Impacts of Economic Reforms on Small - Scale Industries in India

Impacts of Economic Reforms on Small - Scale Industries in India

The Indian government has been recommending many reforms to improve the situation of small-scale industries (SSI). Some reforms are good, but some brought about many challenges to SSI in India This paper aims to evaluate the performance of SSI, taking into account such parameters as employment generated, exports, number of units and productivity per employee in the pre-liberalization and post-liberalization periods. To analyze how the Indian SSI policies have been effectively put in practice after economic liberalization, the growth rate and location quotient of the SSI before and after the reform period (1973-2007) are calculated. This is followed by a discussion on the Indian economic reforms have adversely affected the growth rate of SSI in terms of output, production, employment and units. After the economic reforms, the concentration of SSI increased around the big cities. Therefore putting emphasis on the SSI to reduce regional disparities has decreased.