FICCI suggests strategies to boost SMEs

By Staff
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Google Oneindia News

New Delhi, June 24: Industry body FICCI has recommended a five-pronged strategy to boost cluster-based development of SMEs.

The strategy includes filling up the technology gaps along with quality upgradation, low-cost financing and linking Indian and overseas SME clusters.

Besides, networking support for gaining access to new markets and information on new products and technologies should also be provided along with provision of institutional support for training and skill development.

To access and compete in the international market, Indian clusters need to match up to the global standards, which will necessitate intensive studies of specific clusters to identify the technology gaps.

Once the roadmap for modernising the clusters has been drawn, the financial and technical institutions need to play a leading role in making available the requisite inputs, the chamber suggested.

''The high cost of funding is a major constraint for SMEs and inhibits them to make investments for technology upgradation.

Therefore, the government needs to make available low-cost funds for effecting modernisation of clusters.'' Cluster-to-cluster cooperation arrangement, besides helping the Indian clusters to improve their overall production techniques, will also afford them an opportunity to enhance exports through the supply of goods and components to overseas counterpart clusters where the factors of production are favourable to Indian conditions viz, the chamber claimed.

The body indicated networking can play a dominant role in supporting SMEs for gaining access to new markets and information on new products and technologies, which may be difficult for them to achieve on their own.

Ficci claimed that the cluster development approach will move up the value chain to a new trajectory by integrating the suggested elements.

The body pointed out lack of an inter-institutional synergy, dearth of committed NGOs and industry associations, paucity of good consultants and services providers as reasons for the lack of development of the SMEs.

''Comprehensive strategy could be applied to select clusters at different locations with varied product group and based on the experience, the developmental model could be replicated in other clusters,'' it suggested.

UNI

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