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Small Scale Industries

Small Scale Industries

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Published by Tanya Gupta
small scale industries
small scale industries

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Published by: Tanya Gupta on Sep 26, 2010
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12/13/2010

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Small ScaleIndustries: AnImportant Catalystfor the Growth of India’s Economy
ESBD REPORT TANYA GUPTA ( 131)MBA, SECTION -B9/20/2010
 
 The definition for small-scale industrial undertakings haschanged over time.Initially they were classified into twocategories- those using power with less than 50 employees andthose not using power with the employee strength being morethan 50 but less than 100. However the capital resourcesinvested on plant and machinery buildings have been theprimary criteria to differentiate the small-scale industries fromthe large and medium scale industries. An industrial unit canbe categorized as a small- scale unit if it fulfils the capitalinvestment limit fixed by the Government of India for the small-scale sector.According to 2001 census, Small scale industrial units arethose engaged in the manufacture, processing or preservationof goods and whose investment in plant and machinery(original cost) does not exceed Rs.1 crore. These would, interalia, include units engaged in mining or quarrying, servicingand repairing of machinerySmall Scale Industries are located throughout the country,though predominantly in the rural areas. The small scaleindustries in the rural areas are skill based, wherein the skillfor manufacturing is passed on from one generation toanother. Some of the goods manufactured in these units aretextile handicrafts, woodcarving, stone carving, metal wareetc. Small scale industrial factories are also present in urbanareas and usually they account for the maximum volume of production for that particular good.For e.g. Ludhiana in the state of Punjab is the main center in
 
the country for producing woolen hosiery, sewing machineparts, bicycles and its parts, similarly Tiruppur in Tamil Naduaccounts for small scale firms that are involved in spinning,weaving and dying of cotton garments. The importance of cottage industries in the Indian economywas first understood by our first prime minister
 JawaharlalNehru
. The development of such small scale industriesinfused much needed production efficiency into the ruralIndian economy. The Cottage Industries also helped theagricultural workers to have a better quality of life. This is dueto the additional profits generated by the farming community. The traditional small-scale industries clearly differ fromtheir modern counterparts in many respects. The traditionalunits are highly labor consuming with their age-oldmachineries and conventional techniques of productionresulting in poor productivity rate whereas the modern small-scale units are much more productive with less manpower andmore sophisticated equipments.Khadi and handloom, sericulture, handicrafts, villageindustries, coir, Bell metal are some of the traditional small-scale industries in India. The modern small industries offer awide range of products starting from simple items like hosieryproducts, garments,leather products, fishing hook etc to moresophisticated items like television sets,electronics controlsystem, various engineering products especially as ancillariesto large industrial undertakings.Nowadays Indian small-scale industries (SSIs) are mostlymodern small-scale industries. Modernization has widened thelist of products offered by this industry. The itemsmanufactured in modern Small-scale service & Business

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