Asian Journal of Research in Business Economics and Management
Year : 2015, Volume : 5, Issue : 4
First page : ( 8) Last page : ( 24)
Online ISSN : 2249-7307.
Article DOI : 10.5958/2249-7307.2015.00084.5

Constructs and Constraints of MSME in India for Sustainable Development

Dr. Sharma Nitya

Deputy Controller, Punjab Technical University, Jalandhar, India

Online published on 4 April, 2015.

Abstract

MSMEs are critical to growth and economic indicators of national economy. The Manufacturing Plan, April 2012 reports that the Indian SME market is valued at 5 billion $ and over 11 million SME units produce more than 8000 products. Its deep forward and backward linkages with several segments of economy provide dynamism to the industrial sector of the economy. With such contribution to the economy this sector has to be sustainable. Sustainable development that can be defined as the progressive dedication by MSMEs to behave fairly in equitable and just manner and add towards economic expansion while recuperating the excellence of existence of the stakeholders: their families, local communities, the society and the world at large as well as future generations. In the present paper an attempt has been made to study the contribution of this sector based on MSMEs Census reports. Along with it firsthand information in form of questionnaire has been derived from the entrepreneurs to know the strengths and challenges of MSME sector. For this purpose 19 variables relating to strengths or constructs and 23 different variables relating to constraints have been defined to analyse the constructs and constraints of MSMEs in Punjab for Sustainable Development. Following the Census reports, it is ascertained that government is progressive to sustain this sector as it is characterized as a boon for employment, output, growth, and export in the present era of globalization due to its cost efficiency. Further by Applying Factor Analysis the results indicate that small scale entrepreneurs are mostly influenced by their core strengths which prompt the revenue generating activities and look for a favourable economic and infrastructural environment. While exploring the constraints, it indicated that entrepreneurs of MSME of Punjab feel that high tax structure, bottlenecks in bank finance, regulatory machinery and inadequate infrastructure pose threat to competencies and sustainability of this sector in Punjab. Thus, the State Government has a major role in reducing the burden of administrative regulations and improving the business environment. It is suggested that enabling business environment must be provided to nurture and promote entrepreneurism and this sector could develop on their own competence to rule the market and provide sustainability in the economy.

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Keywords

MSMEs, Constructs of MSMEs, Constraints of MSMEs, Sustainability.

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