Author: Sebastian MorrisRakesh Basant/Keshab Das: Sebastian Morris, Rakesh Basant and Keshab DasPublisher: Oxford University PressYear: 2001Language: EnglishPages: 376ISBN/UPC (if available): 0195651197
The volume assesses the performance of the small-scale sector in India especially in response to the introduction of economic reforms. It evaluates the consistency and relevance of various policies in this context, including:1.Reservations2.Excise duty concessions3.Infrastructural Support 4.Credit AvailabilityThe study finds that macroeconomic policy, especially with regards to trade and exchange rate and the functioning of credit markets, has severely discriminated against small firms. Bringing in a wide variety of evidence, including that from a large primary survey, the study recommends:1. More aggressive exchange rate policy2. Correction of the tariff inversion3. Incentivization of credit flows, and4. De-reservation.This would make the sector the principal dynamic force in the economy. Small firms need to be freed rather than protected. The deep schism in the labor market makes small firms crucial to the transformation of the economy and to labor absorption.The author goes beyond the current paradigm of protective small industry policy and make recommendations both for the development of the sector as well as growth and the transformation of the economy. The characterization the segments within the small firms sector is new and innovative and leads to a new perspective of the economy and its structure. This book will be of interest to students of industrial economics and management, and policy-maker with a serious interest in the small-scale sector.