Essay-Small scale industries are the backbone of the Indian economy SSC CGL Tier 3 I SSC CHSL Tier 2
In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Small Enterprises are classified in two Classes: Manufacturing enterprises, in which investment is between twenty-five lakh to five crore rupees; Service Enterprises in which investment is between ten lakh to two crore rupees.
Small scale industries are labor-intensive yet require little capital. They provide opportunities for entrepreneurs with limited capital and offer several job opportunities for skilled labor. That is why they are considered the lifeline of the Indian economy.
Small scale industries distribute resources and wealth more equitably. This results in both economic and social welfare. Moreover, the consumer goods produced by Small Scale Industries are cheaper and satisfy the requirements of the poorer sections. Further, products produced by them are used in the manufacture of products by large scale industries.
They also contribute nearly 40 percent to the industrial exports of the country and thus earn valuable foreign exchange as their imports are very little and so there is less foreign exchange outgo.