Why the Project was set up

THE GENESIS

The Small Scale Industries sector has an indispensable role in the industrial development of India and has been its vibrant and growing component. This sector produces a wide range of more than 7500 products, accounting for almost 40 % of the total production and 35 % of the total exports of the country.
The small scale sector also acts as a nursery for promoting entrepreneurial talent and as a catalyst for industrial growth through a wide network of more than 3 million units in the country.
Besides this, this sector also addresses effectively the national problem of unemployment by providing direct employment to an estimated 17 million people.
This sector also maintains healthy linkages with the large scale sector through ancillarisation and subcontracting.
The other positive aspect of the Small Scale Industries sector is that it needs shorter gestation period and relatively smaller markets to make it economically viable.
Small scale industries need lower investments and offer a method of ensuring a more equitable distribution of national income which facilitates an effective mobilisation of capital and skill which might otherwise remain unutilized.
However with the competitive environment, the task will not get any easier unless proper supporting services are also provided. The prospective small entrepreneurs are disadvantaged by factors like lack of training, less accessibility to reliable and timely information, lack of proper guidance and counselling, limitations on adopting modern technologies, inadequacy of institutional finance etc.
The Friedrich Naumann Foundation (FNF) joined hands with the State level Industry Association - TamilNadu Small and Tiny Industries Association (TANSTIA) to establish a service Centre, to fill in these crucial gaps felt by the Small Scale Industries Sector.