India may add up to $216 billion to GDP in 4 years, thanks to small businesses; here’s how

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July 28, 2020 3:44 PM

Technology for MSMEs: Shortage of digital skills and talent, lack of enabling technologies, and lack of commitment or budget from management were the top three digital challenges for Indian SMEs.

68 per cent of SME respondents from India are looking to digitally transform themselves.

Technology for MSMEs: Indian small and medium enterprises (SME) are likely to add $158 to $216 billion to the country’s gross domestic product (GDP) in the coming four years on the back digitalization of their businesses, said a Cisco study. The data gathered from more than 1,400 SMEs in 14 markets in APAC region to assess challenges and opportunities they face in their digital transformation journey in the post-Covid world showed that shortage of digital skills and talent, lack of enabling technologies, and lack of commitment or budget from management were the top three digital challenges for Indian SMEs.

“While technology will serve as the greatest enabler in helping SMBs leverage the opportunities created by the emerging low-touch economy, this (Covid) crisis is far too complex for anyone to solve alone. Now more than ever, we need to work together to navigate these uncharted waters,” said Panish PK, Managing Director, SMB, Cisco India and SAARC.

The survey further revealed that 68 per cent of SME respondents from India are looking to digitally transform to launch new products and services and distance themselves from the competition and grow. On the other hand, 60 per cent of respondents said that competition is transforming and that they must keep pace while 50 per cent sought digital transformation due to the change demanded by customers, according to the Cisco and IDC survey titled 2020 Asia Pacific SMB Digital Maturity Study. The other markets surveyed included Australia, China, Hong Kong, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Thailand, Taiwan, and Vietnam.

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Cloud, security, and upgrading IT hardware were the three digital technologies wherein 16 per cent, 13 per cent and 12 per cent SMEs surveyed in India had made investment respectively. For them among the top priorities in their digital transformation route was delivering better or improved customer experience (19 per cent), improve operations or service delivery (18 per cent) and improve finance viability and predictability (15 per cent). Overall, Indian SMEs stood at ninth rank in terms of their digital maturity out of the 14 Asia Pacific countries ranked in the survey.

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