You are on page 1of 6

Impact factor 1.

472
International Journal for Science and Emerging
Technologies with Latest Trends 21(1): 1- 6(2015)

ISSN No. (Online):2250-3641


ISSN No. (Print): 2277-8136

Growth of Small Scale Industries in Punjab


Balvinder Singh* and Dr. Shashi Shekhar**
*Ph. D Scholar, **Guide, Department of Management Studies,
Punjab Technical University, Kapurthala Road,
Jalandhar City
(Received 29 March 2015 Accepted 4 April 2015)
Abstract- Punjab is the developing state , small scale industries plays an important role .Small Scale
Industries are labour oriented industry and require less capital investment Punjab is labour surplus state and
faces shortage of capital and here is shortage of natural resources like Iron, coal and minerals. These
resources are far away from the state and attract the high transport cost., whereas small scale industry uses
local raw material or it is labour oriented industry . In the recent past years small scale industry has made the
very good progress ion the state but still they face number of problems which are high lighted at the end of
report these problems are high transportation cost , high labour cost, shortage of powers, high rate of state
taxes ,lack of central assistance This industry uses the obsolete technology. recommendation is given to over
come these problems.
Keywords: Development, Industries, Government, Small Scale Industries, Department

INTRODUCTION
Small scale Industrial unit or an
Industrial under taking in which the
investment in assets in plant and
machinery whether held in ownership term
or on lease or by hire purchase does not
exceed one crore as on 31.03.2001 is to be
treated as small scale Industrial unit

Country wise terminology and scope


is given as under

Small scale industry is the industry where


the total capital employed is less than one
crore. Punjab consists of 22 districts.
Small scale industry can further be sub
divided into manufacturing industry Agro
based industry. The definition of small
scale industries varies across countries ,
agencies and authors .The terminology
small scale industries is used by different
nomenclature
such as small scale
industries , small business, small firms
.Atkin and lowe (1997) noted that as
many as 40 definition of small scale have
reported in literature. What is small scale
industry Meaning of small scale industry is
different for different governments as per
Indian government small scale industry is
the industry in which total capital
employed is less than one crore
Small scale as the name implies consists of
small Scale industries It can be further sub
divided in to three categories
1. Cottage Industry
2. Agro Based Industry
3. Small Industries

2.

Impact factor 1.472

Balvinder Singh* and Dr. Shashi Shekhar**

Investment Limit in Small Scale Industries

Kalchetty Erosi (1989) Observed In


a labour abundant capital scare country
like India , Small scale industry has come
to occupy a significant position in the
planned industrialization of economy.
They have great social and economic
significance .They are relatively labour
intensive and often generate more indirect
jobs per unit of capital invested than large
scale

M A Hasnat (1991) The small scale


industries sector occupy a place of
importance in economy of all labour
surplus as they provide employment for a
substantial work force , small industries
derive part of their potential value from the
employment of trained and educational
person
Small Scale industries require more of the
labour less amount of capital and Punjab
also has shortage of capital There is
surplus of labour and hence Punjab can be
benefited from the small scale industry.

OBJECT OF STUDY
Object of the study is to analyze the
progress made by the industry. High light
the problems faced by the industry.
Suggest the way to overcome these
problems. Punjab is NRI belt majority of
people lives in Europe and American
continent they have established very good
industries overseas if we involve them in
our industry it could be very helpful to the
industry of Punjab. Object of the study is
to examine the problems faced by the
small industries find out the problem
faced by the export house . What are the
incentives and benefits received by the
small scale industries. Taxation problem of
small scale industries

LITERATURE REVIEW
Literature review is the review of
literature of already work done in the field.
It should be started from the latest one to
back say up to fifty years.

Chandra BL (1994) The banks with


their low cost financing would be ideal for
lending to the agriculture sector the small
industries small business and the self
employed .This would help relive the rural
poor from the clutches of the informal and
unorganized lending agencies .

Narendra Prasad (1988) Surplus


agriculture labour can be utilized by small
industries and problem of India can be
solved when it uses the local raw material
and process them in to finish goods Japan
has net work of small industries on a
labour intensive and light machinery

Veena

Bhatnagar

(1995)

The

Strongest argument that could be raised in


developing countries in the favour of small
scale enterprises is their employment
generation potential

Research methodology:
Research simply the search for the facts,
answers to question and solution to
problem it is persuasive investigation. It is
an organized inquiry in other words.

RESERCH METHODOLOGY

3.

Balvinder Singh* and Dr. Shashi Shekhar**

Impact factor 1.472

THE DESIGN
Research simply means the search for the
facts, answers to questions and solutions to
problems, it is a persuasive investigation.
It is an organized enquiry in the other
words. Research means search for
knowledge and research methodology is a
way to systematically solve these
problems.

RESEARCH DESIGN
A research design is the arrangement of
conditions for collection and analysis of
data in a manner that aims to combine
relevance to the research purpose with
economy in procedure .This facilitate the
smooth sailing of our research , it makes
our research as yielding as maximum
information with minimum expenditure of
time money and efforts

TYPE OF RESEARCH
The project will be conducted by means of
descriptive research in which main data is
taken from the internet and other journals
or books and from Industry department .
I.e. mainly secondary data will be used

METHOD
COLLECTION

OF

DATA

Generally there are two methods of data


collection.

PRIMARY DATA
Primary data is
company

collected from

the

SECONDARY DATA
I. These types of data are available in
published media, Internet and other
type of media,.
II. For this project secondary data
will be used will take help from
text books of financial services and
journals etc. For this project the

main data will be taken from the


internet ,
III. Google Search, , Wikipedia .org.,
punjab.gov.in.

SECONDARY SOURCES ARE:


1. Text Books
2. Journal like business world, market
research journal, research journal
3. Internet site
4. Newspaper Article
5. Industries Department of Punjab

1. DATA ANALYSIS
Use of various statistical techniques to
empirically prove the results and to
validate the findings. Techniques used for
the data interpretation are Ratio Analysis
.Tools of Analysis which will be used

1. Mean Mean is the mathematical


average of s set of numbers. Average is
calculated by adding up two or more score
and dividing by the total by the number of
score. Mean facilitate quick understanding
of general and complex mass of data in to
single typical feature. The task of
comparison become easy and conclusion
can be drawn easily.
2. Ratio Analysis
What is Ratio Analysis A ratio is defined
as the indicated quotient of two
mathematically
expression
and
as
relationship between two or more thing .A
ratio is used to benchmark for evaluating
the financial position the absolute
accounting figure reported in the financial
statements do not provide a meaningful
under standing of the performance and
financial position of the firm . A
information alone do not give meaningful
reply . If we see profit of 5 crore in the
books of account we can not say this good
or bad unless we relate it to the other
figure .Net profit of 5 crore earned out
what investment how much we have
invested in the firm out of which we have
earned this profit of this 5 crore only then
we can say it is good or bad The

4.

Balvinder Singh* and Dr. Shashi Shekhar**

Impact factor 1.472

relationship between two mathematical


figure is known as financial ratio or simply
as ratio.
Ratio convert the vast data in to easily
understandable form as in the case of
current ratio is current assets divided with
the current liabilities , current assets are
cash , bank, marketable securities , work in
progress and raw material finished stock
and current liabilities are sundry creditors
bill payables and other exp payable when
we divide the current assets with the
current liabilities it give us current ratio By
looking at the current ratio we can know
what is the amount of current assets as
compare to the current liabilities . Ratio
analysis help us to under stand the
liquidity of the firm

Table district wise distribution


and types of industries in Punjab

District wise status of small


scale units as on 31.3.2009

5.

Balvinder Singh* and Dr. Shashi Shekhar**

Impact factor 1.472

4. Unskilled Labour : Labour in the


small scale industry is unskilled that is
why their productivity is very poor.

5. Power problem : Here in Punjab


industry faces the power problem
during the summer season industry
experience power cut of six to seven
hours in a day . During these days
industries have to pay to the labour
even when they have produced nothing
due to the power cut.

6. Taxation Problem Taxes in the

Problems Faced by the small Scale


Industries:1. High Cost of Production : Cost of
production in Punjab is very High in
the case of steel products in put is
brought from the other states which
have high transportation charges.

2. Poor

Quality

of

Products:

Quality of the products is very poor i9t


can not compete with the international
standard . These industries can not
compete with the Japanes, or America
firms.

3. Obsolete Technology: Industry in


the Punjab is using the very old and
obsolete
technology.
Punjabs
technology is very old where as china
and Japan uses the very latest
technology and they produce the latest
and cheap product ( cost wise )

Punjab are very high as compare to the


neighbor state due to the high taxes
industry of Punjab cannot compete
with neighbor state industry. As
himachal government gives incentives
to the industry in their state .many
units have shifted to the Himachal
Pardesh . Industry is also facing the
problem of Vat refund .Refund is not
granted for the longer period. Money
of the Industrialist remain blocked with
the state sales tax Department without
any fault of the Industry which
increase the cost of production.

7. Sickness of units Sick Industrial


Unit is defined as unit or company
(having been in existence for not less
than five years) which is found at the
end of any financial year incurred
accumulated losses equal to or
exceeding its entire net worth. Net
worth of the firm sum equal to paid up
capital plus free reserves less
provisions and expenses as may be
prescribed sick or weak unit . If at the
end of any financial year it has
accumulated losses equal to or
exceeding to 50 percent of its average
net worth in the immediately
proceeding four financial years and has
failed to pay creditors in three

6.

Balvinder Singh* and Dr. Shashi Shekhar**

constructive quarters when demand


made in writing for such repayment.
Despite the all above problems these
industry provide employment to large no
of workers as compare to the capital
employed . Small scale industry has made
its contribution to provide the employment
to large number of population. Small Scale
Industries have invented the new products
.Growth of state is not possible without the
growth of small scale industry.

CONCLUSION
This report tells us that Punjab has made
remarkable progress in
small scale
industries in the last recent years , But this
industry is also facing the problems of old
technology power shortage,
taxation
problem hug of money remain blocked in
the vat refund . This money can be best
utilized if returned in time. Secondly
research and innovation is not good in the
Punjab . If the research and innovation is
encouraged it will help the industry.
Government should improve the power
supply and make some new industrial Hub
and export should be encouraged.

BIBLIOGRAPHY:BOOKS
1. Chandra BL Changing phase of
Indian
banking
since
1969Emerging Scenario Pigmy
Economic weekly 31(21)15, 1996
2. Kalchetty Erosi Management of
Finance in small scale Industries
Vohra publishers and Distributors
1989 p39-40

Impact factor 1.472

3. Kothari
C.
R.
Research
Methodology
, New Age
Publications new Delhi
4. M A Hasnat Role of nationalized
bank in development of small scale
industries new Delhi Classical
Publication Company 1991 p 1
5. Panday
I.M.
Financial
Management Vikas Publiscation
2010
6. Singhania
V.K
.
Taxman
Publication
7. NarendraPrashad The state bank
of India and rural development
(Delhi Amar Parkashan /1988) p130
8. Veena Bhatnagar SSI Concept
states small scale enterprised and
policy (Delhi , Kaveri books 1995)
p 20

WEBSITES
1. www : en. Wikipedia.org
2. www: scribe.com
3. www:shodhganga.inflibent.centre/
Evolution of small scale Industries in
India.
4. www.shodhgangotri.inflibent.centrew
ww:business.gov.in/
small
scale
industries
in
indiawww:oxforddcholarship.com/sma
ll scale industries.
5. www:unido.org/ General review study
of small & medium scale industry
WWWddegjust.ac.in:/
JOURNALS
Prooblem and Prospectus of small scale
industries / Indianresearchjournal.com /2012
octSmall scale enterprpenusrship in india /

Serbian journal of management 3(2)


(2008)171-187

You might also like