In this article we share Role of Small Business in Economic Development which is tells countries 75% capital is depend of small scale industries.
Economic development is defined in a number of ways; the commonest definition could be an increase in real per capita income of a person resulting in improvement in the levels of living.
Small scale industries are important because it helps in increasing employment and economic development of India. It improves the growth of the country by increasing urban and rural growth.
Role of Small Business in Economic Development
Let us learn more about the the role of small business in economic development is given below:-
Point 1: Employment :
SSI use labour intensive techniques and therefore provide employment on a large scale, SSI accounts for 75% of the total employment in the industrial sector.
SSI provides self-employment to artisans, technically qualified person and professionals.
Point 2: Optimization of capital :-
SSI requires less capital per unit of output and provides quick returns on investment due to shorter gestation period.
Small scale units help to molatise small and scattered savings and channelize them into industrial activities.
Point 3: Balanced Regional Development :-
SSI promotes decentralized development of industries. They help to remove regional disparities by industrializing rural and backward areas.
They also help to improve the standard of living in suburban and rural areas.
Point 4: Mobilization of Local Resources :-
SSI helps to mobilize and utilize local resources like small saving, entrepreneurial talent etc. which might otherwise remain idle and unutilized.
Point 5: Export promotion :-
SSI helps in reducing pressure on the country’s balance of payments in two ways.
First they do not require imports of sophisticated machinery or raw material.
Secondly, SSI can earn valuable foreign exchange through exports.
Point 6: Consumer surplus :-
SSI now reduces a wide range of mass conception items. About one-half of the output of manufacturing sector in India comes from small scale industries.
Point 7: Feeder to Large Scale industries:-
Small Scale enterprise plays a complementary role to large scale sector. They Provides parts, components, accessories etc. to large scale industries.
Point 8: Social Advantage :-
Small Scale sector contributes towards the development of a socialistic pattern of society by reducing concentration of income and wealth.
They provides an honorable and independent living to people with limited resources.
They facilities wide participation of public in the process of development.
Point 9: Share in industrial Production :-
SSI contributes more than one-half of the total industrial production in India.
Point 10: Development of Entrepreneurship :-
Small Scale units have helped to develop a class of entrepreneur. These units facilitate self-employment and spirit of self-reliance in the society.
At last words, If we want to Role of Small Business in Economic Development then Small scale Industries is backbone for a country and its plays important role for develop of any country.
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.
Therefore,the government is also implementing new policies to develop small businesses and Government has appoint government board whose ensure to develop small businesses.
We suggest to know that what are doing government support for small scale industries to complete read my previous article.
Note :- If you have anything to say about this article of Role of Small Business in Economic Development or you need of this article note, then you can comment or connect us.