Justify the following statement.
Generally, Small Scale Industries are sick.
- There are many problems faced by Small Scale Industries. These problems may be internal problems or external problems.
- Internal Problems are like unskilled labour or untrained labour, lack of managerial skills and marketing skills, lack of modernisation, etc.
- External problems like shortage of working capital, inadequate loans, delayed payments, shortage of raw material, etc.
- According to RBI a sick unit is that which has incurred a cash loss for one year, is likely to continue it for the current year as well as following year.
- Thus, mainly due to financial problem, industrial units are unable to sustain themselves and are called as sick units.
Concept: Challenges of Small Scale Industries
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