New Delhi, June 15: A snap poll conducted by the Confederation of Indian Industry (CII) suggests that small and medium term enterprises (SME) may have to shut shop if they do not “reposition” themselves to stay afloat.
The measures suggested for repositioning SMEs are simplification of labour laws, legislative support, including enactment of the Small Enterprises Development Act, Limited Liability Partnership Act and legislation allowing factoring of debts as well as regulatory changes like allowing foreign investments in SMEs, VAT implementation and changes in the indirect tax structure.
Some respondents also mentioned transition of small scale units to small and medium scale, better awareness of the impact of the World Trade Organisation norms and the use of ICT, respectively, as contributors to the process of repositioning SMEs.
The poll says that in 2005 SMEs will complete their restructuring by either closing or scaling down their operations or else being acquired by large companies. The respondents felt SMEs will eventually launch themselves as “vendors to the global industry evolving into a world class entity” in international markets by 2015.