INP-WealthPk
SMEs need innovation to stay relevant in economy: experts
March 27, 2023
Mansoor Sadiq
Amidst the prevailing economic meltdown, when all leading large-scale manufacturing industries in Pakistan are going through multiple challenges and facing shutdown or reduced production, small and medium-sized enterprises (SMEs) have the potential to support economic development, experts said. The economic crunch has compelled the decision makers to take tough decisions like import restrictions, increased tariff on electricity, and excessive taxation, which have forced almost all major industries either to suspend or cut production.
Hassanien Javed, Project Director of the National Business Development Program for SMEs, told WealthPK that the dynamics of world trade have changed altogether with the advent of e-commerce. Highlighting the importance of information technology (IT) solutions in collaboration with e-commerce, he said that IT can be beneficial for SMEs in view of improved communications, and finding the best markets in the global market for products through online platforms. Similarly, he said, modern tools of e-commerce can also be beneficial for SMEs in data analysing to make better decisions about their business operations, cost savings, and getting quick response from customers, and enhancing the scope of business parameters.
“Marketing and online trading nowadays are those basic tools, which have revolutionised the modern-day trade,” he mentioned. Hassanien said Pakistan’s SMEs have the potential to contribute considerably more than their current share towards gross domestic product (GDP). Pakistan’s SMEs share to GDP is 30%, exports 25%, and industrial employment 78%. Following the agriculture, SMEs are considered leading employment providers in the country. SMEs are considered as an indispensable and inevitable part for the progress and development of a nation. On one side, SMEs hold enormous potential in strengthening domestic growth, and also contribute towards the national economy with potentials of employment creation.
Fawad Hussein Butt, Chief Executive, One-Link Solutions computer firm, told WealthPK that proper training and guidance could improve the performance and working mechanism for the SMEs sector in Pakistan. He said that SMEs are considered the backbone of the economy, providing employment opportunities at the grassroots level and keeping business activities rolling. “Stability of business activities at the grassroots level plays an imperative role in poverty alleviation and improving the living standards of the public with better opportunities,” Fawad said.
He said shortage of financial resources is the main hindrance for the growth of the SMEs sector in the country.Most of the SMEs in Pakistan could not develop according to their true potential due to lack of innovation in their business model. Fawad pointed out that a majority of small-scale businesses and industries are still pursuing a traditional approach to keep their business activities rolling.
Credit: Independent News Pakistan-WealthPk
