Backward sections lead MSME march in UP

Posted on January 12, 2011 By Virendra Singh Rawat

The Micro, Small and Medium Enterprises (MSME) sector is contributing handsomely not only to the industrial growth of the country, but is also playing a vital role towards an egalitarian economy.

In Uttar Pradesh, home to 3.1 million MSMEs, both in the manufacturing and services sectors, an overwhelming percentage of units are owned by the so-called oppressed sections of the society.

Collectively, MSME sector contributes almost 60 per cent to the state’s industrial output and provides employment to over five million people. The state accounts for about 12 per cent of the MSME space in India.

According to the last 4th All-India Census of the sector conducted by the union MSME ministry, over 62 per cent of the MSME units in Uttar Pradesh were being run by entrepreneurs belonging to the scheduled caste (SC), scheduled tribe (ST) and other backward classes (OBC) categories.

In number terms, the total units run by those belonging to the three categories totaled to about two million. The rest of the units were run by ‘others’ and ‘societies’ according to the survey results.

On pan-India basis, about 51 per cent or 12.5 million MSME units were run by SC/ST/OBC category entrepreneurs, which clearly shows they have taken the lead in entrepreneurship vis-à-vis their counterparts in other states.

Rural enterprises account for over half of the MSME units in the state, which highlight the significance of the sector in ensuring equitable distribution of employment opportunities, resources and wealth.

In consolidated terms, Uttar Pradesh had over 3.1 million MSMEs, including 7,60,000 and 2.34 million units in the manufacturing and services sector, respectively.

Proprietorship accounted for over 95 per cent of the ownership pattern, while partnership, private company, public limited company and cooperatives account for less than one per cent each. However, the number of registered units pale in comparison to unregistered units account for 1,90,000 and 2.9 million units respectively.

Major MSME pockets in the state include Varanasi, Allahabad, Moradabad, Saharanpur, Lucknow, Kanpur, Agra, Ferozabad, Meerut, Bhadohi, Ghaziabad, Noida, Bareilly, Gorakhpur, Khurja, Aligarh and Mathura.

These are product specific hubs viz. Varanasi is famous for banarasi sari, Agra and Kanpur for leather, Bhadohi for carpets, Moradabad for brassware, Lucknow for chikan and Aligarh for locks.

Clearly, the sector is positive for the affirmative action-oriented New Economic Policy of the Mayawati government encompassing equal opportunities for the oppressed sections.

*Posted on www.business-standard.com