Presentation by
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Presentation Plan
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A. Macro Economic Situation in India
Economy has entered an era of distinct buoyancy
GDP growth rate – 7.2% in current fiscal year 6.7% (2008-09)
Major drivers : inflation , purchase power, easier availability of credit &
market potential
Bank credit for the fortnight ended 15th January 2010, grew by
13.8% on a YOY basis as against 22% in the corresponding period
of the previous year. After swelling to a nine©\month high in the
previous fortnight, the outstanding credit of schedule commercial
banks decreased by Rs 11,898 crore in fortnight under review. On
a YTD basis, credit growth continued to remain sluggish at 8.4%
in the current fortnight as compared to 12% in the corresponding
period of the previous year. Consequently, as on the last fortnight
ended on 2 January 2010, bank credit increased by 79,514 crores,
however, in the current fortnight banks witnessed a reversal
resulting into a decline in outstanding credit.
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B. Indian SME Sector – A Profile
• Small and Medium Enterprises play a vital role for the
growth of Indian economy by contributing 45% of
industrial output, 40% of exports, 42 million
employments, create one million jobs every year and
produce more than 8000 quality products for the Indian
and international markets. As a result, MSMEs are today
exposed to greater opportunities for expansion and
diversification across the sectors. Indian market is
growing rapidly and Indian industry is making remarkable
progress in various Industries like Manufacturing,
Precision Engineering, Food Processing, Pharmaceutical,
Textile & Garments, Retail, IT (Information Technology),
Agro and Service sectors.
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C. Institutional Support Structure
MSME Development Act, 2006
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C. Institutional Support Structure
Central Bank : Reserve Bank of India
Separate Ministry at Central Govt. – Ministry of SSI
Office of DC(SSI) at the Centre : Small Industries
Development Organisation- SIDO
Small Industries Service Institutes (SISIs) for
technical/skill development
R&D institutions for technical help
Financial Institutions and banks for financing at national
and regional levels
Various support institutions for entrepreneurship
development, technical & marketing services and Govt.
approvals
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D. Key Challenges for SMEs
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E. Enhancing Competitiveness of SMEs
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F. SMEs Access to Finance
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F. SMEs Access to Finance
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F. SMEs Access to Finance
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F. SMEs Access to Finance
Receivable Financing
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F. SMEs Access to Finance
E-Banking
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G. SIDBI’s Role in Transformation of SMEs
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G. SIDBI’s Role in Transformation of SMEs
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G. SIDBI’s Role in Transformation of SMEs
Bouquet of Products
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G. CASECSTUDY
SIDBI’s role in Transformation of SMEs
Refinance/Rediscounting
Resource support to banks and other lending institutions to
refinance their loans to SMEs
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G. SIDBI’s role in Transformation of SMEs
Direct Assistance
Term Lending / Bills Discounting
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G. SIDBI’s role in Transformation of SMEs
Promotional & Developmental Initiatives
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G. SIDBI’s Role in Transformation of SMEs
Micro Credit
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G. SIDBI’s Role in Transformation of SMEs
Venture Finance
Encouraging first generation and other high risk projects through venture
financing route by way of equity participation
To provide impetus to fledgling Information Technology (IT) sector in India
set up a separate outfit called SIDBI Venture Capital Ltd (SVCL) in 1999 to
support the small IT ventures
Initially set up a National Fund for software & Information Technology with
support from Govt. of India and IDBI - a all India Financial Institution sister
Expanded the reach to the IT projects through regional level funds
An International Fund set up in collaboration with Small Enterprises
Assistance Fund, USA
Support extended setting up Innovation and Incubation Centres to promote
entrepreneurship in association with Institutions of Technical Excellence
For encouraging small grass root innovations, Micro Ventures Innovation
Fund was set up
Launched National SME Growth Fund with for promoting industries in
biotechnology, food processing, pharmaceuticals and other Knowledge
based industries
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G. SIDBI’s role in transformation of SMEs
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G. SIDBI’s role in transformation of SMEs
Technological Services
To provide various technology related support services, in collaboration with
UN-Asia Pacific Centre for Transfer of Technology, SIDBI set up
Technology Bureau for Small Enterprises (TBSE) in 1995
TBSE had aimed at becoming a one stop solution provider for all technology
related problems of SMEs in India.
Range of services offered on nominal charges included :
Technology Information
Match Making
Finance Syndication
Business Collaboration
Support Services
To give more flexibility in operations, TBSE has since been converted into
India SME Technology Services Ltd in 2005
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G. SIDBI’s Role in Transformation of SMEs
Credit Rating for SMEs
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G. SIDBI’s Role in Transformation of SMEs
Nodal Agency for Govt. Sponsored Programmes
Technology Upgradation
Credit Linked Capital Subsidy Scheme
Technology Upgradation Fund Scheme for Textiles and Jute Industry
Equity-linked
National Equity Fund Scheme
Micro Credit
Portfolio Risk Fund
Infrastructure
Integrated Infrastructure Development Scheme
Credit Guarantee Fund
Credit Guarantee Scheme
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H. OUTLOOK FOR SMEs
SMEs continue to be the thrust area for Government policies
The growing economy and the tremendous market potential of the
country augurs well for the sustained growth of SMEs in the country
Panacea for employment and decentralised industrial development
Latest policy package for SMEs envisages 20% annual growth in
credit to SME sector from FY 2005, to be doubled by 2010
With the enactment of MSME Act, the sector is all set to emerge as
the most significant player in national economy
SIDBI as the apex institution will continue to play its key role in
facilitating timely and adequate credit besides meeting the
developmental needs of the sector
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“wanting to be someone else is a waste of the
person you are”
: KURT COBAIN (1967 - 1994)
THANK YOU
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