Industrial development is the key for achieving middle income status of the country. However, both opportunities and prospects for the development of large-scale industries in developing countries like our country are limited because of a lack of technological support and skilled human resources.
High-tech companies do not grow much in developing countries owing to a lack of investment and inability to bear potential risks. As a result, small and medium enterprises need to play a big role in advancing the country's economy.
Currently this sector contributes about 25 percent to the GDP. More than 95 percent of the total enterprises in the industrial sector belong to the SME sector. After the agriculture sector, this sector has generated the highest employment. It will not be possible to take the country to the level of higher middle income status without giving proper attention to the SME sector.
In our country, SME sector suffers from adequate information and data that impedes rigorous research in this sector. Further, it has become a tradition to change the definition of SMEs frequently, which also creates problems to assess the actual situation of the SME sector. Apart from that. access to bank finance is one of the main obstacles for the development of this sector. Overall, skills development through a comprehensive and consolidated curriculum involving SCITI of BSCIC and SME Foundation, facilitating access to bank finance for SMEs, establishing one stop service centre, creating a database of SMEs are some of the key policy issues that can help develop and grow the SME sector at a faster rate. It is also important to streamline the role of NGOs and private sectors that are working for the SMEs.
In many countries, particularly in East Asia, such as Japan, Korea, Taiwan and China, the SME sector has been playing the role of engine of economic growth. In all these countries, SMEs are playing an important role by contributing to global value chains through establishing backward and forward linkages with larger industries. The SME sector has been contributing significantly to the industrialisation process worldwide by participating in national and regional production networks. Therefore, we should give highest priority for the development of SMEs that is crucial for achieving inclusive growth and sustainable development goals.