Growth of Small Scale Industries in Punjab

Transcription

1 International Journal for Science and Emerging ISSN No. (Online): Technologies with Latest Trends 21(1): 1-6(2015) ISSN No. (Print): 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 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 2. 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 3. Balvinder Singh* and Dr. Shashi Shekhar** 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 OF DATA COLLECTION Generally there are two methods of data collection. PRIMARY DATA Primary data is collected from the company 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 4. Balvinder Singh* and Dr. Shashi Shekhar** 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

5 5. Balvinder Singh* and Dr. Shashi Shekhar** 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. 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. Punjab s technology is very old where as china and Japan uses the very latest technology and they produce the latest and cheap product ( cost wise ) 6. Taxation Problem Taxes in the 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 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 1969 Emerging Scenario Pigmy Economic weekly 31(21)15, Kalchetty Erosi Management of Finance in small scale Industries Vohra publishers and Distributors 1989 p 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 Singhania V.K. Taxman Publication 7. NarendraPrashad The state bank of India and rural development (Delhi Amar Parkashan /1988) - p 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 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)