President's Message
"We welcome the initiatives announced in the
policy, but they are at best tactical, not strategic. Now that Indian
exports have become more competitive, we need a well thought-out
strategy to push our products and services in countries where we have
been outcompeted in several product categories especially in ASEAN,
African and Latin American markets. "
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NID Design workshop
Date: June 27-29 , 2012
Venue: , Ahmedabad)
See Details
Avnet X-fest 2012
Date:July-August, 2012
Venue: Various cities across Asia
See Details
Electronics Rocks 2012
NCEDAR 2012
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MSMEs say weak Re will fail to spur growth: Survey
According to The FISME Factor survey, a majority
of MSMEs, 57%, think the competitive advantage provided by the weak
rupee will fail to spur growth unless the government takes strategic
steps.
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Dear Readers,
FISME has once again shown the way when it comes to
protecting the interests of the Indian MSME sector. While most industry
bodies merely welcomed the measures announced in the annual supplement
to India’s foreign trade policy on June 5, 2012, FISME boldly pointed
out that the measures were at best tactical and not strategic in nature.
The FISME President hit the nail on the head by saying we need to take
advantage of the “historic opportunity” presented by the weak rupee and
step up strategic efforts for Indian exporters to penetrate new markets
and cut their dependence on the troubled Eurozone and the sluggish US
market. FISME has rightly highlighted that the trade policy has failed
to do that and it must be supplemented with a strategic thrust to help
Indian exporters penetrate new markets now that they are more
competitive compared to their other Asian competitors. In this issue, we
bring to you a few articles which bolster this FISME view point. Read
and stay ahead of the competition!
Editor
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Trade Trends
India’s Look East Policy and Myanmar
The normalization of relations with Myanmar under
India’s Look East Policy will help Indian exporters to penetrate the
huge potential market represented by Myanmar, the ASEAN bloc and other
South and Southeast Asian countries, writes Absar Alam
Latest ‘sops' will help exporters not exports hit by global recession
The Commerce Ministry has just released the annual
supplement to the Foreign Trade Policy 2009-14 amidst a pervasive gloom
over almost the entire global economy.
Policy Polemic
Re-aligning India's export focus – the need of the hour
After India's export growth staggered to 3.2 per cent
in April, the industry was expecting some big-ticket reforms to
kick-start an ailing manufacturing sector and revitalise exports.
Global risks and domestic response
After India's export growth staggered to 3.2 per cent
in April, the industry was expecting some big-ticket reforms to
kick-start an ailing manufacturing sector and revitalise exports.
Finance Fundamentals
Securing the entire family with Group Health Insurance policy
Group Health Insurance provides many advantages over
individual insurance for both employers and employees. Argues Abhishek
Bondia.
Marketing Mantras
Ways to get ads for your SME website
Having a website for your business to promote the
products or services is always the icing on the cake. Your potential
customer can have an online view of the product on your website and that
you can convert it into a business opportunity.
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Directory of Testing Laboratories in India
Buy our one-of-a-kind guide to all industrial testing
laboratories in India. Find the one most convenient for getting your
products tested and certified. An invaluable compendium for all
industrial units and exporters.
PP: 894, Hard Cover.
Price: Rs 900.
50% discount for members.
Handbook for Managing Export Payment Risks
If you are an exporter you simply cannot do without
this unique publication which tells you how to manage payment and other
risks arising from exports.
PP: 78.
Price: Rs 300.
50% discount for members.
Free Publications
Fertilizer quality control in India: Need for change
This monograph argues for a systemic change in
fertiliser quality control. Essential reading for those in policy-making
positions.
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FISME regularly receives monthly reports on the
economies of various countries from their missions in India. These
reports provide information on key economic parameters, trade related
information and all news relevant for importers and exporters. In this
edition you can take a look at reports on:
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Activities
Macro Metre
Domestic Digest
World Watch
Knowledge Store
...And A Lot More
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 FISME
in collaboration with the National Institute of Design organised a
five-day workshop (June 12-16, 2012) in Meerut to present to
stakeholders the results of a need assessment survey for design
interventions in the Meerut scissors manufacturing cluster. The survey
was conducted by Industrial Designer and Design Consultant Amita
Bhatnagar on behalf FISME and NID under the MSME Design Clinic Scheme.
The workshop was attended by about 40 scissor manufacturers located in
the scissor manufacturing cluster in and around Meerut. At the workshop,
the design consultant together with FISME and NID officials made
presentations on the survey results and sought the views of the
manufacturers regarding the results and recommendations of the survey.
FISME organised a seminar on micro, small and medium enterprises
(MSMEs) during the Global Investor’s Meet, 2012, in Bangalore. While the
GIM was during June 6-8, the seminar on MSMEs was organised on June 7,
2012. Immediate past President of FISME Shri Mohan Suresh delivered the
welcome address at the seminar. Investors from the MSME sector,
directors and officials of public and private sector banks, government
officials, media representatives and visitors interested in the MSME
sector were present at the seminar.
 As
compared to most other leading industry bodies in India, FISME, India’s
leading MSME organisation, took a different stand on the annual
supplement to India’s foreign trade policy announced on June 5, 2012 by
the Commerce and Industry Minister Mr Anand Sharma. While welcoming the
measures announced in the policy, FISME was, perhaps, the only industry
body in India that pointed out that these measures were at best tactical
and not strategic and they would have to be supplemented with a
strategic thrust to take advantage of the depreciation of the rupee
which is here to stay in the short and medium term. “These initiatives
are at best tactical not strategic,” FISME President Mr V.K. Agarwal
said in a press statement that got wide coverage in the media.
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Has the govt. failed to provide a
strategic thrust in the measures announced in the annual supplement to
India's foreign trade policy on June 5, 2012?
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Planning Commission survey on business environment
On behalf of the Planning Commission of India,
the Institute for Competitiveness, New Delhi, is conducting a survey of
Indian micro, small and medium enterprises to assess the business
environment of each state of India. The response to the questionnaire
will help the Indian government to formulate policies for improving
business conditions in every state and enhancing the overall
competitiveness of the country. All MSME readers are requested to
enthusiastically respond to the questionnaire. The questionnaire is
available at http://competitiveness.in/india-competitiveness/planning-commission or Download Questionnaire and will take around 20 minutes to fill up.
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AITD survey on India-Bangladesh Trade Facilitation
On behalf of UNESCAP, the Asian Institute of
Transport Development (AITD), New Delhi, is conducting a trade
facilitation study between India and Bangladesh. The objective of the
study is to analyse the impediments of cross border trade between the
two countries. Accordingly, policy recommendations would be made to
government for simplification of trade procedure. The AITD is conducting
a questionnaire survey of stake holders, particularly exporters as part
of this study. Readers are requested to respond to the questionnaire
and send it to asianinstitute.del@gmail.com Or alamabsar@gmail.com The questionnaire is available at Download Questionnaires.doc and will take around 10 minutes to fill up.
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Macro Metre
 Despite
a pick-up in the Wholesale Price Index (WPI) for the month of May,
analysts are optimistic that the Reserve Bank of India (RBI) will go for
a cut in its key policy rates on June 18. The rise in the WPI to 7.55
per cent from 7.23 per cent in April came as both food and fuel prices
picked up. Traders said that core inflation, which excludes volatile
food and fuel prices, was around 5 percent, giving the Reserve Bank of
India (RBI) room to cut its policy rate.
 Industrial
production growth rate slowed down sharply to 0.1 per cent in April
versus (-) 3.2 per cent due to contraction in capital goods and dip in
manufacturing output, reflecting the sluggish state of the economy that
may prompt RBI to cut lending rates. Growth in factory output, as
measured by the Index of Industrial Production (IIP), was 5.3 per cent
in April last year. The slowdown in industrial production is likely to
put pressure on the Reserve Bank to cut lending rates at its
mid-quarterly review on June 18.
 The
Government's miseries on the economic front are mounting. After a flat
industrial output growth in April, the provisional data released on
Thursday by the Commerce Ministry revealed that exports in May shrank
4.16 per cent year-on-year to $25.68 billion. The growth slump (the
second time in three months) was due to the weak demand in the
traditional markets — the European Union and the US.
 State
Bank of India (SBI), the largest public sector lender in the country,
reduced its loan rates for the agriculture and small & medium
enterprise (SME) sectors by 50-350 basis points. The new rates,
effective from June 1, aimed at pushing credit off take comes three days
before the Reserve Bank of India’s (RBI’s) mid-quarter monetary policy
review. Santosh Nayar, deputy managing director and group head,
corporate accounts, told reporters recently. Adding: “The interest rate
on retail loans such as personal, housing and car loans have been
untouched.”
India's largest bank, State Bank of India (SBI), has
assigned 600 bank branches to target micro, small and medium enterprise
(SME) clusters across the country. “We are in the process of mapping
these branches to SME clusters across the country The credit delivery to
SMEs becomes faster by targeting these clusters,” said Manas Kumar Nag,
chief general manager, SME Business Unit, SBI.
The North Eastern states have demanded “revision” of
the centre sponsored North East Industrial and Investment Promotion
Policy (NEIIPP), 2007 to shift the focus from heavy industry to micro
and small scale sector. The eight North Eastern states, including
Sikkim, have collectively stated that though the NEIIPP “had been good
for the region” it needs to put thrust on micro and small scale sector
as there were “constraints” on the part of the states in attracting big
ticket investments.
 There
is a deficit of Rs 10 trillion (10 lakh crore) in financing for the SME
sector. This was revealed by Sachin Nigam, director of SME ratings of
Crisil, in his keynote address at SME Connect, a seminar organized by
Moneycontrol.com. The demand for SME finance is Rs 16 trillion (Rs 16
lakh crore), but the available finance is about Rs 6 trillion (Rs 6 lakh
crore), Nigam said.
Against the backdrop of tough economic conditions,
Finance Minister Pranab Mukherjee will review the annual performance of
government-run banks and financial institutions recently. Mukherjee
would meet with chiefs of public sector banks and financial institutions
to review their performances. The review would focus on credit to
agriculture and MSME, housing and education loans, gross and net
Non-Performing Assets (NPAs), an official release recently.
Banks have logged growth of 24.59 per cent in credit
flow to the MSME (micro, small & medium enterprises) sector in
2011-12. Total advances to the sector stood at Rs 2812.48 crore in last
fiscal. The share of advances to small enterprises in the MSME segment
was the highest at Rs 1322.86 crore made available through 4972
accounts. Credit to micro and small units stood at Rs 1101.08 crore and
Rs 388.52 crore respectively, according to latest data compiled by State
Level Bankers' Committee (SLBC).
 In
order to help state small and medium enterprises (SMEs), the Uttar
Pradesh government will engage with industrial and business bodies June
11-13 to frame the new Infrastructure, Industry and Service Sector
Investment Policy for 2012. Officials said the draft of the proposed
policy has been in public domain for some time. Suggestions had been
invited from all stakeholders.
It is raining trillions (crores) of rupees in
Karnataka at its second Global Investors' Meet (GIM 2012) even though
the advancing south-west monsoon is yet to hit this tech hub. "We have
received investment proposals worth a whopping Rs.7.6 trillion
(Rs.7.6-lakh crore) from 730 global and Indian firms, exceeding the
modest target of Rs.6 trillion (Rs.6 lakh crore) set for the second
edition of GIM," state Chief Secretary S.V. Ranganath announced at the
valedictory function of the two-day mega event. "The sunrise micro,
small and medium enterprises (MSME) sector has for the first time
attracted investment proposals worth Rs.35, 000 crore (Rs.350 billion),"
Ranganath asserted.
To augment credit flow to the SME segment, Corporation
Bank opened its exclusive SME Loan Centre in Coimbatore recently. This
is the bank’s eighth SME loan centre. The others are located at Delhi,
Hyderabad, Bangalore, Chennai, Pune, Mumbai and Vadodara. Mr Ajai Kumar,
Chairman and Managing Director of Corporation Bank, formally launched
the SME Loan Centre. The bank plans to open eight more SME Loan centres
in the next two months, said Mr Ajai Kumar.
With an aim to provide product testing and R&D
facilities exclusively for micro, small & medium enterprises (MSMEs)
across Nashik, the MSME Development Institute, Mumbai, under the
ministry of MSME, has in principal approved the proposal for setting up a
Testing Lab in Nashik city and a tool unit in Sinnar industrial estate,
about 30 km away. The Testing Lab would be the first in Nashik district
for MSMEs. The decision to this effect was taken by the MSME
Development Institute at a meeting held in Nashik with Nashik Industries
& Manufacturers' Association (NIMA).
India's auto component exports is expected to grow by
15 percent in the current fiscal as there has been a continuous demand
flow from the European markets, said the Automotive Component
Manufacturers Association (ACMA), Executive Director, Vinnie Mehta. "It
is an interesting paradox that while the European economy is under
stress, our export to Europe has continued to grow. Europe is one of the
largest trading partners for India in the auto component sector and
accounts for 35% of our exports," he told SME Times.
The Ministry of Micro, Small and Medium Enterprise
(MSME) has informed that Khadi and Village Industries Commission (KVIC)
undertakes various schemes and programmes for the holistic development
and promotion of khadi and village industries, which includes reaching
to the grassroots level and providing facilities and affordable
technologies. Mahatma Gandhi Institute for Rural Industrialization
(MGIRI) at Wardha, a national-level institute, undertakes research,
design and extension activities in the rural industries sector, the
ministry said in a press statement recently.
The Tiruchi circle of the Indian Bank organised home
loan and MSME (Micro, Small and Medium Enterprises) mela at all its 61
branches in Tiruchi, Karur, Pudukottai, Ariyalur and Perambalur
districts recently. K. Manoharan, zonal manager and zonal head, Indian
Bank, Tiruchi zone, inaugurated the mela at Tiruchi Cantonment branch.
He handed over sanction letters to beneficiaries on the occasion.
 Religare
Finvest Limited (RFL), a subsidiary of Religare Enterprises Limited
(REL), is a SME- and MSME-focused lender having a loan book size of Rs
13,000 crore built organically over the last three years and targeting
Rs 25,000 crore in the next two years. In an e-mail interaction with
Pravda Godbole, Kavi Arora, RFL’s CEO, dwells on the issue of finance
for MSMEs and the company’s decision to focus on this sector.
Apex financial institution SIDBI plans to partner with
West Bengal-based Glocal Healthcare Systems to set up corporate
hospitals in rural areas through the Public Private Partnership (PPP)
route. SIDBI facilitates promotion, financing and development of
industries in the micro, small & medium enterprises. On June 9, the
first such corporate rural hospital was built across a 3-acre land in
the Murshidabad district of West Bengal on the PPP model.
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Focus on UAE 
Dubai SME on Monday launched the ‘SME Friendliness
Index’ that will help enable banks to access 230,000 SMEs in the UAE and
realise up to Dh6 billion SME financing revenue opportunity. The index
is a signalling tool that gives constructive feedback to banks about how
their SME strategies are actually working, according to Dubai SME-the
agency of the Department of Economic Development mandated to develop the
SME sector.
Focus on UK 
A new bank targeting established small to medium sized
enterprises (SMEs) has launched. Cambridge & Counties Bank says it
will provide SMEs with loans secured against commercial property as well
as a deposit account. In addition to this, it will also offer secured
pension scheme lending, and has plans to launch professional firm
financing, as well as other savings accounts into both the retail and
non-retail sectors.
Focus on Thailand 
A stock trading board for smaller companies and
startups is currently being considered, says Vorapol Sokatiyanurak,
secretary-general of the Securities and Exchange Commission (SEC).
High-yield bonds are also being researched as another possible funding
option for small and medium-sized enterprises (SMEs). The aim is to
enable an additional 10,000 companies to access the capital markets by
issuing bonds or listing on the new board, which if formed would be the
country's third.
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The FISME Factor is impressive and informative, say readers
Read what readers have to say on this newsletter and various other issues.
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There are business opportunities available for Indian
companies in Canada. The interested candidates can check details.
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During the period June 1, 2012 to June 15, 2012 a total of 8 new MSMEs became members of FISME.
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