The Consumer Unity & Trust Society (CUTS) International has emphasised on the need for exporters to share their profits or benefits with the producers in order to uplift the informal industry engaged in producing export-oriented goods. This development holds huge importance for SMEs because a major portion of the export-oriented goods producing community consists of small units.

When a Bizxchange correspondent spoke to Bakul M Patel, an executive committee member at the Tamil Nadu Small and Tiny Industries Association (TANSTIA) in this context, he said, “Exporters usually buy products at very nominal costs from cottage or traditional industries based SMEs and sell those to foreign customers at high prices. If the exporters share even a nominal portion of their revenue from sale of those goods with the producers, the SME producers would get a financial boost, which would enable them to upgrade their infrastructure.”

Echoing similar sentiments, Ramesh Bhatia, owner of Bhagyashree Suits, a small-sized unit in Jaipur which manufactures and supplies handloom garments, said, “A benefit sharing mechanism between exporters and producers will help both parties because while the producing SME will be able to supply better products to exporters, the latter will be able earn more from enhanced goods.”

Meanwhile, Planning Commission Deputy Chairman Montek Singh Ahluwalia has recently said that India will aim at registering around 10% growth in the 12th Five-Year Plan (2012-17).