Orissa plans special body for small firms
Business Standard 20 December 2007
With a view to identify the sick micro, small and medium enterprises (MSMEs) for revival and pick up viable projects for setting up of new units, the Orissa government plans to constitute a “MSME Development Consortium” soon. The proposed consortium will have the director, Industries, director, Institutional Finance, State Bank of India, UCO Bank (convener of SLBC) and the director, Micro, Small and Medium Enterprises Development Institute, Cuttack as members. The consortium is proposed to be in the form of a society with appropriate and agreed upon share holding by each stake holder.

IT majors bank on SME biz
Business Standard, 19 December 2007
Indian small and medium enterprises (SMEs) are expected to emerge as major buyers of the information technology (IT) products by 2008. Most SMEs do not have IT departments and often are not located in metropolitan cities. According to Mr Joydeep Datta Gupta, executive director of Deloitte & Touche Consulting, any IT-led SME business transformation project could succeed only if the project was sustained. According to Mr Prathick Sarkar, regional sales manager of SAP India, “For midsize companies, leadership depends on the ability to adapt to changes in the market, build lasting relationships with customers and get to market quickly.” However, meeting these business objectives could be daunting when business systems were not fully integrated and lacked functionality.

Sebi to set up bourse for SMEs
The Times of India, 17 December 2007
Sebi chairman Mr M Damodaran has said the stock market regulator would very soon identify a party to set up a dedicated bourse for the SME (small and medium enterprises sector. The move to establish a separate bourse for the SME sector, according to experts, has gathered momentum considering the difficulties small and medium enterprises face competing in the existing stock exchanges, which are dominated by big players.

SIDBI to focus on direct equity support to SMEs of north
The Economic Times, 17 December 2007
SIDBI (Small Industries Development Bank of India) has earmarked Rs 11 crore to provide direct equity support to SMEs of north India including Punjab, Haryana, Delhi and Chandigarh to help them carry out their expansion plans. Under the scheme, SIDBI would acquire equity stake in the SME, to whom it would provide funds. SIDBI has projected to provide equity support of Rs 3 crore each to small scale unit of Punjab, Chandigarh and Haryana and Rs 2 crore for Delhi during the current fiscal.

Feeling the green pinch
Business Standard, 13 December 2007
The need for Indian MSME (micro, small, medium enterprises) sector to become compliant with environmental standards is beginning to pinch the industry. A recent World Bank report said that India's 4.5 million MSMEs contribute 40 per cent of industrial production but create 70 per cent of industrial pollution. The report stated that most of the initiatives towards attaining environmental compliance within Indian industry do not cover MSMEs. The CII (Confederation of Indian Industry) has joined hands with the ministry of environment and the Central Pollution Control Board to promote higher environmental standards amongst the MSME sector. It has also entered into an agreement with UNIDO (United Nations Industrial Development Organisation) to take up a consolidated project for MSME development in India. The CII-UNIDO Development Project will promote direct foreign investment and industrial co-operation agreements, fostering investment and partnership of selected target market countries towards the MSMEs. The project will also facilitate and promote investment, development through cluster approach, equity financing, technology and subcontracting partnerships between MSMEs and international potential partners. The project will further upgrade and strengthen the existing capabilities and capacities of Indian MSMEs through cluster twinning strategy.

Companies to get back patent fees
Business Standard, 13 December 2007
In an move to promote innovation among emerging companies, the Department of Information Technology has launched its programme entitled, “Support International Patent Protection in Electronics & IT”. Under the scheme, SMEs (small and medium enterprises) and technology start-ups can apply for reimbursement, up to a limit of Rs 15 lakh, for the costs incurred in filing international patent applications. This scheme applies for their indigenous inventions in the electronics and ICT (information, communication and technology) domain. The grant will be disbursed to applicants on a reimbursement basis and will be limited to 50 per cent of the total expenses in actual cost incurred by the applicant on filing international patent. The scheme, which was introduced on 4 November, will be valid for a period of five years. Beyond the allotted time-frame, the scheme will be reviewed for extension

CII, FICCI demand bailout package for small firms
Business Standard, 13 December 2007
Industry chambers like the Confederation of Indian Industry (CII) and the Federation of Indian Chambers of Commerce and Industry (FICCI) are demanding a slew of fiscal incentives to bail out small and medium enterprises (SMEs), from the havoc of rising rupee. The chambers are unanimous on the issue of reducing interest rates as it will go a long way in lowering the operating costs of SMEs and exporters. To improve Information Technology (IT) consumption in SMEs, CII feels that a central research and development fund for the use of SMEs should be created in which private companies can voluntarily contribute and get 200 per cent weighted tax deduction on contribution.

RBI sets up working group to rehabilitate sick MSMEs
The Economic Times, 13 December 2007
Reserve Bank of India (RBI) has set up a working group for improving the financial health of small and medium enterprises, Minister of Micro, Small and Medium Enterprises Mr Mahabir Prasad said. Mr Prasad said Small Industries Development Bank of India (SIDBI) should be given the status of a commercial bank to address the problem of credit faced by small enterprises. The Minister said SIDBI should open more branches to meet the rising credit requirements of the micro, small and medium enterprises. Currently, it has 65 branches across the country and plans to add five more within the next three months.

AIMA to train small firms from early 2008
Business Standard, 29 November 2007
In an initiative to train SMEs (small and medium enterprises) cope better with challenges faced by them, the AIMA (All India Management Association) is in the process of preparing modules for training SMEs across the country. The training is most likely to begin by early next year. Countrywide, various organizations are running programmes with similar objective. These include industry associations like the Confederation of Indian Industry, private banks like ICICI Bank Ltd and HSBC and top management institutes like the Indian Institute of Management. AIMA had been doing workshops for SMEs in the past, but it now plans to institutionalize this initiative through these modules

UNIDO plans to boost productivity
Business Standard, 22 November 2007
In order to boost productivity in leather, footwear and automotive components related SMEs and to promote tie ups between Indian and Italian companies in the same space, United Nations Industrial Development Organisation has drawn up a three-year programme for establishment of mutual credit guarantee schemes, cluster twining and foreign investment and technology promotion across many cities in the country. The Italian government has allotted Euro 3 million for the project titled Consolidated Project for SME Development in India, which will be implemented by Unido

SIDBI to help Ludhiana's steel forging units adopt cleaner technologies
The Hindu Business Line, 20 November 2007
SIDBI (Small Industries Development Bank of India) has signed an agreement with a SPV floated by SME units in Ludhiana's steel forging sector to provide financial assistance so that they can embrace more environment-friendly technologies. The World Bank has given its backing to this initiative by agreeing to purchase 9.90 lakh certified emission reduction units from the SPV. The bank is also helping the SPV in development and implementation of the CDM (clean development mechanism) project. Around 300 SMEs are expected to benefit from the project. According to a press release, SIDBI signed a MoU (memorandum of understanding) with Ludhiana Hand Tools and Forging Envirocare Pvt Ltd, which is the SPV (special purpose vehicle) floated by SME units in Ludhiana's steel forging cluster. As per the MoU, SIDBI will collaborate with the SPV to provide financial assistance to SMEs participating in the CDM project being implemented at the steel-forging cluster in Punjab.

New India-US trade initiative to boost SMEs’ enterprising skill
Indian Express, 17 November 2007
The USIBC (US-India Business Council) launched a comprehensive initiative to deepen two-way trade and investment between the United States and India. The USIBC initiative will focus on the principal trade and investment barriers of commercial significance to USIBC member companies and will build towards substantial market opening arrangements designed to bring broadly inclusive growth to both countries.

Banks bet big on SMEs
Business Standard, 15 November 2007
Even as MSME (micro, small, medium enterprise) associations, like National Small Industries Corporation or Laghu Udyog Bharti, believe that credit flow to SMEs is a bottleneck in the development of this sector, most private banks claim that their MSME oriented initiatives are doing fairly well. These banks also believe that their services for MSMEs go much beyond than just lending money. ICICI bank, in an effort to help SMEs (small and medium enterprises) start, finance and grow their business, has started an on-line resource centre by the name of “India SME toolkit”. The website, www.india.smetoolkit.org, contains updated information and tools to enable SMEs in emerging markets learn how to increase productivity, efficiency and capacity, as well as improve their access to capital and new markets.

Punjab foundries move to Chhattisgarh
Business Standard, 15 November 2007
Amarjit Singh of Mithila Malleables Private Limited, had a flourishing steel business near Steel City at North Mandigobindgarh for over three decades, but the changing business scenario in the past five years persuaded him to relocate his business and he zeroed in on Raipur, capital of Chhattisgarh. Amarjit Singh is not an isolated case, but there are a few who relocated and expanded their operations in other states of India either closer to the source of raw material (Chhattisgarh) or in tax holiday state (Himachal Pradesh). Squeezing profits due to high power tariffs coupled with the withdrawal of freight subsidy hit the cluster of steel re-rolling, induction furnaces and forging units a few years back. But the tax concessions offered in the neighbouring states of Himachal Pradesh, Jammu and Kashmir and Uttarakhand by the Government of India in 2003 was the last straw on the camel’s back. Many small units shifted to Himachal Pradesh, but others, with an eye on future expansion, relocated and expanded in Raipur.

Mother of all SME fairs in February
Business Standard, 15 November 2007
To enhance the competitiveness of the SMEs (small and medium entrepreneurs), the IIA (Indian Industries Association) — an apex body of micro, small and medium industries — is gearing up to organize the biggest industrial trade fair of Uttar Pradesh, in Lucknow. The fair, organized by IIA, along with the Department of Food Processing and Industrial Development, Government of Uttar Pradesh, is scheduled from 1st to 4th February next year. The main objective of the event is to exhibit whatever agro-products are made in the state and outside, along with emphasis on displaying the technologies, machinery, products and services produced within and outside the country.

Orissa to set up stock exchange for SMEs
Business Standard, 15 November 2007
The small entrepreneurs in Orissa are quite upbeat on the idea of Bhubaneswar Stock Exchange floating a SMX (Small and Medium Enterprise Exchange) in the state. Companies with a paid-up capital of less than Rs 3 crore will be able to raise money at the exchange. The fund-starved SMEs can avail the opportunity to raise funds for expansion and diversification. Besides, the small investors who were investing in large companies and banks will have the option of investing in the equity shares of these small units

SMEs grab power pie
Business Standard, 8 November 2007
The big boys in the business of power-generation and distribution may soon lose their monopoly as small and medium entrepreneurs are keen to foray into this stream. This was disclosed at a conference, Indian Power Sector: 11th Plan and Beyond, organized by CII (Northern Region) in Chandigarh recently. The entrepreneurs urged the Secretary, Ministry of Power, Mr Anil Razdan to provide the details of the equipment they need from the SMEs for the execution of big projects. The secretary endorsed the fact that the SMEs can play a vital role in the expansion of the power sector by providing the equipment at a competitive price.

Italy to fund SME project in India
The Statesman, 5 November 2007
In a move that will benefit leather clusters in Shantiniketan, Agra and Chennai, as well as, auto clusters in the NCR (National Capital Region), Pune and Tamil Nadu, Italy will fund to the tune of over three million euros a project for the development of SMEs (small and medium enterprises) in India. The three-year project, titled ‘a consolidated project for SMEs development in India’ with the ministry of MSMEs (micro, small and medium enterprises), government of India as the Indian counterpart agency, and the UNIDO (United Nations Industrial Development Organization) as the implementation agency, aims at supporting the development of Indian MSMEs to enable them to become globally competitive. For this purpose, leather and auto components have been identified under the manufacturing sector. The leather clusters that will receive support under the projects are, Shantiniketan for leather goods; Chennai for tanning and footwear; and Agra for footwear. In the auto component sector, while the auto component cluster of Chennai will receive support, interventions will be made to foster foreign direct investment and business promotion in Pune and the NCR auto parts clusters

IBM India launches SMB operations in Surat
The Hindu, 23 October 2007
As part of its ongoing expansion strategy to tier II cities in the country, IBM India has announced the launch of its SMB (small and medium business) operations in Surat. This expansion would enable IBM to provide better support to SME (small and medium enterprises) clients in and around Surat and help IBM's customers leverage IT for business growth, the company said in a statement. IBM's SME offerings have been "accepted" in various industries in Surat including diamonds and gems, cooperative banks, textiles and chemicals, IBM said.

NSIC to launch 250 incubators in five years
Business Standard, 18 October 2007
With the object of developing new small enterprises, NSIC (National Small Industries Corporation), has initiated a programme whereby it is setting up incubators for aspiring entrepreneurs to start their own ventures. An incubator works by way of providing support-services like practical training on new machines or projects, preparing reports, seeking government approvals, identification and procurement of plant and machinery, helping to access credit facilities, and providing market support among others. The work on one incubator in Guwahati and another in Kolkata is in progress. NSIC plans to set up 250 such incubators across the country by 2012 at the cost of Rs 70 lakh per incubator.

Banks eye small sector M&A
Business Standard, 18 October 2007
As marquee investment banks Morgan Stanley, UBS, Rothschild, Goldman Sachs and others chase big-ticket deals in India, a clutch of boutique investment banks are looking to tap the opportunity in the lucrative small and mid-sized market as SMEs (small and medium enterprises) look to ramp up fast through mergers and acquisitions, initial public offerings, and private equity funding. Delhi-based Almondz Global Securities has tied up with Noble, a London-based investment bank to set up an FII (foreign institutional investor) desk, and to help Indian companies raise money abroad through primary equity offerings like American Depository Receipts, Global Depository Receipts and London listing (including the Alternative Investment Market and main London Stock Exchange). UK-based investment bank, Collins Stewart, has a tie-up with India’s Inga Advisors to tap the small to mid segment of the market. Another UK-based investment bank, Collins Stewart, has a tie-up with India’s Inga Advisors to tap the small to mid segment of the market.

MNCs target SMEs to fuel growth
Mint, 17 October 2007
Multinational IT firms that were once content to follow the 80:20 rule—this meant 80% of their revenue came from 20% of their customers—are now singing a different tune. All of them are now focused on SMEs, as they believe selling to these firms present better opportunities than selling to larger ones. In the past few months, the Indian arms of global IT heavyweights such as International Business Machines Corp., SAP AG, and Oracle Corp. have unveiled strategies to tap SMEs or the SMB (small and medium business) segment. As India’s economy continues to expand at more than 9%, SMBs are being created across the country in a variety of sectors including cooperative banking, auto ancillaries, health care, mining and textiles. Many of these firms spend on IT because they see it as something that can help them become more efficient and profitable. According to research firm ACNielsen, IT spend by small and medium enterprises will reach Rs26,709 crore by 2008. The firm adds that there are over nine million such enterprises in India, with an average IT spend of Rs30 lakh a year.

IBM package for SMEs
The Asian Age, 12 October 2007
IBM India has launched a software and service package named Express Advantage for the SMEs. It will be made available to SMEs in six major cities – Delhi, Mumbai, Pune, Hyderabad, Bangalore and Chennai. The Express Advantage package includes products from IBM’s software systems and service groups. It addresses several issues affecting SMEs including business, security and energy efficiency.

SMEs to invest $50 billion in telecom
Business Standard, 11 October 2007
Australia, S Korea, India and China will account for 70% of telecom spend. Small and medium enterprises across the Asia-Pacific region outside of Japan (APeJ) are on track to invest $50 billion on telecommunications equipment and services this year. This is up some 5 per cent over 2006, according to the latest study by New York-based Access Markets International (AMI) Partners, Inc. The Indian SMEs have spent over $5 billion on telecom equipment and services last year. Further growth is expected from the cellular market which is set to grow at over 13 per cent.

SME tech platform goes biennial
Business Standard, 1 October 2007
Following the success of the recently concluded three-day trade and technology show (TTBS) at Kochi, the Kerala government plans to organize the show every two years to boost the small and medium industries sector. The show saw Thailand Dhonpuri University offering a unique business incubation service for SME units and technology transfer for upgradation of SMEs in Kerala to international standards. Also, the Katestart University of Thailand has offered technology for R&D of virgin coconut

Agra firm develops non-polluting generator
Business Standard, 20 September 2007
Following a ban on diesel engine manufacture in Agra by the CPCB (Central Pollution Control Board), the diesel engine and generator manufacturing industry has come to a virtual standstill. Though most of the diesel engine manufacturers have either downed their shutters or have begun selling unassembled engines and generators, a few of the major engine manufacturers of the town have taken a step further, developing new technologies and making their engines compliant to the CPCB standards. BS Agricultural Industries has recently announced the development of a completely new engine technology, which, besides being compliant with CPCB standards, also heavily economizes on fuel consumption.

Channel partners cash in as SMEs go tech-savvy
Business Standard, 20 September 2007
The economic boom, coupled with high IT awareness among SMEs (small and medium enterprises), is boosting the fortunes of resellers or channel partners in India, with more than 90 per cent of them reporting a rise in their annual revenues over the last 12 months, according to the latest report by New York-based Access Markets International Partners. The average revenue of channel partners focusing on IT needs of SMEs in India was $324,000 in the 2005-06 financial year. It has risen to $399,400 in the last 12 months. Channel partners in India have aligned their business models to suit the current requirement of SMEs. Currently, channel partners focusing on SME needs are still product-oriented and their revenue mix is dominated by computing and networking hardware (about 52 per cent).

Bourses lure small companies with lucrative offers
The Economic Times, 17 September 2007
SMEs (small and medium enterprises) may get a new breath of life with both the National Stock Exchange and the BSE (Bombay Stock Exchange) vying for these companies. BSE is believed to have sought regulatory approval to make its Indonext platform attractive for SMEs. It has joined hands with the State Bank of India in its latest initiative. BSE had submitted its proposal to the Securities and Exchange Board of India and is ready to dole out lucrative incentives like lower listing fees, reduced exchange charges and dilution in listing guidelines, if allowed by the regulator. There are a little over 500 companies trading on the Indonext platform. Indonext was launched in January 2005.

Karnataka firms get new technology
Business Standard, 13 September 2007
The state council has identified over 9,000 techniques from across the world. The Karnataka Council for Technological Upgrade has launched several initiatives to transfer the latest technologies to small and medium enterprises. The council’s objective is to enhance the competitiveness of the sector through technological upgrade. It will also help firms to plan their modernization and diversification programmes. The council is a joint venture of the central government, the Karnataka government and several industry associations.

SMEs in corridor must opt for eco-friendly production techniques
The Financial Express, 31 August 2007

The DMIC (Delhi-Mumbai Industrial Corridor) project can be environmentally sustainable and cost-effective in the long run if the government encourages units coming up in the corridor to use CPT (Cleaner Production Technologies) from their inception, according to the UNIDO (United Nations Industrial Development Organization). The UNIDO, which has been working for CPT since early 1990s in India, also proposed tax incentives for MSMEs (Micro, Small And Medium Enterprises) to help them invest in CPT as well as a voluntary `cleaner production audit' to be undertaken by the MSMEs. The UNIDO, a United Nations body responsible for industrial development, also said it could help in MSMEs in the industrial corridor to form clusters, which can in turn help mobilizing financial resources needed for purchasing environment friendly machinery.

XLRI to sharpen local SME skills
The Financial Express, 20 August 2007
The Xavier Labour Relations Institute (XLRI), which recently came forward to enhance skills of a batch of local entrepreneurs associated with the Singhbhum Chamber of Commerce & Industry, has promised to hold such short-term courses in the future as well for the benefit of the trade association's members. XLRI entrepreneur development cell coordinator Prof Prabal K Sen, who designed the course for a group of small & medium enterprise (SME) entrepreneurs, said the faculty too had been 'hugely' benefitted by interacting for the first time with SME entrepreneurs. The XLRI proposes to incorporate the knowledge it gained from the 'insights' and 'experiences' of the participants for future use. The B-school wants to enhance capabilities of local entrepreneurs by charting an action plan for them so that they do not fall behind in a fast-changing global scenario.

Foreign borrowings curb lending to SMEs
The Economic Times, 17 August 2007
Curbs on external commercial borrowings (ECB) will have an impact on the lending to small and medium enterprises. With the increased cost of overseas borrowings for corporates and a subsequent liquidity squeeze, SMEs will be affected due to longer repayment cycles of the corporates, bankers feel. Most public sector banks classify SMEs based on their investment in plant and machinery up to Rs 10 crore as per guidelines of the ministry of small-scale industries. The SMEs typically do not go in for ECBs, but depend on banks for their working capital loans. SMEs are already facing the heat with increase in interest rates, power shortages, rupee appreciation among other issues. With the services sector dominating the SME, and large corporates outsourcing their various requirements to Indian service providers, repayment cycles become crucial, bankers said.

UNIDO seeks govt nod to extend 5-year service network plan
Business Standard, 16 August 2007
The United Nations Industrial Development Organisation (UNIDO), which has been promoting the SME sector through various modes of intervention, is in talks with the commerce and industry ministry to extend the five-year country service network programme. The new strategy, to be implemented between 2007 and 2012, will see more intense and proactive interaction with the government while supporting the SME sector. The new five-year plan is likely to require funds worth $32 million out of which around $5 million will be spent every year. It has identified five focus areas for its future programmes — rural industrial development, women entrepreneurship, environment, energy sector, as well as development of the SME sector. The country service network programme of Unido provides support to the SME sector through trade-related technological assistance, clean and environment-friendly solutions as well as special programmes for industrially backward regions like the North Eastern states.

ICICI Bank, IBM, IFC launch toolkit for sector
Business Standard, 16 August 2007
In an effort to help small and medium enterprises (SMEs) start, finance and grow their business, an on-line resource centre by the name of “India SME toolkit” has been launched by ICICI Bank, IBM and the International Finance Corporation (IFC), the private sector arm of the World Bank group. The website, www.india.smetoolkit.org, contains updated information and tools to enable SMEs in emerging markets learn how to increase productivity, efficiency and capacity, as well as improve their access to capital and new markets. The site offers off-line CDs, mobile alerts and classroom training, both in English and Hindi. The toolkit addresses issues concerning accounting and finance, business planning, human resources, insurance, marketing and sales, operations, technology, business news and others.

SME pharmas likely to get interest sops
The Economic Times, 16 August 2007
The government may provide an interest subsidy to SME pharma companies to upgrade their facilities in order to meet stringent quality protocols. The proposal in the draft pharma policy is getting support from different wings of the government. The Prime Minister’s Office is keen to take forward the proposal for extending 5% interest subsidy to SMEs facing a fund crunch in order to meet the health ministry’s revised good manufacturing practices (GMP). Once implemented, the interest subsidy scheme is likely to benefit close to 2,000 SMEs drug makers. The scheme would also come to the rescue of drug makers in Gujarat and Madhya Pradesh, several of whom have closed down due to lack of capital while others are struggling to find resources to meet the new GMP requirements. Several companies have also defaulted on loan repayments due to paucity of funds.

Companies can list different vehicles on AIM
Business Standard, 19 July 2007
The Alternative Investment Market (AIM), the London Stock Exchange’s market for early-stage growing companies, is a firm believer in the Indian growth story. It is in constant dialogue with Indian small and medium enterprises (SMEs) looking to raise capital through equity and debt. About 20 companies have already listed on the AIM in the last two-and-a-half years. The AIM’s India business development head Mr Ibukun Adebayo says that the most encouraging aspect is that many of the 20 listed companies are planning follow-on equity offers.

Centre to adopt six handloom clusters in Orissa
Business Standard, 12 July 2007
73 handloom clusters have been identified in Orissa, covering almost all the weavers. The Union government has agreed to adopt 6 handloom clusters in Orissa. These clusters are Badamba in Cuttack district; Jagatsinghpur; Boudh, Berhampur in Ganjam district; Fakirpur in Keonjhar district and Patnagarh of Bolangir district. However, no fund has yet been sanctioned by the Union government for these clusters, according to state textile and handloom minister, Mr Golak Bihari Nayak. 73 handloom clusters have been identified in the state covering almost all the weavers. During 2007-08, a provision of Rs 4 crore was made in the central plan for adoption of 8 clusters. To facilitate handloom weavers in meeting the challenges of a globalised environment, the state government launched the Cluster Development Programme recently.

SMEs to get more funds
The Asian Age, 9 July 2007
A majority of micro, small and medium enterprises (MSMEs) plan to authorize more capital investment this year in comparison with the previous year, according to CII’s Business Outlook Survey. Out of these (91%), 20% of the respondents plan to authorize between 5-10% more capital investment and 15% of the respondents expect to authorize capital investment of more than 50%. According to the research findings, the production growth expectations of the surveyed respondents reveal that 69% of the respondents reveal that 69% of the respondents expect more than 10% growth in their production.

West Bengal setting up 37 industrial clusters for small & medium sector
The Financial Express, 28 June 2007
West Bengal is setting up 37 clusters for small and medium scale industries. While 91 others are in the pipeline, 17 have been approved for the handloom and khadi sector and 20 for conch shells, shitalpati, leather accessories etc. The investment for each cluster will be around Rs 3.5-4 crore, with the Centre contributing 75% and the state 20%.

RCOM, Cisco launch services for SMEs
The Economic Times, 28 June 2007
Telecom service provider Reliance Communication and Cisco, the networking and communication technology player, have launched business internet services for SMEs. The product which is for the first time introduced as a service to SME segment will bundle services such as high speed broadband access, anti-virus suite, business email packages, domain name service, firewall, local area network and wide area network among others. This will be offered on a pay-per-use basis at a cost of Rs 1200 to Rs 10,000 per month, depending upon the different services required and the area to automated. After Pune, the service will be offered in other cities too.

FICCI for cluster-based approachmerce and Industry (FICCI) has recommended a five-point strategy to boost development of small and mediu to boost SMEs
Business Standard, 25 June 2007
The Federation of Indian Chamber of Comm enterprises (SMEs) through the cluster-based approach. These points are technology and quality upgrade, low-cost financing, linkages between Indian and overseas SME clusters, marketing and export promotion and training, and skills upgrade. The industry chamber feels that the cluster-based approach should move up the value chain to a new trajectory by integrating the five suggested elements. It is of the view that lack of an inter-institutional synergy, dearth of committed NGOs and industry bodies, and paucity of good service providers have led to limited success of various initiatives undertaken so far.

PM keen on social security for SME workers
The Financial Express, 23 June 2007
Prime Minister Dr Manmohan Singh said the time was ripe for a new policy regime to take the small and medium enterprises (SMEs) to the next level and ensure a smooth transition without impediments. He further said he would ask finance minister Dr P Chidambaram to find possible ways for expanding access to capital, particularly risk capital. Singh was speaking at the “Emerging India Awards, 2007” organized by CNBC-TV 18. He said the government was committed to growth of SMEs and the emergence of new enterprise in the country. “We have passed the Micro, Small & Medium Enterprise Development Act to promote growth of SMEs. A policy package has been announced for doubling credit flow to this sector. With growth of the economy, new opportunities have emerged in the SME sectors, like civil aviation, tourism, biotechnology and agriculture. The government is open to all new ideas on how to spread industrialization across the country,” Dr Singh said. The Prime Minister recognized the market imperfections, particularly in access to credit. Markets and technology place small enterprises at a competitive disadvantage vis-à-vis large enterprises.

Portal to enhance performance of SMEs launched
The Financial Express, 20 June 2007
National Manufacturing Portal—the first of its kind in the country—was launched to enhance the competitiveness of the manufacturing sector especially the small and medium enterprises (SMEs) through the use of IT and enable them to compete more effectively in the international market. The portal (www.nmcc-vikas.gov.in) has been created by National Manufacturing Competitiveness Council (NMCC) with support from Microsoft, India as a part of the "Project Vikas”. Project Vikas aims to develop knowledge networks through the creation of R&D linkages, capacity building with regional training institutes, sharing of best practices and enable linkage with the SME cluster eco-system. The portal includes knowledge base on different manufacturing sectors/sub-sectors; resources on Indian and international clusters; intellectual property rights (IPR), market information to improve market access; credit and finance related areas for SMEs including various policies, schemes etc.

Big companies make hay from shining SMEs
The Economic Times, 18 June 2007
The country’s GDP is growing at a robust 10%, largely driven by small and medium-sized enterprises, which are seeking funds to ramp up production. Experts now believe that as these companies look for expansion, the need for private equity will multiply. “Many of these companies are expected to make huge profits in the next few years of economic boom,” says AT Kearney’s Raman Mangalorkar, who consults SMEs. Not without reason, companies, including some big names in business, and from diverse fields like cement production, pharma manufacturing and retail are also creating PE funds to tap the business. Sample this: Of the well-known pharma major Ranbaxy has floated its fund Religare, the diversified Dalmia group, which also makes cements, has set up Landmark and retail giant Future group has launched Future Capital. Another diversified business house, Ashok Piramal group, has also floated the Peninsula Fund, while the Munjals of Hero group and Burmans of Dabur are investing aggressively in small companies. The opportunities are immense. And the best way a traditional business can make optimum use of opportunities being thrown by SMEs is by launching PE funds and taking their share of the SME growth pie.

Funds are coming cheap
Business Standard, 15 June 2007
Statistics show that most SMEs are availing of loans below prime lending rate. Small and medium enterprises (SMEs) and their industry associations often complain about getting very little benefit from competitive lending rates (read loans are costly). While problems of delay in decision-making and availability of timely credit is an issue, industry statistics show that a major portion of the SMEs gets loans below the prime lending rate. At present, the rate that the country's largest lender charges is 12.75 per cent. Of SBI's total SSI credit portfolio of Rs 22,817 crore as on March 31, 2007, about 50 per cent (about Rs 11,000 crore) is advanced at sub-PLR.

Banks urged to boost credit
Business Standard, 1 June 2007
Industry has asked banks for greater assistance to small and medium enterprises (SMEs) along with a rating system for the sector and transparency in service charges. The demands were made in the wake of difficulties faced by the industry such as high interest rates, insistence on collateral and guarantees by banks, higher interest on export credit and higher transaction costs. Addressing these demands at the Bankers-Borrowers Meet, organized by the PHD Chamber of Commerce and Industry, Mr H N Sinor, chief executive, Indian Banks' Association said, "The Basel-11 prudential norms clearly mention the need for rating SMEs. Work is in progress for streamlining the SME rating and will be completed soon. Triple A ratings are also being given to SMEs to enable them to source funds at competitive rates."

Orissa IT firms seek more floor space in Infocity
Business Standard, 1 June 2007
Small and medium enterprises in the information technology (ITSMEs) sector in Orissa are approaching the government to increase the floor area ratio (FAR) of buildings in Infocity, the IT hub of the state. The demand is in line with the existing FARs for IT buildings in West Bengal, Andhra Pradesh, Tamil Nadu and Maharashtra. The SMEs are also demanding an increase in the rent subsidy period from the present 1 year to 3 years and a hike in interest subsidy from the current 5 per cent on loans up to Rs 1 crore for 5 years.

ITC, Exim develop software for SMEs
The Financial Express, 30 May 2007
Geneva-based International Trade Centre (ITC) in joint venture with Exim Bank has developed a software, ‘Loan.com’, which will help the SMEs of the country and other developing countries to be competent to enter the global market. A fund of 2,00,000 euros has been kept aside by the European Commission (EC) which will be used in financing those SMEs in the developed countries that are able to answer a series of questions as asked by the software. The 12-month pilot project ‘Building competitiveness for SME financing’, was successfully completed by the Exim Bank in the country. Even though there are 150 developing countries in the world as defined by the United Nations, the project is meant for the developing countries where the SMEs are finding it difficult to access financial resources and hence are unable to get global exposure.

In good health
The Economic Times, 29 May 2007
India's healthcare industry is valued at about $23 billion, which is almost four per cent of the GDP and is expected to grow at 12–13 per cent over the next five years. Health expenditure in India is to a large extent (close to 70 per cent) private payer dominated and the public sector, especially the state governments, contributes less than 30 per cent. The Government of India plans to improve health infrastructure by upgrading and increasing the total number of hospitals, clinics and clinical laboratories in urban and rural areas. This is expected to drive growth in this sector. According to industry estimates, 65 per cent of the Indian manufacturers can be classified as belonging to the SME sector and their average annual sale volume is not above $100,000. Forecasts assume a 3–7 fold increase by 2010.

BSE plans to launch platform for SMEs
Business Standard, 6 May 2007
The Bombay Stock Exchange, Asia’s oldest stock exchange, plans to launch a separate trading platform for SMEs. BSE was preparing a strategy for an SME exchange. Apart from the National Stock Exchange, others in the fray for launching an SME exchange are the Inter-Connected Stock Exchange and Financial Technologies. Inter-Connected Stock Exchange is a trading platform created by 13 regional stock exchanges, while Financial Technologies is the promoter of commodities exchange MCX. Financial Technologies proposes to enter the segment in partnership with the Small Industries Development Bank of India, the state-run lender for SMEs. The Over-The-Counter Exchange of India (OTCEI) also proposes to revive its trading platform after its earlier attempts to make itself a strong trading platform for SMEs failed to succeed

ICICI Bank launches Rs 1000 million fund for SMEs
The Economic Times, 27 April 2007
ICICI Bank announced a Rs 1000 million fund to support innovation and development of green businesses in India. The fund would provide short to medium-term loans ranging between Rs 5 lakh and Rs 40 lakh to SMEs (small and medium enterprises). The bank has not identified any particular sector for lending but would focus on energy-efficient and environment-friendly ventures. `The dedicated fund would help SMEs to promote sustainable growth,' ICICI Bank deputy managing director Mr Nachiket Mor said, addressing a seminar organized by CII and the Indian Venture Capital Association. `The Rs 1000 million fund is an initial effort, let's see how we take it forward,' he added. In 2005/06, ICICI's microfinancing was to the tune of Rs 22,000 million and the bank expects significantly higher funding this fiscal, according to Mr Mor.

Big storage for small firms
Business Standard, 27 April 2007
With Indian SMEs shifting to network-based storage, IT's big boys are smelling big bucks in this volumes business. With IT adoption increasing among the small and medium enterprises (SME) managing data is becoming a clear priority. As per the IDC quarterly disk storage tracker, Indian external disk storage market clocked $209 million (approx. Rs 919 crore) in the calendar year 2006 and had witnessed a growth of 43 per cent on a yearly basis. In terms of capacity, the same market has expanded over 100 per cent in the same period and clocked 24.5 petabytes. Though an exact breakup for the SME segment is not available most of the companies agree that it contributes 30-40 per cent to their sales. According to IDC predictions for 2007, IT vendors will focus on mid-size enterprises, which require speedy implementations and target a reasonably quick return on their IT investments

Exim policy brings relief
Business Standard, 27 April 2007
This year's Exim policy has brought a degree of relief to small exporters with the extension of the export obligation under the Export Promotion Capital Goods (EPCG) scheme from eight to 10 years. The scheme which was initiated by Mr Murasoli Maran in 2002, allows the import of capital goods at five per cent duty in return for fulfilling specified export obligations. Under the new policy, tiny and cottage industries will be allowed to fulfill their export obligation within 12 years, instead of the earlier eight years. For SSIs, the 8 year cap has been retained. The policy has also raised the EPCG limit for SSI units from Rs 25 lakh to Rs 5 crore. Besides, if the unit's export performance during the past three years is more than Rs 10 crore, it would become eligible for export house recognition.

Groping in the dark
Business Standard, 20 April 2007
The oldest hub of scientific instruments and apparatus industry at Ambala is fast losing its identity owing to lack of grants and poor R&D. The industry, comprising a cluster of almost 800 small scale and cottage units, is about 50 years old. It has been passing through a rough patch due to obsolete technology, lack of research and development and government support requisite for the growth. Ashwani Goel, President Ambala Scientific Instruments Manufacturers' Association, says: "A centre of excellence, common facilities and upgradation of infrastructure is a must for the growth of industry". Proposal was sent for the modernization of industry under the cluster development programme of Government of India in which the industry bears 15 per cent of the total project cost, 10 per cent is to be contributed by the state government and 75 per cent is provided by the government of India but it has yet to fetch concrete results. The Scientific Instruments cluster of Ambala exports more than 50 per cent of its output to the developing counties of Africa, Far East Asia and Middle East worth Rs 100 crore annually. The political crisis in the Middle East severely hit the industry as it was a major export destination.

London SE sees strong Indian demand for AIM listings
The Hindu Business Line, 17 April 2007
Indian SMEs are likely to maintain the tempo on raising of growth capital through the Alternative Investments Market (AIM) in the current year too, a top London Stock Exchange (LSE) official has said. In 2006, 10 India-related companies/investment funds raised about $2.6 billion, accounting for 10 per cent of the total $26 billion of capital raised from AIM in that year.

Indian SMEs bullish on economic growth
Business Standard, 13 April 2007
Over 80 per cent of Indian small- and medium-sized enterprises (SMEs) are optimistic about India’s growth story, according to the UPS Asia Business Monitor (UPS ABM) 2007 report. Last year, only 69 per cent expressed bullishness, which reflects that the level of confidence has risen by 17 per cent. Moreover, 89 per cent of Indian SMEs are confident about their company’s growth prospects, which is a consistent rise in growth expectations from 2006. This positive sentiment is reflected in Indian. There are roadblocks to competitiveness such as a lack of qualified workers, innovation, and government support. SME leaders in India cite a lack of supply chain efficiency and transportation infrastructure as the biggest obstacles to their competitiveness, factors considered both important and lacking. These obstacles need to be addressed to ensure their sustainable growth and competitive position in the global marketplace, states the report

Rate hike to hit profit margins
Business Standard, 13 April 2007
With close to 30-40 per cent of the small and medium enterprises (SME) funding coming from borrowings, the increase in interest rates is bound to affect SME margins by about 2-3 per cent, note industry experts. SMEs fear the repeated hike in prime lending rate (PLR) is likely to impact their bottom line. PLR is the rate at which banks extend loans to their most credit worthy customer. In the last one year, the PLR of most banks has increased by over 2 per cent.

MSE package inadequate
Business Standard, 30 March 2007
IFRASTE (Industrial and Financial Reconstruction Association for Small and Tiny Enterprises) and NACOSI (National Confederation of Small Industry) have come down heavily on the policy prescriptions for MSEs (micro and small enterprises). Mr D E Ramakrishnan, president, IFRASTE and NACOSI, said, “The policy talks about SIDBI (Small Industries Development Bank of India) scaling up and strengthening its credit operations for micro enterprises and covering 50 lakh additional beneficiaries over five years beginning 2006-07. It also talks of the government providing grant to SIDBI to augment SIDBI’s portfolio risk fund for this purpose. This sounds hollow as 2006-07 is almost over and no funds have been provided so far.”

We are only a Commission; the implementation is up to the Govt.
Mint, 7 April 2007
Details

SME rating agency to expand operations in northern region
The Financial Express, 28 March 2007
In a bid to cater to the growing needs of the SME segment in northern region, the SMERA (SME Rating Agency of India Limited) has announced plans to set up four offices in Punjab, Chandigarh, Uttarakhand and Jammu & Kashmir. `We will soon open our four offices in Ludhiana, Chandigarh, Dehradun and Jammu & Kashmir with a view to catering to the growing SME segments in these areas,' SMERA, Regional Manager (North), Mr Sumeet Mehta said. The agency would cater to existing industry clusters in Punjab and new industrial units being set up in hilly areas through its new offices, he said. The rating agency has so far done rating of 40 SMEs and received 225 proposals in this regard from northern region comprising Punjab, Haryana, Uttrakhand, Rajasthan, Himachal Pradesh, Jammu & Kashmir and Uttar Pradesh.

Pharma SMEs may trade with margins
The Economic Times, 28 March 2007
The large number of SMEs (small and medium enterprises) in the pharmaceutical sector may be allowed to give a higher trade margin to chemists than their bigger rivals. This would help them compete with big pharma companies that employ a vast army of salesmen to promote their products. The chemicals and fertilizers ministry is working on a formula that is likely to be a part of the proposed notification on trade margin caps, sources told ET. One option the ministry is considering is to allow SMEs use a multiple of the price at which they get medicines from the manufacturer to compute the trade margin. This multiple could be decided in such a way that traders could get a little more than the proposed margin of 50% of the price to the consumer. The cap of 15% for wholesalers and 35% for retailers would be made applicable to the entire list of control-free drugs, irrespective of whether they are branded or not. Earlier, the government thought of capping margins of only non-branded medicines that form a small part of the market, dominated by SMEs. The logic is that big pharma companies have little share of the non-branded generics market and controlling margins in the segment would not be of use if prices are to be lowered across the board.

German SMEs keen on JV with India
EFY Times, 19 March 2007
Recently, a 21-member business delegation of small and medium entrepreneurs
from State of Saarland (Germany), led by its minister of Economics and Labour, Dr Hanspeter Georgi, was in the Kolkata to eye for business collaboration with their Indian counterparts. Talking to media, Dr Georgi said, “Saarland though is one of the small states in Germany with a population of around 1 million, but its geographical location holds potential for doing business in Europe.” He added, “I feel West Bengal is growing leaps and bounds in technologies in areas such as automobile, chemicals and pharmaceuticals, nanotechnology, biotechnology, food processing machinery and equipment. It is also developing fast in areas such as IT and ITES. So we look forward to work closely.”

SSI quota to continue
Business Standard, 15 March 2007
The government has said it would continue to reserve items for exclusive manufacture by small-scale industries. `At present, 115 items are reserved for the small-scale sector. We will continue to reserve these items as it helps in promoting the small-scale sector,' industry secretary Mr Ajay Dua said. Addressing a conference on the state of competition in the Indian economy, Mr Dua said the government has reduced the number of reserved items from 812 to 115 items over the years.

A mixed bag: Budget 2007-08
Business Standard, 9 March 2007
Budget 2007-08 has been a mixed bag. The small-scale sector has received some attention. It was presented against a backdrop of high expectations with the economy having moved into the high growth trajectory of 8.5 per cent, supported by a strong growth in services and industry sector. Yet many observers believe that big-ticket reform in Budget 2007-08 have not been taken on the way they should have and tax changes have left most quarters wanting, as substantial giveaways had been anticipated. In a Budget speech that sought to strike the right notes with regard to inflation control and concern for the ‘aam aadmi’ (common man), the finance minister Mr P Chidambaram reported that the Forward Markets Commission had banned futures trading in wheat and rice, and introduced a dual taxation scheme for cement (pegged to a retail price of Rs 190 per bag of 50 kg). He dwelt at length on programmes for agriculture and announced hefty spending increases for education and health care as also for the infrastructure-oriented Bharat Nirman. But while extending the national rural employment guarantee scheme to 130 new districts (adding to the 200 covered this year), the financial allocation has not been increased much from this year’s budgeted number. There is a package of incentives for small and medium industry, including a raising of the exemption limit from Rs 1 crore to Rs 1.5 crore.

Package for small units announced
The Hindu, 3 March 2007
The Centre has announced a package for promotion of micro and small enterprises, which calls for a comprehensive study to assess the needs and scope of government intervention required for enhancing the competitiveness of micro and small enterprises in the service/business sector. Making a statement in the Rajya Sabha, Minister for Small-Scale Industries and Agro and Rural Industries Mr Mahavir Prasad said that the package fulfilled the requirement in the National Common Minimum Programme for promoting economic growth that was employment-oriented. A technological mission would be established to assist small and medium enterprises in technology development, energy conservation, and pollution mitigation. A new scheme would be formulated to provide financial assistance to select management/business schools and technical institutes to conduct tailor-made courses. Five select universities/colleges would be financed to run 1200 entrepreneurial clubs. Under the package, the existing guidelines of the Small Industries Cluster Development Programme – renamed Micro and Small Enterprises Cluster Development– would be reviewed to accelerate holistic development of clusters. The Small Industries Development Bank of India would scale up and strengthen its credit operations for micro enterprises and cover 5 million additional beneficiaries over five years beginning 2006/07.

Big breaks for small units (Budget proposals)
Business Standard, 2 March 2007
Extension of Textile Upgradation Fund: Small and medium enterprises (SMEs) in the textile sector had been asking for an extension of the scheme which offers the upgrading unit funds at five per cent interest. At a time when interest rates are moving up, the scheme will benefit smaller units that have to fall back on domestic banking channels to raise funds and do not have access to foreign markets. The availability of the scheme throughout the 11th five-year plan will ensure that textile units that were unable to access it during the last couple years will be able to avail of it now.

Raising the exemption limit on excise duty: The move will benefit SMEs with a turnover of less than Rs 1.5 crore, allowing them to stay out of the excise net. Earlier, as soon as a unit reached the Rs 80 lakh or the 80 per cent threshold, it had to register with the excise department. With the new exemption limit, the 80 per cent threshold has gone up to Rs 1.25 crore and the excise duty payment begins only when turnover touches Rs 1.5 crore

Small change
Business Standard, 2 March 2007
Small and medium enterprises (SMEs) are not likely to save much on account of the removal of surcharge on tax paid on book profit, as proposed in the budget for 2007-08. While it will encourage SMEs to invest in upgrading plant and machinery, it is unlikely to make a huge impact on their bottomlines. According to a study based on 1,300 companies with a taxable income of Rs 1 crore or less, these firms paid tax of Rs 157.29 crore in 2005-06 including the 10 per cent surcharge and education cess of two per cent on the tax paid in that year. It is assumed that these firms will pay a similar amount in tax during 2007-08, with savings from the removal of surcharge being around Rs 20 crore

SMEs notch up 54% net profit
Business Standard, 23 February 2007
Small- and medium-enterprises outperformed the BSE Sensex firms in terms of net profit growth in the first nine months of financial year 2006-07. A total of 595 SMEs (excluding banks and NBFC) posted a 54 per cent growth in net profit, compared to 27 per cent by 25 sensex firms in first nine months (April-December 2006). The aggregate net profit of these companies increased from Rs 17,202 crore to Rs 26,479 crore during April to December, 2006. The total sales of these firms increased 28 per cent to Rs 3,59,252 crore (from Rs 2,80,844 crore). Income from other sources rose 24 per cent from Rs 7,157 crore to Rs 8,856 crore and the interest burden increased by 22 per cent to Rs 8,618 crore (Rs 7,067 crore) during the period.

SEBI okay with bourse for SMEs
Business Standard, 15 February 2007
The SEBI (Securities and Exchange Board of India) is understood to have taken an in-principle view to promote an exchange for small and medium enterprises (SME exchange) as part of the existing stock exchanges. The regulator is reportedly of the view that the objective of the exchange will be to provide capital to SMEs, which in turn will help them grow in size. Subsequently they could list in bigger exchanges, which then will be more of a formality rather than a separate exercise. This is because, the bigger exchanges by then will have the preliminary data for necessary surveillance of the companies. While the guidelines may not have much changes in corporate governance norms, the cost of listing for SMEs will be drastically cut down, said the source. Further the companies under SME category will be categorized as the one with capital base of Rs 5-10 crore. It was one of the issues taken up in the recently held technical advisory committee and will be discussed in the board meeting for finalizing guidelines.

SMEs queue up to get themselves rated
The Financial Express, 15 February 2007
Recognizing the significance of improved credit flow and transparency, large number of SMEs (small and medium enterprises) are approaching rating agencies to avail improved credit and better rate of interest. Rating agency Crisil, which started with rating of SMEs in April 2005 has received a warm response, with 650 companies rated till date. Speaking at a seminar SME - The world of opportunities in Mumbai, Mr Yogesh Dixit, head-SME Ratings, Crisil, said, “Timely and adequate availability of credit is imperative for growth of the SME sector. Rating acts as an effective tool for all the stakeholders and gives a distinction in credit quality to lenders.” Given the subsidies given by NSIC (National Small Industries Corporation Ltd), rating services have become affordable for SMEs. With a 75% reimbursement of the rating fee from NSIC, rating fees range between Rs 7587 to Rs 13875.

Strategic planning, risk management vital for SMEs
The Financial Express, 15 February 2007
Experts who gathered at the seminar SME - The World of Opportunities reiterated the role played by the small and medium industries in economic development, the prospects and challenges ahead. Inaugurated by Dr P K Biswas, executive director, Reserve Bank of India, the opening session covered in detail some issues the sector faces today, like strategic planning and risk management, benefits of raising funds abroad, role of infrastructure in growth, how to face market realities and various modes of SME financing. Delivering the inaugural address, Dr Biswas gave a holistic view on the Indian SME sector and emphasized the importance of strategic planning and risk management, in a scenario where the sector is prone to volatile market forces and limited finance back up. There was an overall consensus amongst the experts that there is a huge potential for the sector to grow. However, they believed that if the sector has to grow at the rate forecast, then it is very important that it grows through self-development and self- evolvement rather than depending on the favours earned through legislations. Financing is absolutely vital for the sector, as SME have to depend on financing throughout their lifecycle, right from creation to daily operations

Italy signs 3 pacts to boost business ties
The Hindu Business Line, 13 February 2007
Three MoUs (memoranda of understanding) were signed between Indian and Italian firms on Monday, when the largest-ever Italian SMB (Small & Medium Businesses) delegation of 400 entrepreneurs visited Kolkata to explore businesses opportunities in the State and hold discussions with their counterparts. While one MoU was signed between Magaldi Power and DC Industrial Plant Services Pvt Ltd for an exclusive licensing arrangement for selling the Magaldi MAC dry bottom ash extraction system for West Bengal, the other was between Unione Parmense Degli Industriali and the Confederation of Indian Food Trade & Industry for "promoting, improving and developing economic relations and investments between the Indian and Italian business communities engaged in the food sector". The third MoU was signed between the Council for Leather Exports and the National Association of Italian Manufacturers of Footwear, Leather Goods and Tanning Machinery for setting up a tanning training & service centre in Kolkata and to provide assistance in terms of machinery and trainers.

Italian fund to strengthen SME ties with India
The Economic Times, 12 February 2007
The 'Go India' fund, set up by seven Italian banks, would help strengthen ties between SMEs of the two countries, Italy's Minister for International Trade Ms Emma Bonino said. Briefing reporters at the sidelines of an investment seminar, Ms Bonino said the Euro 300 million-fund would focus on the specific SME sectors and would facilitate business promotion between the two countries. In the next three years, bilateral trade between the two countries was expected to touch $10 billion from the current levels of $4.6 billion, she said. The areas where Italian business was interested were film-making, mechanics, traditional craft, biotechnology, infrastructure, logistics, chemicals, pharmaceuticals and distribution in India.

Social security for unorganized sector
Business Standard, 9 February 2007
The NCEUS (National Commission for Enterprises in the Unorganized Sector) has suggested setting up a social security fund for workers in the unorganized sector. The commission has submitted the report to Prime Minister Dr Manmohan Singh. The commission is also planning to suggest a provision for unemployment insurance. NCEUS was set up two years ago under the chairmanship of economist and member of Parliament, Dr Arjun Sengupta. Besides, workers in the unorganized sector, the commission is preparing a report on credit access for the micro and tiny enterprises in the country. There are 1.15 crore such enterprises in the sector. “A majority of bank loans directed at the SME sector is going to SMEs with a turnover of more than Rs 5 crore. The tiny and micro enterprises in the Rs 20-25 lakh turnover category hardly get any funding. We are preparing a status report on this which will be submitted to the government by September 2007,” Member-secretary of NCEUS, Mr V K Malhotra said.

Nutan no more
Business Standard, 26 January 2007
The growing popularity of LPG has put paid to the hopes of Nutan stove makers in Madhya Pradesh.
Massive shortage of kerosene and the growing use of LPG for cooking have snuffed out the flickering hopes of Nutan wick-stoves makers in Madhya Pradesh. Manufacturers say that if government does not stop the black marketing of kerosene at prices far higher than those stipulated, this poor people’s product will soon become a ‘museum piece’. Of the 12 licensed manufacturers of Nutan wick-stoves, developed by the Indian Institute of Petroleum in the 1960s, four are in Madhya Pradesh. Two are in Indore and two in Ujjain. Two of these companies have shut shop. Two others also see a bleak future for their product and are planning to switch to other products. The manufacturers say if the government makes efforts to make kerosene easily available and slash its black market prices, the units may get a fresh lease of life.

India, US to co-operate to promote SMEs
The Economic Times, 24 January 2007
India and the United States of America will enter into an agreement for cooperation in the small and medium enterprises segment of the two countries. The objective is to bring in investment and technology from rich American SMEs. This is because the size of American SMEs in terms of both investment and capacity is far more than that of Indian SMEs. Such a partnership with boost job creation in the country. The two governments will develop a work plan to identify specific joint activities. These will include exchanging technical expertise and experience, sharing information on the small business programmes, products and services, facilitating business alliances promoting business linkages identifying investment and commerce opportunities in each country. The two sides will also organize joint trade promotion programmes, conferences, expositions, etc. The Ministry of Small Scale Industries is also seeking to share the experience of the US SBA, particularly in the creation of specialized small business investment companies, equity investment through small business investment companies, federal procurement assistance, research and development assistance.

Textile units get IT savvy
Business Standard, 19 January 2007
Indian textile businesses are increasingly investing in IT infrastructure. The textile sector’s ambition to touch the $85 billion mark by 2010 may not fructify, if it lags in using technology. But an increasing number of owners of textile units believe that IT is not only essential but indispensable. Given that more than 85 per cent of the industry consists of small units, the rising trend of textile units going in for IT-related infrastructure is a positive sign. Increasingly complex product mixes and longer processing sequences are intensifying the need for IT infrastructure. In composite mills (spinning, weaving, garmenting, retailing), these are becoming inevitable. Information technology can streamline processes by organizing information from manufacturing, sales and finance, enabling data sharing for improved decision making. Hyderabad-based Suryajyoti Spinning Mills has connected its plants with a network.

SISI to help Agra units
Business Standard, 19 January 2007
In an effort to promote the growth of cottage and small scale industries in Agra, the SISI (Small Industries Services Institute), working under the Union ministry for small industries, has decided to offer the small industries of Agra a chance to participate in three international trade fairs to be held in France, Hong Kong and Australia. The industrialists of Agra and Firozabad have been invited to participate in the international handicrafts and trade fair to be held in Leon, France between 16-26th March where the industrialists will be able to display their product line to international buyers. The other fairs include the international trade fair of leather fashion garments to be held in Hong Kong between 28 and 30 March, and the multi-purpose cottage industry trade fair to be held in Melbourne.

IFC and CII may ink pact to help SMEs in NE
The Economic Times, 20 November 2006
The IFC (International Finance Corporation), as part of its South Asia Enterprise Development Facility, will help small and medium enterprises (SMEs) in north-east India access marketing expertise needed to scale up their operations while also funding skill development initiatives in the region. IFC will sign an MoU with CII to be the institutional partner to the rural business hub initiative of the Panchayati Raj Ministry and the chamber. Under the MoU, IFC will facilitate, support and promote RBHs in the north-east in agri-business, poultry, fisheries, handicrafts and initiatives relating to non-conventional energy sources.

Project Vikas: Microsoft’s initiative for MSME development
Business Standard, 20 November 2006
Manufacturing has been India’s lynchpin for sustainable development, employment generation, continued economic growth and fostering innovation. It is critical for SMEs to significantly enhance competitiveness. Microsoft, in partnership with National Manufacturing Competitive Council and other industry stakeholders, aims to address this gap through “Project VIKAS” which is a holistic and scalable, five year action plan designed to enhance the competitiveness of India’s SME sector through a multi-pronged strategy, encompassing skill and capacity building, knowledge creation and dissemination, and enablement of linkages in the cluster ecosystem. The project signifies a long term commitment by Microsoft India to help the Indian SME sector address its `soft’ challenges and gear up to effectively to face global competition.

Saluting the Indian MSMEs: Ministry of SSI and CII partnership
Business Standard, 20 November 2006
The MSME (micro, small and medium enterprises) sector in India is an emerging, vibrant and powerful economic player and is expected to contribute to the overall output of the country. There are three strategic interventions happening at the policy level for further promoting this sector.

Small-scale industries` investment declines in Punjab
Business Standard, 10 November 2006
Although Punjab manages to attract huge investment in real estate as far as the small-scale industries sector is concerned, the situation is grim. This indicates that in coming years the pace of industrial growth in the state may slow down. According to data collected from the industries department, there had been significant decline in terms of new investment in Punjab in the SSI sector, while units are keen to go to Himachal Pradesh to get the tax sops there. In 2005-06, 692 units were registered in Punjab, in comparison with 798 units in 2004-05 in the SSI sector. As far total investment is concerned, it was Rs 117.83 crore in 2005-06, whereas it was Rs 140.60 crore in 2004-05. In 2002-03, the total number of units registered in the SSI sector was 833, as against 729 in 2003-04. In 2001-02, 1162 new units were registered. On the other hand, in 2005-06 alone, about 1970 units in the SSI sector were registered in Himachal Pradesh with an investment of about Rs 990 crore. The state is witnessing decline in investment in the SSI sector ever since 1995-96. On the one hand, new investment is not coming, and on the other, existing industries are finding it difficult to survive in the absence of any sops in the state. Already hundreds of foundry units in Batala, dyeing and printing units in Amritsar, and cycle parts units in Ludhiana have closed operations.

Uttar Pradesh to focus on cluser development
Business Standard, 9 November 2006
The Uttar Pradesh government will focus on cluster development in the Eleventh Plan while skill development through private-public partnership would be given importance. This was stated by Mr Govindan Nair, Principal Secretary, Small Scale Industries and Export Promotion, Uttar Pradesh, at the conference Innovation and faster growth: The challenge for SMEs, organized by the PHD Chamber of Commerce and Industry, in association with the National Knowledge Commission in the city. ‘The Knowledge Commission was working on making SMEs all over the country competitive and innovative,’ said Mr Ashok Ganguly, member, National Knowledge Commission, in his address. He pointed out the advantages of entrepreneur skills in the country and called for linking and offering innovation for development of the country.

Banks go for green push
Business Standard, 3 November 2006
Yes Bank and Exim Bank signed an MoU with CII - GBC (Godrej Green Business Centre) to promote small and medium enterprises in auto ancillary, textiles, gems and jewellery, media and entertainment and life sciences and biotech sectors. The objective of the MoUs is to promote green enterprises among the SMEs to make their products export-worthy. The green enterprises are typically energy efficient and help in sustaining the natural resources. The tie-ups with the banks will essentially focus on the facilitation of such small and medium units. The financial institutions will focus on developing renewable energy and sustainable infrastructure among SMEs. Yes Bank will create 20 teams across the country, to identify emerging SMEs in different regions. National Capital Region Pune-Nashik, Ahmedabad-Surat, Hyderbad-Bangalore and Kolkata-Orissa belts are among the main focus areas of Yes Bank.

An African safari could be profitable for Indian SMEs
The Financial Express, 1 November 2006
Africa is currently experiencing its best economic performance in many years. Riding the global economic recovery and a general rise in global commodity prices— chiefly oil, copper, timber and coal—economic growth in Africa as a whole has crossed the 5% mark. In 2005-06, India exported goods to Africa worth $5.5 billion and imported goods worth $4 billion. SMEs (small and medium enterprises) directly contribute more than 35% to India’s exports and in most products, they are the main contributor to exports to Africa. The contribution of the Indian diaspora in southern and eastern Africa is significant in India’s trade, as they own distribution channels, manufacturing facilities and even mines in these countries. Despite this advantage, the India-Africa trade potential has remained for long largely unexploited. Key segments like consumer durables, industrial supplies and joint ventures for re-exports need to be explored. In all these segments, Africa is the new battlefield for China and India, with the impact being more pronounced in consumer durables. As far as industrial supplies for the manufacturing sector in Africa is concerned, opportunities exist for Indian SMEs in high-tech and high value added products in sectors such as engineering and electricals, chemicals and pharma and plastics. A recent Engineering Export Promotion Council study has identified capital goods, electrical products, cranes, lifts and winches, as well as construction and excavating machinery and parts for focus in Africa. In addition, pipes and fittings and small plants for plastics, food processing and packaging also have a good scope for export in Africa. Another area that needs to be seriously looked at by Indian SMEs is establishing manufacturing in select countries for re-export to the European Union. The EU is Africa’s most important market, with more than 30% share of African exports. Indian SMEs encounter several constraints in exploiting business opportunities in Africa. The biggest constraint is the absence of banking channels. Financial markets in Africa are fragmented and African SMEs themselves suffer from their apathy. Indian banks should be persuaded to open branches in major centres in focused countries. Some mechanism for realizing bad debts are also needed as defaults are common and discourage SMEs to export to Africa. Secondly, SMEs suffer from the inconsistency and arbitrariness of the import policies and procedures in these markets. Seeking a predictable and transparent trade regime for India’s exports should become an important issue in bilateral talks with African countries. Thirdly, arbitrary freight and transport charges in most of the African countries, with the exception of South Africa, dissuade SMEs from entering into long-term contracts. Fourthly, Export-Import Bank of India credit lines have so far never focused on exports from SMEs

Master plan soon to boost Karnataka SSIs
The Financial Express, 30 October 2006
The Karnataka government is set prepare a master plan to boost SSIs (small-scale industries) in a bid to attract more entrepreneurs. For this purpose, a state-level team has been pressed into action to carry out surveys in all 29 districts to study the current condition of SSIs in the state. According to Karnataka Small Scale Industries Association President, Mr R Prithviraj, the state comprises more than 800 000 SSI units, both under the organized and unorganized sectors, where close to 3 million people are employed. SSIs produce more than 2800 products in Karnataka, dominating other states in six segments—garments, machine tools and accessories, auto components, pharmaceuticals, electronics, and information technology. In total, Karnataka SSIs are making products worth Rs 640 billion every year and generate Rs 270 billion of foreign exchange through exports, Mr Prithviraj said. In total, 52% of SSIs in the state are located in rural areas while the remaining 48% operate in urban pockets, especially in Bangalore and its surrounding areas. In the last 10 years, lack of infrastructure, finance, effective market access, and bureaucratic bottlenecks has pushed several SSIs into sickness.

SMEs untouched by fiscal reforms
The Asian Age, 23 October 2006
Financial sector reforms in India have been of little use for the small and medium size enterprises as also for India’s rural poor, points out a recent study by the World Bank. The report, which focuses on the agenda of `inclusive growth’ in the India economy, says that while there have been reforms in the financial sector, from 1991 onwards, those have mostly helped in liberalizing the capital market and have been helpful for big firms to assess finance. The report points out that small and medium size enterprises are unable to receive credit at the levels that is required that is required by them. It also shows that ratio of private credit to GDP in India remains very low. The study recommends that if the financial sector is to contribute more fully to inclusive economic growth, it must reach out to more people.

Loan channels open up for SMEs
Business Standard, 20 October 2006
Even as SMEs are fast becoming the buzzwords for the banking and finance sector, the public sector Bank of Baroda has fired the first salvo by starting a new business delivery model – SME Loan Factory. The model which primarily aims at cutting down the turnaround time for sanctioning financial assistance to SME players, is based on the assembly line concept in a manufacturing set up where the flow of work is defined, removing all bottlenecks. SME Loan Factory has a central processing hub, which will ensure speedy decision-making, especially the appraisals.

Indian SMEs expected to double in size
Business Standard, 20 October 2006
The $10 billion auto components industry will double in size to become a $22 billion industry by 2010, similarly, exports of auto components will grow from $1.8 billion in 2005 to $4.5 billion by 2010, says a recent study by D&B (Dun & Bradstreet) in association with the SMERA (SME Rating Agency of India Ltd. D&B along with SMERA announced the launch of its first series of publication, Emerging SMEs of India series of six publications covering auto components, textiles, food processing, pharmaceuticals, chemicals and engineering to address these needs. The first publication in the series titled Emerging Auto Components SMEs of India, the domestic auto components industry will double in size by 2010 from $10 billion in FY (financial year) 2006 to $22 billion by 2010. Even the exports are set to grow from $1.8 billion in FY 2005 to $4.5 billion by 2010. There are multiple factors that are seeing the auto component industry record such exponential growth. The publication also studies the banking preferences of the SMEs and notes that nearly 66 per cent of the profiled companies preferred banking with public sector banks, followed by private banks and cooperative banks.

Rs 22,500 million package for small units
Business Standard, 18 October 2006
The government has finalised a comprehensive promotional package of over Rs 22,500 million for the small-scale sector, which includes increasing the general excise exemption limit for micro and small enterprises from Rs 10 million to Rs 12.5 million. The fiscal impact of the promotional measures, approved by the Cabinet, in the current financial year will come to Rs 840 million. This includes Rs 400 million as support for cluster-based development, Rs 250 million for setting up of a risk capital fund, and Rs 100 million for augmentation of a portfolio risk fund. The small enterprise turnover eligibility limit for general excise exemption has been enhanced from Rs 40 million to Rs 50 million. Also, micro and small enterprises will now be allowed to pay excise duty by 45 days, as against 15 days at present. In order to encourage small enterprises to graduate to the medium enterprise level, the general excise exemptions will be extended to graduating enterprises for three years after such graduation at a tapering scale of 75, 50 and 25 per cent, respectively.

Centre may 'teach' SMEs marketing
The Financial Express, 18 October 2006
The ministry of textiles is actively looking to augment the 'marketing skills' of small and medium entrepreneurs so as to enable a systematic and organized way of selling their produce. “Under the policy, the office is organizing workshops in such areas where there is rich potential of marketing handicraft,” Central Region Office, Development Commissioner (Handicraft) Mr V D Chaturvedi said on the sidelines of a one-day state-level marketing workshop on handicrafts of Uttar Pradesh.

SMEs turn to SMERA to get credit rating
The Economic Times, 12 October 2006
SMEs (small and medium enterprises) are turning to the SMERA (SME rating agency of India) to assess their credit-worthiness. SMERA is a joint initiative of SIDBI (Small Industry Development Bank of India), Dun & Bradstreet, Credit Information Bureau and 16 leading banks of the country. The banks help SMERA with database for assessing SMEs. Nearly 240 units have been rated by SMERA, which came into being on 5 September 2005. Another 500 units are about to receive rating certificates, applications of which are being processed.

Investment envisaged in food processing in next plan period
The Financial Express, 11 October 2006
The government envisages an investment of Rs 50,000 crore in the food processing industry during the 11th Five Year Plan. Out of this, the government’s share will be 10%, industry’s 40% and banks and financial institutions’ 50%, Mr Subodh Kant Sahai, Minister of State for Food Processing said. These investments will go towards building backward and forward linkages in the supply chain, testing facilities and setting up new abattoirs. The government is also setting up a “National Meat Board” to promote the meat processing industry, Mr Sahai said at a CII workshop. This will implement a policy to develop this sector of the food processing industry and oversee aspects such as research and development, quality assurance and hygiene. The government plans to set up 100 abattoirs through the public-private partnership route in different parts of the country. The food processing industry needs to adhere to strict guidelines on standards that will be incorporated in the proposed law on food processing, that is expected to be notified shortly, Mr Sahai said.

D&B series on Indian SMEs to enhance their global visibility
The Financial Express, 6 October 2006
D&B (Dun & Bradstreet) and the SME Rating Agency of India have launched D&B’s “Emerging SMEs of India” series of publications with an aim to enhance the sector’s global visibility. The first publication in this series is the “Emerging Auto Component SMEs of India,” which profiles 370 companies with a turnover of less than less than Rs 1 billion. Of these, 160 firms are small-scale, with investments in plant and machinery of less than Rs 50 million, and a sales turnover not exceeding Rs 1 billion. The other sectors in the series are textiles, engineering, pharma, chemicals and food processing.

Microsoft training for Indian SME clusters
The Financial Express, 6 October 2006
Microsoft India will train a group of Tirupur exporters in reaching out to customers through e-mail and export documentation. The aim is to give Tamil Nadu’s textile and apparel clusters a global edge in the next couple of years. Microsoft has also taken up clusters in Ahmedabad (pharma) and Pune (auto components) under its $15 million project, Vikas, which took off in 2005.

Ministry, plan panel oppose big sops for SMEs
The Economic Times, 5 October 2006
A series of fiscal and promotional incentives proposed for small units have hit a roadblock due to strong resistance from the Ministry of Finance and the Planning Commission. Incentives that may cost the government Rs 3300 crore under two different schemes are stuck due to the opposition from these departments. Despite clearance from the department of expenditure, the new promotional package prepared by the ministry of SSI is yet to reach the Cabinet as the department of revenue is not supporting it. The package was supported by the banking division in the ministry of finance. SSI units are keenly waiting for the package as the last package offered by the government was way back in 1991. The current package is estimated to cost Rs 2300 crore over the next five years.

SSI credit trust corpus to swell to Rs 2500 crore
The Economic Times, 5 October 2006
The Ministry of Finance will enhance the corpus of the credit guarantee trust for small industry to Rs 2500 crore from the existing Rs 1400 crore. While inaugurating the National Expo of Small, Khadi, Village and Coir Industries, the Finance Minister Mr P Chidambaram said the government will raise the corpus in five years time. The credit disbursed by public sector banks to small and micro enterprises has gone up by 21.6% while credit disbursals to small and medium enterprises has grown by 28% in 2005-06.