Feb 2012/ Volume 2/Issue 2/Article No-4/247-255 ISSN: 2249-7196

INTERNATIONAL JOURNAL OF MANAGEMENT RESEARCH

AND REVIEW

SMALL MEDIUM ENTERPRISEs IN INDIA - ISSUES AND PROSPECTS

P.Suresh*1, Dr.M.Akbar Mohideen2
Assistant Professor (Research Scholar), Department of Management Studies, Ranippettai
Engineering College, Thenkadappanthangal, Vellore.
Associate Professor, Corporate Secretaryship & Research Guide in Commerce, C.Abdul
Hakeem College, Melvisharam.
ABSTRACT
Small and Medium Enterprises are two legs of Industrialization process of a country. Hence,
Small and Medium Enterprises are found in existence in every country. Small and Medium
Scale Enterprises have been given an important place in the frame work of Indian planning
since beginning both for economic and ideological reasons. Small and Medium Enterprises
has now emerged as a dynamic and vibrant sector for the Indian economy in the recent years.
The latest All India Census of Small & Medium Enterprises (SMEs) was conducted with
reference year 2006-2007. As per the 'Quick Results: Fourth All India Census of Micro,
Small & Medium Enterprises 2006-2007', the number of registered and unregistered Micro,
Small and Medium Enterprises in the country is 26100797. However, in order to develop this
sector properly it is necessary for government agencies, regulators and financing agencies to
come hand in hand.
INTRODUCTION
SMEs play a catalytic role in the development process of most economies. The importance of
the SME sector is well-recognized the world over using to its significant contribution in
achieving various socio-economic objectives, such as employment generation, contribution to
national output and exports, fostering new entrepreneurship and providing volume to the
industrial base of the economy. The SMEs today constitutes a very important segment of the
Indian economy. The development of this sector came about primarily due to the vision of
our late Prime Minister Jawaharlal Nehru who sought to develop core industry and have a
supporting sector in the form of SMEs. SME has emerged as a dynamic and vibrant sector of
the economy. SMEs in India have been given a distinct identity and the Government of India
has accorded high priority to this sector on account of the vital role it plays in balanced and
sustainable economic growth. It is considered a growth engine of our economy and plays a
crucial role in the process of economic development by value addition, employment
generation, fostering entrepreneurship and entrepreneurial skills, equitable distribution of
national income, regional dispersal of industries and priority depth to the industrial base,
mobilization of capital and contributing to the countrys exports. Today, it accounts for
nearly 35% of the gross value of output in the manufacturing sector and over 40% of the total
exports from the country. In terms of value added this sector accounts for about 40% of the

*Corresponding Author www.ijmrr.com 247