Small Scale and Cottage Industries

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Small Scale and Cottage Industries Managerial Economics PROJECT ABSTRACT Small-Scale industry is defined as manufacturing and processing establishments with less than fifty workers. Small-Scale industry ran the gamut from the most primitive kind of handicraft to small mechanized factories and from independent business units to cottage industries. The possible existence of Cottage industry is prehistoric. In cottage industry production of goods by individual households is specifically for trade not for their own consumption. Small-Scale industry play an important role in developing countries by urban job creation and market expansion that will affect the prospects of developing countries engaging more actively in international trade in the future. Because of small scale industry low skill demand, it provide women and children opportunities to supplement household income and it also provide technical and entrepreneurial training to urban workers. Unlike western countries, most developing economies have a small percentage of their labour forces in large-scale manufacturing and a large share engaged in small-scale enterprises. In the future, the capacity for trade in developing countries will depend increasingly on their ability to create sufficient numbers of jobs to absorb their rapidly growing labour forces. This paper will focus on the role of small-scale and cottage industries in aiding to the economy of the developing countries. Key Words: Small Scale Industries, Cottage Industries, Challenges, Opportunities, Aiding economy, five year plans INTRODUCTION The definition of small scale industries has undergone changes over the years in terms of investment limits is as follow as, In 1977, small scale industrial unit having investment of less than Rs. 10 lakh were defined as small scale industrial undertakings, while for ancillary units, the

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