Ad Here  
June
July
August
September
October
November
 
 
B H Kothari - a tribute Of course, Gujarat is vibrant Kulandai was a giant A C Muthiah – his munificent bequeaths to science Tribute – UCAL Selvan… SoA @ 80 GM Technology at last! Things happen by accident and not by design... He saved millions from starvation... An inexplicable neglect Scientists urged to take up farmer-oriented research Paytm karo... When small is no larger beautiful.. Diamond jubilee of Egmore Samskrt School Solar thermal shines… Air Asia India will set new benchmarks for budget travel Rahman at CIC Cleaning Ganga – relocate tanneries and install electric crematoria CSR and CMI: promise of another Srinivasan Ramanujan... Another Indian music maestro at the UN Secularism and anti-Hinduism Russi Mody – a tribute Nuclear power at the nucleus Auto components surge… Editor's Notes Liberal imports idling indigenous capacities When the President was rendered homeless… No engine for this car The nuclear option West Bengal: mindless malignancy Sweeter prospects for sugar Vibrant Gujarat Infrastructure funding – lessons learnt to the lack of interest on the part of these to focus on original research. This despite the much lower costs of such research in India. The industry which thrived on the protection of a closed economy and the advantage of a vast domestic market, has failed to organise its evolution on healthy lines Revive development banks... A think tank for Chennai Adharma of opposition politics Tribute – M V Murugappan Haul over the coal Online not in line with brick and mortar businesses... Tribute A Grand Finale for SN’s MS centenary at the US… All eyes on Sankara Nethralaya TN-leverage strength of BHEL, NLC... Towards speedy justice …and of a popular trade leader Maximising the micro pricing … Plummeting profits of PSBs Small units prefers to remain small... Valli, they are more marginalised Put expensive assets created to use... A welcome initiative by the judiciary An informal presentation - analytical, forward locking... Whistle-Stop Tour of Raghuram Rajan Lalu’s envy, India’s pride The few handicaps... The brown list of Venkitaramanan Where a state respects its litterateurs… Telangana in top gear… Quality silica from Neyveli Revving up the manufacturing sector Focus on quality of power - its only around 170-180V TIAM turns a full cycle Polls and promises The rise and rise of KCP Silver Years of Madras Musings Excel Generators provide the vital back-up How Air-India loses customs... When Ratan Tata visited SRM Remembering Indira Sivasailam... A more liberated TN… WTO Meet: resolved to meet again More Shakthi to Das’ elbow Shale gas and its shallow future GNS - 100: our first subscriber ONGC at KG Basin Welcome changes that testify to Jayalalithaa’s return to health A friendly business group Insurance companies bleeding, yet no decision on increasing FDI limit! The ‘Ayyo-yes’ is no more Reliance’s TV – 18 ready to launch Tamil News Channel Breaththrough in malaria control Intellectual of rare qualities The ‘Jayanthi Tax.’ Don’t seem to feel the pulse… Medical costs hit the roof... Parliament in paralysis... Convulsions in The Hindu He continues the focus on social amelioration Preserving for the future Muffled voices for merit… Naidu’s return augurs well for Seemandhra Not just in-laws (and outlaws); they’ve renowned academics at the helm! The power-full Hindujas Bihar elections - the Rajaji formula worked Make standards certification mandatory... Padma Bhushan for A Ramakrishna Rs.1600 crore paper board plant of TNPL Fall in crude prices help in oil sector reform China invests in India Welcome thrust on trade in Modi’s foreign visits... Alexa – Talking Wikipedia A rich pool of talent not utilised…. Music happens Multi-faceted Venkat A Grand Finale for SN’s MS centenary at the US… Kudos to NDTV... Where is Rajaji? A yen for wastage… TN accounts for the largest recruits by the IT sector Lesson from Chandrababu Naidu Solar, solar everywhere … CIPET hqrs to stay at Guindy – for the present? TELANGANA at last…BUT The Ports’ Pasha expands into Tamil Nadu Editor's Says Should we change the official year? More Shakti to resource mobilisation... Funding the un-funded Welcome focus on core competence There was flood of milk. Reason: no milk commissioner! Modi and the lady Adapt Vajpayee dinner diplomacy The balancing act Recognition to role of NBFCs.... Tough task taking states together Marketing expert Balagopal is no more Boy, can you beat these? Delhi is distant Why this malaise in medical education? Road development slows down Readers' Mail For whom the bell tolls? Airlines in India: cost and space Tatas moving out of urea production... Varuna (rain) in 2015; Vaayu (air) in 2016. Chennai devastated Wanted: a second airport for Chennai Naidu will soon build a new Hyderabad Wise Presidents Tatas moving out of urea production... Cement prices continue to rise… Welcome GST Strengthen the base... No Maha Koottani in TN... Mu Sigma – is no more When nations steal growth from one another… More heat than light Shanti and Sadhana through Music PC’s preference for professionals Streamlining mandatory third party cover The Swadeshi Trump Align crops to agro climate endowments… Computation of GDP – conundrums continue The star of Spencers is no more Gas is the way forward CII projects higher growth… S V Raju – a ‘good’ true liberal IAS invades NDDB... TN – agglomerate land holdings without alienating ownership Shaming of Tamils by Tamil farmers at Delhi The sea- saw battle continues... Poor quality of university VCs A proud Madrasi Delhi returns to BJP EEC at the National Media Centre This scant respect for Law Cutting the nose to spite the face Build close rapport with business leaders Contrarian cousins Mersal magnified Odisha: spectacular win by Naveen Patnaik When online building permits work…. Dr C Rangarajan returns to Chennai The rise and fall of Annamalai University Discoms deserve better… London, London Narayan Making ‘my Amaravati’... Tax agriculture PPP mode for upgrading Corporation Hospitals Protest masters... MHC should not return to its old indisciplined ways Tribute – Manikam Ramaswami Inflation: are we emulating Argentina and Brazil? Waning interest in public discussions… EVM is tamper-proof Measuring roof tops in terms of KW/MW L&T: focus on infrastructure and more infrastructure… Fortune for Indian Airlines Eternal support for capitalisation of PS banks Pharma – overdose of copying Colour-Chem’s colourful KRVS Shipping woes of Chennai companies Demise of a media baron... Which side are you, Montek? Delhi is distant… Poor representation for Kerala and TN in Cabinet Quality education through the PPP mode Bihar – Nitish Kumar adopts the Lalu model Kinetic Karnataka Modi storms Silicon Valley S Ramanathan – a versatile musician, musicologist Tihar, Puzhal not different from Parappana Agrahara When TN politicians can emulate Kerala's TGS- The king storyteller Sri Lanka votes for change Godspeed, Chief Minister JJ Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai Like Hinduism: many paths to reach God... IPL - no surprise this scam For whom the MIDS bell tolls? Limit foreign borrowings to hi-tech, export potential projects... Roaring Ro-Ro facility L&T- the specialty of special purpose vehicles Why land prices zoom in TN? Come elections, come advertisements... F C Kohli - his concerns all embracing Gay abandon in pricing Increasing non co-operation of state leaders Fuel for thought A professional at the helm of IRDA... Sweet news for TN sugar mills Fortune 500 review Five star activism stalls development activity Delhi Chalo... Land reclamation from sea appears cheaper! Banning booze... No mega rail project for Tamil Nadu The Gulf aviation boom More tributes to GR Engineering seats go abegging An enemy’s enemy is a friend The Jan Dhan bonanza CRS, a jewel among managers, is no more. R Sridhar steps down as CEO of Shriram Capital New IT products of Ramco in the pipeline… IPL type auction for VCs? Noble nonagenarians... Robber barons everywhere A glass full of corruption The why of tax incentives Building loyalty through the stomach Return to king coal for urea... Moily’s bold thrust Permanent secretariat for TN GIM
 
When small is no larger beautiful..

Professor R Vaidyanathan of IIM Bangalore and S Gurumurthy of Swadeshi Jagran Manch have been quite active in recent times in re-establishing the small is beautiful concept. In his book India Uninc., RV points to the substantial contribution of the unorganised sector to the country’s GDP.

    I belong to the small sector, entering this over five decades ago. I have been operating in the Industrial Estate, Guindy for 34 years. Guindy pioneered the concepts of industrial estates and the small sector in the country. The small sector was designated a priority sector status. For decades this did enjoy concessional rate of lending from banks, lower rate of excise duties and more moderate tariff for power. In the liberalisation era these have vanished. Interest rates of 14 per cent are much higher than the return on capital most of these units get. A huge power tariff of over Rs 7.50  for kwh is poised for further rise. With existence a struggle, very few have scaled up their operations or bothered to  induct technology. The result: most of these units have disappeared from the landscape. When I set up shop in the 1980s, 15 others were allotted sheds. Of these 16, just two of us have survived in the same line of activity. The rest have sold off their properties or moved out. One saving grace for these was the huge spurt in real estate prices. Many of them handed the property to developers to great profit. The estate, which was once a centre for engineering excellence and innovation by small units, is now totally devoid of these.

The crucial lesson: businesses today needs large capital to scale up operations, technology and management. In all these the small, unorganised sector suffers severe handicaps.

China built its economy by scaling up production. When an enterprise produces a million steel chairs a year, it is miles ahead of a small unit in India producing a few hundred pieces a month and cannot obviously survive the competition. Most units that were producing steel chairs in the city, today trade in chairs imported from China (not often of reliable quality) but priced at half of their own cost of doing it.

Large  scale production would take demand for basic commodities like steel to dizzy heights. Four decades ago production of steel in China was comparable to that of India. Today China is the largest producer of steel . She produced last year 779 million tonnes. India produced 81.2 million tonnes.  This scale makes China offer steel at much lower prices to hundreds of manufacturers of steel products. This in turn makes Chinese products extremely competitive. Go to any large mall in the US; most of the products ranging from textiles to computers to electrical goods and to a vast range of consumer products carry the label, Made in China.

Reliance Industries provides yet another instance of economics of scale. The two refineries, set up by Reliance at Jamnagar import crude and refine it to a wide range of products at modest cost and exports these at high profit. Last year the company exported 41.2 million tonnes and earned for the country $ 44.1 billion. Despite crude oil and petroleum products accounting for over a third of the import bill, thanks to Reliance,  petroleum product exports have the largest share in foreign exchange earnings. We need to build scale in production.

 

Author :
Reported On :
Sector :
Shoulder :
RELATED NEWS
ABOUT IE
IE, the business magazine from south was launched in 1968 and pioneered business journalism in south. Through the 45 years IE has been focusing on well-presented and well-researched articles. When giants in the industry stumbled to keep pace with the digital revolution, IE stayed affixed embracing technology.
Read more
 
PRIVACY POLICY
Economist Communications Ltd is committed to ensuring that your privacy is protected.
Read more
TERMS AND CONDITIONS
You agree that your use of this Website and the purchase of the magazine will be governed by these terms and conditions.
Read more
 
CONTACT US
S-15, Industrial Estate,
Guindy,
Chennai - 600 032.
PHONE: +91 44 22501236
EMAIL: indecom1968@gmail.com