The Hindu : Business : 'SMEs have an important role'

Online edition of India's National Newspaper
Saturday, Jan 22, 2005

Business

Business

'SMEs have an important role'

By Our Staff Correspondent

MUMBAI, JAN. 21. In India, Small and Medium sized enterprises (SMEs) have an important role to play given their greater resource-use efficiency, capacity for employment generation, technological innovation, promoting inter-sectoral linkages, raising exports and developing entrepreneurial skills, according to Thomas Matthew, Managing Director, UPS Jetair Express Pvt. Ltd.

Speaking at the release of UPS' findings of its first annual Asia Business Monitor (ABM) survey, a study of the competitive issues faced by Asia's small and medium sized enterprises, Mr. Matthew said Indian SMEs had shown a positive outlook towards the economic growth and their business prospects in India. The objective of conducting the ABM study was to gain a better understanding of the needs and concerns of Asia's SMEs.

The UPS ABM found Asia's SMEs primed for growth and optimistic about 2005, with the information technology and telecommunications sector leading their economies forward.

However, major concerns darken their horizons, with cash flow worries and dissatisfaction with their credit providers looming and China's emergence as the region's most competitive economy posing both as an opportunity and a threat.

However, Indian SMEs led the field when asked about their perceptions about economic growth and business prospects in 2005 with 58 per cent being optimistic about economic growth and 83 per cent saying business prospects are better.

Government support was cited as a key business concern by SMEs in India. Interestingly, 52 per cent of Indian SMEs consider China to be a boost rather than a threat.

However, Indian SMEs were mainly concerned about transparency with 68 per cent stating it as a prime concern in doing business with China.

Indian SMEs are optimistic about increasing their workforce with 67 per cent of the SMEs saying they expect to increase their workforce.

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