Small Scale Industry

Meaning
The Planning commission,
Government of India views the entire
village and small industries sector as a
part of the SSI sector.
The central Excise Department
distinguishes SSIs on the basis of the
annual turnover of the units (upto a
maximum limit of Rs.30 million)

Small scale industry

defined in three ways.
1.Conventional defination:
2.Operational defination:
3.National Income
accounting:

1.Conventional
definition:
It includes:*Traditional labour intensive
methods
*Traditional product
E.g. cottage and handcraft
industry

2.Operational definition:
It includes:*Investment in fixed assets
in plant & mchinery
*It can be held on
ownership terms or by lease
or hire purchase.
*Not exceeding Rs. 60 lakhs

3.National Income
Accounting definition:
It includes:*Manufacturing &
processing activities
*Maintenance & Repair
services
Undertaken by both
household & non-household
which are not registered

Types of small scale

industries
1.Manufacturing industries
2.Feeder industries
3.Servicing Industries
4.Ancillary to large scale
industries
5.Mining or quarrying

Characteristics of SMEs
1. Less capital
2.Highly localised
3.Lobour intensive
4.simple technology
5.Easily established
6.Flexible
7.Ownership and
management is almost same.
8.Lesser gestation period

Objective of SMEs
1.Increased employment opportunities.
2.Promote productionthrough labour
intensive methods
3.Adoption of modern techniques
4.Effective use of resources
5.Promote balanced regional
development
6.Ensure equitable distribution of
national income
7.Improve std of living

1.Employment opportunities
2. Less capital
3.Close supervision and
control
4.Employee-employer
relationship
5.Personal contact with
customer
6.Balanced regional
development

Industrial Estate
An industrial estate is an area
developed systematically as
per the industrial policy of the
government.

Features of an industrial
estate
1.Tract of land subdivided & developed
into factory plots or sheds.
2. It is planned clustering of industrial
units.
3.Tool of industrialization & balanced
regional development.
4.It may be developed in urban, semiurban or rural areas.
5.It may be large, medium or small.
6. It may be set up by the government or
by co-operatives or by private agencies.

Objectives of SMEs
1.To provide well-planned
accommodation to the new
entrepreneurs.
2. To provide infrastructure &
common facilities.
3.To encourage the
development of small scale
industries in the country.