Small and medium enterprises in India

 

How SMEs help in growing an Indian economy?

Small and medium enterprises are auxiliary businesses that maintain assets, revenues, and a number of employees that fall below a certain threshold. These small businesses employ a less number of employees starting from 5 then reach up to 50. But the small and medium enterprises in India make a great contribution to the Indian economy.



How various SMEs help the Indian economy grow?

Earlier, the public sector was a big part of the job growth rate in India. During this period, in the cases of only loss or crisis, opposition political parties used to blame the Indian government for not generating enough jobs. Then the question used to raise on the data arriving from public sector companies.

 

You know what the big advantage of promoting small and medium enterprises in India is that they provide employment to people without making the government get involved in this. These SMEs helps in both urban as well as rural growth. Also, they boost the Indian economy in the following ways:

 

     Generate more employment

     Decrease poverty rate

     Deduce urban-rural income gap

     Diminish migration

     Motivates regional development

     Magnify exports

     Reduce pollution levels

     Enhance production

     Encourage people’s purchasing power

     Improve the quality of life

These all characteristics and improvements won’t be logistically possible for big enterprises and organizations to establish themselves in rural areas. And if suppose they anyhow become able to do so, they will be restricted to only a few industrial and commercial zones.

Challenges faced by Indian SMEs

Though small and medium enterprises in India are resistant to growth. It results in low productivity. The concept of staying small and comfortable is much better since it eliminates regulatory and taxation hurdles.

 

When an organization chooses to grow, they have to deal with multiple problems beginning from financing. The estimate was made via an earlier survey which was conducted with over 15000 listed and unlisted companies from multiple sectors. These sectors included agriculture, power, textile, IT&ITES. This survey clearly showed that small and medium enterprises in India had a drastically falling exposure to bank credit due to the rising interest rates.

 

The next reason that came out was shunned bank credit which was originated due to repayment timelines. The big organizations who purchase products from SMEs enjoy an interest-free repayment timeline of about 120 days. But these SMEs get only 60 days to do so. Therefore, most SMEs have now adopted strategies to decrease their exposure to bank credit.

Final Thoughts

Though SMEs face many challenges from limited access to lack of databases, finance, undeveloped sales channels, and low levels of financial involvement, these small and medium enterprises in India put a great contribution to an Indian economy which is a good sign of future growth.

AC Mechanic Course in Delhi  

 

AC PCB Repairing Course

 

ac pcb repairing course delhi

 

AC Repairing Course in Delhi

Comments

Popular posts from this blog

list of mnc companies in Gurgaon | list of companies with hr contact details pdf

B2B Data In India | B2B Company In India

Email marketing tool in India | SalezShark Connect+