Indian SMEs

Author: Aandy Dicosta
Date Created: Jan 29, 2010 - 6:00:35 AM

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Appearances can be deceptive. There may be many automobile  garages and unstable sheds dotting Pune’s roadsides, but you never know how many of them have entered into tie-ups with foreign firms. For example, no less than 250 SMEs have come up in Pune’s auto cluster areas and most of these companies have entered into some kind of partnership with German auto component manufacturers. Little wonder, Lufthansa airline has introduced a direct flight between Pune and Frankfurt six times a week to cater to the needs of this growing segment.

Moreover, Indian SMEs are also realizing the importance of intellectual property. They have started giving due importance to research and IPR, informs Anjan Das who heads the technology and IPR division at Confederation of Indian Industries. Going forward, many of them will even raise their bars in terms of quality for launching them in the international markets. Partnerships with international companies are looked upon as the best means for Indian companies to get their hands on international technologies.

The Indian SME market is currently a $5 billion industry. However, it is still an unorganized sector and has to encounter internal and external challenges. SMEs have massive potential in terms of innovations which needs to be consistently fostered for manufacturing new goods and services at competitive rates.

India has the largest number of SMBs as opposed to its counterparts like Brazil, Russia, China and US, as per Zinnov Research. In 2006-07, the number of SMBs in India stood at 35 million and is estimated to go up by 48 million by 2015. The most remarkable aspect being SMB contributed more than 60 percent to the Indian GDP. SMB contribution to GDP has been steadily climbing at a rate of 12 percent in the last 7 years.

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