FROM THE CHAIRMAN'S DESK - CII

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FROM THE CHAIRMAN'S DESK - CII

usiness

MSME

Journal of Small Business and Enterprise Volume 2, Issue 1, january 2012

Ramesh Datla

Chairman, CII National

MSME Council

FROM THE

CHAIRMAN’S DESK

Global fears of

a double dip

in the developed

markets that

could potentially

undermine crossborder

trade and

investment flows,

and the relatively

bleak current domestic economic scenario

marked by dipping GDP growth and falling factory

output, have posed new challenges to Indian

MSMEs, many of which have been assiduously

building up their capabilities to move up

the global manufacturing value chain. Viewed

against this background, the Union Cabinet's

nod for the Public Procurement Policy for

Micro and Small Enterprises (MSEs) assumes

great significance. The policy move to ensure

that at least 20% of total annual purchases of

Central ministries, departments and PSUs are

procured from MSEs will provide the necessary

impetus for small businesses in the country to

raise their quality and productivity levels.

The procurement policy will deepen the

small business foray into key and strategic

sectors. Although the government is likely to

exempt the defence sector from the MSE procurement

policy, the SME attention is rightly

transfixed on the emerging opportunities in

the defence sector, stemming from the offset

provisions. SMEs engaged in high-tech manufacturing

will particularly benefit from the defence

procurement, more so in light of the defence

establishment's accent on indigenization

of equipment and component manufacturing.

SMEs operating in this space would do well to

align themselves with the large defence suppliers

and thereby overcome the entry barriers

in the defence industry.

Market access is key to the growth of MSME

sector. Over the years, global outsourcing

has opened up new markets for Indian MSME

manufacturing firms. Indian MSMEs have been

supplying a whole range of intermediate goods

to global majors. Now, with insourcing gathering

pace, domestic MSMEs are seeing fresh

growth opportunities. Insourcing is governed

by factors like tax policies, access to natural

and human resources, logistics and infrastructure

support, among others. Both outsourcing

and insourcing trends will create new market

opportunities for Indian MSMEs.

In the midst of these developments, Government

announced its plan to open up multibrand

retail to FDI. The decision has been temporarily

put on hold but the writing is clearly

on the wall. FDI will greatly benefit Indian

MSMEs in terms of market access, knowledge

sharing, and quality improvements.

The macro-economic outlook may not seem

very promising at this stage but the growth

opportunities for MSMEs are emerging from

different quarters. To get the best of the situation,

Indian MSMEs will need to accelerate the

adoption of new technologies. The government

has ushered in a new scheme to promote

the usage of Information and Communication

Technology (ICT) among MSMEs. This scheme

will enable MSMEs to adopt cost saving technologies

like cloud computing. ICT is central

to these enterprises establishing partnerships

with global buyers and suppliers.

Global partnerships will eventually drive the

globalisation of Indian MSMEs. In this edition

of MSME Business, we have focused attention

on the potential areas of partnership between

Indian and Brazilian small businesses. We have

also touched upon other key developments

linked with the MSME sector such as the new

public procurement policy, defence procurement,

outsourcing and insourcing trends, and

FDI in retail.

We have also introduced two new sections

in this journal which will serve as ready

reckoners for our readers Ð a round-up of

key economic developments that impinge

MSME activities, a sum-up of the initiatives

and activities spearheaded by our MSME regional

teams.

We welcome your thoughts on the issues

cited in this edition, and we invite you to proactively

participate in the development of this

journal and in the MSME Council's activities.

Please write to me at: Chairman.CIIMSMEcouncil@cii.in

Inside This Issue

INTERVIEW

FDI IN RETAIL

DEFENCE

TRIUMPH

MARKETING

Plus

Small World

ECONOMIC ROUNDUP

INTERNATIONAL

REGIONS

UPCOMING EVENTS

`MSME sector plays

a significant role

in balanced and

inclusive growth'...PG5

Mr Radha Krishna Mathur

Secretary, Ministry of MSME,

Government of India

PG5

PG8

PG9

PG13

PG14

Pg3

PG4

Pg19

Pg21

PG23


Small World

Electronic tracking

system for PMEGP

The Ministry of Micro,

Small and Medium Enterprises

(MSME) will introduce an

electronic tracking system for

online tracking of all cases under

Prime Minister's Employment

Generation Programme (PMEGP)

scheme. The system will track

filing of application, selection,

sanction, disbursal,

setting up of

units and physical

verification. The

applicants will be

able to view the

status of their

cases on-line.

PMEGP was introduced in August

2008 by merging Prime Minister's

Rozgar Yojana (PMRY) and

Rural Employment Generation

Program (REGP) schemes of the

ministry with a total plan outlay

Industry innovation clusters

for MSEs

The Ministry of MSME has decided

to develop 25 clusters

as industry innovation clusters. The

innovation will necessarily include

successful commercial exploitation

of new technologies, ideas or methods

through the introduction of new

products and processes or through

the improvement of existing ones.

According to a statement issued

by the ministry, it has adopted the

cluster approach for holistic development

of MSEs in a cost-effective

manner. The institutional linkages

of clusters with technical and academic

institutions, incubation centres,

patent offices, research and

development centres, etc., are emphasized

to make use of new ideas

and knowledge for the benefit of the

of Rs 4,485 crore towards margin

money subsidy. It was aimed

to generate an estimated 37.38

lakh additional employment opportunities

during the four terminal

years of XI plan (2008-09 to

2011-12). Under this programme,

financial assistance is provided

to set up micro enterprises, each

costing up to Rs

10 lakh in service

sector and Rs 25

lakh in manufacturing

sector. The

assistance is provided

in the form

of subsidy of up

to 25% (35% for special category

including weaker sections) of the

project cost in rural areas while

it is 15% (25% for special category

including weaker sections) for

urban areas.

cluster. Efforts have also been made

to identify proactive associations

and special purpose vehicles (SPVs)

for this purpose. Soft interventions

(technical assistance, capacity

building, exposure visits, market

development and trust building) and

hard interventions (creation of tangible

assets and infrastructure development)

are undertaken in the

existing clusters.

CII holds training

programme for

MSMEs

Select Indian MSMEs have

formed 11 joint ventures with

their German counterparts in sectors

such as auto components, machines

and engineering goods, at the recently

concluded third annual Indo-

German Management Training Programme,

organised by -CII-Avantha

Centre for Competitiveness for SMEs

in Chandigarh. According to media

reports, 48 more JVs are likely to be

formed in the next six months. Besides,

the programme helped participants

from the Indian small sector to

gain experience from their German

counterparts. The programme was

organised in collaboration with Germany

to enhance the administrative,

social, intercultural and professional

competencies of Indian managers in

the small sector.

MFIs will be

allowed ECB

limit of up to

$10 m

Microfinance institutions

(MFIs) will be allowed to

draw external commercial borrowings

of up to $10 million. RBI

would come out with a notification

on this. But MFIs would need

to come out with a proper hedging

strategy. The move is expected to

address the issue of liquidity that

the microfinance sector has been

witnessing in recent times. The

regulator also sought to `correct'

an anomaly in the extant rules

that allowed only NGO MFIs to leverage

the ECB window. The maximum

limit was fixed at $5 million,

too. MFIs have long been requesting

the Reserve Bank for a review

of the situation.

MSME Business

3

January 2012


Economic Roundup

MSME Business January 2012

4

Falling rupee: boon & bane for MSMEs

The unabated rise of the Indian

rupee continues to adversely

affect Indian exporters, especially

MSMEs. According to a survey,

the exporters have complained

that the 10% rise in rupee valuation

has rendered the export proceeds

uncompetitive. The exporters

were recently given a relief

package of Rs 14 billion by the

government to offset their losses.

The level of appreciation of the

Indian rupee, which strengthened

by 8.35% during the first half of

this year, is second only to that

of the Brazilian currency, which

appreciated by 9.28% during the

same period. Rising transactions

cost and lack of availability of

proper infrastructure, coupled

with little government support to

exporters, have in the recent past

threatened their better prospects

for higher export proceeds. Exporters

are also jittery of the fact

that the rupee would appreciate

more and its effect vis--vis other

Asian currencies would erode

away its competitive edge.

Some MSMEs are cheering the

crash of the rupee to the US dollar,

as the cheap imports from

China would become 15-20%

costlier. Manufacturing cost in

India is higher due to infrastructure

and other bottlenecks. The

weakening rupee has provided

the cushion that Indian MSMEs

needed to make them competitive.

Entrepreneurs are optimistic

that instead of buying Chinese

or imported inputs, even big corporates

would prefer to buy from

domestic manufacturers. Often

Indian firms buy Chinese items to

manufacture their products, due

to its cheaper rates, but now they

will go for domestic inputs.

Ministry asks departments to

implement P&PP policy

In view of a High Court order, the

Ministry of MSME, via a recent letter,

has asked all government departments

to strictly implement the Government

Purchase and Price Preference Policy

for Micro & Small Enterprises (MSEs).

It has been brought to the notice of

the MSME Ministry that some of the

Central and state government departments

are imposing a mandatory eligibility

clause for a minimum turnover

and amount of purchase orders executed

earlier to the tune of crores in

the tenders floated, thereby restricting

the participation of the MSEs.

To provide assistance and support

to MSEs for marketing their products,

under the present Government Purchase

and Price Preference Policy for

MSEs, Government of India has been

extending various facilities to the

MSEs registered with National Small

Industries Corporation (NSIC) under

its Single Point Registration Scheme.

In addition, 358 items are reserved for

exclusive purchase from the MSEs.

Assistance under Government Stores

Purchase Programme in the form of reservation

of products for exclusive purchase

from small scale sector and price

preference are among the major instruments

for providing marketing support

to the small scale industries. The number

of facilities to small scale industries

under the programme included reservation

of certain products for exclusive

purchase from the small scale sector

and price preference up to 15% in case

of selected items which are produced in

both large and small scale units. Under

the Single Point Registration Scheme of

NSIC, MSMEs enjoy availability of tender

sets free of cost; exemption from

payment of Earnest Money Deposit;

exemption from payment of Security

Deposit and price preference upto 15%

over the lowest quotation of the large

scale units (on merits).

Dip in IIP data

raises alarm bells

India Inc. raised their concern

as the industrial output

shrank 5.1% year-on-year in

October 2011. The October figure

released by the government

marked a sharp slump from the

1.9% expansion posted in September

2011, and was the first

contraction in output for more

than two years. Manufacturing

production, which accounts for

around 75% of the industrial index,

declined 6% year-on-year,

while mining output was down

7.2% and capital goods output

plunged 25.5%. Mr Chandrajit

Banerjee, Director-General,

Confederation of Indian Industry

(CII), said the latest data

was a serious disappointment

that showed a severe industrial

slowdown. "The sharp decline

in the capital goods sector is

of particular concern, as it indicates

lack of investments,

which will continue to be a drag

on growth," Mr Banerjee said.

The sluggish output figures

are likely to further undercut

hopes that emerging markets

such as India can power global

growth as Europe and the US

struggle. "Urgent measures

are required to induce investments,

including creating a

shelf of bankable projects,

particularly in the infrastructure

sector, gradual rollback

of interest rate increases,

improve the fiscal situation,

which in turn would help ease

the effective rate of interest,"

Mr Banerjee added.

Industry captains believe

that as growth of eight core

industries rebounded to a

robust 6.8% in November

2011, industrial growth is

likely to be positive for the

month after a contraction in

October 2011.


Interview

‘MSME Sector Nurtures

Entrepreneurship,

Meets Social Objectives’

Mr Radha Krishna Mathur, Secretary, Ministry of Micro, Small & Medium

Enterprises, Government of India, provides an overview of the challenges,

development of the sector and initiatives of the government in an exclusive

interview. Excerpts:

MSME Business

Mr Radha Krishna Mathur

Ministry of MSME, Government of India

The Cabinet has given its approval

for the National Manufacturing

Policy. How important is this

policy for the MSME sector?

The new policy initiatives recently

announced by the government envisage

creation of 100 million additional

jobs in the next 10 years. This

also covers liberalization of labour

and environment regulations, single

window clearance for all issues related

to industrial units, mega industrial

townships equipped with world

class infrastructures, incentives for

adoption of green technology and

financial/tax incentives to SMEs,

etc. DIPP has prepared the National

Manufacturing Policy, approved on

25.10.2011, for enhancing the share

of manufacturing in GDP to 25% by

2022, increase the rate of job creation

in manufacturing so as to create 100

million additional jobs, creation of

appropriate skills, increase domestic

value addition, enhance global competitiveness

and ensure sustainable

growth particularly with regard to

environment. The policy instruments

include incentives for SMEs.

Government has approved a procurement

policy which makes it

mandatory for all state- run companies,

ministries and departments

to procure 20% of their

products and service needs from

MSMEs. What is the likely impact

of this move on the MSME sector?

The Public Procurement Policy is

meant to promote MSEs (micro and

small enterprises) by improving their

market access and competitiveness

through increased participation by

them in government purchases. This

initiative will enhance the market

share of MSEs and growth of MSEs.

Will the recently unveiled defence

production policy propel MSME

growth and increasing their share

of total industrial output. Besides,

how do you see the defence

production policy supporting innovation

and R&D activities in the

sector?

The increase in spending on defence

procurements as well as the requirements

of offsets will open up significant

business opportunities for

Indian SMEs and they can integrate

themselves with the supply chains of

national and international defence

majors. The offset requirements will

5

January 2012


Interview

MSME Business January 2012

6

propel global OEMs (Original Equipment

Manufacturers) to work in close

coordination with SMEs. The defence

sector is thus emerging as a lucrative

market for SMEs and will assist

in technology developments by way

of transfer of knowledge through

OEMs.

Rising interest rates, weakening

of the rupee against USD and

the overall bleak global scenario

could seriously impede MSME

output and growth. What steps

are likely to be taken by the MSME

Ministry to shore up the sector's

business confidence?

High cost of credit is one of the key

constraints faced by MSEs which affect

their competitiveness adversely

in the domestic and global markets.

With a view to enhancing transparency

in lending rates of banks

and enabling better assessment of

transmission of monetary policy, all

scheduled commercial banks have

been advised by the RBI to introduce

the Base Rate System w.e.f. from July

1, 2010. Accordingly, the Base Rate

System has replaced the BPLR system

with effect from July 1, 2010. All

categories of loans would henceforth

be priced only with reference to the

Base Rate. Banks are not permitted

to lend below the Base Rate. It is

expected that the above deregulation

of lending rate will increase the

credit flow to small borrowers at reasonable

rates.

The Ministry is implementing the

"Performance and Credit Rating

Scheme" for MSEs. The scheme is being

implemented through NSIC with

the involvement of accredited rating

agencies. The fee to be paid by the

MSEs for the rating is subsidized by

the government to the extent of 75%

of the rating fee, up to a maximum of

Rs 40,000.

The rating serves as a trusted third

party opinion on the unit's capabilities

and credit-worthiness. A good

rating enhances the acceptability of

the rated unit in the market and also

facilitates access to cheaper credit

quickly and thus helps in economising

the cost of credit. Further,

M/o MSME is implementing various

schemes relating to credit, namely

Credit Guarantee Scheme, Credit

Linked Capital Subsidy Scheme, Micro

Finance Programme, etc., for the

promotion and development of MSEs.

These schemes are aimed at facilitating

credit flow to the sector.

Are you seeing greater cooperation

and meaningful collaborations

between Indian MSMEs and

their counterparts overseas?

More recently, several MSME delegations

from across the globe

attended the India Global Summit

on MSMEs, 2011. What are your

expectations from these developments?

The government has taken initiatives

to engage with their overseas

counterparts in a fruitful manner

through various MOUs/agreements/

joint action plans for cooperation in

the MSME sector with Ministries/Organizations

from some 14 countries

including Mozambique, Romania,

Mexico, Korea, Sri Lanka, among others.

Such cooperation endeavours

offer a window of opportunity to Indian

MSMEs by way of opening up of

new markets. In addition NSIC is also

engaged in promoting such international

collaborations that benefit

MSMEs.

The International Cooperation Scheme

of the Ministry of MSME envisages

modernization of Indian MSMEs and

promotion of exports. It also covers

deputing MSME business delegations

to other countries, participation by

Indian MSMEs in international exhibitions/trade

fairs and holding international

conferences and seminars on

topics of relevance to MSMEs.

In what ways can the MSME sector

contribute to the overall goal

of inclusive growth? Is the sector

also contributing toward balanced

regional growth in the country?

The MSME sector is a dynamic and

vibrant sector and nurtures entrepreneurial

talent besides meeting

the social objectives including that of

providing employment to millions of

people across the country. The MSME

sector plays a very significant role

in terms of balanced and inclusive

growth and contributes to the process

of economic development, equitable

distribution of national income

and regional dispersal of enterprises

by way of mobilisation of capital and

entrepreneurial skills.

The sector employs about 60 million

persons in over 6 million units

across the country and contributes

about 45% of industrial output and

continues to show dynamism in terms

of growth and employment generation.

It is a highly labour-intensive

sector. The enterprises are scattered

throughout the country. MSMEs are

the real engines of growth which can

promote inclusive and broad-based

growth with inter-regional equity.

A significant number of MSMEs

continue to operate in the unorganized

sector. What steps would

you advocate to bring the majority

of these units into the organized

fold?

The National Commission for the

Enterprises in the Unorganised Sector

(NCEUS) has examined problems

confronting enterprises in the unorganised

sector and submitted its report

with various recommendations

to provide technological, marketing

and credit support to the enterprises.

Also, the Prime Minister's Task Force

on MSMEs made several recommendations

to create an overall enabling

environment using appropriate legal

and fiscal instruments to incentivise

the transition of MSMEs from the unorganised

sector to the organised

sector.

In pursuance of the above, action has

already been initiated by different

ministries/departments. In order to

cater to the credit needs of the micro/

unorganised sector, SIDBI has already

set up a special cell for refinancing

micro enterprises. An advisory group

has been constituted to monitor the

operation of the special cell. Further,

a sub-group has been formed under

the Working Group on MSMEs Growth

for 12th Five Year Plan and its recommendations

are being incorporated

in the report of the Working Group.

Enterprises in the unorganised sector

may make use of all such efforts

initiated by the government.


Interview

The MSME sector already contributes

over 40% of domestic

industrial output, exports and

employment. Is there scope for

increasing this share further?

What steps would you advocate

for this?

As per 4th All India Census of MSMEs

(registered sector) 2006-07, the

domestic industrial output (2006-

07), exports and employment was Rs

7,07,510 crore, Rs 67,914 crore and

93.09 lakh, respectively.

The MSME sector has shown consistent

growth in terms of output, export

and employment generation over the

last few years. Still, huge potential

exists in the sector. The government

has provided an enabling institutional

mechanism by way of enacting the

Micro, Small and Medium Enterprises

Development Act, 2006 for promotion

and development of MSMEs and

to enhance their competitiveness.

Further, the National Manufacturing

Competitiveness Programme (NMCP)

with ten innovative components has

been launched to improve the productivity

and competitiveness of MSMEs.

Also, initiatives such as MSE-Cluster

Development Programme, Market

Development Assistance, etc., would

give rich dividends to the sector.

The MSME sector is often faced

with challenges such as limited financing

options, lack of adequate

market and technology access,

shortage of skilled workforce,

etc. What kind of an eco-system

would you recommend wherein all

these issues are addressed, besides

giving the MSMEs the global

competitive edge?

The ministry has been implementing

various schemes for the promotion

and development of MSMEs covering

credit access, infrastructure

support, technology upgradation,

marketing, etc. This inter-alia enables

them to operate successfully

in the present era of liberalisation

and globalisation.

Is vocationalising of education adequately

geared to meet the workforce

needs of MSMEs across the

country? Would you suggest any alternative

methods to strengthen the

training and development of human

resources for this sector?

Towards integrating entrepreneurship/skill

development with the secondary

and university level education,

the Prime Minister's Task Force

on MSMEs has recommended the development

of appropriate course curricula

for inclusion in the education

systems across the country. Ministry

of HRD, as the nodal ministry, has

already held a meeting of group of

state education ministers to discuss

the draft National Vocational Education

Qualification Framework. As the

thrust of the M/o MSME is entrepreneurship

development, efforts are

being to link this with the National

Innovation Council.

Adoption of new web and IT tools

will help MSMEs enhance their

operational efficiency. Cloud

computing is one aspect that has

received a lot of attention lately.

Is the government taking any specific

step to promote the adoption

of these tools by MSMEs?

The ministry has already launched the

"Scheme for Promotion of Information

and Communication Technology

(ICT) in MSME Sector" as a component

under NMCP with the objective

of formulating a planned model of

adoption of information technology

in potential MSME clusters based

on need analysis of stakeholders. It

covers the entire chain of business

from procurement of raw materials

to after-sales service. This scheme

would improve the competitiveness

and operational efficiency of MSMEs

so that MSMEs can sustain in the

global competitive environment. The

scheme envisages, inter alia, the establishment

of a national portal for

MSMEs to provide e-commerce and

e-catalogue related facilities to them.

This portal will have adequate linkages

with all the cluster specific portals

established under the scheme. The

cloud-computing model offers visible

benefits to SMEs which are looking

for easy-to-use, reliable and scalable

applications to enable good business

growth and also to dynamically scale

their computing capability without

having to invest in costly infrastruc-

ture. However, issues like online security

threats need to be addressed

adequately while adopting the cloud

computing model of information and

service sharing.

What steps may be taken to enhance

the market access for

MSMEs, both within the country

and overseas?

The ministry has taken several initiatives

to facilitate MSMEs to enhance

their market accesses both within

and outside the country. Ministry

of MSME organises exhibitions/fairs

and buyer-seller meets across the

country providing the MSMEs with

an opportunity for displaying their

products and capabilities. Under the

MSE Marketing Development Assistance

(MDA) Scheme, assistance is

extended to individuals for participation

in overseas fairs/exhibitions,

overseas study tours or tours of individuals

as member of a trade delegation

going abroad.

The Ministry of MSME has also formulated

two schemes under the

National Manufacturing Competitiveness

Programme (NMCP) to

smoothen marketing of MSME products.

The activities supported under

these components include assistance

for upgradation/development

for modern marketing techniques.

Such participation provides an opportunity

to MSEs to generate business

enquiries and access market

trend in product design, marketing,

pricing, packaging, etc.

The Public Procurement Policy for

MSEs is also there to enhance their

market access in the country. For

instance, financial assistance is provided

for use of bar code to enhance

marketing competitiveness of MSEs.

Participation of MSEs in exhibitions/

trade fairs are financially assisted by

the government to enhance the market

access overseas.

Also, NSIC has launched a B2B web

portal and established a Marketing

Intelligence Cell for providing domestic

and global market information

to the MSMEs. The Public Procurement

Policy for MSEs will also

provide support to MSEs in marketing

their products.

MSME Business

7

January 2012


FDI In Retail

‘FDI in Retail Can Be a

Game Changer’

CII states FDI in multi brand retail will give a boost to the small sector and the

economy as a whole. Besides, it would greatly improve investment sentiment

in the country as declining investments have led to lower industry output and

slower GDP growth

MSME Business January 2012

8

In the last few months, the country

has seen significant discussions

on permitting FDI in multi-brand

retailing. India being a signatory

to the WTO General Agreement

on Trade in Services, which includes

wholesale and retailing services, has

had to open up its retail trade sector

to foreign investment. There were initial

reservations on opening up of the

retail sector, arising from fear of job

losses, procurement from international

market, competition and loss of entrepreneurial

opportunities. However, the

government has steadily opened up the

retail sector to FDI. In 1997, FDI in cash

and carry (wholesale) with 100% ownership

was allowed under the government

approval route. It was brought under

the `automatic route' in 2006, and

51% investment in a single brand retail

outlet was also permitted in 2006.

Now, FDI in multi-brand retailing is

put on hold until all stakeholders reach

a consensus on the matter. Union Commerce

and Industry Minister, Mr Anand

Sharma, has been quoted saying in the

media that the government is committed

to the reform agenda. Mr Sharma said,

"There is only a suspension, there is no

rollback of the decision. We will be talking

once again with all stakeholders."

CII Perspective

CII has wholeheartedly welcomed the

decision to invite FDI in the retail sector.

Mr B Muthuraman, President, CII, has said

that FDI in retail would greatly improve

the investment sentiment in the country.

"At a time when declining investments

have led to slower GDP growth, the entry

of foreign funds in retail as envisaged by

the government would go a long way in

boosting confidence," he said.

CII has also expressed its disappointment

when the move was put on hold. Mr

Chandrajit Banerjee, Director General, CII,

said in the media that "one of the most

important ones, the game changer so to

say, is FDI in multi-brand retail that was

very much at there on cards. It is very disappointing

that it didn't go through."

According to the CII Discussion Paper,

earlier invited by the Department of Industrial

Policy and Promotion (DIPP) on

FDI in Multi-Brand Retail Trading, the

move would benefit consumers, producers,

especially small and medium

enterprises (SMEs) and generate significant

employment.

A CII press statement said that "FDI

can help SMEs supply in large volumes,

increase quality standards, and become

vendors to international players." Traditional

trade will continue to have its own

place and should not decline. Even in the

last three years when modern retail grew

24%, unorganised retail in the country

continued to grow, albeit at a slower rate

of 10% to 12%, the release said.

The government clarified that 30%

mandatory procurement from small and

medium enterprises (SMEs) clause will

be applied only to Indian enterprises,

not globally. "Sourcing of a minimum

of 30% from Indian MSEs having capital

investment of not more than $1 million

has been made mandatory," the Ministry

of Commerce and Industry, Government

of India, said in a statement.

The current size of the Indian retail

market is $450 billion which is expected

to increase to $850 billion in the

next 10 years. At present, 35% of products

are sourced from SMEs. The projections

are that by 2020, more than

$298-billion worth products would be

sourced from SMEs.

According to a CII press release,

opening up of FDI in retail can increase

organized retail market size to

$260 billion by 2020. This would result

in an aggregate increase in income of

$35-45 billion per year for all producers

combined; 3-4 million new direct

jobs and around 4-6 million new indirect

jobs in the logistics sector, contract

labour in the distribution and repackaging

centers, housekeeping and

security staff in the stores.

CII has pointed out that the government

also stands to gain by bring FDI in multibrand

retail trading and can be expected

to receive an additional income of $25-30

billion by way of increased tax collection

and reduction of tax slippages.


Defence

Defence Sector,

A Big Ground For

Small Players

MSMEs need to make right assessment of defence procurement opportunities

The global defence industry,

which is primarily dominated

by a few Original Equipment

Manufacturers (OEMs),

works in close co-ordination

with micro, small and medium enterprises

(MSMEs). The reason why OEMs

prefer to work with MSMEs is because

of their innovative capabilities in niche

manufacturing, greater flexibility, lower

overhead costs and their ability to

learn and absorb new technologies.

In India, a large number of MSMEs

serve as suppliers to defence PSUs and

have a role to play in the Indian defence

market, but their potential is somehow

underutilized. The recently unveiled

first-ever Defence Production Policy

(DPrP) is the testimony of the Government

of India's efforts to enhance the

potential of MSMEs for indigenisation

and broadening the defence research

and development base of the country.

According to the new Defence Production

Policy, preference will be

given to indigenous design, development

and manufacture of defence

equipment. Therefore, wherever the

required arms, ammunition and equipment

are possible to be made by the

Indian industry within the timelines set

by the services, the procurement will

be made from the indigenous sources.

Whenever the Indian industry is not

in a position to make and deliver the

equipment in the requisite time-frame,

procurement from foreign sources

would be resorted to, as per Defence

Procurement Procedure.

At the India Global Summit on MSMEs

2011, jointly organised by CII and the

Ministry of Micro, Small & Medium Enterprises,

Government of India, in New

Delhi on October 19-20, 2011, experts

observed that MSMEs can play an active

role in the army's drive to indegenise

production of equipment and

spare parts. Brigadier Raja Puri, DDG

Indigenization, Ministry of Defence,

Government of India, said that the defence

sector wants to go for indigenization

for the spare parts and therein

lies the opportunity for the MSMEs.

The DPrP document says that the

government will endeavour to build a

robust indigenous defence industrial

base by proactively encouraging larger

involvement of the Indian private sector

in design, development and manufacture

of defence equipment. Towards

this end, efforts would be made to progressively

identify and address any issue

which impacts or which has potential

of impacting the competitiveness of

the Indian defence industry in comparison

to foreign companies. To synergise

and enhance the national competence

in producing state-of-the-art defence

product within the price lines and timelines

that are globally competitive, all

viable approaches such as formation

of consortia, joint venture and public

private partnerships, etc., within the

government approved framework will

be undertaken. Mr Nalin Kohli, Chairman

Ð CII Defence SME Committee,

remarked that India has very strong IT

capabilities and modern defence products

have a huge software component.

He said this while discussing the role,

opportunities and challenges of Indian

MSMEs in the production of defence

equipment, at the India Global Summit

on MSMEs 2011.

MSME Business

9

January 2012


Defence

January 2012

10

MSME Business

The defence industry is of strategic

importance to any nation. The Government

of India acknowledges the fact

that India needs to increase its self reliance.

On the other hand, the international

defence industry today is global

in nature with a complex network of

global supply chains. Therefore, it is

imperative for Indian companies, especially

MSMEs, to integrate themselves

with the supply chains of national and

international defence majors in order

to reduce the country's dependence on

foreign supplies and to gain a foothold

in the international defence market.

Mr Harvansh Batra, Director (Sourcing)

of EADS, observed that Indian MSMEs

have good capabilities in the defence

sector; however, they need to focus on

quality, cost and delivery.

The government has announced that

policies will also be put in place to encourage

the private sector to strengthen

their research and development

wings so that constant upgradation

and improvement in systems under

manufacture is possible. The government

will set up a separate fund to provide

necessary resources to public and

private sector including MSMEs as well

as academic and scientific institutions

to support research and development

of defence products.

At present, 70% of the armament

requirements of the Indian armed

forces are met through imports. But

this scenario is likely to change once

the DPrP is implemented in full, and

subsequently Indian MSME would benefit

hugely from this. Earlier, Indian

defence production was an exclusive

domain of the public sector undertakings

and the Ordnance Factories. Since

2000, the government has increased

private participation in the sector.

Challenges for MSMEs

Commodore S Samaddar, Vice President

Nova Integrated Systems, said at

the Summit that defence business is

public funded and the offset policy is a

challenge for the MSME sector. Offsets,

introduced in 2008, made it mandatory

for foreign arms vendors to plough

back 30% of a defence deal worth over

Rs 300 crore (USD 66 million) to the

domestic defence industry, thereby vitalising

the sector in India. However,

the defence ministry had released the

revised procurement procedure to be

followed for acquiring arms, weapons

and other systems for the armed forces

under which it had diluted the offsets

clause.

The procuredure for 2011 has now

included sectors such as civil aviation

and internal security for foreign vendors

to discharge their liabilities under

the offsets clause. Mr Aslam S Khan,

President & Divisional Head, Bharat

Realtime Ltd, observed that MSMEs

can be banked upon in the defence

procurement business. However, they

need to understand the commercial arrangement

of offset to succeed in this

business. He cautioned that foreign

OEMs are large and they have very

little to share with MSMEs.

In the current environment, increasing

competition, cost pressures, rising

energy costs and high raw material

prices are key challenges for defence

manufacturers. The industry is witnessing

outsourcing of elements of

technology, design and component/

subassembly manufacture. This transformation

provides an opportunity

for those MSME vendors which can

innovate, adopt high-level technologies,

implement best practices and

invest in change. Mr Deepak Sharma,

Head Ð Procurement, BAE Systems

Ltd, stressed that the MSMEs need to

have a long-term policy if they want to

operate in the defence sector. He also

observed that MSMEs need to understand

the supplier landscape and the

tax structure prevalent in the country

to work in the sector.

To be able to integrate with the supply

chain, MSMEs need to know their

clients well, understand their requirements,

gain their confidence and demonstrate

a strong commitment to develop

a long term business relationship.

Such initiatives by MSMEs coupled with

government's policy to enhance the

role of MSMEs in the Indian defence

industry. It has been observed that in

order to succeed the MSMEs need to

understand the technology matrix of

the defence sector.

CII Role

CII has been playing an active role

in the areas of steering defence

policy formulation, market development,

trade promotion and formulation

of international joint ventures

and technology transfers.

"CII believes that, in order to create

a self reliant defence industrial base

in the country, the small and medium

scale industries should be benefited

in terms of getting access to newer

technologies, strengthening the infrastructure,

manufacturing and managerial

capabilities as well as by becoming

part of the global supply chain for defence

and aerospace products," maintained

Mr Gurpal Singh, Deputy Director

General, CII.

The Defence Production Policy has

been prepared after extensive consultations

with various stakeholders

including CII. The industry body has

always highlighted the issues relevant

to MSMEs in the defence sector and

the key actions that are needed to facilitate

an enhanced role for them. The

industry chamber has always urged the

government and industry to proactively

address issues concerning MSMEs in

India and contribute in formulating a

strategy for their significant participation

in opportunities in the defence industries.

"CII has always emphasised on the

growth and participation of SMEs in

the defence production. Indigenisation

is very critical for our defence forces to

become self-reliant and cut down the

exports," said Mr Singh. "With constant

perseverance of CII, Government of

India announced a major policy initiative

in 2002 permitting private sector

participation in the defence production.

The guidelines issued in 2002 allows

up to 100 per cent private sector

participation in this sector with foreign

direct investment up to 26 per cent,"

Mr Singh added.


Growth Driver

Financing MSMEs In Current

Economic Scenario

Financial institutions need to adopt innovative models for financing MSMEs

Worldwide, the wind has

been changing in the finance

sector in general

and banking-investment

sector in particular.

Such a panorama teaches us that now

is the time for cooperation rather than

competition, it's a time for convergence

rather than cutting each other's neck

over customers and markets, and it's a

time for consolidation rather than antagonism.

A ray of hope is seen in the small and

medium enterprises (SMEs) which are

an emerging, inevitable and profitable

target market for the financers, i.e., financial

institutions and banks. However,

that does not mean that banks and

financial institutions will back-up the

social banking; rather than being seen

as directed and philanthropic-like financing,

such lending should be viewed

as being business driven.

SMEs play a catalytic role in the development

of any country. They are the

engines of growth in developing and

transition economies. In India, they

account for a significant proportion of

manufacturing, exports and employment,

and are major contributors

to the GDP.

Curing any fatal disease

requires doses of

small pills; impressive

thoughts come out from

the small brain. Similarly,

India requires to accord due

prominence to SMEs for curing

its problem of low economic growth

vis--vis developed nations. To cure the

overall disease of lack of appropriate

growth of Indian SMEs, India needs to

put in place several small pills such

as adequate credit delivery to SMEs,

better risk management, technological

upgradation of banks, especially

public sector Banks, attitudinal

change in bankers, and so on.

However, given the level of SME appetite

for credit facilities, private and

public sector banks in India need to

work out a unique and innovative model

for financing enterprises in this vital

sector.

The need of the hour is to enhance

SME risk management skills. Risk management

is key to success in which

adoption of the state-of-the-art technology

and latest rating and management

skills turn out to be the significant aid

for better risk management. The ability

to gauge the risks and take appropriate

position will be key to successful financing

in the emerging Indian banking

scenario. Risk-takers will survive, effective

risk managers will prosper and the

risk-averse are likely to perish.

In this context, Indian financiers have

to ensure that:

• Risk management trickles down from

the corporate office to branches. They

should be made more accountable and

respon- sible towards their duties.

• As audit and supervision shifts to a

risk-based approach rather than transaction

oriented, the risk awareness levels

of line functionaries will also have

to increase.

• A clear assessment of the growing

need for banks to deal with issues relating

to `reputational risk' to maintain

a high degree of public confidence for

raising capital and other resources.

With the successful adaptation of

these imperatives, the technological

advancement of Indian financiers would

create a soothing climate to manage

their risk in a better way. In the years

to come, technological developments

would render flow of information and

data faster, leading to prompt appraisal

and decision-making. This would enable

banks to make credit management more

effective, besides leading to an appreciable

reduction in transaction cost.

Banks and financial institutions

should also come together to share

facilities in the areas of payment and

settlement, back-office processing,

data warehousing, and so on, mainly

for cost effectiveness and with a secondary

motto to provide everything

under one umbrella.

The advent of new technologies

could see the emergence of new players

doing financial intermediation. For

example, we could see utility service

providers offering, bill payment services

or supermarkets or retailers doing

basic lending operations. Hence,

for better profit margin, with the help

of technological innovation, consolidation

and innovation in lending, the

conventional definition of financing

might undergo changes.

Credits:

Management Team of Religare

Finvest Limited -- Lending Arm of

Religare Enterprises Limited

MSME Business

11

January 2012


Payments

No Strings Attached

MSMEs facing working capital constraints would be better off accessing factoring

and forfaiting services

MSME Business January 2012

12

Delayed payments have continually

affected the business

prospects of domestic

MSMEs, most of which are

constrained by lack of adequate

working capital. Hence, the Lok

Sabha passing the Regulation of Factors

(Assignment of Receivables) Bill 2011 on

December 21 assumes critical importance

for the sector. The CII National

MSME Council had been proactively advocating

the need to promote `factoring'

services for the benefit of MSMEs.

The Council in its recommendations

made to the Working Group on MSMEs

Growth for Twelfth Five Year Plan

(2012-17) called for promoting `factoring'

as mandated under MSMED Act

2006. The provision stipulated mandatory

factoring of a receivable of an

MSME in case the payment is delayed

beyond 45 days. That is, in the `delay

period' the receivables would automatically

become eligible for factoring

on a non-recourse basis.

The Council also called for a new factoring

vehicle to be set up or for PSU

Receivables under Factoring Law Guidelines

to be framed. Alternatively, existing

factoring companies were to formulate

the necessary regulatory framework.

The Regulation of Factor (Assignment

of Receivables) Bill, 2011, introduced in

the Lok Sabha on March 24, 2011, sought

to regulate the business of factoring by

providing a mechanism for assignment

of receivables of an industry to a factor

and payment of consideration by the

factor to the industrial unit.

The Bill provided that no factor may

commence or carry on the factoring

business without a certificate of registration

from the RBI. It also provided

for empowering the RBI to issue directions,

call for information from the

factor, and prohibit financial institutions

from undertaking the factoring

business if they fail to comply with its

directions. If any factor failed to comply

with an RBI direction, the factor

and every officer in default would have

to pay a fine of up to Rs 5 lakh and an

additional fine of Rs 10,000 for each

day the default continues.

The Bill referred to the factor as the

"assignee", the industry selling the receivable

to the factor as the "assignor",

and the person liable to the industry

as the "debtor". Under the Bill, assignees

would be given the right to secure

due payment of the receivable from the

debtor and may exercise all rights of

the assignor for this purpose.

Debtors shall have the right of notification

of assignment. The assignee

will not be entitled to demand payment

from the debtor until the notice is given.

Where no notice is given by the assignor

or assignee, any payment made

by the debtor to the assignor shall be

held in trust by the assignor for the

benefit of the assignee.

If the assignor is an MSE, the liability

of the debtor will be subject to certain

provisions of the Micro, Small, and

Medium Enterprises Development Act,

2006, which regulate payment and recovery

of debt.

Every factor will be required to file

the particulars of every transaction of

assignment of receivables within 30

days from the date of assignment with

the Central Registry, to be set up under

the Securitisation and Reconstruction

of Financial Assets and Enforcement of

Security Interest Act, 2002.

With the passing of the Bill, MSMEs

have emerged as a key target for factoring

companies. Key benefits that factoring

affords to MSMEs are:

• Improved cash flow: Factoring

provides instant availability of cash

on receivables thereby addressing the

funding problems of MSMEs.

• Elimination of default risk: The

factoring company undertakes the

credit risk, thereby eliminating the

same for the MSMEs.

• Freeing up of fixed assets for

collateralisation elsewhere: Given

that factoring services generally do

not require fixed assets as collateral

against advances, these assets can then

be used as collateral for other kinds of

loans.

• Resources freed up from sales

ledger management: As factoring

companies undertake collections and

sales ledger management of their clients,

MSMEs are able to save their resources

and utilise them for other business

needs.

Forfaiting is another powerful tool

in the hands of MSMEs for managing

their financing needs. The term forfaiting

means to surrender one's right on

something to someone else. In international

trade, forfaiting may be defined

as the purchasing of an exporter's receivables

at a discount price by paying

cash.

For the exporter, the key benefits of

forfaiting are:

• 100% financing: Once the exporter

obtains the financed fund, he will be

exempted from the responsibility to repay

the debt.

• Improved cash flow: Receivables

become current cash inflow.

• Risk reduction: Forfaiting business

enables the exporter to transfer

various risk resulted from deferred

payments, such as interest rate risk,

currency risk, credit risk, and political

risk to the forfaiting bank.

• Advance tax refund: Through forfaiting

the exporter can make the verification

of export and get tax refund in

advance just after financing.

Forfaiting, like factoring, has not

been adopted widely in India as it is still

a relatively new concept among MSMEs.

Besides, there are only a limited number

of institutions offering this service.

Awareness building regarding these

services will encourage more MSMEs to

avail of these benefits.


Triumph

Innovation, Key to Success

Bharat Biotech is a leader in manufacturing of vaccines and biologics

Bharat Biotech

Dr Krishna M Ella, CMD, Bharat Biotech

cessity drove the company to develop an

alternative technology relying on salt fractionation,

patented as HIMAX technology,

which was as effective as ultracentrifuge

in separation of VLPs. The relatively lower

capital investment and cost effective manufacturing

process gave Bharat Biotech

the edge to market the vaccine at very

low prices that revolutionized the vaccine

industry in India.

On June 6, 2011 when Bharat Biotech announced

ROTAVAC, India's first indigenously

developed Rotavirus vaccine for $1 a dose

for global populations; the company moved

one step closer to turn another big dream to

reality. ROTAVAC expects India licensure and

global supplies during 2014. Bharat Biotech

is thankful to its funding agencies in making

the rotavirus vaccine dream into reality.

Bharat Biotech hopes that the new vaccine

will help prevent atleast part of the 500,000

child deaths each year due to rotavirus diarrhea,

and improve access to better, affordable

rotavirus vaccines in the developing

world. The vaccine is currently undergoing

Phase III clinical safety and efficacy trials in

8,000 subjects, and it is one of the largest

such clinical trials ever conducted in India.

Social responsibility is a key aspect

Bharat Biotech's business and that's why

Bharat Biotech lays importance on region

specific diseases like chikungunya, typhoid,

malaria, and JE and Chandipura virus encephalitis,

public health care issue never

addressed by the vaccine development sector.

Initiatives in regional diseases also gave

us leadership and the confidence that we

Bharat Biotech (www.bharatbiotech.com)

enjoys a unique space

in the biotech industry in India

since its establishment in Genome

Valley in the year 1996.

The company's business strategy relied on

strong manufacturing platforms complemented

by capabilities in R&D and continuously

strives to explore new market areas

through strategic alliances and partnerships.

Today, Bharat Biotech is a globally acknowledged

leader in the development and manufacture

of vaccines and biologics.

Founded by Dr Krishna M Ella and Ms

Suchitra K Ella, Bharat Biotech's focus is to

discover novel medicines to solve neglected

diseases a problem that affects the 5.8 Billion,

emerging market populace. Its discovery

principle lays strong emphasis on innovative

product oriented research, and strengthening

manufacturing capabilities to rigorous cGMP

standards, and create a strong platform to

take up challenging projects on known and

emerging infectious diseases.

Today, Bharat Biotech's indigenously

developed vaccines and biopharmaceuticals

are providing affordable healthcare

for the underprivileged sections of society.

The company's product range includes viral

and bacterial polysaccharide, subunit

vaccines, biotherapeutics and nutraceuticals.

In the last one decade, Bharat Biotech

has delivered more than 1.6 billion

doses of vaccines in over 65 countries.

When Bharat Biotech set out in 1996,

the founders decided that innovation has

to be in every aspect of its business, be in

R&D, process development, manufacturing

or even in marketing. Its business model

relied on establishing strong manufacturing

platforms with diverse technology capabilities

to tap newer opportunities.

Bharat Biotech's strong manufacturing

platforms not only helped drive revenues

but also meet its core mission±Innovate.

When Bharat Biotech started manufacture

of hepatitis B vaccine the biggest

hurdle was preparative ultracentrifuge

that has prohibitively expensive. The nehave

the capabilities to develop novel vaccines

like any MNCs. The company's ongoing

programmes include typhoid conjugate

vaccines and combined Phase I/III trials of

JE vaccines with licensed technology.

Bharat Biotech sees IP (intellectual property)

as a major step forward in the biotech

sector. The organization wants India to be

acknowledged as a country that can take

care of its own unmet needs in the healthcare

sector and, not just as a destination of

Ms Suchitra K Ella, JMD, Bharat Biotech

low-cost vaccines and biological.

The company has successfully commercialized

many products and increased its

market presence in India and several other

developing countries through strategic marketing

alliances and partnerships. It has nearly

40% market share in hepatitis B vaccine

with REVAC-B, which its flagship product.

In February 2009, Bharat Biotech launched

COMVAC-5, a single-shot pentavalent combination

vaccine which contains the first

indigenously developed and manufactured

haemophilus influenza type-b (Hib) in combination

with hepatitis B vaccine and DPT.

Bharat Biotech is the first and largest

manufacturer typhoid and rabies vaccines

in India. It is the first company in

the developing world to launch a cell derived

H1N1 pandemic flu vaccine the HN-

VAC, where others have developed the

less efficient egg-based platforms.

The company has secured patent rights

for lysostaphin, a potent anti-Staphylococcal

molecule for foray into the regulated markets

including USA, Europe and Australia. RE-

GEN-D which is recombinant epidermal.

MSME Business

13

January 2012


Marketing

Search For Top Slot

In the Internet marketing strategy mix, search engine optimisation (SEO) is a

preferable and highly lucrative investment for MSMEs

MSME Business January 2012

14

It is an accepted fact that the Internet

is going to play an increasingly

important role for all enterprises,

big or small, in the way

they market their products or

services, given the rapid rate at which

consumers are transitioning away

from traditional media. In fact, it has

been found that media consumption is

moving to the Internet from more traditional

channels at an unprecedented

pace. It is good news for micro, small

and medium enterprises (MSMEs) as

they are not as disadvantaged when

it comes to marketing online, as they

have been with more traditional mediums,

like television or print.

Once there is an appreciation that

MSMEs need to be fully engaged in Internet

marketing, the question shifts

to how they should approach this opportunity.

MSMEs tend to lean towards

spending their limited resources in

making more attractive, more functional

websites under the notion that

"if my website is better than my competitors

then it will attract more potential

customers." This approach

bears little fruit and often increases

the mystic of Internet marketing when

few gains are achieved.

SEO for MSMSE

The online search has triggered fundamental

changes in the way people

seek and find information. Given the

importance of the search engine as

a method for finding information, it

offers opportunities galore as a marketing

medium to firms, especially

for MSMEs. With the recent economic

downturn, and subsequent budget

cuts, when it comes to web marketing,

it is the search engine marketing (SEM)

method that advertisers turn to. There

are numerous measures which may be

opted for. However, SEO is found to

be the favourite among various SEM

strategies of organizations, with over

70% money being allocated to it in the

planning, according to a survey.

SEO is the process of identifying

and fine-tuning elements of a website

in order to achieve the highest possible

visibility when a search engine

responds to a relevant query. SEO leverages

the search engine algorithm

to channel users to specific websites,

the results of which are referred to

as organic results. In the case of paid

search engines, any search triggers a

display of advertisements based on the

topic or keyword entered. It has been

found in a survey that searchers tend

to trust organic links or editorial listings

(SEO) over sponsored links (Paid

Search), and customers referred from

organic links generally tend to stick

around longer.

The reason why the marketing pundits

advise SEO for MSMEs, is because it

takes little initial investment to execute,

while other advertising measures involve

overhead campaign management

charges, in addition to the basic charges.

The fact that a major part of SEO involves

overhauling the website design in

terms of copy and code offers a distinct

advantage to MSMEs. To execute SEO on

a Flash-heavy website is more cumbersome

than to do it on a simple website.

This advantage will always be available

to MSMEs over bigger enterprises.

SEO works towards generating organic

traffic towards the website which

can be monitored and acted upon. SEO

allows organisations to access customers

that are already looking for what is

being offered, thus enabling to pull inquiries

rather than pushing the products

or services to an audience that

are not interested in them.

Once SEO is executed, generally the

website is ranked substantially high

with a certain keyword. High ranking

websites generally enjoy more visibility

and better brand perception online.

Thus, the value delivered by SEO in

terms of branding is invaluable.


Technology

Prevent a Data Tsunami

Intelligent Data Management (IDM) helps companies manage data through its

lifecycle—from the time the data is generated to the stage when it is deleted from

the systems

Today, average consumers

routinely tote hundreds of

gigabytes of data with them

everywhere they go, and

businesses are expected to

store absolutely everything they doÐfrom

emails all the way to corporate

videosÐand make it all easily accessible

to users. In fact, we are living

in the age of `information overload'.

Companies are relying heavily on enterprise

planning systems like ERP,

SCM and CRM to automate and manage

their resources. The structured and

unstructured information is required

to be stored and retained within these

systems for various strategic, business

and regulatory requirements.

The exponential growth in data and

the most effective ways of managing

that data are being seen as biggest

challenges by companies today.

Given issues such as data archiving,

data security, disaster recovery and

storing and managing the information

continuously streaming in, companies

recognise that this is no longer just

a backroom IT issue but really among

the key CXO concerns.

Information by itself is considered

a resource and enterprises need to

plan effectively and put the right

combination of strategy, software

and hardware tools in place to avoid

a data tsunami. Apart from the new

data that is generated every day, the

strict data retention policies and legal

regulations to retain transactional

data over long periods is fuelling data

growth. This is where the increasingly

popular concept of intelligent

data management (IDM) comes into

picture. IDM helps companies strategies

on how to manage data through

its lifecycleÐfrom the time the data is

generated/captured to the time it is

deleted from the systems.

While there are some technologies

like Data de-duplication and

iSCSI consolidation that businesses

increasingly find exciting, some of

these technologies are still in their

early stages of evolution as customers

seek to understand the associated

ROI. Not just large enterprises

but small and medium business (SMB)

have also stopped dumping data and

have started using storage solutions

for business continuity purposes. In

fact the SMB segment in India has

consistently defied industry growth

and is delivering marvelous results as

of today. They are steadily realising

the power of technology in boosting

their enterprise. It thus becomes a

must for every business to capitalise

on the shining segment and channel

is going to play a big role in reaching

out to them.

Just like vendors, channel partners

need to understand that most

of these businesses do not have an

IT person, let alone an IT department

and, therefore, look at complete endto-end

solutions as opposed to individual

hardware products. According

to Gartner, AsiaÐPacific mid-sized

business are slower in adopting server

virtualisation technologies compared

to their European and North

American counterparts, and it cites

training and skills as the reason. The

role of the vendor has got a lot bigger

as they need to fill in the role of

a trusted IT partner and Dell is aiming

to be just that.

On the channel front, vendors need

to align themselves seamlessly with

channel partners to offer simple, easy

to set up, easy to run solutions that

would have shorter delivery cycles

and a robust support and services.

This vendor-channel partner integration

can take place with the help of

tools that can felicitate better learning

about the products/solutions,

constant feedback and so on. Once

this task is accomplished we could

see storage technologies like data

de-duplication and iSCSI consolidation

being adopted at an increasing

rate as more businesses will start to

understand the associated ROI.

MSME Business

15

January 2012


Policy

New Procurement

Policy: Timely Growth

Impetus For MSMEs

The policy will induce MSMEs to raise their quality and productivity levels

MSME Business January 2012

16

The recently announced Public

Procurement Policy for

Micro and Small Enterprises

(MSEs) provides for a minimum

of 20% of total annual

purchases of Central ministries, departments

and public sector undertakings

(PSUs) to be procured from MSEs.

Of the 20% share of annual procurement

from MSEs, 4% (or 20% of 20%)

shall be reserved for procurement from

MSEs owned by Dalit and ST entrepreneurs.

Besides, all Central ministries,

departments and PSUs will have to

organise special vendor development

programmes and buyer-seller meets to

further this goal. They will have also to

report their targets and achievements

with respect to procurement from MSEs

in their annual reports.

Ministries, departments and PSUs

that fail to meet the mandatory goals

laid down in the public procurement

policy will be required to provide reasons

to a review committee headed

by the Secretary of the Ministry of

Micro, Small and Medium Enterprises

(MSMEs). Mr Virbhadra Singh, Minister

of Micro, Small & Medium Enterprises,

Government of India, has been quoted

saying that the policy would become

mandatory within a span of three

years. A committee has been set up under

the Secretary of Ministry of MSME

to review the list of 358 items reserved

for exclusive purchase from MSEs.

Reflecting on this policy move, Mr

Chandrajit Banerjee, Director General,

CII, said the Public Procurement Policy

is aimed at improving transparency

and providing the MSEs access to many

high value contracts, in sectors such as

defence, where the offset policy would

complement the Public Procurement

Policy. In line with the CII's Affirmative

Action Agenda, the policy shall help

and facilitate the backward and socially

weak entrepreneurs gain a foothold

in the procurement process of the government

and PSUs.

The CII study on worldwide procurement

policies states that several countries

around the world have formulated

such policies enabling their SMEs to

compete strongly even in adverse economic

conditions. The European Commission

has prepared the 'European

Code of Best Practices Facilitating Access

by SMEs to Public Procurement

Contracts'. United Kingdom government

has proposed to award 25% of

public contracts to SMEs; all government

spending up to a specified limit is

published online.

In Australia, the government has

committed to FMA agencies sourcing

at least 10% of their purchases by

value from SMEs. In Brazil, the government

buys from SMEs, while at the

same time providing technical assistance

to all phases of the businesses

involved in procurement. In China, to

help alleviate the tight credit environment

and less robust operating climates

confronting the country's SMEs,

the Shanghai Municipal Government

Purchasing and Procurement Center

and Pudong Development Bank have

joined forces with the local government

to create a more enabling lending

and procurement environment for

SMEs. With this SMEs will get more opportunities

to participate in the local

government procurement process.

Various media reports suggest that

the new procurement policy in India

will open business opportunities

worth Rs 7,000 crore for Dalit and ST

entrepreneurs. These entrepreneurs

are now gearing up to tap this opportunity

by launching their own venture

capital fund and increasing their production

capacities.

India Inc has also been asked to help

Dalit entrepreneurs grow. Mr Ratan

Tata, Chairman, Tata Group has recently

urged India Inc to assist the small

entrepreneurs, especially those from

the Dalit community, to become global

entrepreneurs. "We should all assist

in letting small enterprises, especially

those from the Dalit community, to

become big and global enterprises. Everyone

in the country should help the

young entrepreneurs and help them

share the prosperity of the country,"

Tata said at a two-day national trade

fair focusing on Dalit entrepreneurs.

The event is supported by Tata Group,

Godrej Group and CII.

The Tata group chairman also said

the corporate India should use products

manufactured by the small enterprises,

and also help them increase

their exports. "I am happy to endorse

and support the cause of the Dalit entrepreneurs,"

he added. At the same

event, Mr Adi Godrej, Chairman, Godrej

Group & President Designate, CII,

has appealed to the corporate India

to help Dalit entrepreneurs as a part

of the corporate social responsibility.

The policy is being perceived as a big

step in the government and industry's

efforts to promote inclusivity in the

growth process.


Budget 2012-13 Needs To

Revive Growth: CII

Budget

CII has maintained in its pre-Budget memorandum that Budget 2012-13 should

direct attention on stimulating investments and unshackling the true growth

potential of MSMEs

The current domestic economic

concerns notwithstanding, CII

maintains that policy interventions

aimed at catalyzing

investments will provide the

necessary growth impetus for the economy

as a whole. Here, the MSME sector

has a key role to play. In the pre-Budget

memorandum submitted with the Government,

CII has voiced the need for

unraveling the true growth potentials of

the MSME sector. This may be achieved

through innovative fiscal initiatives.

The CII pre-Budget memorandum

has called for:

• Review of Income Tax Act: Tax

benefits under section 10A & 10 B of the

Income Tax Act, popularly known as STPI

scheme, are getting over because of the

`Sunset Clause'. This will adversely affect

over 5,000 small software and IT services

companies in the country. The Department

of IT has already taken up the issue with

the Ministry of Finance. As this principally

affects SME companies, it would be appropriate

for the Ministry of Micro, Small & Medium

Enterprises to take up the matter.

• Revision of threshold for Service

Tax exemption: The threshold

for Service Tax exemption is very low

and needs to be revised from the present

level of Rs 10 lakh to at least Rs 25

lakh. This will provide relief to a large

number of small companies in the services

sector.

• Review of Direct Tax Code: The

new Direct Tax Code states that tax incentives

should be investment linked.

This works against the MSME sector as

this sector by definition is not capital

intensive. In fact, the incentives should

be linked to aspects like employment

creation, as is the case in the UK and

many other countries.

• Encourage IT penetration: To

encourage wider use of ICT by MSMEs

there is the need for enhanced depreciation

on IT products. This would

greatly enhance MSME competitiveness.

It is recommended that the government

should consider according

100% depreciation, once in a block

of three financial years, for an annual

investment in IT equipment and

software up to a limit of Rs 25 lakh,

to the MSMEs. The ICT hardware/software

equipment for which this depreciation

is accorded should be excise

duty paid/cleared and the software is

original (genuine)/duly licensed.

• Direct & Indirect Tax procedures:

Simplify direct and indirect tax

procedures/regulations and address

`executive discretion'.

• Encourage adoption of environment-friendly

technologies:

The promotion of environment-friendly

energy technologies is important to

enhance the self-reliance on energy.

There is a need to create a Central Climate

Friendly Technology Fund to help

MSMEs adopt such technologies.

• Establishment of a Venture

Capital Fund with a corpus of Rs

10,000 crore: A PPP mode of operations

for the fund with budgetary

support (as seed fund) and ownership

with SIDBI may be considered. The

fund could be set up with an seed fund

corpus of Rs 3,000 crore and enlarged

to Rs 10,000 crore during the 12th

Plan period with contributions from

the banking sector. From this fund,

`Anchor Investment' of 15% should be

provided to any SME focused VC Fund

launched in the country.

• Uniform credit rating: RBI could

constitute a group along with the Indian

Banks Association and the credit

rating agencies to work out a uniform

credit rating format and processes to

bring about transparency.

• FDI in MSMEs: There is a need

for policy guidelines to encourage FDI

participation by NRIs in the SME sector

Ð this would include automatic approval

for 100% FDI from NRIs, and

other promotional measures, including

a single window clearance, across

all subsectors within the MSMEs.

MSME Business

17

January 2012


12 th Plan

Roadmap For Growth

The Working Group on Micro, Small & Medium Enterprises (MSMEs) Growth

for the 12th Five Year Plan (2012-17) has recommended key initiatives in

areas covering finance, technology, infrastructure, marketing, training and

institutional structure

MSME Business January 2012

18

The terms of reference of the

present Working Group on

Micro, Small & Medium Enterprises

(MSMEs) Growth

for the 12th Five Year Plan

(2012-17), constituted by the Planning

Commission, were to carry forward recommendations

of Prime Minister's Task

Force and suggest a specific action plan

to facilitate the overall growth of the

MSME sector within the plan period.

The Working Group's recommendations

are classified under six important verticals:

(i) Credit & Finance; (ii) Technology;

(iii) Infrastructure; (iv) Marketing;

(v) Skill Development; and (vi) Institutional

Structure.

• Credit & Finance: Access to finance

needs to be enlarged through alternative

sources of capital such as private

equity, venture capital and angel funds.

This is crucial for facilitating the growth

of knowledge-based enterprises which

have high potential in India. Further,

prospective enterprises in emerging

areas such as nano-technology, biotechnology,

aero-space, defence-applications

and homeland security would

also require such alternative sources

of finance since traditional channels

are unable to meet their needs.

• Technology Upgradation & Support

for Emerging Sectors: The Group

recommends setting up of a Technology

Acquisition and Support Fund with

adequate allocation to assist both development

of indigenous technology

and acquisition of global technology

by Indian MSMEs. Separate schemes

for installation of plants and equipment

with advanced technologies, viz.,

CLCSS & NMCP components, should be

merged into one scheme. Technologyoriented

initiatives under NMCP should

be clubbed as the modified NMCP

Scheme and offered to MSME Clusters/

Mini-Clusters as a package in the cafeteria

mode and they can develop their

own projects as per requirement. The

Group recommends that during the

12th Plan period, at least 20 modular

industrial estates with plug-and-play

facilities in the respective areas may

be launched in collaboration with IITs,

IISc and other premier institutions.

• Infrastructure Development: To

strengthen and expand existing Integrated

Infrastructural Development

(IID) Scheme, the Group recommends

that the eligible project cost for infrastructure

development (excluding

cost of land) for Government of India

assistance should be enhanced from

the present limit of Rs 10 crore to Rs

15 crore. To complement the efforts of

state and Central governments, private

sector (companies and SPVs) should

also be allowed to participate in the

development of infrastructure, with

Government of India assistance under

the Micro & Small EnterprisesÐCluster

Development Programme (MSE-CDP).

• Marketing: The Group recommends

new schemes especially in areas like

use of ICT for creating cluster-level,

state-level and national level B2B portals

with connectivity to international

markets and marketing infrastructure

such as setting up of testing facilities

and establishment of information dissemination

centres and display-cum

exhibition centres. Recommendations

are made for setting up of marketing

organisations in clusters in PPP mode

through formation of SPVs, which

would form the focal point

at the cluster

level for all

marketing related activities such as e-

marketing, branding, advertising, barcoding,

participation in domestic and

international trade fairs, etc.

• Skill Development: The Group

recommends upscaling of the training

capacity of the MSME ministry through

the public-private partnership mode.

Group also recommends that training

programmes for skill upgradation of

chief executives/owners of the MSMEs

should be conducted. It is recommended

that a web-based management information

system be launched. To coordinate

the entire process of conducting

skill development programmes, setting

up of a virtual SME university has also

been recommended.

• Institutional Structure: Prime

Minister's Task Force, in its report, has

made significant recommendations on

liberalising the policy regime for the

MSME sector, viz., introduction of Insolvency

Act, liberalisation of labour

laws, liberalisation of Apprenticeship

Act, strengthening of District Industries

Centres, etc. The Group has identified

important areas like environmental issues,

labour issues, exit policy amendment

of MSMED Act and restructuring

of the DICs and MSME-DIs, to

be immediately addressed to

unshackle the growth of the

MSME sector.


International

A Samba With Small Biz

MSME Business

Brazil is more than just the popular future host of the 2014 World Cup and 2016

Olympics. It offers entrepreneurs across the globe opportunities galore as the country

has a significantly large small business sector contributing about 20% of GDP and

employing 60 million people

India's links with Brazil go back

five centuries. In recent years,

relations between Brazil and

India have grown considerably

and business cooperation between

the two countries has been

extended to diverse areas. Brazil is

India's largest trading partner in Latin

America and Carribean, with bilateral

trade between India and Brazil

reaching an unprecedented figure of

$8.1 billion in the first ten months

of 2011 (India's imports were a little

over $3 billion; India's exports: $5.0

billion). In 2010, total trade was to

the tune of $7.7 billion, showing a

phenomenal rise from $828 million

in 2000. India's exports registered a

growth of 94% in 2010 over 2009.

On the investment front, Brazilian

companies have invested in India in

automobiles, IT, mining, energy, biofuels,

footwear sectors, whereas Indian

companies have invested in IT,

pharmaceutical, energy, agri-business,

mining, engineering/auto sectors

in Brazil.

India and Brazil maintain close

contacts in the multilateral fora, in

particular in the UN, WTO and G-20.

Cooperation through IBSA, BRICS and

BASIC is another dimension of the bilateral

relations.

Union Minister of Commerce & Industry,

Mr Anand Sharma, said recently,

"There is vast potential for

cooperation between Indian and Brazil

in a number of areas including the

MSME sector".

Small Business in Brazil

The small business sector is significantly

larger in Brazil, accounting for

99.23% of Brazil's enterprises; with

16 million small and micro enterprises

contributing about 20% of Brazil's

GDP and employing 60 million people

or 56% of the urban workforce in

the formal sector. According to the

Brazilian Micro-Enterprise and Small

Business Support Service (Sebrae),

there are 5.89 million registered

SMEs and 10.34 million informal

SMEs in Brazil.

The industry body maintains that

the rapid rise of new companies in

Brazil is related to the indomitable

Brazilian entrepreneurial spirit that

is coming into own. A greater entrepreneurial

spirit is crucial for a country

where young people between the

age of 18 and 24 comprise 36% of the

unemployed workforce. Brazil has

recognized this and has been taking

determined steps to encourage entrepreneurship.

Brazil seems quite

aware of the impact of new, growing

businesses not only on employment

but also on innovation, and this is

reflected in the efforts to support

start-ups.

Brazil has traditionally relied on

its domestic economy, but that's all

changing fast. Currently the eighthlargest

economy in the world is ex-

19

January 2012


International

MSME Business January 2012

20

pected to grow to be the fifth-largest

in a few decades. Even during the

worst phase of the global meltdown,

Brazil's domestic performance and

output were solid thanks to small

businesses in the country. Even the

experts have been quoted saying in

the media that many SMEs in Brazil

have the potential to be listed on

the stock exchange. "The country

has 15,000 companies with annual

revenue between $62.5 million and

$250 million. Of that, 1% can go to

the stocks market," said Mr Edemir

Pinto, CEO of BM&F Bovespa, one of

the largest exchanges in the world in

terms of market value.

The Christian Science Monitor recently

reported that "Brazil symbolises

the way continents of the South

are ramping up efforts to nurture

new businesses." For instance, the

government's Financing Agency

for Projects & Studies (FINEP) has

launched a significant project to support

start-ups titled PRIME which will

disburse around $65,000 to start-ups

focused on innovation. FINEP expects

to help 10,000 innovative companies

over four years.

This interest in an entrepreneurial

strategy for growth will translate

into pro-entrepreneurship policies in

the future. The country has taken active

steps to promote entrepreneurship,

and innovative start-ups. For

example, the country has tapped into

the Brazilian Diaspora. In 2005, the

Inter-American Development Bank

and Sebrae engaged in a $1.5 million

technical cooperation programme

to help Brazilians returning home

from Japan with the goal of starting

new businesses. Brazilians constitute

Japan's third largest immigrant

community, and most Brazilians report

having moved to Japan to save

money and open their own businesses

upon returning to Brazil after 1-5

years. Under this programme, Sebrae

selected and trained potential entrepreneurs.

There are also several economic

policies in Brazil focusing on

technological innovation. In 2004,

for instance, the government passed

a law that allows federal university

professors temporary leave to create

a start-up.

Universities in Brazil are assuming

an important and necessary role

in the country's entrepreneurial and

innovation ecosphere. Universitybased

incubator programmes are

flourishing. Take into account the

fact that Brazil's incubator network

has developed from 136 in 2000 to

400 today, and it reflects the power

of Brazil's entrepreneurship boom. A

Networks Financial Institute working

paper argues that Brazil leads one

of the most successful incubation

movements in Latin America, with

incubator models that are bottom up

or suited to indigenous needs.

Indian Initiatives

Likewise in India, the micro, small

and medium enterprises (MSMEs)

have been accepted as the engine

of economic growth for promoting

equitable development. In recent

years, the MSME sector has consistently

registered higher growth rate

compared to the overall industrial

sector. With its agility and dynamism,

the sector has shown admirable innovativeness

and adaptability to survive

the recent economic downturn

and recession.

However, MSMEs have been facing

great challenge in the era of globalisation,

privatisation and liberalisation.

With its consistent growth performance

and abundant high skilled

manpower, India provides enormous

opportunities for investment, both

domestic and foreign. To exploit this

potential, Ministry of Micro, Small &

Medium Enterprises, Government of

India, and its organisations, through

its various schemes and programmes,

are providing support to the Indian

MSME sector, by giving them exposure

of the international market; foreign

technology; sharing of experiences

and best management practices in the

international arena. Taking advantages

of these schemes Indian small enterprises

can look for best practices and

analysis of how new ventures are becoming

powerful engine moving Brazil

up the global economic ladder.

World Cup to strengthen Brazil’s small businesses

Sebrae has mapped 930 business

opportunities that will be created

as a result of the 2014 World

Cup. This study was conducted under

a partnership with the Getulio

Vargas Foundation (FGV). It has

identified business opportunities

in civil construction; information

technology; timber and furniture;

textiles and apparel; tourism; tourism

related activities; retail trade;

agribusiness; and services.

Sebrae President, Mr Luiz Barretto,

has been quoted saying in

the media that the World Cup is

an opportunity to build a managerial

legacy for Brazilian entrepreneurs.

"We expect the World

Cup to be a development hallmark

for micro and small businesses.

In addition to the hundreds of

business opportunities during

the games, the improvements in

terms of management, innovation

and sustainability will make the

difference for the future of those

businesses. That's why we have

developed the Sebrae 2014 Programme,

as its objective is to help

small entrepreneurs gear up to

make the most out of the momentum

generated by the World Cup.

This is the legacy Sebrae expects

to continue," he said.


Regions

A roundup of major MSME linked

initiatives taken by CII regional offices

western region

‘Evolving With Changes Is Important To Be Competitive’

Evolving with the changes is highly important

to be competitive. This was

stated by Mr Rajiv Bajaj, Managing Director

Bajaj Auto Ltd during his inaugural

address at the 7th MSME Development

Meet held at Pune on 8 December 2011.

Mr Bajaj advised MSMEs to concentrate

on their core strengths and avoid multitasking

so that they are able to make the

optimum use of their resources. Mr Sanjay

Sethi, Secretary, Small and Medium

Enterprises and Development Commissioner,

Industry, Government of Maharashtra,

also addressed the session.

Mr Sethi talked about the new industrial

policy of Government of Maharashtra and

said that the state government has proposed

a mini-cluster project for the development

of MSMEs. He added that the gov ernment

will also provide financial assistance to the

Northern Region

Mr Rajiv Bajaj, Managing Director, Bajaj Auto Ltd

at 7th MSME Development Meet, held in Pune on

8 December 2011

tune of Rs 5-7 crore for select projects.

The conference covered four sessions

that included innovation, energy audit

and conservation, finance and IT-cloud

computing. The session on innovation was

presided by Dr Naushad Forbes, Director,

Forbes Marshall Pvt Ltd. Mr H N Daruwalla,

Executive Vice President, Godrej & Boyce

Ltd, presided over the session on energy

audit and conservation. Representatives

of Zensar Ltd and Microsoft were present

during the session on IT.

A full-day Buyer Seller Meet was also

organized by the Western Region MSME

subcommittee on 9 December. The meet

saw the participation of leading companies

in auto and engineering sectors.

Representatives from government undertakings

and PSUs were also present

at the meet. General Motors India Ltd,

Tata Auto Comp Systems Ltd, Piaggio Vehicles

P Ltd, Anand Automotives Ltd, Naval

Dockyard, Indian Air Force, Mazagon

Docks Ltd, Cummins India Ltd and Eaton

Fluid Power Ltd made their respective

presentations at the meet.

MSME Business

21

January 2012

Awareness Programme on SME Exchange

With the aim of creating awareness about

the upcoming SME Exchange of Bombay

Stock Exchange, CII Rajasthan organised

an interactive session with Mr Lakshman

Gugulothu, Chief Executive Officer, SME Exchange,

Bombay Stock Exchange, at Jaipur on

December 2, 2011. Dr Lalit Mehra, Principal

Secretary, Labour & Employment, Government

of Rajasthan, also participated in the

deliberations. He spoke about the industrial

labour reforms scenario in Rajasthan.

CII Western UP Zonal Council organised

an interaction with Mr Sanjay Sinha, Director,

Employees State Insurance Corporation

(ESIC), Noida. The objective of

the interaction was to discuss and share

the issues faced by industries in western

Uttar Pradesh. At the session CII's initiatives

to bringing all stakeholders on a

Mr Lakshman Gugulothu, Chief Executive Officer,

SME Exchange, Bombay Stock Exchange, Dr Lalit

Mehra, Principal Secretary, Labour & Employment,

Government of Rajasthan at Jaipur

common platform was widely applauded.

To propel industrial growth, CII Haryana

State Council organised a conference on

proactive strategies and a Buyer Seller

Meet on December 14, 2011. The meet offered

an opportunity for the MSME players

to have one-to-one meetings with the

larger companies and PSUs to explore possibilities

for future collaboration and business

development. Bharat Petroleum Corporation

Ltd, Power Grid Corporation Ltd,

etc., were among the large companies that

attended the meet.

With the objective of creating awareness

on the latest policies and procedures

related to customs, central excise and service

taxes, CII Uttarakhand State Council

organised an interactive session with Dr D

K Bisen, Assistant Commissioner Customs,

Central Excise & Service Tax on December

12, 2011. At the session issues related

to excise exemptions vis--vis central industrial

package given to Uttarakhand in

2003 were also discussed.


Regions

Southern region

MSME Business January 2012

22

Seminar on Finance Availability for MSMEs

CII Andhra Pradesh organised a seminar

on Finance Availability for MSMEs in

Hyderabad on November 22, 2011. Mr R Karikal

Valaven, Commissioner of Industries,

Government of Andhra Pradesh, Mr Ramesh

Datla, Chairman CII National MSME Council

& Managing Director Elico Limited, Mr S Durairajan,

Deputy General Manager, Reserve

Bank of India, and Mr M Babu Rao, Convener,

CII AP MSME Panel & Managing Director,

GSB Forge Pvt Ltd attended the seminar.

CII Erode Zone jointly with EEDISSIA and

MSME Development Institute, Government

of India, organized the Erode MSME Conclave

2011 on November 25, 2011. Mr V K

Shanmugam, District Collector, Erode District,

Tamil Nadu, delivered the inaugural

address and Mr S Sivagnanam, Director,

MSME Development Institute. delivered

the keynote address. Industry leaders and

senior government officials participated in

the various technical sessions.

Meanwhile, with an objective to provide

business linkages between PSUs and MSME

members, CII Southern Region organised a

EASTern region

(LÐR) Mr R Karikal Valaven, Commissioner of Industries, Government of AP, addressing the seminar

on Finance Availability for MSMEs on November 22, 2011. Mr Y V Krishna Mohan, Co-Convener, CII AP

MSME Panel, Mr S Durairajan, Deputy General Manager, RBI, Hyderabad, Mr Ramesh Datla, Chairman, CII

National MSME Council, Mr M Babu Rao, Convenor, CII AP MSME Panel, Mr S Kannan, Director & Head, CII

AP, are also seen in the picture

CII delegation meets UK officials

Members of CII North Bengal Zonal Council's

Mission to United Kingdom during September

12Ð18, 2011

CII North Bengal Zonal Council organised

a mission to United Kingdom

during September 12Ð18, 2011.

The objective of the mission was to

interact with UK companies to explore

business opportunities for MSMEs

based in North Bengal and to interact

with government officials keeping in

view the social, cultural and economic

dimensions for mutual benefit. In this

regard the delegation met with Lord

Mayor, Councilor Frank Prendergast,

Mr Niel Peterson, Head, International

& Commercial Relations, Ms Barbara

King, Manager, International Relation,

at the Liverpool Town Hall.

Meanwhile, CII Odisha organised an

MSME Linkage session at Bhubaneswar

on November 29, 2011. The event

was organised in connection with the

CII `Business for Livelihood'. Considering

the need for overall development

of the state, the objective of the MSME

Linkage session was to shift the focus

of the large scale industry and government

towards the development and

growth of small scale industries.

CII Chhattisgarh and Chhattisgarh

Buyer Seller Meet at Mysore on November

11, 2011. The aim of the meet was to provide

marketing opportunities for MSMEs on

their strength and competitiveness; provide

an insight into modern technological development;

showcase capabilities of industrial

equipment and machinery suppliers, manufacturing

and technology and service providers.

Companies that made presentations

about their requirements and procurement

processes included Hindustan Aeronautics

Ltd, ISRO, among others. CII Karnataka organised

an MSME meet on December 19,

2011 at Bangalore.

Laghu & Sahayak Udyog Sangh jointly

organised an awareness session on

Design Clinic Scheme, an initiative of

the Ministry of Micro, Small & Medium

Enterprises (MSME), Government

of India, in association with National

Institute of Design (NID), in Bilaspur.

This awareness programme was organised

to provide information about

the Design Clinic Scheme launched by

Ministry of MSME and spread information

about importance of design,

benefits of the scheme and focus on

the MSME sectors.

To spread awareness on the recent

technological changes in logistics and

packaging industry, CII Jamshedpur

Zonal Office organised a session on

`Competiveness through efficient logistics

and packaging' at Jamshedpur

on September 20, 2011.


Upcoming Events

MSME focused Events/Programmes (Jan-Feb 2012)

CII Northern Region

Title/Theme Date Venue

Workshop on Effective Communication & Presentation Skills 11 January 2012 Chandigarh

Workshop on Autonomous Maintenance 20 January 2012 Baddi

Manufacturing Mission to Ropar 27 Ð 28 January 2012 Ropar

Manufacturing Excellence Mission to Pune 30 Ð 31 January 2012 Pune

Workshop on Good Manufacturing Practices 3 February 2012 Kala Amb

CII-DIT Seminar on ICTE Manufacturing in Chandigarh 22 February 2012 Chandigarh

Contact: Vinod Dhiman, Phone: 0172 - 2605868, Email ID: vinod.dhiman@cii.in

CII Western Region

Title/Theme Date Venue

One day Training Programme on Supervisory Skills 20 January 2012 Indore

Interactive Session with PanIIT 20 January 2012 Surat

One Day Training Programme on Export Policy, Procedure & Documentation 25 January 2012 Indore

Workshop on Tender Management 3 February 2012 Vadodara

QCC Regional Final 9 February 2012 Aurangabad

Manufacturing Excellence Study Mission to Tata Motors,

Forbes Marshall, Sandvik Asia Ð Pune

9 February 2012 Surat

Session on Mergers & Acquisitions 10 February 2012 Pune

Agri Advantage & Conference on Food Processing 10 February 2012 Nashik

Mission on Lean Manufacturing to North India 16-17 February 2012 Pune

Mission on Manufacturing Excellence 20-21 February 2012 Nashik

Seminar on Entrepreneurship Development 23 February 2012 Surat

Conference on Logistics & Material Handling 24 February 2012 Pune

Session on Post Budget Analysis 29 February 2012 Pune

Contact: C M Tungare, Phone: +91 9867 510 622, Email ID: c.tungare@cii.in

CII Southern Region

Title/Theme Date Venue

IT Usage for MSME January 2012 Chennai

Session on Innovative Financing for SMEs January 2012 Madurai

Session on 5 S January 2012 Puducherry

Workshop on Foundation for Profitability for MSMEs January 2012 Hyderabad

MSME Summit February 2012 Chennai

CEOs Experience Sharing February 2012 Madurai

Toyota Production System February 2012 Puducherry

Session on Good Manufacturing Practices February 2012 Puducherry

CII Eastern Region

Title/Theme Date Venue

MSME East

Contact: Suparna Nanda: suparna.nanda@cii.in: Mob: 09937154773

10 February 2012 Kolkata

Arogya Fair : Trade Fair for MSME alternative medicine manufacturers 22-25 February

Contact: Mainak Mandal: mainak.mandal@cii.in: Mob: 08895211926

2012

Exhibition Ground, Bhubaneswar

MSME Business

23

January 2012

For further details please contact Mr Gurpal Singh, Confederation of Indian Industry (CII), 249-F, Sector 18, Udyog Vihar, Phase IV, Gurgaon 122015

(Haryana, India); Tel: +91(124) 4014060-67; Fax: +91(124)4014080; Email: gurpal.singh@cii.in

DISCLAIMER: No part of this publication may be reproduced, stored in, or introduced into a retrieval system, or transmitted in any form or by any

means (electronic, mechanical, photocopying, recording or otherwise), without the prior written permission of the copyright owner. CII has made every

effort to ensure the accuracy of information presented in this document. However, neither CII nor any of its office bearers or analysts or employees can

be held responsible for any financial consequences arising out of the use of information provided herein.

Published by Confederation of Indian Industry (CII), The Mantosh Sondhi Centre; 23, Institutional Area, Lodi Road, New Delhi-110003 (INDIA); Tel:

+91-11-24629994-7; Fax: +91-11-24626149; Email: info@cii.in; Web: www.cii.in

Copyright © 2011 by Confederation of Indian Industry (CII), All rights reserved.

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