An Empirical Study on Performance of Indian MSME

Abstract

The article discusses the performance of micro, small and medium enterprises (MSME) during the pre-liberalisation and post-liberalisation periods. The sector has faced a number of enactments and amendments in the policies and programmes between the first Industrial Policy and Micro, Small and Medium Enterprises Development Act for better performance. It has acquired a respectable place in the socio-economic contribution of India even after various shortcomings in the policy proposal, poor infrastructure, inadequate training, deficient credit facility, higher sickness rate and so forth. The aim of this article is to compute and compare performance variables of MSME between the pre-liberalisation and post-liberalisation period as well as to examine the inter-relationship among variables plus the functional relationship between variables. The cumulative annual growth rate and average of percentage change value are applied to calculate and compare the performance between two periods. The correlation coefficient is used to find out the inter-relationship among variables and multiple regression (ordinary least squares) with and without dummy variables are used to find out the degree of functional relationship between output and other performance variables.