nadu Small and Tiny Industries Association.

He told presspersons here that these issues would be discussed at the Small and Tiny Industries Convention (STICON-2002) to be held at Hosur on August 24 and 25.

While the Tamil Nadu Government has announced in the Assembly that it would foster public private partnership (PPP), the bond can only be strengthened with involvement of industry associations. Industry representatives would have to be involved in addressing issues such as the financial sickness prevalent in the sector, technology upgradation, marketing and competitiveness. They could also better disseminate information and provide escort services with financial backing by the State Government.

Escort services to revive a sick unit, high cost of finance, technology upgradation and marketing are key issues that need to be addressed. While State and Central Government agencies were expected to work towards these goals, there was a lack of coordination between these agencies, which prevented the intentions from being translated into reality, Mr Selvaraj said.

While official estimates say that there are 3.5 lakh small-scale enterprises in the State, a sample study carried out by the association indicates that the actual units in operation could be far less. Even according to a RBI report, at least 40 per cent of the 37-lakh small-scale units in the country are sick. For instance, the Tamil Nadu Industrial Investment Corporation has 26,000 loan accounts of which small-scale units account for 18,000. The outstanding is about Rs 2,331 crore and 39 per cent are declared NPAs. Only a participative approach will help assess ground realities and devise measures to tackle the problems.

With employment opportunities shrinking elsewhere, the well-being of the small-scale sector, the largest mployment provider, was vital, he said.

STICON will also act as a forum to provide crucial inputs to two major legislations concerning the sector — the Small Enterprises Development Bill 2002 and labour reforms. The Small Enterprises Development Bill was a welcome move but needed changes that better address the issues concerned. The subjects that will be discussed include rejuvenating the sector, the challenges, agro industries and exports.

The industry associations in the South including Tamil Nadu, Karnataka, Kerala, Goa and Pondicherry have formed a confederation to enhance efficiency of representation to the Centre and State Governments, he said.

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