Tackling the common problems in Saarc nations

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: Mr Khan from Lahore, Pakistan had to close his Rs 100 crore business in car batteries because of the easy availability of cheap smuggled batteries from Afghanistan. His government could not do anything to protect his business. Rajan Jaywardene of Sri Lanka had to get credit from the banks at 36% rate of interest on OD Facility when he needed money for his business. He still succeeded in fulfilling export orders. These were the facts which emerged from a two day international conclave on,” SMEs of SAARC Countries—Looking Ahead “organised by the PHD Chamber along with KAS of Germany. Businessmen from Afghanistan, Bangladesh, Pakistan, Sri Lanka, Bhutan, Nepal, and India were present at the conclave.

This conclave threw open some interesting insights. Though SMEs are the backbone of the economy for all the SAARC countries and constitute a huge percentage of the industry, still enough is not done to promote them and they are facing multitude of problems which are surprisingly similar. Affordability, accessibility and timeliness of short-term and export credit are major constraints. Other hindrances that SMEs face to grow are timely payments, technology upgradation, right manpower, poor quality control, lack of business information, no training programmes and no extra resources on research and development. Apart from this, poor infrastructure facilities–airports, ports, roads, power, low internet connectivity, inadequate information about rules and regulations governing trade between SAARC countries and time consuming procedures for export and import which increase the transaction cost of business also are some the common obstacles that they face.

SMEs contribute a huge share to their respective GDPs, export and provide highest employment opportunities next only to agriculture and also utilise local resources as well as prevent migration of rural population to urban centres.