The Hindu Business Line : Why Thailand scores in small industry sector

WITH the opening of the global market, the need for the short and medium enterprises (SMEs) to become aware of the preparations among the competing countries to the challenges under the WTO regime has become necessary. India is no exception to this.

With Thailand, competing with India as a major player in garments and food processing, the entrepreneurs representing the SMEs' associations from Madurai, Karur, Tiruppur and Karnataka, visited Thailand between September 12 and 20, facilitated by the ZDH, the apex body of the German Small Business and Craft Sector.

They interacted with the industry associations, government bodies; visited the exhibitions connected with food ingredients, gem and jewellery, OTOP Fair, Thai President Food Processing Company and participated in the gem and jewellery workshop.

Mr Aravind, President, Madurai District Tiny and Small Scale Industries Association (Maditssia) and Mr KR. Gnanasambandan, former president, who were part of the 22-member team, shared their impressions, in a meet with the press here.

Elevated expressways with six lanes of international standard coupled with sky-trains and sub-way trains facilitated quick movement across the country.

Compared to India, the cost of power is cheap. Eighty per cent of power is generated through compressed natural gas. Pollution control norms are strictly implemented. The non-littering habit of the public is truly impressive, they said.

Referring to the SMEs, they said that units with less than 200 workers or an investment of less than Rs 5 crore is declared as small industry. While no licence is required to start a venture, the concerned department needs to be informed. The rate of interest is low at 3 per cent. The non-performing assets amount to more than 12 per cent.

A finance restructuring company helps the sick units but if the situation necessitated, entrepreneurs are permitted an exit. Value-added tax system is in adoption.

The existing labour laws are very simple.

Foreign direct investment is encouraged in large industries. Child labour is seen in hotels and in tourist spots.

On the scope for increased economic relations between the two countries, they said that they found joint ventures welcome and scope existing in textiles, chemicals, pharmaceuticals etc. An action plan prepared by the study team is to be forwarded to the Government, they said.