Abstract- is taken into consideration it can be




Modern Economy is the big market of any country. All types of companies are
playing vital role in Indian Economy as well as economic development. SSI
industries are one of those industries. The small scale sector is vital
constituent of overall industrial sector of the country. The SSI forms a
dominant part of Indian industry and contributing to a significant proportion
of production. Export and employment but by the other side’s unemployment is
rising. The number of poor workers are constantly increasing. Business’s are
going under concern is growing over the balance fineness and sustainability of
the sort of globalization we have had the run up to the financial crash. The international
labor organization representing actors the real economy that governments,
working together with representatives of employers and workers organizations
are playing it’s role withen the UN and multiliteratal system to support its
constituents as they seek to weather crisis, prepare for recovery and shape a
new fair globalization. Therefore SIDBI (Small Industries Development Bank of
India) is working as an OPex body for SSI and provide financial assistance on
regular interval through in the unorganized sector is working to recognize the
problems of small scale industries playing a very vital role in economic
development countries. If population of India is taken into consideration it
can be said that this sector has wide scope in India. If small entrepreneurs
sector is developed other economy related problems can be dissolved

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SSI, Economic Development


Small scale industries are playing very important role in Indian
economic development and economic growth. The share of industrial sector in
national income is near about 29%, out of them small scale entrepreneurs role
is most important. Actually small scale industries are the backbone of
industrial sector. The small scale sector emerged during last 5 decades as a
highly dynamic sector of the Indian economy. This sector now account for about
95% of industrial units. This is contributing about 45% of value addition in
the manufacturing sector early 8% of manufacturing employment and around 35% of
total export. The SSI is having 32.4% lack unit which are spread all over the
country producing nearly 7500 items and providing employment more than 180 lack
person. The small entrepreneurs not only play employment opportunities at lower
capital costs than larger scale industries but also helps in industrialization of
rural and backward areas thereby reducing not only regional imbalance but
assuring more equitable distribution of nations income and wealth. SSI units
are complementary to large and medium scale units as ancillary units.

Indian Economy has initiate to concentrate on the development of small industrial
base which had contribute positively to India’s GDP growth is better than other
developing countries with the developed small industrial sector. A BOP crisis in
1991 pushed the country to near insolvency in return for an IMF hail out, gold
was transferred to London an collateral, the rupee devalued and economic
reforms (LPG) were forced upon India after the world economy was upon to attack
the Indian economy has initiated to concentrate on the development of small
industrial base which had contributed positively to India’s GDP. The main
objective of the government was to transform the economy system from socialism
to capitalism. So, that to achieve high economic growth and industrialize the
nation for the well being of Indian citizens.


1) To examine the
performance of small scale industries.

2) To analyze the
problems of small scale industries.

Small Scale Entrepreneurs /Industries-

According to MSMED Act 2006, the micro, small, medium enterprises are
classified into two classes namely manufacturing enterprises that are engaged
in manufacturer or production of goods pertaining to any industry specified in
the first schedule to the industries Act 1951 and service enterprises. The limit
for investment in plant and machinery equipments for manufacturing/ service
enterprises is shown in table.

Limit for investment in Plant and Equipments-


Investment for Plant and Equipment








to 20 million


50 million to 1 billion

20 million to 50 million


Types of Small Scale Entrepreneurs-

1) Manufacturing Industries-

industries that are liable for producing articles for processing called as
manufacturing industries. For example, Powerlooms, khadi, engineering
industries, processing industries.

2) Ancillary Industries-

industry is liable for processing small to bigger parts of every component that
are used to render services in big industries.

3) Service Industries-

          The well
known service sector is known for covering all right repair shops that are
essential to maintain all types of mechanical equipments. This industry is also
known for the complete dependency on machines.

Major Features of Small Entrepreneur
Policy 1991-

1)      Emphasis
to shift from cheap credit to adequate credit.

2)      New
technology vp graduation programs.

3)      Opportunity
to SSI in Indian global economy.

4)      Establishment
of technology development cell.

Opportunities for SSI in Indian Global

1) To expand their
business in all over India.

2) Emergence of
worldwide production markets and broader access to range of foreign products
for consumers and companies, particularly movement of material and goods
between and within national boundaries. For example- MNC.

3) Increase in information flows between
geographically remote location.

4) Survival in the new global business market calls for
improved productivity and increased competition due to market becoming
worldwide companies in various industries have to upgrade their product and use
technology skillful in face increased competition.

5) Growth of crass-

           Cultural contract, it can make
opportunities of new category  of
consciousness and identities which embodies cultural diffusion the desire to increase
one’s standard of living and enjoy foreign product and ideas, adopt new
technology and practices and participate in a ‘World Culture’. Some become the
resulting consumerism and loss of languages.

5)One more opportunity for small scale industries is
that they create less harm to the environment and generate less pollution. If they
use effluents than its quantity is limited that can be easily disposed after every
use, just because of limited strength , they manage things beautiful and generally
follow all related rules and regulations meant by the government for them.

6)Company Proprietor itself can make communication
and contact with the employees for not only find the problem in company but for
the better quality production and quantity of production.

Challenges to SSI

A)    Capital-

is most important to all business. SSI facing financial problem finance is the
life bold an organization and no organization can function properly in the
absence of adequate fund. The scarcity of capital and inadequate availability
of credit facilities are the major causes of this factor. Also entrepreneurs
due to weak economic base, have lower credit worthiness. They neither have
their own resources nor are other prepared to lend them comfort to MNCS.

B)    Finding
Qualified Workers-

Scale Industries can not pay the level of




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