SSI bill may be passed in winter session

The new law will allow small units to diversify

The comprehensive bill for the small scale industries is likely to be placed in the winter session of Parliament. "The draft of the bill is ready and it needs approval of the Cabinet before it is introduced in Parliament. I am hopeful of its passage in the winter session," Mahabir Prasad, Minister for Small Scale, Agriculture and Rural Industries, said at the CII global summit on small and medium enterprises.

The Small Enterprises Development Bill 2004 will remove the remaining barriers to the progress of the small scale sector by bringing in a user friendly environment, Anupam Dasgupta, secretary in the ministry of small scale industries, said.

The new law will allow small and medium enterprises to diversify from the conventional product range, encourage exports and global integration and propel them towards the projected 12 per cent growth target, he added.

Dasgupta said the government was encouraging FDI in small scale sector.

"FDI in SSI units up to 24 per cent, with no restrictions on the equity owned by non-resident Indians, is being actively encouraged," he said.

Dasgupta said under the World Trade Organisation, new opportunities were being created for linkages among SMEs across the globe. "Sectors like biotech, IT, footwear and IT enabled services have shown great potential," he said.

The future will see increased services exports from this (small scale) sector," Dasgupta said. The SSI sector had been growing at the rate of 7 to 10 per cent in the past decade and could easily achieve the decadal growth rate of 12 per cent, he said.

Meanwhile, Sunil Kant Munjal, president of CII, said that the SMEs were unable to harness opportunities created by globalisation for lack of proper institutional framework. He urged the government to work closely with the development institutions to further improve the functioning of small and medium enterprises.