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Small and Medium Scale Enterprise (SMEs)


SME is the abbreviation for Small and Medium Enterprises. These enterprises can be rightly called as the backbone of the GDP of India. The SME sector in India is growing at an exceptionally fast rate due to which it is proving to be beneficial to the Indian Economy.

Micro, Small and Medium Enterprise (MSMEs) definition

Micro enterprise:- An enterprise where investment in plant and machinery

[original cost excluding land and building and the items specified by the Ministry of Small Scale Industries] does not exceed Rs.50 lakh.

Small enterprise:-An enterprise where the investment in plant and machinery

[original cost excluding land and building and the items specified by the Ministry of Small Scale Industries] is more than Rs.25 lakh but does not exceed Rs.5 crores.

Medium enterprise:- medium enterprise is an enterprise where the

investment in plant and machinery [original cost excluding land and building and the items specified by the Ministry of Small Scale Industries] is more than Rs.5 crores but does not exceed Rs.10 crores

Manufacturing Sector

Service Sector

Why SMEs are more adoptable?

Independent structure

Simple to organized

Skill prompters

Low risk

Low finance

Innovation and new concepts

SMEs role in India

Economy driver

Sector growth

Employment generator


SMEs have been established in almost all-major sectors in the Indian industry such as: Food Processing Agricultural Inputs Chemicals & Pharmaceuticals Engineering; Electricals; Electronics Electro-medical equipment Textiles and Garments Leather and leather goods Meat products Bio-engineering Sports goods Plastics products Computer Software, etc.


The Indian SME market is worth $5 billion. There are over 11 million SME units in India that produce more than 8,000 products. SME's Contribution towards GDP in 2011 was 17% which is expected to increase at the rate of 22% by 2012. SMEs are the fountain head of several innovations in manufacturing and service sectors, the major link in the supply chain to corporate and the PSUs. By promoting SMEs, the rural areas of India will be developed.


Employment generation. Use of local resources. Balanced regional development Promoting exports

Efficient use of productive factors.


Credit benefits Exemptions under direct tax laws Incentives and concession in power tariffs Price and purchase preference of goods produced


Govt. policy, tariff and easy loan with low interest rate for SMES in help to grow these enterprises. Foreign and local fund providers are taking huge interest in the small and medium enterprises of India. Banking sector has also shown a keen interest in lending credit to these enterprises. Recent mergers have taken place in the sector. The sector has significantly contributed towards the domestic production as well as the export earnings. Low investment is required to start and maintain these enterprises. The sector has contributed impressively towards job creation and increase in individual incomes. Technological growth is also a factor for growth of SME's in India as there are several trade portals and BUISNESSESS DIRECTORIES available online with huge database of buyers, sellers, manufacturers who are basically back bone of SME's.


Infrastructure needs to be developed for setting up the SMEs in the rural sector of the country. Transportation, electricity and communication are the main parts of the infrastructure required. Technology need to be evolved so that quality products are manufactured by the sector. Lack of information about the inputs, including raw material, machinery and skills, is one critical challenge in front of the owners of these enterprises. High level of research and development is required.

Govt. department for smes in india Small & Medium Business Development Chamber of India Msme govt of india India International Trade Centre (IITC-India) Europe-India SME Business Council (EISBC) Maharashtra Industrial and Economic Development Association SME Export Promotion Council Indian Young Entrepreneurs Forum SME Training Institute of India

SME Technology Development Council

Scheme of govt. of india for smes

Rajiv Gandhi Udyami Mitra Yojna ( RGUMY) Marketing Assistance ( Bar Code) Skill Development Export Promotion Infrastructural Development National Awards Credit Guarantee Scheme ISO 9000/14001 Certification Fee Reimbursement Scheme Micro & Small Enterprises Cluster Development Programmed Credit Linked Capital Subsidy Scheme Intellectual Property Rights for MSMEs Quality Management Standards/Quality Technology Tools

Indian SMEs doesnt get proper support from Because of this SMEs cant trade on national and international market. o o o o Government Departments Banking Sectors Financial institutions Corporate sectors