The Hindu Business Line : Big business avenue exists for small, medium units: Study

Hyderabad April 3 Small and medium enterprises (SMEs) can cash in on about $356-billion business opportunity in knowledge-based sectors by 2020, according to a latest study conducted by All India Management Association (AIMA).

In his presentation at a seminar on small and medium enterprises here on Tuesday, Dr J.S. Juneja, Chairman, Global Projects Private Ltd, and member of AIMA panel on SMEs, said fashion technology, IT, design, health and biotechnology were the most promising sectors for SMEs.

The SME policy in the country had been consistent for the last 50 years.

"While the current trends are favourable in general, more budgetary support for small-scale industries and funding provision for technology upgradation are the need of the hour," Dr Juneja said citing the findings from AIMA study.

The seminar was organised by the Hyderabad Management Association and Madras Management Association with the support of Konrad Adenauer Stiftung.

On challenges for SMEs, he said about 70 per cent of the firms showed problems in marketing while 25 per cent had problems pertaining to finance.

There has been a dip in bank lending for SME sector in percentage terms.

"About 7.83 per cent of total industrial lending had gone to SMEs in 2005-06 against 8.62 per cent in the previous year," Dr Juneja said adding that in value terms, it had gone up a little.

Economic `miracle'

Dr Michael Fuchs, Member of Parliament, Germany, said the economic `miracle' achieved by Germany after the Second World War was due to the focus on SMEs. "Out of 3.4 million business units in Germany, 99.7 per cent are SMEs providing 70 per cent of industrial employment," he said.

A perfect competitive environment with no barriers for innovation and new comers hold the key for SME growth, Dr Fuchs pointed out, adding: "In Germany most of the parameters for SME growth had been met and we would improve upon further."

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