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SSIs 1950

using power with less than 50 employees

not using power with the employee strength being more than 50 but less than 100

YEAR
1960
1966 1975 1980 1985 1991 1997 1999

INVESTMENT LIMITS Upto Rs 5 lacs in Plant & Machinery Upto Rs 7.5 lacs in Plant & Machinery Upto Rs 10 lacs in Plant & Machinery Upto Rs 20 lacs in Plant & Machinery

Upto Rs 35 lacs in Plant & Machinery


Upto Rs 60 lacs in Plant & Machinery

Upto Rs 100 lacs in Plant & Machinery


Upto Rs 100 lacs in Plant & Machinery

CLASSIFICATION OF SSIs

TRADITIONAL KHADI HANDLOOM VILLAGE INDUSTRIES HANDICRAFTS SERICULTURE

MODERN TV sets ELECTRONICS CONTROL SYSTEMS ANCILLARY INDUSTRIES

PRODUCTION EMPLOYMENT EXPORT OPPORTUNITIES WELFARE

PROMOTING.

Contributes

value.

almost 40% of the gross industrial

The

small-scale sector has grown rapidly over the years. The growth rates during the various plan periods have been very impressive. The number of small-scale units has increased from an estimated 0.87 million units in the year 198081 to over 3 million in the year 2000.

Creates

largest employment opportunities for the Indian populace, next to Agriculture.


It has been estimated that Rs. 1 lakh of investment in fixed assets in the small-scale sector generates employment for four persons. products industry has ranked first in generating employment, providing employment to 0.48 million persons (13.1%). The next two industry groups were Non-metallic mineral products with employment of 0.45 million persons (12.2%) and Metal products with 0.37 million persons (10.2%).

Food

80% 70% 60% 50% 40% 30% 20% 10%


56%

74%

EMPLOYMENT
33%

OUTPUT

13%

0% TRADITIONAL MODERN

33% of the Indian Exports is contributed by SSI Sector. non-traditional products account for more than 95% of the SSI exports. mostly fuelled by the performance of garments, leather and gems and jewellery units from this sector. The product groups where the SSI sector dominates in exports, are sports goods, readymade garments, woollen garments and knitwear, plastic products, processed food and leather products.

FACTORS Less Capital Intensive Extensive Promotion & Support by Government Reservation for Exclusive Manufacture by small scale sector Funding - Finance & Subsidies Machinery Procurement

Raw Material Procurement Manpower Training Technical & Managerial skills Tooling & Testing support Reservation for Exclusive Purchase

Government Export Promotion Growth in demand in the domestic market size due to overall economic growth Increasing Export Potential for Indian products

by

Fashion Technology

Information Technology
Design Technology

Health Technology
Bio Technology

Increases income levels.


Equitable distribution of income. Reduction of regional disparities. Preservation of inherited skills.

Year

SSI Sector Growth Rate

Total Industrial Sector Growth Rate

2000-01 2001-02 2002-03 2003-04 2004-05

8.04 6.06 7.68 8.06 9.96

5.00 2.70 5.70 6.09 8.04

Source: SIDO Half Century by DCSSI, Govt. of India 2004 and Annual Report of the Ministry of SSI 2005-06

COMPARATIVE GROWTH RATES

9.96 7.68 5.7 8.04

10 8.04 9 8 7 6 5 4 3 2 1 0 200001 200102


5 6.06

8.06 6.09

SSI
2.7

INDUSTRY

SSI 200203 200304 200405

Source: SIDO Half Century by DCSSI, Govt. of India 2004 and Annual Report of the Ministry of SSI 2005-06

SSI units : 12.3 million Employment generated in SSIs : 29.5 million Production : At current Prices Rs. 4762.01 billion Exports : Rs. 1215 billion SSI account: Industrial Production : 40% Exports : 35% (50% of Direct & Indirect) GDP Share : 7%

Ownership pattern : Proprietorships : 78% Partnerships : 16% Corporate & Others : 6% Industrial Units : 96%

Service Enterprises : 3%
Ancillary Units : 1% Produces Diverse range of products (more than 8000consumer items, capital goods and intermediates)

OUTPUT vs EMPLOYMENT
ADVERSE IMPACT ON CAPITAL FORMATION. INEFFICIENT PRODUCTION LARGE SICKNESS. SEVERAL DIFFICULTIES.

AIMA Impact Assessment IMPEDIMENTS TO GROWTH


Problems Faced by SSIs as Barriers to Growth

Market Related Finance Related Government Policy Related

70% 25% 12.78%

Power Related/Infrastructure 14.0% Technology 14.60%

CREDIT RATING SCHEME MARKETING ASSISTANCE SCHEME TECHNICAL ASSISTANCE MEASURES FOR EXPORT PROMOTION INFRASTRUCTURE DEVELOPMENT ENTREPRENEURSHIP ANK SKILL DEVELOPMENT

INDIAN ECONOMY by RUDDAR DATT AND K.P.M. SUNDHARAM INDIAN ECONOMY by A.N. AGRAWAL ESSENTIALS OF BUSINESS ENVIRONMENT BY K. ASWATHAPPA Websites:

http://indiabudget.nic.in http://dcmsme.gov.in/ssiindia