d - Mahratta Chamber Of Commerce Industries & Agriculture Pune

22
Micro and Small Enterprises in India :
Policy Framework and Contribution to National Economy
Dr. S. P. Kashyap
Introduction outcomes and to a large extent ignores isolated, or dependent (large firms or
the impact of endogenous impulses. It is merchant capital), or inter-dependent
The micro small-sized enterprise sector plausible that in a labour surplus (as part of a community of small firms)
in India has been the subject of much situation, especially in rural areas existence. These issues no doubt
discussion. This sector covers a very because of land constraints, a large deserve a thorough examination. In this
wide spectrum of manufacturing number of small enterprises would paper we outline the public policy
activities, ranging from simple craft- sprout as workers sought non- framework for micro and small
based household units in rural areas to agricultural employment as wage enterprises (MSE) and portray the
small manufacturing units in urban earners or as self employed. There is broad contours of their contribution to
areas that compete with large-sized ample evidence that indicates that rural national economy.
units in terms of products and employment has undergone a structural
technology. The major objective of change in favour of the non-farm sector. Policy framework for small
Indian policy with regard to the enterprise development
promotion of small enterprises has been Indian studies have also been
employment generation, besides excessively preoccupied with the “large India had a strong craft tradition which
several other equity objectives. It was versus small” debate and implicitly was badly bruised, though not
presumed that these objectives would assume a lonely existence for small extinguished, by the onslaught of
not be fulfilled by the promotion of large- firms. The policy formulation process industrialization during the colonial
scale enterprises alone, which primarily and research in this area did not pay period. The policy in the post-colonial
aimed to strengthen the capital base of adequate attention to the fact that the period aimed at the revitalization of
the economy, particularly in the public s u r v i v a l , g r o w t h a n d r e l a t i v e small and village enterprises so that
sector. The literature in this area has performance of small firms would these could play an important role in the
concentrated mainly on policy-induced depend upon whether they led an overall process of development. Official
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