performance of cott age and small scale industries...

4.1 Introduction

The specific role of SSI was recognised in the Industrial Policy Statement of

1948, which stated that cottage and small scale industries are particularly suited for

better utilisation of local resources and achievement of local self-sufficiency in certain

essential goods [Hussain,1997, P.25].

The cottage industries are essential for uplifting the weaker sections of the

community and creating self-employment for educated unemployed, self-sufficiency,

maximum utilisation of local resources and economic development of the nation.

The small scale and cottage industries are assisted by agencies such as the

Directorate of Industries, Small Scale Industries Development Organisation, National

Small Industries Corporation, State Small Scale Industries Boards, State Bank of India

and its subsidiaries, State Financial Corporations, State Small Industries Development

Corporations, Kerala Khadi and Village Industries Board, Coir Board, Coir Corporation,

Directorate of Handloom, Development Commissioner Handloom, Handloom

Development Corporation, HANTEX, Directorate of Handicrafts and Development

Commissioner Handicrafts.

With the introduction of economic reforms since 1991, the cottage and small

CHAPTER 4

PERFORMANCE OF COTTAGE ANDSMALL SCALE INDUSTRIES IN KERALA

Chapter - 4. Performance of Cottage and Small Scale Industries in Kerala94�

scale industries have a number of challenges as well as chances.

The emerging challenges to the small-scale sector come from the impact

of the agreements under WTO to which India is a signatory along with 134 member

countries. The main outcomes of WTO-stipulated requirements will be brought

about through reduction in export subsidies, greater market access, removal of

non-tariff barriers and reduction in tariffs [http://www.banknetindia.com/banking/

ssi3.htm].

The SSI sector in India covers a wide spectrum of industries categorised under

small, tiny and cottage segments ranging from small artisans and handicraft units to

modern production units with significant investments [Soundarapandian, 2006].

There is no separate data on the label of cottage industries. But small scale

industries include cottage, tiny or micro enterprises. This chapter deals with SSI in Kerala

covering the number of registered units, investment, production, employment, export,

memorandum filed under MSMED, budgeted and actual figures of SSI in Kerala,

performance of KSIDCO and SIDBI, production, sales, sales outlets, employees under

KK&VIB and also budgeted and actual figures of KK&VIB. It also covers coir export,

Kerala Coir Workers Welfare Fund Board, coir co-operative societies in Kerala and

budgeted and actual figures of coir industry in Kerala. The number of looms, production

of handloom, productivity of handloom, number of weavers, export of handloom,

handloom co-operative societies, performance of HANTEX and HANVEEV and budgeted

and actual figures of handloom industry in Kerala. The export of handicraft, performance

of the Handicrafts Development Corporation [Kerala] Ltd., the Kerala State Bamboo

Corporation Ltd., the Kerala Artisans Development Corporation Ltd., SURABHI and

budgeted and actual figures of handicraft industry in Kerala, GDP, GSDP and NSDP etc.

4.2 Small Scale Industries

The small scale sector covers both traditional and non-traditional industries. The

Directorate of Industries and Commerce keeps the record of registered SSI units in

Kerala. But there are number of unregistered firms functioning in Kerala. Registered

firms get advantages from the concerned agencies and directorates.

Chapter - 4. Performance of Cottage and Small Scale Industries in Kerala 95�

The organisation charged with the responsibility of promoting small

industries at the State level is the Directorate of Industries and Commerce, Kerala.

Every State has its own directorate. The activities of the directorate include:

promotional efforts for small industry development, financial assistance to small

units, establishment of industrial estates, provision of infrastructure facilities for

small industries and the development of industrial co-operatives [Bhattacharya,

1986, P.22.].

4.2.1 Small Scale Industrial Units

In Kerala there were 2,88,869 units registered in the year 2007-08 [Economic

Review, 2009]. The small scale industries have nearly 40% share in the total industrial

output and 35% share in export [http://www.tradechakra.com/indian-economy/small-scale/

index.html].

Table 4.1 shows the registered SSI units in India during the pre-liberalisation

period.

Table 4.1

SSI Units Registered in India During

the Pre-liberalisation Period

1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

8.1

8.7

9.6

10.6

11.6

12.4

13.5

14.6

15.8

17.1

18.2

-

7.4

10.3

10.4

9.4

6.9

8.9

8.2

8.2

8.2

6.4

Year Units [in Lakh] Growth [%]

Source: Government of India, Economic Survey, New Delhi:Ministry of Finance, from 1981 to 1991.


Note: Calculation of Compound Annual Growth Rate

r = antiln ln Yt - ln Yo

t- 1

Where, r is the average annual growth

ln is the natural logarithm

antiln is the anti-logarithm

Yt is the final value of the variable

Yo is the initial value and

t is the number of periods over which the variable

has grown.

Table 4.1 shows that in the year 1979-80 there were 8.10 lakh SSI units registered

in India and in 1989-90 it was increased to 18.2 lakh with an average annual growth of

8.43 percent. The growth rate was highest in the year 1982-83 and lowest in 1989-90.

Table 4.2 shows the registered SSI units in India during the post-liberalisation

period.

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

67.9

70.6

73.5

76.5

79.6

82.8

86.2

89.7

93.4

97.2

101.1

105.2

109.5

114.0

118.6

123.4

128.4

-

3.98

4.11

4.08

4.05

4.02

4.11

4.06

4.12

4.07

4.01

4.05

4.09

4.11

4.03

4.06

4.07

Growth [%]Units [in Lakh]Year

Source: Government of India, Economic Survey, New Delhi:Ministry of Finance, from 1992 to 2008.

[C.V. = 13.17, T.V. = 2.06, D.F. = 24, S.L. = 5%,P.V .= 0.0001]

Table 4.2


the Post-liberalisation Period


Figure 4.1 shows that there is a fast growth in the registered SSI units in India

during the pre-liberalisation period but there is only a slow growth during the post-

liberalisation period.

Table 4.3 shows the registered SSI units in Kerala during the pre-liberalisation

period.

02468

101214161820

19

79

-80

19

80

-81

19

81

-82

19

82

-83

19

83

-84

19

84

-85

19

85

-86

19

86

-87

19

87

-88

19

88

-89

19

89

-90

0

20

40

60

80

100

120

140

19

90

-91

19

92

-93

19

94

-95

19

96

-97

19

98

-99

20

00

-01

20

02

-03

20

04

-05

20

06

-07

Figure 4.1


the Pre and Post-liberalisation Period

Pre-liberalisation Period Post-liberalisation Period

Year Year

Un

its in

La

kh

Un

its in

La

kh

Source: Government of India, Economic Survey, New Delhi: Ministry of Finance, from 1981 to 2008.

Table 4.2 shows that in the year 1990-91 there were 67.9 lakh units registered in

India and in 2006-07 it was increased to 128.44 lakh with an average annual growth of


As compared to the pre-liberalisation period there is a decrease in the average annual

growth of SSI units in India from 8.43 percent to 4.06 percent. The ‘t’ test confirms the

decline.

Figure 4.1 shows the registered SSI units in India during the pre and post-



15974

18954

21977

24884

28117

31499

35365

40342

47191

55427

65251

-

18.7

15.9

13.2

12.9

12.0

12.3

14.1

16.9

17.5

1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90Source: Government of Kerala, Economic Review,Thiruvananthapuram: Kerala State Planning Board, from 1981to1991.

Table 4.3

SSI Units Registered in Kerala During

the Pre-liberalisation Period

Units [No.] Growth [%]Year

Table 4.3 shows that in the year 1979-80 there were 15,974 units registered in

Kerala and in 1989-90 it was increased to 65,251 with an average annual growth of


Table 4.4 shows the SSI units registered in Kerala during the post-liberalisation

period.Table 4.4

SSI Units Registered in Kerala

During the Post-liberalisation Period

73522

84440

95851

110384

126220

143123

160544

180091

199827

219833

239906

258010

270344

275649

280584

288869

Growth [%]Units [No.]

-

14.85

13.52

15.17

14.35

13.39

12.18

12.18

10.96

10.01

9.13

7.54

4.78

1.96

1.79

2.95Source: Government of Kerala, Economic Review,

Thiruvananthapuram: Kerala State Planning Board, from

1992 to 2009.[C.V. =3.32, T.V. = 2.06, D.F. = 23, S.L. = 5%,

P.V. = 0.0030]

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2007-08

Year


Figure 4.2

SSI Units Registered in Kerala During


0

10000

20000

30000

40000

50000

60000

70000

1979-8

0

1980-8

1

1981-8

2

1982-8

3

1983-8

4

1984-8

5

1985-8

6

1986-8

7

1987-8

8

1988-8

9

1989-9

0

0

50000

100000

150000

200000

250000

300000

350000

1990-9

1

1992-9

3

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5


Year Year

Units

Units

Figure 4.2 shows that there is a fast growth of SSI units in Kerala during the pre-

liberalisation period but there is a slow growth during the post-liberalisation period.

Table 4.5 shows the SSI sick units in Kerala during the pre-liberalisation period.

Table 4.5

SSI Sick Units in KeralaDuring the Pre-liberalisation Period

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

3525

6500

1755

1805

1874

2117

7444

-

84.40

-73.00

2.85

3.82

12.97

251.63

Year Units [No.] Growth [%]

Source: Government of Kerala, Economic Review, Thiruvananthapuram: Kerala State Planning Board, from 1981 to

2009.

Table 4.4 shows that in the year 1990-91 there were 73,522 units registered in

Kerala and in 2007-08 it was increased to 2,88,869 with an average annual growth of

8.38 percent. As compared to the pre-liberalisation period there is a decrease in the

average annual growth of SSI units in Kerala from 15.11 percent to 8.38 percent. The ‘t’

test confirms the decline.

Figure 4.2 shows the SSI units registered in Kerala during the pre and post-


Source: Government of Kerala, Economic Review,


1984 to 1990.


Table 4.6

SSI Sick Units in Kerala


Growth [%]Units [No.]Year

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2588

2705

2768

3341

3478

3816

4492

5065

5526

5941

6477

6835

7064

7586

7737

-

4.52

2.33

20.70

4.10

9.72

17.71

12.76

9.10

7.51

9.02

5.53

3.35

7.39

1.99Source: Government of Kerala, Economic Review,


1992 to 2009.[C.V. =1.35, T.V. = 2.10, D.F. = 18, S.L. = 5%,

P.V. = 0.1953]

Table 4.6 shows that in the year 1993-94 there were 2,588 sick units in Kerala

and in 2007-08 it was increased to 7,737 with an average annual growth of 8.14 percent.

The growth rate was highest in the year 1996-97 and lowest in 2007-08. As compared to

the pre-liberalisation period there is a decrease in the average annual growth of SSI sick

units in Kerala from 13.3 percent to 8.14 percent. The ‘t’ test rejects the period-wise

difference.

Figure 4.3 shows the SSI sick units in Kerala during the pre and post-liberalisation

period.

Table 4.5 shows that in the year 1982-83 there were 3,525 sick units in Kerala

and in 1988-89 it was increased to 7,444 with an average annual growth of 13.3 percent.

The growth rate was highest in the year 1988-89 and lowest in 1984-85.

Table 4.6 shows the SSI sick units in Kerala during the post-liberalisation period.


0

1000

2000

3000

4000

5000

6000

7000

8000

9000

19

93

-94

19

94

-95

19

95

-96

19

96

-97

19

97

-98

19

98

-99

19

99

-00

20

00

-01

20

01

-02

20

02

-03

20

03

-04

20

04

-05

20

05

-06

20

06

-07

20

07

-08

Figure 4.3

SSI Sick Units in Kerala

During the Pre and Post-liberalisation Period

0

1000

2000

3000

4000

5000

6000

7000

8000

1982-8

3

1983-8

4

1984-8

5

1985-8

6

1986-8

7

1987-8

8

1988-8

9

Units

Units

Post-liberalisation PeriodPre-liberalisation Period

Year Year

Source: Government of Kerala, Economic Review, Thiruvananthapuram: Kerala State Planning Board, from 1984 to

2009.

Figure 4.3 shows that there is a fast growth of SSI sick units in Kerala at the

initial and final stage during the pre-liberalisation period but there is a steady growth

during the post-liberalisation period.

4.2.2 SSI Investment

The SSI sector investment may be in the form of workshed, tools, equipments,

finished stock and raw material.

Table 4.7 shows the SSI investment in Kerala during the pre-liberalisation period.

Year

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

Amount

44048.18

46902.15

49827.23

53162.54

58202.44

65117.00

65958.13

76996.13

-

6.48

6.24

6.69

9.48

11.88

1.29

16.73

Source:Govt.of Kerala, Economic Review, Thiruvananthapuram:Kerala State Planning Board, from 1984 to 1991.

[Rs. in Lakh]

Table 4.7

SSI Investment in Kerala

During the Pre-liberalisation Period

Growth [%]


Table 4.7 shows that in the year 1982-83 there was an investment of Rs.44,048.18

lakh and it was increased to Rs.76,996.13 lakh in 1989-90 with an average annual

growth of 8.31 percent. The growth rate was highest in the year 1989-90 and lowest in

1988-89.

Table 4.8 shows the SSI investment in Kerala during the post-liberalisation period.

Year

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

Amount

73279.98

86386.28

100888.51

117516.26

136734.03

159187.86

192269.07

235133.66

265343.62

305096.73

494328.00

372643.38

391118.53

397139.72

423003.59

591439.65

600254.65

452988.13

-

17.89

16.79

16.49

16.36

16.43

20.79

22.30

12.85

14.98

62.02

-24.62

4.96

1.54

6.51

39.82

1.49

-24.53

[Rs. in Lakh]

Table 4.8



Growth [%]

Source: Govt. of Kerala, Economic Review, Thiruvananthapuram:Kerala State Planning Board, from 1990 to 2009.

[C.V. = 0.59, T.V. = 2.07, D.F. = 22, S.L. = 5%, P.V .= 0.55]

Table 4.8 shows that in the year 1990-91 there was an investment of Rs.73,279.98

lakh and it was increased to Rs.4,52,988.13 lakh in 2007-08 with an average annual

growth of 11.31 percent. The growth rate was highest in the year 2000-01 and lowest in

2001-02. As compared to the pre-liberalisation period there is an increase in the average

annual growth of SSI investment from 8.31 percent to 11.31 percent. The ‘t’ test rejects

the period-wise difference.

Figure 4.4 shows the SSI investment during the pre and post-liberalisation period.


Figure 4.4 shows that there is a slow growth of investment during the pre-

liberalisation period but there is no steady growth during the post-liberalisation period.

4.2.3 Production of SSI Units

The SSI sector produces more than 7500 products with a wide range of qualities

or specifications catering to different market segments, particularly in consumer or

household products [http://dcmsme.gov.in/ssiindia/spgxx01x.htm].

Table 4.9 shows the value of SSI production in India during the pre-liberalisation

period.

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

19

82

-83

19

83

-84

19

84

-85

19

85

-86

19

86

-87

19

87

-88

19

88

-89

19

89

-90

Figure 4.4




Year

Rs.in L

akh

Source: Government of Kerala, Economic Review, Thiruvananthapuram: Kerala State Planning Board, from 1984 to2009.

0

100000

200000

300000

400000

500000

600000

700000

1990-9

1

1992-9

3

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Rs.in L

akh

Year

Table 4.9

SSI Production in India

During the Pre-liberalistion Period

Year1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

21600

28100

32600

35000

41600

50500

61200

72300

87300

106400

132300

-

30.09

16.01

7.36

18.86

21.39

21.19

18.14

20.75

21.88

24.35

Production[Rs. in Crore]

Source: Government of India, Economic Survey, New Delhi: Ministryof Finance, from 1981 to 1991.

Growth [%]


Table 4.10


During the Post-liberalistion Period

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

78802

80615

84413

98796

122154

147712

167805

187217

210454

233760

261297

282270

311993

357733

418263

471244

471663

-

2.30

4.71

17.04

23.64

20.92

13.60

11.57

12.41

11.07

11.78

8.03

10.53

14.66

16.92

12.67

0.09Source: Government of India, Economic Survey, New Delhi: Ministry ofFinance, from 1992 to 2008.

[C.V. = 3.26, T.V. = 2.06, D.F. = 24, S.L. = 5%, P.V .= 0.0033]

Production Growth [%]

[Rs. in Crore]

Year

Table 4.10 shows that in the year 1990-91 the value of production of SSI in India

was Rs.78,802 crore and it was increased to Rs.4,71,663 crore in 2006-07 with an

average annual growth of 11.83 percent. The growth rate was highest in the year 1994-

95 and lowest in 2006-07. As compared to the pre-liberalisation period there is a decrease

in the average annual growth of SSI production from 19.87 percent to 11.83 percent.

The ‘t’ test confirms the decrease.

Table 4.9 shows that in the year 1979-80 the value of production of SSI in India

was Rs.21,600 crore and it was increased to Rs.1,32,300 crore in 1989-90 with an


81 and lowest in 1982-83.

Table 4.10 shows the value of SSI production in India during the post-liberalisation

period.


0

20000

40000

60000

80000

100000

120000

140000

1979-8

0

1980-8

1

1981-8

2

1982-8

3

1983-8

4

1984-8

5

1985-8

6

1986-8

7

1987-8

8

1988-8

9

1989-9

0

0

50000

100000150000

200000250000300000

350000

400000

450000500000

1990-9

1

1992-9

3

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Figure 4.5


During the Pre and Post-liberalistion Period

Rs.in

Cro

re

Year


Figure 4.5 shows that there is a slow growth at the initial stage and a fast growth

of SSI production at the end of the pre-liberalisation period. At the middle of the post-

liberalisation period, there was a fast growth and at the end, it is almost stationary.

Table 4.11 shows the production of SSI in Kerala during the pre-liberalistion

period.

Rs.in

Cro

re

Year

Figure 4.5 shows the SSI production in India during the pre and post-liberalisation

period.


Table 4.11

SSI Production in Kerala

During the Pre-liberalistion Period

Year Production Growth [%]

[Rs. in Lakh]

1985-86

1986-87

1988-89

15850

20268

172377

-

27.87

750.49

Source: Government of Kerala, Economic Review, Thiruvananthapuram:Kerala State Planning Board, from 1987 to 1990.

Table 4.11 shows that in 1985-86 the value of SSI production in Kerala was only

Rs.15,850 lakh and it was increased to Rs.1,72,377 lakh in 1988-89 with an average

annual growth of 121.56 percent.


Table 4.12

SSI Production in Kerala

During the Post-liberalistion Period

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

236543.53

258418.79

302037.60

360794.14

380776.88

508868.37

633011.19

832570.66

860442.76

977065.49

645676.00

1221437.62

1408372.69

1455043.54

1571409.57

1218028.30

1257899.30

1712048.57

-

9.25

16.88

19.45

5.54

33.64

24.39

31.52

3.35

13.55

-33.92

89.17

15.30

3.31

7.99

-22.49

3.27

36.10

Production Growth [%]Year


[C.V. = 3.96, T.V. = 2.11, D.F. = 17, S.L. = 5%, P.V .= 0.0010]

Table 4.12 shows the production of SSI in Kerala during the post-liberalistion

period.

[Rs. in Lakh]

Table 4.12 shows that in 1990-91 the value of SSI production in Kerala was only

Rs.2,36,543.53 lakh and it was increased to Rs.17,12,048.57 lakh in 2007-08 with an


02 and lowest in 2000-01. The ‘t’ test confirms the decrease.

4.2.4 Employment in SSIs

As a traditional industry coir industry is second to agriculture as a source of

employment in Kerala, providing employment to 3.83 lakh persons, of whom 3.25 lakh

are women. There are about 2 lakh weavers working in the organised and unorganised

handloom industry in Kerala. Majority of employees are women.

Table 4.13 shows the employment in SSI in India during the pre-liberalistion

period.


Table 4.13

Employment in SSI in IndiaDuring the Pre-liberalisation Period

1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

67.0

71.0

75.0

79.0

84.2

90.0

96.0

101.4

107.0

113.0

119.6

-

5.97

5.63

5.33

6.58

6.89

6.67

5.62

5.52

5.61

5.84

Employment Growth [%]Year

[Rs. in Lakh]

Source: Government of India, Economic Survey, New Delhi: Ministry ofFinance, from 1981 to 1991.

Table 4.13 shows that in the year 1979-80 the number of employees in SSI sector

in India was only 67 lakh and it was increased to 119.6 lakh in 1989-90 with an average

annual growth of 5.97 percent.

Table 4.14 shows the employment in SSI in India during the post-liberalistion

period.

Table 4.14

Employment in SSI in India During the Post-liberalisation Period

1990-911991-921992-931993-941994-951995-961996-971997-981998-991999-002000-012001-022002-032003-042004-052005-062006-07

158.3166.0174.8182.6191.4197.9205.9213.2220.6229.1238.7249.3260.2271.4282.6299.8312.5

-4.865.304.464.823.394.043.553.473.854.194.444.374.304.136.104.22

Employment Growth [%]

[Rs.in Lakh]

Year

Source:Government of India, Economic Survey, New Delhi: Ministry ofFinance, from 1990 to 2008.

[C.V. = 6.25, T.V. = 2.06, D.F. = 24, S.L. = 5%, P.V. = 0.0001]

Table 4.14 shows that in the year 1990-91 the number employees in SSI in India

was 158.3 lakh and it was increased to 312.5 lakh in 2006-07 with an average


annual growth of 4.34 percent. The growth rate was highest in the year 2005-06 and

lowest in 1995-96. As compared to the pre-liberalisation period there is a decrease in

the average annual growth of SSI employment in India from 5.97 percent to 4.34 percent.

The ‘t’ test confirms the decrease.

Figure 4.6 shows the SSI employment in India during the pre and post-liberalisation

period.

0

20

40

60

80

100

120

140

1979-8

0

1980-8

1

1981-8

2

1982-8

3

1983-8

4

1984-8

5

1985-8

6

1986-8

7

1987-8

8

1988-8

9

1989-9

0

0

50

100

150

200

250

300

350

1990-9

1

1992-9

3

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Figure 4.6

Employment in SSI in India During


In L

akh

In L

akh

Post-liberalisation PeriodPre-liberalisation Period

Year Year


Figure 4.6 shows that there is a steady growth of employment during the pre-

liberalisation period but there is slow growth during the post-liberalisation period.

Table 4.15 shows the employment in SSI in Kerala during the pre-liberalisation

period.

Table 4.15

Employees in SSI in Kerala


100265

124711

154407

179202

205286

242417

377935

-

24.38

23.81

16.06

14.56

18.08

55.90

Employment Growth [%]


1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

Year


Table 4.15 shows that in the year 1982-83 the number of employees in SSI in

Kerala was 1,00,265 and it was increased to 3,77,935 in 1988-89 with an average


lowest in 1986-87.

Table 4.16 shows the employment in SSI in Kerala during the post-liberalisation

period.

Table 4.16

Employees in SSI in Kerala


1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

465195

517992

568598

629543

703161

775036

839596

909862

981491

1053533

1140260

1173474

1215532

1237422

1260007

1288135

1295200

1300487

-

11.35

9.77

10.72

11.69

10.22

8.33

8.37

7.87

7.34

8.23

2.91

3.58

1.80

1.83

2.23

0.55

0.41Source:Government of Kerala, Economic Review, Thiruvananthapuram:Kerala State Planning Board, from 1990 to 2008.

[C.V. = 4.85, T.V. = 2.08, D.F. = 21, S.L. = 5%, P.V. =0.0001]

Year Employment Growth [%]

Table 4.16 shows that in the year 1990-91 the number of employees in SSI in

Kerala was 4,65,195 and it was increased to 13,00,487 in 2007-08 with an average


lowest in 2007-08. The ‘t’ test confirms the decrease.

Figure 4.8 shows the SSI employment in Kerala during the pre and post-



Figure 4.7

Employment in SSI in Kerala


No.

of

Em

plo

yees

YearYear


Source:Government of Kerala, Economic Review, Thiruvananthapuram: Kerala State Planning Board, from 1984 to2008.

Figure 4.7 shows that there is a steep growth of employment at the end of the

pre-liberalisation period. But there is no steady growth during the post-liberalisation period.

4.2.5 Assistance to the SSI sector

A number of institutions namely commercial banks, financial corporations,

industrial corporations, development corporations etc., provide assistance to the SSI

sector in India.

There are number of schems given by the Central and State Government

through various agencies like DI &C, K&VI etc., to SSI. Margin money loan scheme

is to assist deserving entrepreneurs in setting up small-scale industrial units by

way of providing soft loan to raise the required equity insisted by the financing

institutions. Preference is given to tiny sectors, units owned by technocrats, women,

handicapped persons, ex-service men and persons belonging to scheduled castes

and tribes. Margin money loan is given for both term loan and working capital loan.

It is limited to 20% of the cost of project or of the total working capital requirement

or 50% of the margin stipulated by the financing institution either for term loan or

working capital loan, whichever is less. The maximum limit of margin money loan

is Rs. 0.25 million. The interest rate is 9% per annum [http://www.resourcekerala.org/

schemes.html].

0

50000

100000

150000

200000

250000

300000

350000

400000

1982-8

3

1983-8

4

1984-8

5

1985-8

6

1986-8

7

1987-8

8

1988-8

90

100000

200000

300000400000

500000600000700000

800000900000

1990-9

1

1991-9

2

1992-9

3

1993-9

4

1994-9

5

1995-9

6

1996-9

7

No.

of

Em

plo

yees


Table 4.17

Scheduled Commercial Banks’

Advances to SSI in India Duringthe Pre-liberalisation Period

Year

1970-71

1971-72

1972-73

1973-74

1974-75

1975-76

1976-77

1977-78

1978-79

1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

[Rs. in Crore]

493

576

686

904

1040

1153

1403

1704

2232

2695

3953

4464

5389

6537

7829

9127

10659

12968

14635

15969

-

16.84

19.09

31.78

15.04

10.87

21.68

21.45

30.99

20.74

46.68

12.93

20.72

21.30

19.76

16.58

16.79

21.66

12.85

9.12

Growth [%]

S o u r c e : h t t p : / / w w w. r b i . o r g . i n / s c r i p t s /PublicationsView.aspx?id=10582

Amount

Table 4.17 shows that in the year 1970-71 the banks gave advances of Rs.493

crore for SSI sector and it was increased to Rs.15,969 in the year 1989-90 with an

average annual growth of 20.09 percent.

Table 4.18 shows the advances given by scheduled commercial banks to SSI

sector in India during the post-liberalisation period.

Table 4.17 shows the advances given by scheduled commercial banks to the

SSI sector in India during the pre-liberalisation period.


Table 4.18

Scheduled Commercial Banks’

Advances to SSI in India Duringthe Post-liberalisation Period

Year

1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

Amount

17938

18939

20975

23978

29175

34246

38196

45771

51679

57035

60141

67107

64707

71209

83498

101285

127323

-

5.58

10.75

14.32

21.67

17.38

11.53

19.83

12.91

10.36

5.45

11.58

-3.58

10.05

17.26

21.30

25.71

Growth [%]

Table 4.18 shows that in the year 1990-91 the bank gave Rs.17,938 crore for the

SSI sector and it was increased to Rs.1,27,323 crore in the year 2006-07 with an average

annual growth of 13.03 percent. As compared to the pre-liberalisation period there is a

decrease in average annual growth of assistance from 20.09 percent to 13.03 percent.

The ‘t’ test confirms the decline.

Figure 4.8 shows the advances given to SSI by scheduled commercial bank’s

in India during the pre and post-liberalisation period.

[Rs. in Crore]

S o u r c e : h t t p : / / w w w . r b i . o r g . i n / s c r i p t s /PublicationsView.aspx?id=10582[C.V. = 2.59, T.V. = 2.04, D.F. = 33, S.L. =5%,

P.V. =0.014]


0

2000

4000

6000

8000

10000

12000

14000

16000

18000

19

70-7

1

19

72-7

3

19

74-7

5

19

76-7

7

19

78-7

9

19

80-8

1

19

82-8

3

19

84-8

5

19

86-8

7

19

88-8

9

0

20000

40000

60000

80000

100000

120000

140000

199

0-9

1

199

2-9

3

199

4-9

5

199

6-9

7

199

8-9

9

200

0-0

1

200

2-0

3

200

4-0

5

200

6-0

7

Figure 4.8

Scheduled Commercial Bank’s Advances to SSI in India


Rs.C

rore

Rs.C

rore

Year Year


Figure 4.8 shows that there is a steep growth of advances at the end of the pre-

liberalisation period. But there is a slow growth at the initial period and fast growth at the

end of the post-liberalisation period.

4.2.6 Export of SSI Products

Coir, handloom, handicraft, food items, leather items etc., are mainly exported

to foreign countries.

Table 4.19 shows the value of export of SSI from India during the pre-liberalisation

period.

Source:http://www.rbi.org.in/scripts/PublicationsView.aspx?id=10582 and http://www.rbi.org.in/scripts/PublicationsView.aspx?id=10582

Table 4.19

Value of Export of SSI from India


1979-80

1980-81

1981-82

1982-83

1983-84

1984-85

1985-86

1986-87

1987-88

1988-89

1989-90

1200

1600

2100

2000

2200

2500

2800

3600

4400

5500

7600

-

33.33

31.25

-4.76

10.00

13.64

12.00

28.57

22.22

25.00

38.18

ExportYear Growth [%]

Source: Government of India, Economic Survey, New Delhi: Ministryof Finance, from 1981 to1991.

[Rs. in Crore]


Table 4.20

Value of Export of SSI from India


1990-91

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

9664

13883

17784

25307

29068

36470

39248

44442

48979

54200

69797

71244

86013

97644

124417

150242

-

43.66

28.09

42.30

14.86

25.46

7.62

13.23

10.21

10.66

28.78

2.07

20.73

13.52

27.42

20.76

Year Export Growth [%]

Source: Government of Kerala, Economic Review,

Thiruvananthapuram: Kerala State Planning Board, from 1990 to 2008.

[C.V. = 0.06, T.V. = 2.06, D.F. = 23, S.L. = 5%, P.V. = 0.95]

Table 4.20 shows that in the year 1990-91 the value of export of SSI from India

was Rs.9,664 crore and it was increased to Rs.1,50,242 crore in 2005-06 with an average


lowest in 2001-02. As compared to the pre-liberalisation period there is a decrease in

the average annual growth of value of export of SSI from 20.27 percent to 20.07 percent.

The ‘t’ test rejects the period-wise difference.

Table 4.19 shows that in the year 1979-80 the value of export of SSI from India

was Rs.1,200 crore and it was increased to Rs.7,600 crore in 1989-90 with an average


lowest in 1982-83.

Table 4.20 shows the value of export of SSI from India during the post-liberalisation

period.

[Rs. in Crore]

performance of cott age and small scale industries...

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