WHAT IS SSI
Essentially, “Small Scale Industries” are those that create, produce, and provide services using little machines and a small workforce. These firms must adhere to the Government of India’s rules. This page discusses the fundamentals of SSI registration, SSI certification, and the role of SSI in the Indian economy.
These firms make a one-time investment of up to Rs.10 crore in machinery, plant, and equipment and earn less than Rs.50 crore in annual revenue. On 9 May 2007, the old Ministries of Small Scale Industries and Agriculture and Rural Industries amalgamated to become the Ministry of Micro, Small and Medium Enterprises (M/o MSME), as part of a change to the Government of India (Allocation of Business) Rules, 1961.
STEPS REQUIRED FOR SSI REGISTRATION
The State Government’s Directorate of Industries administers SSI registration on behalf of the Ministry of Micro, Small, and Medium Enterprises. The main reason for SSI registration is to establish new SSI firms in India. SSI registration allows the firm to be eligible for a variety of government benefits. We can also register for SSI/MSME online using Udyam Registration. Let’s have a look at the online SSI/MSME registration process:
– Prescription of credit (priority sector lending), differential interest rates, and so on.
– Excise Exemption Scheme – Exemption from direct taxation under applicable laws.
– Legislative backing, such as reserving provisions and the Interest on Delayed Payments Act.
How to apply for SSI registration
- Navigate to the Udyam Registration portal and select “For New Entrepreneurs who are not yet MSME registered or have EM-II.”
- Click “Validate and Generate OTP” after entering your “Aadhaar Number” and “Entrepreneur’s Name.”
- Your mobile phone will receive an OTP through SMS. When you enter OPT, the PAN validation screen will appear. Enter the PAN number and click the “Validate PAN” button.
- Udyam’s registration page will be launched. Complete all required personal and industrial information including industry name, address, bank account details, and some other common data, and click the “Submit and Get Final OTP” button.
- At this point, the MSME registration process is complete, and a notice indicating success with a reference number will appear. The MSME Registration Certificate is issued following verification of registration.
CHARACTERISTICS OF SMALL SCALE INDUSTRIES
According to the small business definition, such industries exhibit the following characteristics:
These firms are typically sole proprietorships or, in rare instances, partnerships. This typically signifies that the business is owned by a single individual.
- Workforce Requirements
Due to the smaller capital investment required in these industries compared to large-scale ones, they rely heavily on personnel to carry out manufacturing activities.
One of the most significant characteristics of SSI is that both the control and management of such businesses lie with owners. The owner, thus, participates actively in the day-to-day business conduction.
Due to their tiny size, these industries are more susceptible to unexpected business changes. They are more nimble in the face of changing business conditions.
- Optimal Resource Utilization
Because they lack surplus resources, small size enterprises make the most use of what they have without wasting anything.
- Restriction of Operation
The majority of small enterprises operate in a narrow geographic area. As a result, they operate exclusively on a local or regional level.
TOP 5 SMALL SCALE INDUSTRIES EXAMPLES
The 2006 Micro, Small, and Medium-Sized Enterprises Development Act defines and categorizes small-scale industries as MSMEs. The greatest advantage of small manufacturing firms is that they may be launched from the comfort of one’s own home or, at the most, from a tiny rented location. Capital investment is minimal, and the process does not necessitate the acquisition of expensive apparatus or equipment. The following is a list of India’s most successful small-scale industries:
- Candle Making
The candle manufacturing industry requires a capital investment of approximately Rs.50000. It provides work options for numerous women in rural areas. From Diwali to Christmas, lights and candles are a vital element of numerous events throughout India. India’s candle manufacturing industry is thriving, both in terms of production and diversification. Candles are no longer limited to a simple cylinder shape, and virtually every industry produces scented candles.
- Homemade Chocolates
Chocolates have always been a popular treat for people of all ages. Numerous small businesses, particularly in hill station regions, manufacture a variety of chocolates. Mintel, a market intelligence company, predicted that India’s chocolate market would reach approximately Rs172 billion by the end of 2020. With the rise in per capita wealth, chocolate has ceased to be a luxury or a speciality item and is now enjoyed on a daily basis by the common Indian.
India’s cuisine is made with a variety of spices. As a result, demand for spices will always exist. However, due to the vastness of India’s spice market, it also caters to foreign needs. India sold spices worth US$ 3.65 billion during the fiscal year 2020. The industry is tremendously profitable, growing at a rate of around 40000 crores each year.
- Soaps And Oils
Small-scale soap and oil manufacturing enterprises are growing as an increasing number of consumers opt for organic products. Due to the increased acceptance of a chemical-free lifestyle, cold-pressed soaps and oils are in high demand nowadays. Additionally, many of these small firms provide an array of scents and, in some cases, one-of-a-kind products.
- Camphor And Incense Sticks
India is the world’s largest manufacturer of incense sticks, exporting the items to a number of other countries. For the next few years, the agarbatti or incense stick market is predicted to develop at a CAGR of more than 8% in terms of volume. Additionally, there is an increased demand for pharmaceutical grade camphor among Indians, owing to a growing trend toward self-medication. However, in India, 98 percent of camphor is used for religious purposes.
ROLE OF INDIAN ECONOMY IN SMALL SCALE INDUSTRIES
Employment Due to the scarcity of technology and resources, they rely heavily on labour and people to carry out their production tasks.
- Production in its entirety
These firms account for over 40% of India’s total output of products and services. They are a significant factor in the economy’s growth and strengthening.
- Make In India
SSIs are the most effective manifestations of the Make in India concept. They are committed to manufacturing in India and selling their products globally. This also contributes to the growth of global demand.
- Contribution to exports
Nearly half (45%-55%) of the items exported from India are manufactured by these small firms. Small scale industries account for approximately 35% of direct exports and 15% of indirect exports. As a result, India’s export industry is heavily reliant on these small businesses for growth and development.
- The welfare of the Public
Apart from economic considerations, these industries are critical for our country’s social growth and development. These industries are typically founded by members of the poor or middle classes. They have the potential to amass wealth and employ others. It assists in economic distribution and advances social advancement.