Small Scale and Cottage Industries

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SMALL SCALE & COTTAGE INDUSTRIES (Their role, problems & prospects in India) (AN OVERVIEW)

Small scale industries
Definition
The definition of small scale industries have changed from time to time. Earlier they were classified under two categories: * Using power with less than 50 employees.
* Using no power, but strength of employees is more than 50, less than 100. However according to the latest definition a industry is said to be a small scale industry if * Its investment in fixed assets like plants and equipments either held on ownership terms or on lease or on hire purchase is less than Rs 10 million. * It is also essential that the unit is not controlled by any other industrial unit.

CLASSIFICATION —
Two categories:
1) TRADITIONAL SMALL SCALE INDUSTRIES:
* KHADI & HANDLOOM
* VILLAGE INDUSTRIES
* HANDICRAFT
* SERICULTURE

2) MODERN SMALL SCALE INDUSTRIES:
Produce goods include comparatively simple items to sophisticated products. * ELECTRICAL ITEMS
* HARDWARE
* SPORTS GOODS
* STATIONARY ITEMS
* CLOCKS, WATCHES
* AUTOMOBILE PARTS
* CHEMICAL PRODUCTS

KHADI INDUSTRIES
* Khadi industries have been instrumental in generating large scale employment, particularly in rural areas, with low capital investment and short gestation periods. * The total employment provided in the country in

khadi industry increased from 0.66 million in 1955 to 1.24 million in 1999-2000. * Nearly 40% of employment provided by this sector is to women and 32% to SCs and STs

VILLAGE INDUSTRIES
Village Industries is providing assistance by providing training to entrepreneurs for establishing Village Industries through: * Supply of improved tools and equipments, finance, workshed, raw materials * Marketing and organizing co-operative societies for groups. Village Industries are employment intensive and require little capital but earnings per worker are low and hence requires to be graded up so as to compete in the highly constrained market.

HANDICRAFTS INDUSTRIES
The Handicrafts sector is of special significance in the country's economy due to its contribution to * Employment generation
* Foreign exchange earning through exports
* Retaining heritage and tradition.

The following are some major crafts:
* Stone and stone carving
* Wood based and wood carving
* Metal based (Bronzes & Brass)
* Lace and embroidery

SERICULTURE INDUSTRIES
* Sericulture is a rural industry having high employment generation potential and provides substantial returns to the farmers with relatively low capital investment. * It is a labour intensive, agro-based industry providing employment to about 62.5 lakh persons in the country. * Sericulture generates employment for 5 persons throughout the year per acre of mulberry garden. * It provides employment to rural women in maintenance of garden, transporting of leaves, rearing of silk-worms, cocoon harvesting, cleaning of cocoons and reeling of silk in pest-cocoon sector.

Sericulture - SWOT Analysis
Strength
a) Strong domestic demand - pull.
b) Established infrastructure Technology
c) Strong Tradition.
d) Organised Co-operative weaving sector.
Weakness
a) Inconsistency in output quality.
b) Poor Technology Transfer.
c) Inadequate market linkages for silk sale.
d) Small and scattered production structure.
Opportunities
a) Generates Rural employment.
b) Developed countries are withdrawing from production of required silk slowly. c) Receding production in China.
Threats
a) Falling international prices influencing local price. b) Shift faster to finer fabrics.
c) Falling capabilities of States to invest substantially.

Modern small scale industries
In today's scenario, most of the...
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