Workshop on Growth Opportunities
for Small Exporters
FIEO & ICICI Bank jointly organized a Workshop on ‘Growth opportunities and emerging trends in international trade’ at Bangalore on 16th November. The Workshop addressed the issues concerning SME exporters like credit facilities, rupee appreciation, hedging tools, technology up-gradation, emerging trends in international trade, etc. More than 110 SME exporters attended the Workshop.
Mr. Walter D’Souza, Convenor, FIEO Committee on Agro Exports and Agri Export Zones, while inaugurating the workshop, said that SMEs needed a comprehensive credit support for improving technology. To sustain growth, he said, it is essential to lower the cost of manufacturing and improve the quality of products. Rising transaction costs and lack of infrastructure are dimming the prospects for higher exports. Small businesses lack access to capital and money markets. Investors are unwilling to invest in proprietorships, partnerships or unlisted companies as the risk perception about small businesses is high. In India, many small manufacturing enterprises do not have access to adequate bank finance and only about 16% of the total credit finds its way to the sector. Despite being a priority sector for lending, small manufacturing enterprises get just about 8 % of their annual turnover as working capital requirements as against the normative requirement of 20%. Mr. Walter said.
Mr. Walter also took the opportunity to draw the attention of the financial experts towards the strength of SMEs segment. He said India is having nearly three million SMEs accounting for almost 50% of industrial output. It is an employment generating sector with 50% of the private sector employment and 40% value addition in manufacturing. Micro and small enterprises provide employment to almost 41 million people in our country. Including the handloom and handicraft sector, the total employment provided by them is over 60 million. Hence, from the point of view of our people’s livelihood and well-being, said, Mr. Walter, this sector is of tremendous importance.
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Mr Walter D’Souza delivering the Inaugural address. On dais from left are Mr M Balagangadharan, Regional Jt. DGFT, Bangalore; Mr M C R Shetty, President, Karnataka Small Scale Industries Association, Bangalore; Mr T S Gulhati, President & CEO, Sonarome Group of Companies |
"The fact that SMEs are widely dispersed across the entire country also makes them highly important from a regional developmental perspective and as a means to promote balanced and equitable growth all over the country," Mr. Walter added. Highlighting the export performance of the SME sector in India, Mr. Walter said during the year 2006-07, the contribution of direct exports from SME sector worked out to about 37% of total exports from India besides another 20% through indirect exports. Major sectors contributing to SME exports, according to him, are readymade garments, engineering goods, chemicals, pharmaceuticals, electronics, processed food, etc. In terms of export orientation, sports goods have 100% exports from SME followed by readymade garments (90%) leather (70%), marine products (47%) and chemicals and pharmaceuticals (44%), he added.
Mr. Prashant Laxmeshwar, Zonal Head, West & South, Small Enterprises Group, ICICI Bank Ltd, while addressing the participants informed them about various facilities offered by his bank to the SME sector. He said our bank has tied up with IFC to offer free business management information and training to SMEs on accounting, finance, business planning, human resources, marketing, operations, tender information, business news, draft agreements, legal notifications and information technology. "The SME Toolkit India offers a wide range of information and articles, free business software, online training, self-assessment exercises, resources to help entrepreneurs, business owners, and managers in India to start, finance, formalize, and grow their businesses," he said.
Mr. M Balagangadharan, Regional Jt. DGFT, Bangalore highlighted the role of Foreign Trade Policy in promoting exports. He explained various schemes under the Policy, which SME exporters could avail of.
Mr. T S Gulhati, President & CEO, Sonarome Group of Companies, Bangalore said that participation in trade fairs, exhibitions and BSMs organized by FIEO and other EPCs would be very useful for SME exporters as this would give them opportunity to have dialogue directly with the potential customers. Stressing the need for implementing professional management in SME organizations, he said, one of the major constrains faced by the SME today is the non-availability of qualified manpower, as all the professionals prefer to work with larger organizations. He urged the SMEs not to shy away from venturing into risky markets like CIS, African countries, etc, where, he said, huge potential lied for Indian products and services, especially those produced by SMEs.
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Mr. M C R Shetty, President, Karnataka Small Industries Association, while speaking on the issues confronting SME exporters, said that SMEs had been facing serious growth constraints in the context of globalization of Indian economy. He suggested that most of the SMEs should improve their managerial skills and build their capacities to sustain and grow in the global economy. Mr. Shetty stressed the need for more liberalized procedures for SME funding. |
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A view of the audience |
Mr. M C R Shetty, President, Karnataka Small Industries Association, while speaking on the issues confronting SME exporters, said that SMEs had been facing serious growth constraints in the context of globalization of Indian economy. He suggested that most of the SMEs should improve their managerial skills and build their capacities to sustain and grow in the global economy. Mr. Shetty stressed the need for more liberalized procedures for SME funding.
Mr. J Crasta, CEO, CM Environmentsystems Pvt Ltd, Bangalore, while speaking on opportunities and emerging trends in international trade, stressed on the need for more investment in manpower and professional marketing by SMEs. The portals like Google is very useful in getting market leads, he added.
Mr. Sailesh K, Regional Head, Elite Trade Group, ICICI Bank spoke on financing solutions for SME exporters. Ms. Ramya Balal, Regional Head, ICICI Bank, Bangalore spoke on rupee forecasts and various products available to mitigate the exchange risks for the exporters. According to them, "Many SMEs opt for ECBs in order to manage the interest costs. Taking forward cover is one of the ways of managing one’s forex exposures in light of the rupee’s continuing rise. Apart from this, recently SMEs have started looking inward at their operations to create efficiency in order to factor in this cost. SMEs must learn to optimize efficiencies and become competitive in such a market."
Mr. Z N David, Business Development, Intel, in his presentation spoke on technology solution offered by his company which might help SMEs in cost cutting.
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Major Issues raised in the Workshop
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Mr. Krishnamurti Josysulla, Manager, Google Business Solution, made a presentation on internet marketing solutions for SMEs. Realizing the importance of the upcoming SME segment, he said, Google has launched special editions for SMEs. SMEs can sign up for the Standard Edition (free) or Premier Edition ($50) per year. With Google, SMEs can tap in an unprecedented stream of technology and innovation at a fraction of the cost of traditional installed solutions. Google has earned the loyalty of millions of online users who use Google to find products, services and information. When one advertises on Google, they select the keywords that trigger the ads to display. They only appear when users look for something directly related to that products and services. Additionally, one can determine the breadth of their targeting by country and languages. One can also target their ads to any of 14 Adwords language interfaces, so that they appear only to those customers they are able to serve. When compare with Google online opportunities with traditional offline media, there is no more efficient way to spend the marketing budget. Google offers tremendous reach worldwide. Locally, Google reaches an audience of more than 20 million unique users in India. Google Adwords features cost-per-click pricing, means no matter how many people see the ad, and pay only when someone responds to it. This ensures the return on Investment. He added.
| In 1990-91, the direct export share of SSIs in India’s total exports was below 20% at approximately Rs. 9442 crore. In 2006-07, the contribution from SME sector was to the tune of Rs. 2,05,430 crore, up by 26% compared to the previous year’s export of Rs. 1,64,310 crore. |
ICICI official Mr. Laxmeshwar had earlier informed that his bank was planning to organize a series of similar joint workshops with FIEO across the country in locations such as Ahmedabad, Nagpur, Pune, Kolkatta, Mumbai, Hyderabad, Baroda, Triupur, Surat and Indore.
FIEO (Northern Region) in association with IIFT, New Delhi is organizing the 8th Short Term Refresher Programme on International Trade as per the details placed below:
The Programme will cover: · Review of National Foreign Trade Policy; · Overview of Customs & Excise Rules/Regulations covering Export-Import Transactions; · Framework of International Trade Documents · Export Incentives including Duty Drawback Scheme · Understanding the Implications of WTO · Market Entry Strategies – Finding of Importers · Use of Internet for Exporters – Finding Buyers, Sourcing, Business Intelligence, Networking, Online Auctions, etc. · Export Finance Schemes – Facilities to Gold Card Holder – Cost Reduction Approach · Introduction to ECGC Policies, Guarantees & Claims for Export Payments · Understanding Schemes of Managing Currency Risk in Export Transaction, Hedging, Understanding of new UCP 600. Specialists from IIFT, trade-related Ministries and FIEO will constitute the faculty and a Certificate will be given on completion of the Programme. For more details and participation, please contact, FIEO (Northern Region) at 011-46042118, 46042121, 46042172.
Limited seats on first-cum-first served basis |
