Abid Hussain Panel Report On Ssis Favours Dereservation Of Ssi

Abid Hussain, the chairman of the expert committee on small scale enterprises, yesterday submitted a summary of his recommendations to Union industry minister Murasoli Maran.

The summary is broadly in favour of dereservation, sources who attended the presentation said.

Hussain, however, refused to comment on the report on the grounds that it was still incomplete as all the members of the nine-member committee had not signed it yet.

Though these members are unlikely to dissent with the findings of the committee, I have informed the minister that a final report would be submitted following their consent, he said.

The committee had originally declined to submit an interim report on the grounds that it would dilute its final findings.

 

But its inability to get the consent of all its members has now forced it to submit a summary finding.

The committee was originally scheduled to submit its report in October.

The deadline was first extended to November and then to January 1. While the earlier delays were attributable to the illness of one of the committee members, the January 1 meeting was rescheduled for yesterday as the minister was away from the capital during the intervening period.

Among the committee members who were present at the presentation were committee member secretary Rakesh Mohan and SSI development commissioner K V Irniraya.

Others present included department of small scale industries secretary S S Boparai, and SSI joint secretary Brahma Dutt.

The other members - Canara Bank chairman & managing director J V Shetty, J S Sandesara, honorary professor at the department of economics, University of Bombay, Entrepreneurship Development Institute director V G Patel and SIDBI managing director Sailendra Narain - were however absent at the presentation.

The report reportedly endorses the findings of the C S Vijayaraghavan committee on SSIs, the sources said.

The Committee had recommended the dereservation of 90 items out of the 836-odd items presently currently reserved.

The recommendation was based on the argument that of the items that were reserved, very few were actually manufactured, implying that the continuation of protection was not justified.

Besides, the experience of the small scale sector has clearly proved that economic survival is possible even without protection.

For instance, though over 8,000 items were manufactured in the small sector, only 836 currently enjoy protection.

The recommendations have also leaned heavily on the findings of a recent UNIDO report and other existing literature, which broadly argue against protection.

Existing data also support dereservation, the sources said.

The committee had been constituted by the government in December 1995 to go into the gamut of issues concerning the small sector.

Its terms of reference included examination of the promotional and protective policies and direct assistance programme for small industry development, review of definitions, legal framework and heterogeneous composition of the small industry, the reservation policy and assessment of its impact on the growth of small enterprises.

The committee examined the present arrangements and sources for the collection, compilation, dissemination and analysis of data on small enterprises to assess their quality, consistency and reliability.

It also reviewed the institutional arrangements for transfer and dissemination of technological and technical information to small and medium units and the existing institutional arrangements to meet their funding needs.