SME Important for Society and India's Development

The growth and development of the SME sector is very important for the society and the country's economic development and prosperity, said Mr V P Bailgar, IAS, Principal Secretary, Commerce and Industries Department, Government of Karnataka at the CII Karnataka SME Conclave -The World is Your Market, organised in Bangalore on 5 February 2010. Generating more than 45 per cent of the exports of State of Karnataka, manufacturing more than 6000 products and giving employment to more than 22 lakh in the State, the Principal Secretary advised SMEs to remain competitive and aware about the changing dynamics brought about by globalization and technology which had made markets borderless. Further, he urged the SMEs to develop products for global markets, given the tremendous availability of talent and ready supply of raw material. He also spoke on the development initiatives being under taken by the Government of Karnataka in terms of developing infrastructure - gas and roads in preparation for attracting investments in the State.

Mr B Velan, Managing Director, Scorpio Engineering in his theme address emphasized the need for SMEs to leverage India's low cost production and skilled manpower and beyond the domestic markets. He briefly spoke on the numerous benefits that would ensue in terms of better quality, better delivery, higher earning due to the currency factor and most importantly the fact that the SME would get integrated into an international supply chain which would have a multiplier effect on in terms of getting new orders and developing new markets.

Mr Rana Vijeta, Vice President and Regional Head SME Sales South, The Hongkong and Shanghai Banking Corporation Ltd in his address indicated that only 20 per cent of Indian SMEs exported and in the next two years this figure was expected to reach 35 per cent. He briefly pointed out that the primary reason for Indian SMEs to export was not to increase revenue, but to diversify risks. This characteristic of Indian SMEs was somewhat distinct from SMEs of other countries. As per the recent survey conducted by the bank in October-November, the confidence index of SMEs had increased.

Mr T Parabrahman, Chairman CII Karnataka State Council and Managing Director, Kirloskar Toyoda Textile Machinery Pvt Ltd in his address said that in Karnataka, the SME membership was more than 50 percent and CII had initiated a number of specially focused programmes on best practices and operational issues to help SMEs address their challenges and improve their competitiveness.

Mr Aroon Raman, Vice Chairman, CII Karnataka State Council and Managing Director, Raman Fibrescience Pvt Ltd said that Indian SMEs who were going global needed to have a long term perspective with smart thinking and sustained efforts being the two pillars on which they should develop their strategy.

Mr K B Vijaykumar, Convenor CII Karnataka SME Panel and Managing Director, Fowler Westrup (I) Pvt Ltd advised the participants that the downturn had shown the importance for developing a wider base of customers and the need for SMEs to explore markets beyond their immediate horizon.

The conclave presented perspectives on a wide range of important subjects which would increase SMEs awareness on how to do business in global markets such as the market development promotion schemes of the Government of India, hedging risks related to raw material and currency, letters of credit, developing water-tight contracts, leveraging the web for marketing, market development strategies and market opportunities for SMEs in Malaysia and Belgium. Over 150 SMEs participated in the programme.