Urgent steps demanded to boost SME sector

Karachi: The Union of Small and Medium Enterprises (UNISAME) in a message to Ghulam Murtuza Jatoi, federal minister for industries and production (MI&P) invited his attention to the requirements of the SMEs and urged him to take positive steps to promote and develop the sector on fast track basis.

President UNISAME Zulfikar Thaver stated that the SME sector is the vibrant sector, backbone of the economy, the engine of growth and the vehicle for poverty alleviation and best for creating employment.

He said there are 3.2 million SMEs in Pakistan and in addition to this there are equal number of SME farmers and although this sector is referred to as the SMEs it is the majority sector capable of growth and stimulating the economy.

He reminded the MI&P that the SMEs contribute to 30% of the exports and most of them are involved in value addition and they contribute 35% to GDP and offer employment to about 40% of the labour force.

The impediments to SME growth are poor law and order, lack of education, lack of access to finance, improper environment, bad infrastructure, poor logistics and these days the energy crisis is a real issue, he stated.

In order to promote, encourage, facilitate, motivate and upgrade the SME sector he suggested to the minister to set up a co-ordination committee to co-ordinate between the SME promotion and development institutions.

The NPO, EDB, SMEDA, PCSIR and TDAP are all dedicated institutions and working hard for the promotion and development of the SMEs together with the commercial banks but they all need to co-ordinate with one another for integrated efforts, he stated.

UNISAME submitted a road map to the MI&P and urged him to direct the Small Medium Enterprises Development Authority (SMEDA) to educate the SMEs about the new technologies in production, management, marketing, accounting & inventory control

It asked to encourage the SMEs to modernize and make plans for balancing and replacement of their units and arrange transfer of technology. It urged to facilitate the SMEs through banking, leasing, and insurance as these are the pillars for growth.

The SMEs in order to progress need law and order and protection and need to feel safe. The infrastructure needs to be improved. The SME sector is dependent on logistics which encompasses transportation, warehousing and collateral management. The need for alternate energy is being felt due to the energy crisis.

There is an urgent need of industrial estates in all the provinces. The government should adopt a policy of fair taxation and also give tax benefit to innovative industries and new units. The SMEs need their own chamber of commerce and also their own export promotion bureau.

The union said that the above measures are not an easy task and for this the government should strengthen and equip SMEDA and broaden its scope to enable it to reach the SMEs involved in manufacturing, trading and services.

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