SMEs – the relevance & importance

Small and medium business enterprises (SMEs) have been recognized as the silent drivers of a nation’s economy all over the world. This is because they are built on strong foundations of enterprise, risk-taking and resilience in the face of oppositions and hurdles. SMEs have time and again shown ability to generate growth and employment undaunted by recessionary conditions.

The US industry and commerce is a classic, current example of the ubiquity of SMEs. The nation is looking upon SMEs as the economy’s saviour from the slowdown that threatens their No. 1 position. With more and more employees of large companies being laid off, and with running a business not the rocket science it was thought to be some decades ago, entrepreneurship is probably the only answer for many an American.

The SME story in India is the same – but for a different reason. In the last two decades India has blossomed into a land of opportunity and people have been quick to recognize the chance and make the most of it. A recent estimate says that over 40% of industrial output is accounted for by industrial units in the SME sector. SME’s therefore literally form the backbone of the Indian economy.