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Sinha urges small firms to shape up to counter MNC threat

Finance Minister Yashwant Sinha has urged small- and medium-sized enterprises to take equip themselves with skills to face growing competition.

"You should be ready to face competition. You will have to think about the challenges of the future," Sinha told a seminar organised by the Punjab, Haryana and Delhi Chamber of Commerce and Industry in New Delhi.

He said small- and medium-sized businesses should not seek "a blanket of protection" from external business forces that invariably emerge from economic liberalisation.

Some 15.3 million work in India's small- and medium-scale sectors. Over 40 per cent of the Indian manufacturing sector's turnover is from these two segments.

Sinha also called for a debate on the reservation system, which keeps large firms off from some sectors. Sinha opined products made by small- and medium-sized enterprises should be marketed on a large scale to combat the might of multinational corporations.

"You cannot survive against the aggressive advertising of the MNCs. Production should be decentralised but marketing should be on a mega scale," Sinha said.

According to a paper presented at the seminar, small enterprises suffer from unavailability of finance needed to survive in a competitive environment.

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