Small and Medium-sized enterprises (SMEs) are labour intensive, have the advantage of low cost of production and can make good use of locally available resources pushing demand and growth. The sector offers a wide range of employment opportunities and absorbs most of the
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working age population.
Majorly consists of handlooms, handicrafts, coir, sericulture, khadi and village industries, small scale industries and powerlooms. SME’s offer a wide range of benefits which are as follows:
- Income equality: SMEs support industrialisation of backward areas and assure more equitable distribution of national income and wealth.
- Employment generation: Produces a wide range of products, from simple consumer goods to high-precision, sophisticated finished products.
- Has emerged a major supplier of mass consumption goods as well as a producer of electronic and electrical equipment and drugs and pharmaceuticals.
- Can generate more number of employment opportunities per unit of capital invested compared to large industries.
- Provides opportunities for entrepreneurship.
- Poverty eradication: Addresses unemployment, provides diversified income opportunities to rural masses.
- Customised production expands the range of market and ensures sustainability to production.
- Balanced regional development:
- Depends on locally available resources both material and labour and can be set up anywhere in the country.
- Absence of locational constraints ensures that the benefits of industrialisation reach every region. Thus, contributing to the balanced development of the country.