India Global Summit on MSMeS 2011Innovation: Changing the MSMe Landscape

19-20 October 2011: New Delhi, India

Retrospect

CommuniquéJournal of the Confederation of Indian Industry

Special Issue November 2011

47 Countries350+

Delegates400+

B-2-B Meetings72 Speakers

10 Sessions

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IndIa Global SummIt on mSmeS 2011

Institutionalize the various initiatives taken to drive •innovations in the MSME sectorEncourage Indian MSMEs to leverage the investment •opportunities in Afghanistan

Inaugural session

International best Practices for Smes

(L-R) Ramesh Datla, Chairman, CII MSME Council and Managing Director, ELICO Ltd; Gurpal Singh, Deputy Director General, CII;

Dr Anwar Ul Haq Ahady, Minister of Trade & Industry, Afghanistan; Virbhadra Singh, Minister of Micro, Small and Medium Enterprises, India,

and Uday Kumar Varma, Secretary, Ministry of Micro, Small & Medium Enterprises, India

(L-R) Gurpal Singh; Dr Anwar Ul Haq Ahady; Ramesh Datla; Virbhadra Singh, and Uday Kumar Varma

HighlightRelease of CII-PWC report on ‘Innovation: Changing The MSME Landscape’

(L-R) K K. M. Kutty, Past Chairman, CII National MSME Council and Managing Director, Sealings & Jointings; Gurpal Singh; Abdul Atlub Ahmad, President, India-Bangladesh Chamber of Commerce and Industry; Dr Mohamed Al Amin Bin Abdul Majid, JP, Datuk Ir, Chairman, SME Corporation, Malayasia; Deep Kapuria, Past Chairman, CII National MSME Council and Chairman, Hi-Tech Gears Ltd; Patricia Hewitt (Rt. Hon.) Chair, UK India

Business Council and former Secretary of State for Trade and Industry, UK; Li Nianzheng, Vice-Chairman, Shanghai Federation of Industrial and Economics, China, and Grayson Perry, Trade Commissioner Austrade, Australian High Commission

MSME sector is at the threshold of big transformation powered by innovations, where the global alliances and partnerships have assumed key significance for MSMEgrowth. Government of India has accorded high priority to the MSME sector in key national developmental programmes. The role Micro, Small and Medium enterprises (MSME) sector will play in shaping India’s GDP growth in the 12th Plan period is paramount.

RecommendationsEnhance global partnerships in the MSME domain•

Development of Synergies between public and private enterprises should be facilitated for the development of an efficient ecosystem for MSMEs. The session alsofocused on what are the best practices followed around the world to make MSMEs more competitive. Formation of partnerships for mutual benefits was one of the keythoughts, that emerged during session.

RecommendationsMSMEs have key roles in generating employment in •semi-urban and rural areasAlternative funding mechanisms a must for MSME •growth and developmentPromote global MSME partnerships that are key to •knowledge sharing and adoption of best practices

Day 1: 19 October 2011: New Delhi

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IndIa Global SummIt on mSmeS 2011

defence and Homeland Security

Investors meet

HighlightRelease of CII PwC paper on Opportunities in Defence and Homeland security

HighlightRelease of CII PwC Paper on Financing Options

(L-R) Commodore S Samaddar, Vice President Nova Integrated Systems;BhuvneshKumar,Director,Low IntensityConflict,DRDO;Harvansh Batra, Director (Sourcing) EADS; YVV Prasad, President

& Divisional Head, Bharat Realtime Ltd; Aslam S Khan, President & Divisional Head, Bharat Realtime Ltd; K P Singh, former Secretary, Defence Production, India; Nalin Kohli, Co-Chairman, CII National MSME Council

and Chairman & CEO, Araina Enterprises; Brigadier Raja Puri, DDG Indigenization; Deepak Sharma, Head – Procurement, BAE Systems;

Karun Khanna, Chief Advisor, Alpha Design Technology Pvt. Ltd, and Wing Commander Raman Sopory.

(L-R) V K Khamboj, General Manager, Oriental Bank of Commerce; Rakesh Rewari, former Deputy Managing Director, SIDBI; Dr Harish Patnaik, Executive Director, Gujarat Venture Finance Ltd; Rahul Chandra Co-Founder & MD, Helion Venture Partners; A Ramesh Kumar, Chairman, CII Sub-Committee on Credit & Institutional Finance & MD-CEO, Asia PragatiCapfinPvtLtd;RishiSahai,ManagingDirector,CogenceAdvisorsPvtLtd;MahendraSwarup,President, IndiaVenture Capital Association; Vishal Kapur, Investment Director and Principal, Avigo Capital Partners; Rashmi Prasad,

Deputy General Manager - SME, State Bank of India (SBI), and Gagan Kumar, Partner, Archer & Angel

(L-R) K. K. M. Kutty; Ravi Tyagi, Head SME Projects, National Stock Exchange of India Ltd; Nagesh Pydah, Chairman & Managing Director, Oriental Bank of

Commerce, and V S Rathore, Executive Director, SIDBI

Introduce an export advisory programme for the •MSMEs in the defense equipment production sectorMSMEs should need to enhance their design research •capabilities

RecommendationsBuild mechanisms to bridge investor expectation gaps •to spur investments in MSMEsBanks may play the advisory role to MSMEs in accessing •funds from multiple sources including angel investors, VCsSuccess of the SME stock exchange platform will depend •on GDP growth, higher participation of innovative entrepreneurs and risk capital investorsUpscale the existing schemes for MSEs•

The deliberations during the session focused on how the MSMEs may best leverage their capabilities and capacities to avail the opportunities in the Defence sector. It also stressed on the need to focus on quality, cost and delivery. It emerged that given the technology spectrum and the technological challenges required for homeland security, there is a need for the Public Private Partnership in Defence and Homeland security production.

RecommendationsMSME sector needs to develop a long-term policy •to meet the requirements in the defence sector. The enterprises require a high-level understanding of the supplier landscape and the tax structuresMSMEs should be encouraged to work with larger •companies engaged in defence production as the Ministry of DefensegenerallybuysonlyfinishedproductswhichMSMEs seldom produceMSMEs can play an active role in the army’s drive to •indigenize production of equipment and spare parts

There exists a huge gap as to how things stand for the funding that is made available and what is needed for the sector, was one of the key thoughts, that emerged. There is a need to go beyond the traditional find innovativeways tobecomesufficient infinancial requirements.Themeet focused on how MSMEs can avail equity funding from private equity funds, venture capitalists and angel investors, in addition to the existing sources of the debt funds.

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IndIa Global SummIt on mSmeS 2011

(L-R) Shaleen Raizada, Managing Director & CEO, Sanshadow Consultants Pvt Ltd; Ash Verma, Chairman, Gateway Consultants Ltd; Lakshmi V Venkatesan, Founding Trustee & Executive Vice President,

Bharatiya Yuva Shakti Trust (BYST); Ramesh Datla; P Saha, Consultant, CII, IIFT; Jitender Rajput, National Institute of Design (NID), and Madhukar Sinha, Professor, Centre for WTO Studies

(L-R) Nikhil Arora, Vice-President & Managing Director (India), Intuit; Sunil Vyas, Convenor – CII MSME Development Panel, MP State, Digital Integrator Pvt Ltd; Anupama Arya, National Co-Chair,

CII Young Indians (Yi); Dr Jaijit Bhattacharya, Director, Government Affairs, HP, and Rajiv Rao, Director – SMB Segment, Lenovo India

Innovation and IPRTo remain competi t ive and g row. Innovat ion has a key role to play. The session focused on how and from where the innovations can appear. Specific examples of Indian SMEscoming up with their own innovations were put forward. Steps that are required to make MSMEs innovate and own the IPRs, were deliberated upon as well.

RecommendationsEnterprises should be encouraged to •develop their own IPR policiesMSMEs can tap into technologies •that are going off-patent. This will be cost-effectiveInnovations should be pegged •

to particular goals such as ROI, niche market, export opportunity, etc.

Information technologyInformation technology (IT) is critical to driving innovation and competitiveness for MSMEs. For Indian MSMEs to make the ‘difference’, the use of IT has to be optimum, that needs further push from the polcy makers. The session revolved around on how that could be done. Examples of products, such as Cloud computing, besides sharing case studies and best practices that could help improveandenhanceefficiencyandproductivitywerealsodeliberated.

RecommendationsLaunching a nation-wide blue •collared naukri.com, an Indian website similar in features as alibaba.com, easy to use and affordable ERP solutions and a Central Electronic Registry mechanism.Adoption of cloud computing •which is all about service and takes the complexity out of the way of

growth of MSMEs.Peer benchmarking method or case study method works •best in convincing the MSMEs for adopting a particular IT technology.Since collaterals become problems for MSMEs, •government initiatives such as providing subsidy to enterprises for IT support are needed.

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IndIa Global SummIt on mSmeS 2011

HighlightRelease of CII PwC paper on Opportunities in Biotech and Pharma

mSme and adaptation to Climate Change

(L-R) Dr L Ravindran, Founder-President, Federation of Doctors Hospitals and Healthcare Industry; Dr P K Ghosh, Managing Director, KEE GAD Biogen Pvt Ltd; Devendra Chaudhary, Joint Secretary, Department of Pharmaceuticals,

Ministry of Chemicals and Fertilizers; Dr Rama Mukherjee, Managing Director, ARA Healthcare Pvt Ltd, and R K Singh, General Manager, Small Industries Development Bank of India (SIDBI)

(L-R) Suresh Prabhu, Chairman, Council on Energy Environment and Water & former Power Minister, India; RameshDatla;DrAjayMathur,Director,Bureauof EnergyEfficiency;RajivChawla,Chairman, JaiRajGroup,

and R K Das, General Manager, Small Industries Development Bank of India (SIDBI)

Pharma and biotechnologyThe scope for the sector in the Indian context remains vast with India contributing approx 10% to the multi billion dollar global biotech industry. There is a need for high end Research, and the Government and Industry should get together for the same. This will also address the issue of lack of availability of affordable drugs.

RecommendationsC o n s t i t u t e a •taskforce to survey and assess the role of SMEs in biopharma industry.Set up a national •evaluat ion body to cont inuous ly monitor and evaluate the drug discovery processes.

The focus of the session was how to reduce the carbon emissions, the capacity of the sector to mitigate the climate changes remain disappointingly low. On the other hand it was also mentioned that earlier the MSME sector was the largest polluter in the country, however the scenario has changed given the sensitivity of the MSMEs to clean and green environment.

RecommendationsAll stakeholders in the small sector •should take equal responsibility to reduce the carbon emissionLarge companies should share •the latest green technology and process know-how with the small companies

Drive high-end research and reduce the focus on generics •and contract research.

Needs to create a culture of clean technology and •process

Day 2: 20 October 2011: New Delhi

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IndIa Global SummIt on mSmeS 2011

HighlightRelease of CII PwC paper on Procurement policy: an Imperative for Indian MSMEs

(L-R) Rajeev Buddhiraja, General Manager, Maruti Suzuki Ltd; Gurpal Singh; Ramesh Datla; Commodore S Samaddar, Vice President, Nova Integrated

Systems; Col. R S Thapa, Director – Procurement, MGO Branch, Army HQ; B Bose, Director, Indigenization, Air HQ; Murtada Sesay, Senior Procurement &SupplyChainsOfficer in theUnitedNationsOffice forProject (UNOPS),

and Nayan Thakkar, Country Operation Head, Alibaba.com

(L-R) Gurpal Singh; Ramesh Datla; Rajeev Buddhiraja; Commodore S Samaddar; Col. R S Thapa; B Bose; Murtada Sesay, and Nayan Thakkar

(L-R) Gurpal Singh; Ramesh Datla, and A L Meena, Joint Secretary, Ministry of Food Processing Industries, India

The meet discussed the complexities involved in the procurement process. Lack of access to a structured market, past work experience and the annual turnover requirements are some of the bottlenecks faced by Indian MSMEs. The session deliberated on how the draft Public Procurement Policy can help eliminate and how a suitable match making process can be arranged that helps all stakeholders.

RecommendationsReduce stringent conditions such as turnover placed on •MSMEs in the procurement processEncourage large enterprises to help SMEs understand the •complexities in the defense procurement processesMSMEs can provide the spare support to the defense •sector, making up for the shortfall from the OEMsIndian public sector organisations should reform their •procurement process

ValedictoryThe Session focused on how MSMEs can play a vital role in the development of the food processing sector. The growth registeredinthe11thfiveyearplanisremarkableandmayexceed expectations when the Government announces 15 new Mega Food Parks under the Mega Food Parks Scheme, across the country.

RecommendationSMEs operating in the food processing sectors may be •encouraged to form consortiums to pitch for setting up Mega Food Parks

Procurement meet

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IndIa Global SummIt on mSmeS 2011

Delegates Approx : 350+ Overseas participants : 141No. of Countries : 47Domestic Participants : 213

Countries ParticipatedAfghanistan, Austria Bangladesh, Belarus, Brunei Darussalam, Cameroon, Chile China, Columbia, Congo,

Cuba, Djibouti, El Salvador, Ethiopia, European Union, Georgia, Germany, Ghana, Iran, Kenya, Kyrgyzstan, Luxembourg, Madagascar, Malaysia, Mauritius, Mexico, Myanmar, Maldives, Mozambique, Nigeria, Pakistan, Papua New Guinea Russia, Somalia, South Africa Sri lanka, Syria, Taiwan, Tajikistan Tanzania, UAE, Uganda, Ukraine, United Kingdom, USA, Uzbekistan, Zimbabwe

Facts & Figures

mSme mart

Procurement meet

CRISIL•International Finance Corporation (IFC)•Central Bank of India•Tata Communications•TheCorporateProfiles•Petroleum Conservation Research Association•National Institution of Design (NID) •Bhartiya Yuva Shakti Trust (BYST)•National Stock Exchange•Lenovo•

Hamariya Free Trade Zone•Shahnaz Husain Group of Companies•

Total buyers : 13

Total Suppliers : 80

Business-2-Business Meetings : 400 (Approx)

Alibaba•Bharat Heavy Electricals Ltd (BHEL) •Defence Procurement •Escorts Group •Indian Air Force - Indigenisation•International Tractor Ltd•Maruti Suzuki India Ltd•National Thermal Power Corporation (NTPC)•New Holland Fiat (India) Pvt Ltd•

Philips Electronics India ltd •Shahnaz Husain Group of Companies•Tata Motors Ltd•UN OPS (Procurement Cell)•

Published by Confederation of Indian Industry, The Mantosh Sondhi Centre, 23, Institutional Area, Lodi Road, New Delhi - 110 003November 2011

www.cii.in

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Media coverage

Institutionalize the various initiatives taken to drive •innovations in the MSME sector.Encourage Indian MSMEs to leverage overseas •investment opportunities Promote Global partnerships in the MSME •domain.Build mechanisms to bridge investor expectation gaps •to spur investments in MSMEsIntroduce an export advisory programme for the •MSMEs in the defense equipment production sectorAdoption of cloud computing which is all about •

service and takes the complexity out of the way of growth of MSMEs.Drive high-end research and reduce the focus on •generics and contract researchSMEs operating in the food processing sectors may •be encouraged to form consortiums to pitch for setting up Mega Food ParksNeed to create a culture of clean technology and •process among MSMEsCreate an enabling environment for the adoption and •implementation of public procurement policy

Key takeaways