Single law soon for SSIs: P.M

By Our Economy Bureau | 31 Aug 2004

New Delhi: Prime minister Manmohan Singh, has said that it would be the endeavour of his government to create a positive environment in which the ''animal spirits'' of private enterprise would be unleashed to usher in a new era of entrepreneurial development.

Speaking on the golden jubilee celebrations of the Small Industries Development Organisation (SIDO) yesterday, Singh said that the government was currently contemplating more measures to aid and support the small-scale industries (SSI) sector.

"We will soon be setting up a national commission to examine the problems facing enterprises in the unorganised, informal sector. This commission will have a comprehensive mandate to examine and review existing institutional mechanisms for supporting small enterprises," Singh said.

Pointing out that we are living in an increasingly globalised world, the prime minister said that there was a need to see whether protection in the form of reservation of items for production in the SSI sector continues to be an adequate mechanism to enable the sector to thrive.

"While reservation can protect SSI firms from domestic competition, it will not protect them from international competition. This is the reality one must reckon with. Trade is a substitute for domestic competition. And given this scenario of trade-driven competition, the efforts of all government agencies must be towards enhancing the capabilities of small enterprises to face this onslaught of competition," Singh said.

Once the focus shifted to promotion, government agencies would need to start understanding the processes which determine the competitiveness of small enterprises and would also need to create new organisational and institutional mechanisms to facilitate their healthy growth, he added.

"It is time for India to tap into the creative energies of the millions of small enterprises to boost growth and employment just as other countries have successfully done," Singh said. Turning his attention to problems faced by the SSI sector, including that of `inspector raj'', Singh said that the ministry of SSI was working on a single law for the sector which would be finalised and brought to parliament soon.