●Role of small Enterprises in

economy and their

problems

K.UMA MAHESWARA RAJU

HALL TICKET NO :115719672017
MBA 1ST YEAR SECOND SEMESTER
PRAGATI MAHAVIDYALAYA
Small enterprise is classified According to
Micro,Small and Medium Enterprises Development
(MSMED) Act, 2006 

*Manufacturing enterprise: investment in plant

and machinery > Rs. 25 lakh but < Rs. 5 crore;
*Service enterprise:where investment in
equipment >Rs.10 lakh but< Rs. 2 crore;
Financial assistance in India for Small
enterprises provided by:

(i) Commercial/Regional Rural/Co-operative

Banks.
(ii) SIDBI
(iii) SFCs/SIDCs
 Role of small enterprises in Indian economy

* Indian economy, 95% of the industrial units are

small business and They contribute 40% of total
industrial output .
*small businesses bag around 45% of the total
exports from India.
*65-75% of the innovation in India come from the
industry of small business. 
 GROWTH AND PERFORMANCE OF
SMALL Enterprises in INDIA

*Pre- and Post-liberalization Periods:

*The level of output by the SSIs went up from Rs
28,060crorein 1980-81.
*Rs.5,78,470 crore by the end of 1999-2000,
showing an increase of nearly 20 times over a
period of 20 years.
*Exports have also gone up by nearly 40 times
over a period of two decades.
Statistics related to SME’S(2017):

*Number of SMEs in India:42.50 million

*Employment opportunity: Employs about
106 million, 40% of India’s workforce
*Products: produces more than 6000
products.
*GDP Contribution: Currently around 6.11% of
the manufacturing GDP and 24.63% of Service
sector GDP.
Problems faced by Small Scale Industries:
*Poor capacity utilization
*Incompetent Management
*Inadequate Finance
*Raw material shortages
*Lack of marketing support
*Problem of working capital
*Problems in Export
*Lack of technology up-gradation
 Summary:

*Small Enterprise is classified into manufacturing and

service
*Govt of India has been offering Financial assistance
*Small Enterprises average growth rate is 10 %
*Despite of govt assistance,there are still few problems
*Indian economy has to improve in terms of small business
when compared to countries like USA,Mexico.
Thank you 🙏