REGISTERED SSI SECTOR - REVIEW OF THE RESULTS

2.1

There are two phases in the registration process of Small Scale Industrial (SSI) units carried out by the State/ UT Directorates of Industries (SDI) viz. temporary and permanent. In the Third Census of SSIs, the units, which were permanently registered with the SDIs till 31st March 2001, were covered on a complete enumeration basis. The frame of registered SSI units contained SSIs, ancillary units and SSSBEs, which were under the purview of Small Industry Development Organisation (SIDO). It did not include those coming under the purview of KVIC, Silk Board, Handicrafts Board, and Textile Commissioner etc. The lists of permanently registered SSI units were made available to the enumerators by the respective SDIs. The lists furnished to the enumerators contained information on Identification no., name and address of the unit, registration no. and the details of the product manufactured, with respect to each registered unit, duly validated with the help of NIC Cell in the O/o DC (SSI) and this helped them to properly identify and approach the units for data collection. The detailed information was collected in the prescribed format, viz., FORMAT-1 by personal interview method.

COVERAGE

2.2

In the third Census, the units permanently registered up to 31.3.2001 were covered on complete enumeration basis. A total of 22, 62,401 units were surveyed. Out of these, 13, 74,974 units were found to be working and the remaining 8, 87,427 units were found closed. Thus, the number of working units works out to be 60.77 % and those of closed 39.23 %.

2.3

The State-wise percentage distribution of working and closed units for rural and urban sectors is given in table R1 at the Appendix. Out of the 13,74,974 working units, 13,48,451 units were actually surveyed by the enumerators. The total number of working units for which no data could be collected was 26,523. In order to include the estimate of non-response, i.e., in respect of the working units not surveyed, in the final estimates, a multiplier was applied at district level. In the data file of working units surveyed, a multiplier of (p + q)/ p was applied, where p is the number of working units surveyed in the district and q is the number of working units not surveyed in the district. The multiplier, so calculated is appended at unit level in the data file of working units surveyed. In other words, total of any characteristic or variable in the Census (registered) sector was estimated as

Total of the characteristic or variable
among the working units surveyed X (p + q) / p

2.4

At the record level, it was found that in many records important information such as market value of fixed assets, original value of plant & machinery, gross output and exports were either not reported or underreported. In order to partially mitigate the extent of underestimation, market value of fixed assets and gross output being applicable to all types of units were estimated for the missing records using the average for the non-missing ones and the total estimates were prepared. In respect of original value of plant & machinery, estimate was prepared for the missing records belonging to SSI category using the average for the non-missing ones of the same category and the total estimate for SSI category was arrived at. For the SSSBE category, no estimation was done for missing observations, as plant & machinery may not be applicable to most of the units falling in this category. Similarly, for exports also, no estimation for missing observations was resorted to.

2.5

State/UT wise coverage of registered working SSI units is given in the following table. The maximum share of working units was in Tamil Nadu (13.09 %), followed by Uttar Pradesh (11.85 %), Kerala (10.69 %), Gujarat (10.08 %), Karnataka (8.04 %) and Madhya Pradesh (7.41%). These states together had a share of 61.16 %.

TABLE 1: COVERAGE OF REGD. SSI UNITS IN THIRD CENSUS, STATE-WISE

LOCATION

2.6

The dispersal of working and closed units in rural and urban areas was as follows:

TABLE 2: SECTOR-WISE DISTRIBUTION OF WORKING AND CLOSED UNITS

REGISTRATION

2.7

Registration in the SSI Sector is voluntary. The registration is done with the District Industries Centres (DICs), firstly on a temporary basis and subsequently, on the basis of the request of the concerned entrepreneurs, on a permanent basis. The DICs register the units, as SSI, Ancillaries or SSSBEs as per the eligibility of the units. Information on year of registration was collected in the Census, so as to have a time series on number of registered units. State/UT wise and year of registration-wise distribution of the units is given in table R2 in the Appendix. It was found that the maximum number of units (45%), which were found operating, was registered during 1991-98. Details are given in table R3 in the Appendix and also depicted in the chart below:

REGISTRATION UNDER FACTORIES ACT

2.8

Some of the registered SSI units might have been registered under other systems of registration. This issue was investigated in the Third Census with reference to registration under the Factories Act. Registration of manufacturing units is mandatory under Sectors 2m (i) and 2m (ii) of the Factories Act. Section 2m (i) refers to units engaging 10 or more workers and using power whereas 2m (ii) refers to units engaging 20 or more workers and not using power. Besides, some of the State Governments notify certain industrial activities for mandatory registration, although they do not conform to the criteria laid down under Sectors 2m (i) and 2m (ii). Such registrations are done under Section 85 (i) or Section 85 (ii) by the concerned State Governments. Section 85 (i) refers to units engaging less than 10 workers and using power and Section 85 (ii) refers to units engaging less than 20 workers and not using power. Third Census found that 62,909 units (4.58 %) were registered under Section 2m (i) and 2m (ii) of the Factories Act and 83,231 units (6.05 %) were registered under Sections 85 (i) and 85 (ii).

REGISTRATION WITH NATIONAL SMALL INDUSTRIES CORPORATION (NSIC)

2.9

In the SSI Sector, the registered SSI units have the benefit of voluntary registration under the Single Point Registration Scheme of NSIC. Third Census reveals that only 31,193 units (2.27 %) availed this facility. State-wise details of units registered under the Factories Act and the NSIC are given in the following Table.

TABLE 3: STATUS OF REGISTRATION OF OPERATING REGD. SSI UNITS UNDER FACTORIES ACT/ NSIC

NATURE OF OPERATION AND DURATION OF OPERATION

2.10

About 91.42 percent of the registered working units were found to be operating perennially, while 6.08 percent were seasonal and the remaining 2.05 percent were casual. The casual enterprises are relatively more prone to sickness. The State-wise percentage distribution of units by nature of operation is given in the following table. The top 50 seasonal and casual industries are given in Table R4 in the Appendix.

TABLE 4: STATE-WISE PERCENTAGE DISTRIBUTION OF NO. OF UNITS BY NATURE OF OPERATION

2.11

In terms of duration of operation, about 92 % of the units operated for more than 7 months. From the location point of view, about 90% of the units operated for more than 7 months in rural areas whereas this was 94 % in case of units operating in urban areas. Only 1.4 % of the units operated up to 3 months in rural areas whereas only 0.82% operated in urban areas for the same period. Details at all India level are given in the following table. State-wise distributions of units by duration of operation in rural and urban areas are given in Tables R5 and R6, respectively in the Appendix.

TABLE 5: PERCENTAGE DISTRIBUTION OF WORKING REGD. SSI UNITS BY DURATION OF OPERATION

YEAR OF INITIAL PRODUCTION

2.12

One peculiar feature with the system of registration in the SSI sector when compared to the other systems of registration is that the units getting registered in SSI Sector might not be the new entrants in to the industrial area. Some of the units might have existed prior to their registration. Third census found that about 45% of the units existed prior to registration. This shows that the system of registration in SSI Sector has been merely a mechanism to recognize the existing industrial units, at least in respect of 45% of the units. State-wise details are given in the following table.

TABLE 6: PERCENTAGE DISTRIBUTION OF OPERATING REGD. UNITS BY TIMING OF REGISTRATION