By IANS
New Delhi : Underlining the importance of small and medium enterprises (SMEs) and their contribution to the growth of new industries, Prime Minister Manmohan Singh Thursday lauded the spirit of enterprise in this sector and urged entrepreneurs to be globally competitive.
“Nowhere is this spirit of enterprise, this willingness to take risk and an eagerness to strike out on one’s own to seek a fortune more in evidence than in our small and medium enterprises sector,” Singh said while giving national awards for micro, small and medium enterprises at a function here.
“It is this animal spirit which makes the SME sector the most dynamic in our economy and worthy of our support and encouragement.
“International experience shows that it is possible for SMEs to remain globally competitive even in an increasingly integrated global market,” he added.
With almost 60 million people employed in this sector including the handloom and handicraft segments, Singh said they formed a highly important component from a regional developmental perspective and as a means to promote balanced and equitable growth all over the country.
Detailing governmental and institutional support to this sector through incentives and infrastructure facilities, Singh hoped the enactment of the Micro, Small and Medium Enterprises Development Act would improve competitiveness and benefit firms in business ventures.
“Our government has charted a new strategy based on cluster development that offers a holistic and integrated approach to SME sector’s development. We have also taken up skill development as a high priority area,” he said.
“I have recently announced our decision to set up a National Mission on Vocational Education and Skill Development, and we intend to fund more polytechnics and industrial training institutes to address the growing demand for skilled manpower of our enterprises.”
Conscious of the sector’s problem of access to affordable credit, Singh hoped the policy package for stepping up credit to SMEs announced by his government would help double credit flow in this sector within a period of five years.
“I urge our banks and financial institutions to come forward and support and nurse SMEs, especially through risk and venture capital support,” he said.
“We have also set up a credit guarantee fund to provide relief to those small entrepreneurs who are unable to pledge collateral security. I understand that this scheme has also been able to overcome the initial inhibition of bankers and has steadily gained acceptance.”
The setting up of a statutory National Board for Micro, Small and Medium Enterprises for the first time, Singh said, would bring together representatives of SMEs along with policy-makers, bankers, trade union leaders and others.
Recognising the importance of extending social security to workers in the micro and small enterprises sector, the prime minister said an old age pension would be provided to all citizens above the age of 65 and those living below the poverty line.
“We will also provide life and disability cover to one earning member in each family so that they and their families can get over the consequences of injury or death,” Singh said, adding that the government was working on a health insurance model so that the poor did not have to bear the high cost of medical care.