Adequate infrastructure facilities are necessary for the
overall development of every sector of the economy. In the wake of liberalisation
and globalisation, its presence and importance for the proper growth of
small and medium enterprises cannot be underestimated. Both the Central
and the State Governments are making continuous efforts to upgrade the
infrastructural set up of the various States/ Union Territories (UTs)/
Districts of the country. Inspite of all this, the small and medium scale
entrepreneurs are constantly facing the problem of infrastructural bottlenecks,
which restricts their day-to-day business operations as well as their
future growth prospects.
Infrastructure needed by entrepreneurs include all types
of transportation facilities like railways, waterways, roadways and airways
(depending on the type of small and medium scale firm running by these
entrepreneurs) as per the suitability of the business, as well as proper
established channels of telecommunication and adequate supply of power.
Lack of any of these facility can cause serious damages to the firm's
value chain process, that is, to the production, consumption and distribution
of the products of small and medium entrepreneurs, who already face problems
of lack of finance, inadequate marketing facilities, technological obsolescence,
etc.
Some of the major problems faced by small scale entrepreneurs
with respect to infrastructure are:-
- Inadequate infrastructural facilities creates the problem
of acute shortage of basic raw materials, especially those which are
scarce and need to be imported from distant places, needed by small
and medium scale enterprises.
- Small and medium scale entrepreneurs find it difficult
to distribute their products to the markets which are located at far
off places because of incomplete construction or non-existence of basic
roads/ highways.
- Lack of proper airways and waterways facilities also
restricts the growth prospects of those medium/small scale firms whose
target market is located abroad.
- Small and Medium scale enterprises face shortage of power
supply, due to which they are unable to make full utilization of plant
capacity. Most of them find it difficult to install their own power generating
plants, so as to ensure their uninterrupted operations, due to lack
of required funds.
- Most of them are located in rural areas or remote areas
of the country, due to which they find it difficult to communicate with
people outside the region. This is because of non-existence of proper
telecom network.
Hence, small and medium scale entrepreneurs continued to
face the problem of infrastructure bottlenecks in terms of presence of
inadequate transportation facilities, low/ no access to sound power supply,
lack of proper communications channels, inadequate marketing facilities,
lack of funds, etc. All this affects the long run profit earning capacity
of such entrepreneurs as well as inhibits the chances of survival of enterprises
run by them.
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