Role of Small Scale Industries in Eradication of Unemployment and Poverty

 

Dr. Yulendra Kumar Rajput¹*, Sneha Agrawal²

¹Principal, Agrasen College, Raipur (C.G.)

²Assistant Professor, Department of Management, Agrasen College, Raipur (C.G.)

 

ABSTRACT:

Small scale industries (SSI’s) are very important constituents of Indian economy system. Apart from agriculture which is the major source of earning livelihood, small scale industries are another form generating employment opportunities and reducing poverty in India. This paper basically focuses in understanding the role of small scale industries and how it helps in engaging manpower to increase employment. By doing this the employment rate of the country increases, income level the household increases, life expectancy increases and standard of living of the people enhanced. The Central Government has the authority to determine capital investment requirements for SSI’s. The SSI’s are listed under the Industries (Development and Regulation) Act, 1951. The SSI’s are governed and controlled by Small Industries Development Organization. It is a administrative authority of SSI’s, its various issues are solved by it.

 

 

INTRODUCTION:

The governing body of SSI’s is small industries development organization. It is an organization which controls SSI’s and also formulate business policies for the development of SSI’s. The annual report related to SSI has been provided by Ministry of Small and Medium Enterprises (MSME).The major problems of India is poverty and unemployment. The government of our country is taking various measures like Swaranjayanti gram swarojgaar yojna (SJGSY), Sampoorna gramin rojgar yojana (SGRY) , Swarna Jaynti Shahari Rojgaar Yojna (SJSRY) And Prime Minister Employment Genration programme (PMEGP) to solve this drastic problem but still it is not fully solved. The present study

 

 

 

focused on the role of small scale industry in reduction of poverty in India. Poverty is a social phenomena in which societies unable to fulfill the basic requirement of life i.e., food, shelter, clothing and education etc. The main reason of poverty is low income level of people due to scarcity of Employment opportunity. The SSI’s plays important role in removal of unemployment and economic stagnation. The idle resources of a country has been efficiently and effectively utilized by various SSI’s and help in economic growth. The minimum Investment required in SSI’s       

1    Plant & Machinery – (Rs. 25 lakhs-Rs. 5 crores)

2    Services SSI’s investment requirement (Rs. 10 lakhs - Rs. 2 crores).

 

OBJECTIVES OF THE STUDY:

1.     To study and understand about various small scale Industries (SSI’s).

2.     To study and analyzed the role of small scale Industries (SSI’s) in generation of employment.

3.     To study and analyzed the role of SSI in eradication of poverty.

RESEARCH METHODOLOGY:

Research design of this paper is descriptive in nature. The various roles of (SSI’s) has been studied, described and analyzed. The basic focus of this paper is to know various sources of employment generation and poverty eradication through small scale industries. Sources of data collection is secondary. The secondary data is collected from various articles, research paper, books, magazines and internet etc.

 

1.Small scale Industries (SSI):

India is one of the world’s fastest growing economies in the world, It is pertinent to note that SSI’s contribute almost 40% of India’s gross industrial value. These industries produce goods and services worth over Rs. 40 lakhs for every investment of Rs. 10 lakhs. Furthermore, the value addition in this output increases by over 10%. The number of SSI in India increased from around 8 lakhs in 1980 to over 30 lakhs in 2000.This figure has grown even more in recent years owing to the government’s ‘Ease of Doing Business’ policies. As a result of this, the total industrial production output rose tremendously in the last few years. SSI’s are, therefore, strongly responsible for the growth of India’s economy. Small-scale industries offer several advantages and opportunities for investment.

 

They receive many tax benefits and rebates from the government programs like startup standup India of PM Modi JI. Firstly, SSIs are less capital intensive. They even receive financial support and funding easily. Secondly, procuring manpower and raw materials is also relatively easier for them. Even the government’s export policies favour them heavily. Apart from providing profitable opportunities, Small Scale Industries play a large role in advancing welfare measures in the Indian economy. A large number of poor and marginalized sections of the population depend on them for their liveilihood. These industries not only reduce poverty and income inequality, but they also raise standards of living of poor people. Furthermore, they enable people to make a living with dignity.

 

EXAMPLES:

·       Agarbatti Making SSI-Any individual can start agarbatti making. Agarbatti is considered as household goods having a great market potential.

·       Paper Cup Making-Paper cup making business is one of the most lucrative small scale manufacturing opportunity in India.

·       ATM Space Renting-The demand for ATM space is high. If you are looking forward to a fixed monthly income, ATM space renting is a good retail business proposition for SSI

·       Banana Wafer- Making Banana wafers are under-you can sell the item both in the local and export markets.

·       Bed sheet With Pillow. Knowledge in the textile industry is important. Small, medium and large scale operation is possible.

·       Candle Making-Aromatic decorative candles business can be initiated as SSI and part time basis. This is one of the most profitable small scale business ideas for women entrepreneurs also.

·       Bio-diesel Production – It can be established on a small scale basis at any place where the main raw material Jatropha oil is easily available.

·       Bridal Store -A bridal store focused in specialty wedding attire with allied wedding because weddings are memorable once-in-a-lifetime events.

 

2. Poverty:

In a country like India the problem of poverty is at its Pinnacle. There are various measures taken by the government to solve this problem, but still it unsolved. The main reason of it, the root cause of poverty is not fully identified. Poverty can be fully understood as it is a situation of people or society which unable to fulfill the basic need of life like food, clothing, education and shelter etc. The society is classified into three classes according to their income levels i.e. higher class, middle class and lower class society.

 

The people who are unable to fulfill the basic needs of life are considered below the poverty line (BPL) and people who are able to fulfill the basic need of life are considered as above poverty line (APL). Furthermore poverty is explained into two different types i.e., relative poverty and absolute poverty. Relative poverty is a social phenomenon where poverty of two person, two society and two countries are compared relates then it is known as Relative poverty. Absolute poverty is the inability of people to fulfill their basic needs of life. The SSI is playing a vital role to solve this drastic problem to some extent. Employment opportunity is increasing and people are getting job, so that income level of people increases and people become able to fulfill their basic needs which leads to shift of people from below the poverty line (BPL) to above the poverty line (APL) class of society.

 

3. Unemployment:

As a population of a country is increasing day by day, the problem of unemployment also arises as faster pace. Unemployment is a situation in which peoples are willing to work, but they are not getting job. There are various reasons of unemployment in our country like poverty, increased population, slow development of economy, defective education system and slow development of industries etc. SSI’s playing a major role in eradication of unemployment and poverty problem to some extent. As the income level of individual rises, the saving also increases which result in investment and due to this investment new industries will set up. It reduces the level of unemployment. It means unemployment is directly or indirectly related to poverty and can be solved with establishment of SSI’s units. These aspects form a cage like structure which is interlinked and interconnected to each other.

 

FINDINGS:

1.       The small scale industries (SSI’s) helps in increasing increases the employment level of people of our country.

2.       Small scale industries (SSI’s) helps in reducing the poverty level of the country.

3.       The idle resources of our country are utilized by Small scale industries (SSI’s).

4.       Unemployment is reduced and manpower are engaged in the constructive work.

5.       Gross Domestic Product of a country increases and it leads to the growth of economy.

 

CONCLUSION:

SSI’s is playing a vital role in the poverty reduction and  increasing employment. It increases urban and rural growth of the country. Government helps in increasing infrastructures and manufacturing of SSI’s. Reducing issues like slums and poverty etc. SSI’s play a very important role in the economic development of India. It helps in increasing the level of income of people, increases saving, increases investment and industrial development takes places. The unsolved problem of the developing country like India is solving to the some extent.

 

REFERENCES:

1.      Kulkarni Ajay Manisha Golden Research thought Journal (Volume 3 August 2013).

2.      Bharti S.S University of Research Online Wollongong (2002).

3.      Dr. Sinha V.C. Business Environment Sanjay Bhawan SBPD Publishing House Edition (2018).

4.      Some important websites

 

 

 

Accepted on 21.05.2019            © A&V Publications All right reserved