Small Scale Industries

Small Scale Industries: Definition
The small scale industries are playing an important role in the GDP of India. The small scale industries have nearly 40% share in the total industrial output and 35% share in exports. The definition of small scale industries have changed from time to time. Earlier they were classified under two categories:

However according to the latest definition a industry is said to be a small scale industry if its investment in fixed assets like plants and equipments either held on ownership terms or on lease or on hire purchase is less than Rs 10 million. And it is also essential that the unit is not controlled by any other industrial unit.

Traditional and Modern Small Scale Industries and Their Products
The traditional small scale industries are more labour intensive than capital intensive whereas the modern small scale industries are more capital intensive. The traditional small scale industries use old machinery and their output is also very low. But the modern small scale industries use the modern machinery and the quality of their output is also very good. Some of the traditional small scale industries are that of Khadi and Handloom, coir, village industries etc. The modern small scale industries are that of garments, leather products etc. But in today's scenario, most of the small scale industries in India are modern small scale industries. The products manufactured by these small scale industries are electrical items, hardware, sports goods, stationary items, clocks, watches, automobile parts, chemical products etc. They are also helped by the business enterprises in India in their production.

Need to Boost Small Scale Industries
Realizing the importance of small scale industries in Indian economy, the government is trying to develop this industry keeping in mind the following aims: