Small and Cottage Industries
Content
Small and cottage
industries Meaning: It means the industry is run in the home usually with the help of family members. Simple implements are used and workers are not paid wages. In the small scale industry the male members of the family along with hired labour work together. In small industries, electric power and improved improved machines are mostly used in subcontinental the rm employing less than 1 person are classied as small. In subcontinental !arpet industry , poultry farming, farming, bee keeping, tailoring and furniture making is included in the cottage and small industry
"ow it got started: #uring the three decades of planned development there has been an impressive development of large scale industries, but India still remains predominantly predominantly a country of village and small industries. !ottage and small scale industries are scattered over the whole country and they cover a wide range of traditional and modern small$scale industries including handloom, khadi, powerloom, sericulture, coir, handicrafts, village industries and mechani%ed small$scale industries. It is no e&aggeration, therefore, that cottage and small scale industries are the backbone of Indian economy.
!ottage and small$scale industries include four categories of industries, vi%. 'a( village industries, 'b( cottage industries, 'c( tiny$industries, and 'd( small$ scale industries. )he village industries are closely connected with agriculture and are mainly concerned with the processing of local raw$materials with simple techni*ues. )he cottage industries are carried on by b y the artisans in their own cottages with their own family workers. work ers. !ottage industries do not use power and employ a small amount of capital. )iny industries are those industries in which capital investment is not more than +s. -akhs. )he Industrial olicy +esolution, 1/0 has enhanced the limit of capital investment from +s. 1 lakhs to +s. lakhs in case of small$scale industries. Small$scale industries are locali%ed in. urban and semi urban areas. )hey use power and and modern modern techni*ues, Small$scale Small$scale and cottage industries have a great capacity to generate a large volume of employment. employment. In India, capital is scarce, but cheap labour is abundantly available. nemployment, underemployment and seasonal unemployment are rampant on a mass scale. )he employment employment capacity of of small industries being at least eight times that of the large industries, they can substantially help in solving this problem. Small enterprises tend to create a situation in which a more e*uitable distribution of income is made possible. )he process of decentrali%ation accelerated by small$scale industries, in addition to e&ploiting local resources, helps to reduce regional imbalances and the imbalances between rural and urban growth. growth. -arge$ scale and small scale industries also complement each
other, large scale industries, the emphasis is on the production productio n of capital goods. 2ut small enterprises concentrate on producing consumer goods.3nother important advantage of developing small units is that they not only do not re*uire much foreign e&change earnings of the country. 2ut above everything else, they can bring about awakening among the people. )hey can make make them self$condent self$condent and self$reliant self$reliant.)he .)he glorious past of cottage industries is well$known. 4e had 5ourishing cottage industries in early times, many of them having wide markets abroad. 3s the Industrial !ommission observed in its report '1/10( 63t a time when the 4est 7urope, the birth place of the modern industrial system, was inhabited by uncivili%ed tribes, India was famous for the wealth of her rulers and for the high artistic skill of her craftsmen6 craftsmen6 )he skill of the Indians in the production of delicate women fabrics, in the mi&ing of colours, the working of metals and precious stones, the preparation of essences and in all manners of technical arts has, from very early times, en8oyed a world$wide celebrity. )he muslin of #acca, the shawls and carpets of 9ashmir, the silk clothes of #elhi and the are marble work woproducts rk of aipur and the velvets of 3gra, -ucknow a few for which the people were cra%y.3fter independence, it was reali%ed that the development of these industries is essential for the overall progress of the country. )herefore, the government governme nt gave a due attention in the plans. +s.10 crore were spent by the government. )he e&penditure during the )hird lan and three 3nnual lans was +s. ;1 crore and +s. 1<< crore respectively. In the =ourth lan, the e&penditure was +s. >1 crore as against the
outlay of +s. /< crore. )he =ifth lan outlay for the development of those industries was +s. ><> crore and estimated e&penditure e&penditure 'during 1/?;$?0( 1/?;$?0( is +s. <00 crore. 3n outlay of +s. 1@ crore has been earmarked in the nion 2udget for 1/01$0 for the village and small$ scale industries adding to the outlay of +s. 1/< crore in the lan of the States and nion )erritories. )he Si&th =ive$lan 1/0$0> envisages an annual growth rate of 0.?A. in production in the small$scale sector.
Small$Scale and cottage industries are faced with the following problems at present: '1( roblem of +aw$materialB#ue to their limited resources, the owners of these industries cannot aCord to purchase raw$material in bulk. )hat is why they get low *uality materials at high rates. '( roblem roblem of nance $ !heap and easy nance is not available to these industries. )he nancing system of government governme nt institutions and banks is such that these industries have to complete many formalities and there are so many complications which can be followed by these less educated entrepre entrepreneurs. neurs. '<( Marketing problemsB)hese industries mainly e&ist in villages and due to lack of transport and
communication facilities they are handicapped in communication nding suitable markets for their products, ';( -ack of Managerial )alent !ottage and small scale industries are mostly run by the small businessmen having no training of management and organi%ation. organi%ation. "ow these industries, therefore, can stand before the large seals industries which are managed and organi%ed by the specialists of that eldD '>( !ompetition with large$scale large$scale industriesB)he main problem before these industries is that they are unable to compete with large$scale industries. )he economies of large$scale production are not available to them and therefore they fail to compete with large$scale industries.
=ollowing are the main advantages of small scale industry in subcontinental : 1. Increase in Industrial roduct :$ )here is a shortage of manufactured manufactured goods in our our area. 4e spend a lot of foreign e&change on the import of these goods every year. So we should increase the small scale and cottage industry to remove the shortage of these goods. . Increase in 7mployment :$ )he rate of unemployment unemployment is is increasing increasing day by day. day. ) )o o controll unemployment it is necessary that we should contro increase the small scale industries because these are
labour intensive. Eur farmer can also easily work in small scale scale industry. It is not possible to provide Fovt. 8obs to all the unemployed people. It may also increase the self employment. <. Increase in =oreign 7&change 7arnings :$ the various kinds of goods like carpets and sports sold in the international market. 4e earn a lot of foreign e&change e&cha nge by e&porting e&porting these goods. ;. se of Industrial waste :$ )he waste of large scale industries like like cotton and and steel can be used by the small scale industry. In this way we can save a lot of capital. >. rovides 7mployment to 4omen :$ Eur women is engaged in the cottage and small scale industry and increasing the production. 2ecause in our society women can not work with other men in the factories. etc
