• December 19, 2014

December 19, 2014?Small businesses in India would receive\r\nsignificant boost from restructuring and better access to energy sources other\r\nthan fossil fuels and the power grid.

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The two recommendations are among several contained in a\r\nreport that Nathan Economic Consulting India Private Ltd., a unit of Nathan\r\nAssociates, prepared for the Federation of Indian Chambers of Commerce and\r\nIndustry and an affiliated group, the Confederation of MSMEs (micro, small, and\r\nmedium enterprises).

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Government should provide incentives for MSMEs to convert\r\nfrom proprietorships, where a single owner runs affairs, to limited liability\r\npartnerships of two or more individuals, according to the report. Partnerships are\r\nmore likely to attract much-needed capital, employ more people, and be more\r\nproductive than proprietorships, in addition to providing better risk\r\nmanagement, the report found. The availability of finance ?continues to be a\r\nbig challenge in the MSME sector.?

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As for energy, almost 25 percent of MSMEs registered with\r\nthe government ?operate without any energy sources.? Those businesses provide\r\nlimited employment and lag far behind other businesses in productivity. Using\r\nnonconventional energy sources (NCES), such as wind power or biogas, provides\r\n?almost free energy? after initial setup expenses. ?Besides, use of NCES would\r\nhelp to reduce risks of loss of production due to power shortages and high\r\nelectricity costs,? the report found.

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Read\r\nthe full report.

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