Sei sulla pagina 1di 59

MSME

Micro Small and Medium scale


industries

Definition

The following requirements are to be


complied with by an industrial
understanding to be graded as small
scale industrial undertaking w.e.f.
21.12.1999
An industrial undertaking in which
the investment is fixed assets in
plant and machinery whether held on
ownership terms on lease on hire
purchase does not exceed Rs.10
million

Definition

A. in calculating the value of plant


and machinery the following shall be
excluded namely
The cost of equipment such as tools
jigs dies moulds and spare parts for
maintenance and the cost of
consumable stores
The
cost
of
installation
and
development
equipment
and
pollution control equipment

Definition

The cost of installation of plant and


machinery
Cost of fire fighting equipment
Cost of such storage tanks which
store raw materials finished products
only and not linked with the
manufacturing process
The cost of gas producer plants
The bank charges and service
charges paid to the national small
industries corporation or the small

Definition

In the case of imported machinery


the following shall be included in
calculating the value namely:
Import duty
The shipping charges
Customer clearance charges
Sales tax

Characteristics of MSME

Capital investment is less


Number of people involves per unit is
less
Employees of the small scale
industries are generally unorganized
They are generally family owned and
organized as sole proprietorship
organizations. Some of them are
formed on partnership basis with 2 to

Characteristics of MSME

Fixed
asserts
forms
largest
components of small units
Success of the unit depends on
entrepreneurial abilities of the owner
Competition is very high
Financial discipline is very weak
among the units
Profit margins are low
Generally engage in production of
light consumer goods

Need of MSME

MSME play an important role in the


development of economy of any
country.
They are all the more important in a
country like India which is labour
abundant. The MSME and Agro and
rural industries sector have acquired
a place of prominence in the
economy of the country
It is one of the vibrant sectors of the
Indian
economy
in
terms
of
employment generations and the

Need of MSME

SSI are the backbone of the Indian


economy.
Over 40 percent of India gross industrial
production and 35 percent of its exports
are generated by the small and medium
sector.
The sector acts as a nursery for the
development of entrepreneurship talent
and has been contributing significantly
to the national gross domestic product
besides meeting the social objectives

Need of MSME

One of the important contributions to


the Indian economy by the SSI is
assuming adequate supply of goods
and services that are largely to be
consumed by the mass at a
competitive price and to supply
capital goods as input to large and
heavy industries. India as any other
developing country, faces supply
bottlenecks and SSI contribution in
bearing
the
responsibility
to

Need of MSME

The SSI by fostering competitiveness will


bring down the cost and prices of goods and
services making it affordable to the
purchasing power of the general masses.
This particular feature of SSI is even more
significant since it helps to directly attack
poverty
by
providing
employment
opportunities on one hand at affordable
prices.
SSI ability to promote equitable income
distribution on one hand and diversified
production of goods and service on other
hand would serve to strengthen the market

Objectives of MSME

Creation
of
greater
employment
opportunities
Reduction of regional imbalances by
encouraging set up of units in
underdeveloped regions
Contributing to overall development of
the country
To meet customer needs by supplying
products and services at reasonable
prices

Objectives of MSME

Attainment self reliance


To improve standard of living
To create decentralized pattern of
ownership
To encourage growth of local
entrepreneurship
Optimum utilization of skills local
level
To reduce disparities in income and

Advantages of MSME

They do not require high investment


They do not require high level
technology
They can be set in shorter time and
start production activities in a quick
span
They can save foreign exchange
needs of the country by producing
products
which
can
substitute
imports

Advantages of MSME

They make use of local resources


They create huge employment
opportunities
Help in development of development
of backward and rural regions
Help in meeting demand for many
consumer goods
They contribute to promotion of
exports
They offer wide variety of products

Scope of MSME

Scope of MSME is very vast and


involve wide range of manufacturing
and service activities
MSME are performing well in so many
areas like manufacturing , servicing,
finance, construction, transport, food
and other important sectors
Government of India has reserved
the following items for MSME

Scope of MSME
List of items reserved for exclusive
manufacture
Food

and allied industries


Textiles products industry
Wood and wood products
Paper products
Leather and leather products
including footwear
Rubber products
Plastic products

Scope of MSME

Injection moulding thermo plastic


products
Basic dyes
Fast colour bases
Natural essential oils
Organic chemical drugs
Other chemical products
Glass and ceramics
Roofing tiles
Flooring tiles

Scope of MSME

Auto parts
Bicycle parts
Miscellaneous transport equipment
Mathematical survey instrument
Sport goods
Stationary items
Clocks and watches

Steps for setting up MSME


units

Decision to be self employed


Think positively
Self confidence
Goal setting initiative
Courage
Determination
what to manufacture

Steps for setting up MSME


units

Selection of the product based on


market survey
Form of ownership
Proprietary concern
Partnership
Limited company
Cooperative society

Steps for setting up MSME


units

Location of enterprise
Proximity to both market and raw
material
Early availability of transport facility
at cheaper rates
Availability of skilled workers at
cheapest rates
Incentives/concessions for
industrially backward areas

Steps for setting up MSME


units

Land and building


Availability of industrial sheds and
with minimum investments
Preparation of the project report
Technical feasibility
Economic viability
Total cost of the project fixed as well
as working capital

Steps for setting up MSME


units

Registration
Whom to approach depending upon
the locations the factory
Finance
Whom to approach private
institutions, government agencies
Type of scheme
Statutory licenses / clearances
Manufacture of drugs cosmetics
State drug controller

Steps for setting up MSME


units

Control administration
Manufacture of fruits and vegetable
based products
D.D food, vegetable preservation,
ministry of agriculture govt.of India
Power connection
State electricity board
Pollution control
State pollution control board so on

Steps for setting up MSME


units

Purchasing of machinery
NSIC provides indigenous and
imported machinery to MSME on hire
purchase basis. The rate of earnest
to e paid varies from 15 to 30%. Full
hire purchase values is payable in 13
installments
Recruitment of personal
Well qualified-skilled and unskilled
Well experienced- skilled and
unskilled

Steps for setting up MSME


units

Installation of machinery
Power connection water supply
Procurement of raw material
Minimum stock
Easily available
Find substitutes
Lower rates
Production
Know the installed capacity
Less rejections

Steps for setting up MSME


units

Quality control and testing


Marketing
Advertisement and publicity
Channel of distribution
After sales services
Feed back from customer
Repayment of loans
Profit generation
Avoiding sickness

Impact of globalization on SSI in


India

The

process

of

economic

reforms

and

liberalization since 1991 have a major impact


on SSI in India.

While these initiatives on one hand created


tremendous opportunities for the growth

On the other hand they have also thrown up


new challenges for them.

Issues like building global competitiveness


technology up gradation and achieving world
class quality have become essential for

Impact of globalization on SSI in


India

Government has overprotected SSI prior to


reforms & now
competition

SSI have to face severe

from

both

domestic

and

multinational large scale companies.

The slow down in the growth of SSI during this


period can be attributes these factors

SSI are facing problems like delay in project


implementation,

inadequate

availability

of

finance and credit, lack of quality, delay in


payment, technological obsolescence and lack

Impact of WTO on SSIs

India

is

signatory

to

WTO

has

altered

framework of international trade and now we


have moved towards market oriented policies.

Volume of world trade is increasing and it has


intensified competition.

SSI are thus facing global competition and the


need for very high quality at lower costs has
made them to restructure to meet this
demand of global competitiveness

Impact of WTO on SSIs

But the impact of WTO on SSI is more evident due to


the following issues:

SME sector is most vulnerable to impact of WTO. The


impact are:

Import of consumer goods from East Asia and China

Shift in procurement by large companies from SSI to


overseas suppliers

Inability of SME to implement anti dumping measures


and counter other unfair practices such as moves by
competitors to patent traditional Indian products and

LIBERALIZATION

Liberalization had made import of scare and


non available materials easy. This had led to
many new openings. New entrepreneurs have
started many SSIs which otherwise was not
possible due to non availability of certain raw
materials and resources
Liberalization helped getting them from
abroad and use them.
The best example of liberalization in
electronic and computer industries that have
seen tremendous growth in past 2 decades

Privatization

Privatization also helped the growth of SSIs in a


bigger way.
Certain product services were produced only by
government
organization
and
no
other
competition existed.
With Privatization it threw open to many
challenging entrepreneurs to produce similar
goods and service at much competitive price of
better quality.
One example of privatization was the
production of telephones
With the privatization many players had
entered the arena producing better good
looking phones with additional facilities

Privatization

The other important development


due to privatization is life insurance
sector which was earlier monopolized
by LIC.

Now there are many private agencies


offering
life
insurances,
health
insurance and others.

GATT

General agreement on Tariffs and Trade


was a treaty signed by a group of 123
nations agreeing in principle to promote
trade among members in 1947.
GATT was multilateral global initiative
It was important mile stone in global trade
After 2nd world war thinkers in trade &
industry felt that political disputes and
problems can be solved by coming
together and signing agreements similar
idea is extended to business commerce
and industry.

In its existence of more than 5 decades GATT


had many challenges they are:
E-commerce
Agriculture commodities
Political and regional forces on trade and
industry
Development of backward regions
Barter deals
Counter trade
Regional trade blocks
Services
Trade information
High tariffs by some countries

State schemes

Several institutions of government of Karnataka


offering these services and their roles are
discussed in detail:
1.technical consultancy services organization
of Karnataka
TESCOK
is
a
multidisciplinary
consultancy
organization promoted by the government of
Karnataka to provide reliable consultancy services
in India.
TESCOK has been excelling its expertise in a wide
range of services. The package of service includes
feasibility studies, market research, valuation of
assets, environmental impact studies, energy
management and audit, management studies like
corporate plan, budgetary control systems,

1.technical consultancy services


organization of Karnataka

TECSOK is also concentrating studies relating to


cleaner production technologies and methods.
TECSOK
has
been
considered
by
the
government of Karnataka, government of India,
State
and
central
financial
institutions,
commercial banks, consultancy agency.
TECSOK has been recognized as the state nodal
agency by the ministry of food processing
industries, government of India to operate the
ministry promotional schemes in Karnataka

1.technical consultancy services


organization of Karnataka

TECSOK has been excelling its expertise in a


wide range of services
Locate specific identification of investment
opportunities
Assistance in obtaining statutory and
procedural clearances.
Feasibility studies and environmental impact
studies.
Market survey and research
Project implementation and turn key assistance
Reorganization and restructuring of enterprises
Consultancy for merger/take overs

TECSOK has over 25 well experienced engineers


disciplines MBA finance professionals apart from
outside subject experts associate as empanelled
consultants involved on assignment basis
The areas of specialization of these consultants
includes:
Electrical
electronics
telecommunications
and
computer application
Pollution
control
measures
environmental
management plan
Textiles sericulture garments
Energy management non conventional energy use.
Market research data collection and market surveys.
Clients:
Ministry of food processing industries govt of India
Departmental of scientific and industrial research
(DSIR) , govt of India

1.technical consultancy services


organization of Karnataka

Technology information, forecasting


and assessment council (TIFC) new
Delhi
Danish embassy new Delhi
Ford foundation new Delhi
Major port trusts in India

1.technical consultancy services


organization of Karnataka

Major projects handled


a.project conceptualization and monitoring
Karnataka urban development project shelter
and water supply for world bank assistance
Entreprenurship training for project affected
families of project sea bird, karwar
b.viability report for infrastructure
development
report for development of growth centres at
Dharwad raichur and Hassan
study on infrastructure availability in the
leading states

1.technical consultancy services


organization of Karnataka

techni economic surveys of major districts of


Karnataka
technology profile study of Karnataka
d.,market survey/assessment
market study on natural gas in Karnataka
market intelligence report on packaged tender
coconut water
fixing vessel related charges for murmugoa part
trust goa
e.evaluation of impact assessment
rural industries programme of NABARD at bellary
evaluation of schemes of KMDC
f.policy prospective & special studies
perspective plan for karnataka industrial areas

Karnataka industrial areas development


board (KIADB)

Karnataka industrial areas development board


(KIADB) is a wholly owned infrastructure agency
of government of Karnataka set up under
Karnataka industrial areas development act of
1966.
KIADB holds pride in being the first government
organization in Karnataka to obtain ISO 9001
certification in the year 1997.
KIADB a pioneer agency with ISO:9001:2000
certification
offers
to
entrepreneurs
an
unmatched
convenience
of
world
class
infrastructure for their new ventures and
projects. KIADB rolls out a red carpet runway to
the world of prosperity by providing quality
facilities and services toits clients all over the

Karnataka industrial areas development


board (KIADB)

AIMS & OBJECTIVES


Promote rapid and orderly developments of
indutrie in the state
Facilitate for establishing infrastructure
projects
Function on corporate lines with No-Profit No
Loss policy
Functions
Acquire land and build industrial areas
Provide all infrastructures to such industrial
areas
Acquire land for single unit complexes

Karnataka industrial areas development board


(KIADB)
Infrastructure in industrial area
Hebbal in mysore
Baikampady in mangalore
Tarihal in dharwar
Kakati in belgaum
Auto complex in shimoga
Some of the projects excuted with high degree of
professionalism
Acquisition of about 431525 acres of lands for
Bangalore intermnational airport ltd.
Acquisition of about 1850 acres of lands for
harbour at tadri in uttara kannada dist
Acquisition & developing of about 430 acres of

Karnataka industrial areas development


board (KIADB)

KIADB as a premier industrial area developer


KIADB has also acquired lands to cater the specific
needs of individual industrial units (single unit
complexes). The board also acquires land for
infrastructure projects of the government. It
promotes projects of public importance in joint
venture with organizations of international repute.
The vision of KIADB and world class infrastructure
has made investors all over the world take notice
of Karnataka as the premier destination for their
start ups and ventures
Till date KIADB has formed 95 industrial areas
spread over the state and acquired land for nearly
290 single unit complexes ensuring balanced
industrial development in all regions with well

Karnataka industrial areas development board


(KIADB)
Functional units of KIADB

Acquisition wing: this wing conducts the


proceedings of acquisition and hands over the land
to KIADB. A special deputy commissioner heads
acquisition wing nad assisted by special land
acquisition officers at zonal level
Engineering wing: engineering section prepares a
design and development plan taking into
consideration different parameters like:
Infrastructure requirements
Statutory & regulatory requirements
Co-ordination with other agencies

Karnataka industrial areas development


board (KIADB)

Chief engineer and chief development officer: head


engineering section assisted by development
officers who are in charge at the zonal officers. This
wing of KIADB also provides service to the allottees
by approving building lands providing water supply
connections NOC for obtaining power connections
from supply agencies and addressing the
grievences of allottees at industrial areas in the
matters related to infrastructures.
Allotment wing: this section is headed by secretary
assisted by assistant secretaries at zonal offices.
Requests of entrepreneurs in the matters of leasing
issuance of absolute sale deed issuance of NOC for
financial assistance needful clearances for change
in activity change in constitution maintenance of

Karnataka industrial areas development


board (KIADB)

Accounts wing: controller of finance the head of this

department is assisted by senior audit officer


accounts officer project officer and assistant
secretary. This wing of KIADB is engaged in drawing
of budgetary proposals project financing & planning.
This section also has responsibility of monitoring &
maintaining the process related to mobilization of
finance for projects: preparation of final accounts
and other activities of KIADB.
Administration wing: joint director (Administration in
the head of this department this section has overall
responsibility of general administration human
resources management and other administrative

Karnataka small scale industries development


corporation KSSIDC
KSSIDC is rendering service to the small sector in
the state for more than 40yrs. With a moderate
beginning by occupying a small rented building in
the outskirts of Bangalore the corporation moved to
its own building in the rajajinagar industrial estate
From 1960, KSSIDC took over the activities relating
to the management and setting up of industrial
estates and distribution of raw materials and
started to give a new orientation to this aspects of
development
The corporation started with the following as its
main services:
Procurement and distribution of raw materials
Supply of machinery under hire purchase scheme

For selection of product/industry

Directorate of industries and commerce


Joint directors of district industries centres in
district
Technical consultancy service organisation of
karnataka
For registration licence
Directorate of industries and commerce
Assistant directors in the sub divisions
For infrastructure viz. land or shed
Karnataka state small industries development corporation
For iron & steel raw materials
Karnataka state small industries development corporation
For imported raw materials
Joint chief controller of imports and exports Bangalore
For finance
Karnataka state finance corporation
For incentives or information technical know/how / Technical consultancy services organization of Karnataka
consultancy
Directorate of industries and commerce
For venture capital assistance
Industrial development bank of India
for technical assistance
National research development corporation
CSIR polytechnology transfer centre, Bangalore
For standardisation
Bureau of Indian standards
Small industries service institute
Government engineering colleges
For R&D assistance
National aeronautical laboratory
Indian plywood industries research institute
Central machine tool institute
Central power research institute
National institute of design
For marketing assistance
National small industries corporation
Small industries service institute
For export promotion activities
Joint chief controller of imports & exports Bangalore
Export promotion councils in Bangalore
Vishveshwariah industrial trade centre (VITC) Bangalore
For any other assistance
Directorate of industries & commerce
Karnataka state small industries development corporation
limited

Advantages in having KSSIDC industrial estate

KSSIDC land is for industrial purpose. So no need


to waste time for NOC
KSSIDC estates are provided with required
amenities like training institute P&T office
dispensary police chowky etc
An entrepreneurs can start the industry by
collecting necessary possession certification and
passing necessary EMD
KSSIDC estates once declared as notified area are
free from local taxes
KSSIDC provides special services in acquiring and
allotting land to SSI entrepreneurs
KSSIDC provides ready to occupy sheds for
immediate starting of industries and also provide
gowdown for storage of its materials

List of major projects handled by KSSIDC


Power

loom sheds for KSPDC at siguli was


established
Morarji desai residential school complexes at five
laces in Karnataka was established
Multi-storied commercial complex established at
industrial estate shimoga
Multi-storied commercial complex was established
at industrial estate Gulbarga
Multi-storied commercial complex was established
at industrial estate peenya to cater the needs of
light engineering industries garments electronics
and other industries

Future plans
Development of new industrial estates at
taluka levels
Development
of
growth
centre
at
industrially backward areas
Rendering of solid waste management
services
To act as catalyst for export units
To extend hire purchase machinery
assistance
To
promote
small
industry
cluster
development programme

KSIMC (Karnataka state industrial marketing


corporation)
Karnataka state industrial marketing corporation ltd,
KSSIDC with the objective of creating market to SSI
product formulated a concern called KSIMC with an
investment of 35lakhs.
Till date the company fared well in catering the needs
of SSI units to market their products.
The company with a view to strengthen the
marketing of the SSI units participated in the tenders
floated by govt under takings and other public sector
undertaking on behalf of SSI units.
Government both at the state and central level have
been extending marketing assistance to small scale
industries in government procurement through
purchase and price preferences.

KSIMC (Karnataka state industrial marketing


corporation)

The state has also established the Karnataka


small industries marketing corporation to
provide marketing assistance to the small scale
industries sectors.
Act 2000 to provide purchase price preference
to SSI unit of the state which manufacture items
reserved for SSI sector by government of India
from time to time in the following manner:
75% of the items reserved by the SSI sector
shall be procured from the units located within
the state through an open tender system
SSI units of the state shall be offered a price
preference of 15% over the lowest price quoted

KSIMC (Karnataka state industrial marketing


corporation)

The benefit will be available for a period of 5years


from 1st april 2001.
The role of KSIMC will also be considered to help the
SSI sector to:
Improve quality of the products
Improve the production manufacturing process
Reducing prices
DIC single window agency
District industries centres single window agency
Karnataka udyog mitra a single contact point for all
investors who are looking at setting up business in
Karnataka. As the nodal agency its role is to facilitate
investments and execute initiatives
to enable a
smooth transition from receiving an investment
proposal to the eventual implementation of the

Potrebbero piacerti anche