1.

What are admissible criteria of distinguishing Small and Medium enterprises with the large
ones? Support your answer with logical arguments.

Every country has its own definition of SMEs. In Pakistan it is written in SMEDA policy
2007 that Small and medium enterprises are distinguished from the larger one if they meet
certain criteria as follow:
Employment Size up to 250
Paid up capital up to RS 25 Million
Annual Sales up to RS 250 Million
Any firm which meet these requirement fall under the category of Small and medium
enterprises. This definition may varies country to country or from region to region. The federal
government of Pakistan with economic development Pakistan has the right to changes in the
definition whenever it is requited. Whereas in Pakistan some institutions like Federal Bureau of
Statistic and provincial Labor Departments, and few Government Agencies and (SBP) State
Bank of Pakistan has its own definition of SME. According to the SBP
A Small enterprise would be if they have
Up to 20 employees
Annual sales up to RS 75 million
A Medium Enterprise would be if they have
Employment size up to 21-250
Annual sales up to RS 75-400 million
21-50 Trading MEs
Thats why in Pakistan its quite challenging to distinguished small and medium enterprises from
large one because Government and institution have their own definition for SMEs. to clear the
misconception about small and medium enterprises Government should take suggestion from all
the parties and try to implement a single definition of SMEs which will not only encourage
SMEs but definitely benefit them as well in term of financing and meeting their requirement as
well.