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Even developed countries like the US have a Small Business Act, which ensures finance to the units at nominal interest.

CHENNAI, Dec. 17

IN a memorandum submitted to the President, Dr A.P.J. Abdul Kalam, the Tamil Nadu Small and Tiny Industries Association has urged continuation of State Government support to Small Scale Industries and establishment of financing mechanisms tailored to the sector's needs.

According to a copy of the memorandum circulated to the media, the association said the absence of a price control order has resulted in prices increasing continuously; interest rates are higher than those prevailing in competing countries such as Korea, Taiwan and China, and power tariffs should be reduced to levels prevailing in these countries and gaps in State procurement should be addressed.

The association has sought the President's intervention in including such provisions in the Small Enterprise Development Act that is under consideration by the Ministries concerned, including Finance and Commerce, the Planning Commission, and the RBI.

Even developed countries like the US have a Small Business Act, which ensures finance to the units at nominal interest.

A Buy American Act provides marketing support, and regulates policies and aid programmes.

The Government departments including the defence establishment have to report to the US President about the compliance regarding 30 per cent purchase preference to small business enterprises.

India could emulate this example with purchase and price preference compliance reported directly to the President, the memorandum urged.

China has special programmes to help the SSIs in rural areas; land is allocated free and residential quarters provided free to employees. The cost of raw materials and power tariff are kept low.

But India has withdrawn support to the SSI units and this has adversely affected the viability.

Revival of the Indian economy is closely linked to the revival of the SSI sector.

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