Vol. VI No. 9
September 2008
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Innovation in MSMEs: Applying digital tech
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Micro, Small and Medium Enterprises and ICTs
MSMEs in Latin America
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Contents
Vol. VI No. 9
Features 5
Editorial
6
Innovation and ICTs: Mexico
8
Microsoft Project Vikas
10 14
Developing countries need policy support for MSMEs to embrace ICTs!
September 2008
Mail box Interview 17
Tailoring solutions for SME clusters Rajiv Sodhi
MSMEs in Latin America Innovation in MSMEs: Applying digital tech Juan J Palacios
Ministry of MSME, Government of India
16
Santa Clara University, USA
30
FMRP, Bangladesh
35
Status of MSMEs in Africa
38
Launch of Telecentre Academy, Sudan
based on McKinsey 20 A7Smodel Framework Implementing ICTs in Indian agribusiness Sapna A Narula, Nikhil Sharma
ICTs and MSMEs: A look at Africa Ritu Srivastava
Agro-informatics John Bosco Lourdusamy Anima Singh
Columns 42
Bytes for All
44
Books received
Road to sustainability
Unlimited Potential Programme, Microsoft, Malaysia How do ICTs empower women? Iriani Zulkifli
11-13 November 2008 KLCC, Kuala Lumpur, Malaysia
23
Climate Change News
25 Interview:
For a Breath of Fresh Air: Ten years of progress and challenges in urban air quality management in India 1993-2002 Pan Localization: Working Papers 2004-2007 Subir Dey
45
What’s on
46
In Fact
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Micro, Small and Medium Enterprises
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VK Jain, Professor and Dean of SES, JNU Climate change and energy security netgov Speak: Lead up to IGF 2008 Coordinator: Jayalakshmi Chittoor, CSDMS
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Study: Chennai, India 27 Case An integrated approach to
Global Social Benefit Incubator Programme
Financial accountability through ICTs Suparna Roy
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Venture catalyzing MSMEs
Adopting ICT tools in Mexican MSMEs Juan Vilalvazo Naranja
Indian MSMEs: The engine of growth Jawahar Sircar
39
Rajeev Karwal Founder and CEO, Milagrow
Part V: Social networking and Internet governance
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Internet Governance i4d | September 2008
Editorial Developing countries need policy support for MSMEs to embrace ICTs! ADVISORY BOARD M P Narayanan, Chairman, i4d Chin Saik Yoon Southbound Publications, Malaysia Karl Harmsen United Nations University Kenneth Keniston Massachusetts Institute of Technology, USA Mohammed Yunus Grameen Bank, Bangladesh Nagy Hanna e-Leadership Academy, University of Maryland, USA Richard Fuchs IDRC, Singapore Rinalia Abdul Rahim Global Knowledge Partnership, Malaysia
MSMEs have to confront high level competitive markets in an increasingly globalised world. What can information and communication technologies do to create a supportive and empowering environment for the huge numbers of small sized or medium sized or even micro enterprises to battle the current economic and market trends? Attaining competitiveness is a big challenge for the MSMEs in India which are important contributors of GDP and exports. This is especially of concern to the Government of India, which has reponded by setting up a national portal to strengthen the hands of MSMEs through ICTs. Set up with support from Microsoft, the project Vikas enables MSMEs to use information and communication technologies effectively.
Walter Fust Global Humanitarian Forum, Switzerland Wijayananda Jayaweera UNESCO, France EDITORIAL BOARD Akhtar Badshah, Frederick Noronha GROUP DIRECTORS Maneesh Prasad, Sanjay Kumar
As global economies become increasingly reliant on ICTs, to receive, process and send out information, SMEs in developing countries have to become responsive so as not to be left behind. ICTs are often used for increasing the global outreach and awareness of products and services, to integrate to the global supply chain, to bid for outsourcing business opportunities, and to improve their own productivity in production processes as well as to improve internal business processes.
EDITORIAL TEAM Editor-in-Chief Ravi Gupta Programme Co-ordinator Jayalakshmi Chittoor Content Editor Rajat Banerjee Sr. Research Associates Ritu Srivastava, Ajitha Saravanan
In India, the SMEs are spread thin. Wherever clustering approach has been developed, and organisations like UNIDO have brought technology transfer and support to clusters, they have seen to embark on an improved profitability and competitiveness route.
Research Assistant Subir Dey Sr. Graphic Designer Bishwajeet Kumar Singh Graphic Designers Om Prakash Thakur, Shyam Kishore, Chandrakesh Bihari Lal (James) Web Programmer Zia Salahuddin i4d G-4 Sector 39, NOIDA, UP, 201 301, India Phone +91 120 250 2181-85 Fax +91 120 250 0060 Email info@i4donline.net Web www.i4donline.net Printed at R P Printers, Noida, India i4d is a monthly publication. It is intended for those interested and involved in the use of Information and Commnication Technologies for development of underserved communities. It is hoped that it will serve to foster a growing network by keeping the community up to date on many activities in this wide and exciting field. i4d does not necessarily subscribe to the views expressed in this publication. All views expressed in this magazine are those of the contributors. i4d is not responsible or accountable for any loss incurred directly or indirectly as a result of the information provided.
Centre for Science, Development and Media Studies, 2008 Except where otherwise noted, this work is licensed under a Creative Commons Attribution 2.5 License
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Why have MSMEs been slow to adopt ICTs in developing countries? Often, it has been seen that Governments in these regions have been slow to adopt policies. Agencies like Small Industries Development Bank of India (SIDBI) have collaborated with international agencies like GTZ to build technical and business capacities besides rendering the important financial services crucial to MSME sector. If we were to learn from other Asian countries of how they have provided supporting policy environment, we can adapt them for India. For example, Korea provides a webforum to SMEs to showcase their products to an international market; Japan provides tax relief for SMEs that use ICTs; Singapore subsidises the training of SME workers in ICTs, Philippines has deregulated VOIP so as to reduce international telephony costs. These are important policy directives that have been researched and documented by UN’s ADPID policy note issued way back in 2005. It is important to know that SMEs are the core backbone of employment to the rural/peri-urban masses, and manufacturing has to be the hard core strength of any nation, if it has to have a secure financial inclusion, and strong economic future. In this issue, we bring you some of the core experiences of MSME sector and the use of ICTs from across the world. This issue is central to addressing the poverty issues and we hope you will also share other experiences that will benefit the MSME sector.
Ravi Gupta Ravi.Gupta@csdms.in September 2008 | www.i4donline.net
5
INNOVATION AND ICTS: MEXICO
Adopting ICT tools in Mexican MSMEs Mexican government has been supporting the innovation and technological development of small businesses and also giving support to sectors of great impact such as the ICTs
Introduction It is important for developing countries to adopt ICT technologies especially in small to mid size businesses, to improve processes, efficiency and be more competitive. The problem is that many small to mid size companies do not know where to go or they think that they cannot afford it. Very few would be able to pay for servers and staff to maintain them. Therefore, we are working to provide software as a service with applications hosted on central servers for small businesses. There are many current developments of creating platforms, such as Amazon’s web services (Elastic Compute Cloud {EC2}, Simple Database {Simple DB} and Simple Storage Service {S3}), and Google’s App Engine. We believe that to enhance competitiveness it is important to provide low cost solutions and help SMEs adopt ICT technologies based on these platforms as quickly as possible. Softwares can be delivered as a service rather than an upfront purchase. This is a very important step in making software accessible with no need to install and maintain servers locally in order to get the benefits of ICT. This also allows service providers to serve customers at a distance, with no need to visit customer sites to maintain and patch servers, install updates, do backups, etc. There is a disadvantage that it requires Internet connectivity, and when the connection is down, the system cannot be used. However, it is really the only way possible to serve some customers at the price points necessary.
Towards automated management systems Dr Juan Villalvazo Naranjo Director of the Department of Project Engineering University of Guadalajara Mexico jvillalv@newton.dip.udg.mx
6
But to get the full benefit, of ICTs, companies must re-engineer business processes too They must convert papers based systems to data entry systems
and automate the collection of data. Manufacturers, have to automate the collection of data from manufacturing systems into the ICT framework. Bar codes or RFID can be employed to automate the collection of information when products are shipped or moved for any reason. Automatic submission of customer orders to the factory floor, and the status of orders automatically fed back to salesmen and customers, can greatly decrease the cost of processing and shipping orders, and increase customer satisfaction. Automatic collection of information can also make planning easier, efficient and allow management to identify and fix bottlenecks.
Serving rural communities Rural communities have traditionally been underserved and left out of the process of moving to ICTs. Internet access to rural communities will provide impetus for the adoption of ICT technologies. There are emerging low cost technologies such as point-to-point 802.11 being developed by Intel and others that will reduce the cost of long distance point-to-point connections to hundreds of dollars per tower. This will allow rural communities to take advantage of online applications and be served from a distance by service providers in a very cost effective manner. Without Internet access, many rural businesses will be left out of the ICT revolution and be at a competitive disadvantage. The government and universities have a huge role to play in getting Internet access to rural communities at an affordable cost, and just as important, develop the industry that can provide ICT to rural communities. Many of the technologies developed for rural communities can also serve to provide low cost solutions for urban companies with limited financial i4d | September 2008
resources. The government can also play a role in getting low cost Internet service to urban businesses.
Business in need of services (Demand) Business and users’ community in general demand for: cost reduction, access, teaching, training and counseling services and a large information campaign to be aware of the opportunities, uses and costs etc. from their suppliers. Providers, as well as the traditional industries are found in large, medium and small sizes, a majority of them work with private platforms and in quality and certification systems that give them more security, but this raises the prices of the products or services.
The Mexican experience In Mexico, nowadays there are several programmes in operation to support innovation and industrial development, including more or less support of the ICTs, through promotion and credit schemes, that are described below.
products, the rest for activities like: Events, Promotion, Training, Development Centre and others. Small and Medium Enterprises (SMEs) are supported by upto 70% of the total Project cost.
CONACYT-SE Fund The ‘Fund for Innovation’ established between the National Council for Science and Technology (CONACYT) and the Economics Secretary (SE) has been operating for more than five years supporting projects from the SMEs that want to develop projects to increase their level of competitiveness through the development of new products, processes or services. The SMEs receive support for up to 50% of the total cost of the project. From 2004 to 2008 the fund has given resources to the tune of US $ 140 Million. Please refer to the following figure:
Promotional programmes PROSOFT ‘The Programme for the Development of the Software Industry’ (PROSOFT) has been operating for the last six years, with the aim to drive the development of IT sector through temporal support to work on projects for the creation, development, consolidation and productivity enhancement and sustainability of enterprises of the information, communication and services industries. From 2004 to 2008, the federal government allocated an equivalent of US$
Figure 1: Spending on Prosoft
183 million for this purpose, as shown in figure 1. 46% of the budget was for project development and quality certification of September 2008 | www.i4donline.net
Figure 2: Spending on CONACYT-SE
Credit Programmes Support Fund for the Micro, Small and Medium Enterprises (FONDO PYME) It is an instrument to support smaller enterprises and entrepreneurs with the purpose of promoting national economic development, through granting temporal supports to projects and programmes that encourage creation, development, consolidation, competitiveness and sustainability of micro, small and medium enterprises. The credit is up to US $ 150,000 for a project with 0% rate of interest, and up to 80% of the project value, with a repayment term of 48 months, it is necessary to have a guarantor to avail of this credit facility. Between 2004 and 2008 US $ 1,141 million were handled. In 2006, 994 projects were supported, 422 of which were for the creation and strengthening of enterprises, technological development and innovation.
The Fund Jalisco for Entrepreneur Promotion (FOJAL) FOJAL is only for the State of Jalisco. FOJAL supports the creation, survival and consolidation of SMEs. The maximum credit limit is US $ 100,000, with an annual rate of 9%. The repayment period varies between 24 to 60 months. It is necessary to have a guarantor/endorser to avail of this fund.
Private banks The Private Bank has an objective to give credit to persons and enterprises so they can generate capital and satisfy their capital necessities. From 2002 the Federal Government has established a programme called ‘National Guarantee System’, with the participation of Economics Secretary and Nacional Financiera (State Bank). This programme offers the SMEs the benefit to access financing for productive projects through the main bank institutions without the need to guarantee this financing with a hypothec. The financing can be up to US $ 200,000 with rates of TIIE +6% up to TIIE +18%, with terms up to 60 months with no hypothec guarantee. During the last four years, the University of Guadalajara (Mexico) has participated in two projects with an aim to introduce ICTs in the SMEs: e-Industrial Chain, with the support of the FOMIN (Multilateral Investment Fund); and for the creation and development of new enterprises in the regional context: e-Network for Innovation and Incubation, with the support of InfoDev. The results of these projects were surprising due to the participation of SMEs in the introduction of solutions to administrate manufacturing, as well as in business incubators and entrepreneurs for training, counseling and communications.
Conclusion It is well known that use of technology in the industry, government and universities is a way to enhance economic and social productivity; but it is even better when Information and Communications Technologiesare incorporated in their daily lives. In the developing countries, ICTs help introduce services as health, social security and education and give the same opportunities to all the communities in order to have a better life.
7
MICROSOFT PROJECT VIKAS
Tailoring solutions for SME clusters There are more than 8 million SMEs in India today – small companies that churn out auto components or electronic parts, garments, etc. – making manufacturing the biggest engine for job creation in our economy, and contribute to 60 per cent of India’s exports. About 40 million workers are employed by the manufacturing sector, as per the National Sample Survey 2000. These numbers have has only increased in the intervening years. These are big numbers, with the latent potential to grow bigger, and signify one thing clearly: the SME sector can play a crucial role in the economic growth of India. On the other hand, globalization is increasing and competition is becoming more vigorous. To succeed in a competitive environment the manufacturing sector has to adopt some best practices and embrace some new age tools. One of the key differentiators can be Information Technology and its wide adoption by Indian SMEs can play a significant part in enhancing their competitiveness on the world stage. A NASSCOM published Economic Impact Study in 2005, pointed out that while India was the global IT leader in software services, it ranked among the lowest when it came to domestic capital investment and consumption of IT. This is the gap that Project Vikas tries to address. Rolled out in partnership with the National Manufacturing Competitiveness Council (NMCC), Government of India, Microsoft’s Project Vikas entails a five year action plan to help Indian SMEs increase their global competitiveness through usage of IT to expand opportunities in the areas of job creation, market access, knowledge networks and enablement of supply chain linkages in the cluster ecosystem. Cluster development regards ‘initiatives’ as one of the most result oriented approaches available for fostering an environment that
8
is conducive to competitiveness. This leads to positive influence at three levels. Firstly at the enterprise level, by increasing operational efficiency through better productivity, reduced costs, improved quality, access to better skills, improved market access and enhanced sales and profits. Secondly at the cluster level, by giving way to a commonly agreed vision for development of the cluster, increased awareness and best practices. And lastly at the ecosystem level, by positioning linkages with institutions – state agencies, financial institutions, academic and R&D entities, training institutions that will ally with it to achieve a shared objective. To begin with, we are concentrating our efforts through Project Vikas on 10 clusters across five different industry verticals. Recently, Tirupur became the first cluster where Project Vikas was rolled out in partnership with the Tirupur Exporters Association (TEA). The initiative, ongoing for 18 months now, has enabled the cluster to enhance its manufacturing competitiveness in the domestic and global market. The inauguration of the E-Readiness centre (ERC) and launch of the TEA portal are helping the local manufacturers and exporters achieve manifold objectives. The ERC provides technical training, consulting services, business incubation services, and knowledge sharing platforms to the SMEs enabling them to manage and grow their businesses. In addition, the portal (www.tea-india.org), linked to the national portal of NMCC (http://nmccvikas.gov.in) enables them to reach out to the cluster audience beyond geographical boundaries and make a footprint in the global ecosystem. In fact, according to a recent study by the India Development Foundation (IDF) - Waiting to Connect – about IT adoption in the manufacturing sector, there
is strong empirical evidence that IT use by Indian businesses would lead to greater profitability and employment. • IT-using manufacturing businesses had better performance indicators in terms of profitability and labour productivity than those that did not use technology. IT capital is the second largest contributor to increasing operating profits after plant and machinery and before transportation equipment • IT contributes a 32% change in value add • IT use leads to greater profitability, productivity, and greater employment levels. Firms with deeper IT use see greater benefits You can already see these results through Project Vikas in the clusters it is being implemented in – proof that tailor-making solutions for sectors like manufacturing works better than force fitting solutions to the problems peculiar to the area. At Microsoft, for instance, we envisage a world that can access technology by a combination of ‘on premise’ infrastructure and /or ‘off the cloud’ services that offer solutions to problems that customers would like to solve. It is similar to consuming electricity – you pay only for the time that the switch is on. The Software+Services model has many benefits for both, providers and consumers of IT, but the primary advantage it offers to a India is the ability to leapfrog infrastructure development for IT at minimal cost to the government.
Rajiv Sodhi Director – Emerging Geographies Microsoft India rsodhi@microsoft.com i4d | September 2008
MSMES IN LATIN AMERICA
Innovation in MSMEs: Applying digital tech Introduction
MSMEs in Latin America enjoy a number of advantages with respect to the possibilities for both creating and adopting innovations; at the same time, they face major disadvantages
Josef Schumpeter pointed out in the early 20th century that innovation rates increase more than proportionally with firm size and market concentration; he thus established that large firms were the engines of innovation in capitalist economies. Given Schumpeter’s intellectual influence, the dominant doctrine for most of that century was that innovation was an ability reserved for large companies. This doctrine came to reinforce the tenets of Fordist industrial organisation, which praised the wonders of vertical integration and so the superiority of large, vertically integrated enterprises of which Ford Motor Co. was the symbol par excellence. But things have changed over the last decades. Small companies have proved to be as innovative and efficient as their larger counterparts given the advantages their size entails. The fact that some of today’s most advanced and innovative industries are largely made up of micro, small and medium-sized enterprises (MSMEs) is a clear evidence of that trend. Nonetheless, innovation ability and production efficiency still tends to vary with firm size. This occurs particularly in Latin American countries where micro businesses account for the largest proportion of MSMEs which in turn constitute by far the largest segment of national company populations, as the case of Mexico illustrates.
Defining Innovation
Juan J Palacios Transnational Studies Program Department of Political Studies University of Guadalajara, Mexico jjpl@cencar.udg.mx
10
Innovation has traditionally been regarded as the development and introduction of new production technologies. However, Schumpeter argued that innovation is rather the innate entrepreneurial drive that impels some individuals to upgrade their business. He accordingly conceived of the entrepreneur as an innovator that introduces new combinations of products,
production methods, markets, input sources, and organisational structures, and innovation as the development of new value-creating activities (Schumpeter, 1934). Drawing on those views, a broader concept of innovation has emerged in recent years, which assigns a key role to the acquisition and absorption of new technologies and the development of non-technological innovations (e.g. new marketing strategies, new organisational structures and models) on a par to hard technological breakthroughs (Ocampo, 2007). Therefore, innovation is no longer regarded as just the creation of new technologies or the conduction of research and development (R&D) activities but rather as a series of ‘innovation efforts’ that also encompass activities such as the search for and the purchase of new technologies and the acquisition of tacit knowledge required to assimilate those technologies (Ernst, 2001). Nonetheless, innovation continues to be a relative concept. In developing countries it usually takes place as the purchase of machinery and equipment designed and built in advanced countries, which is known as embedded innovation (Observatorio PyME, 2004). In developed economies innovation mainly involves moving up the technological ladder and/or pushing up the technological frontier (Ocampo, 2007). In both cases, innovation can also mean developing non-technological innovations, also known as soft technologies (innovations in organisational structures, marketing strategies or business models), which may be more important than hard technological innovations proper.
MSMEs’ innovation ability in developing economies As noted, MSMEs account for a bulk of national company populations in i4d | September 2008
all latitudes. Less known but equally significant is that micro businesses and small enterprises make up the bulk of the MSME basket. This is especially the case in developing countries where this size category tends to account for even larger proportions, with the additional circumstance that many micro and small companies dwell in the unwieldy circuits of the informal economy. In that context, firm size and innovation ability tend to be more directly related than in developed economies. This is because the amount of resources required for generating innovations is directly proportional to the size of business establishments. Therefore the chances for small and micro businesses to improve their productivity and enhance their ability to innovate largely depend on the extent to which they are able to become suppliers of medium-sized and large companies, insofar as the latter require their suppliers to show the quality standards they have achieved, mainly those awarded by the International Standards Organisation (ISO) (Ruiz, 2001). Those chances are enhanced from the outset when small and micro companies are born into high-technology industries like electronics and ICTs, designing or making components or else developing software. In general, MSMEs in developing countries and particularly in Latin America, enjoy a number of advantages as to their possibilities for both creating and adopting innovations; at the same time, though, they face major disadvantages. The advantages include the following (Ruiz, 2001): • Ability to respond quickly to changes in demand and to adapt to these changes given the close relationship between management and employees and the absence of bureaucratic structures • Ability to use their working capital for the development of new product lines and production processes • Ability to change their size or their organisational structure in response to changes in the market or challenges in the business environment where they operate • Ability to generate more innovations per unit of financial capital than larger enterprises given their adaptability to September 2008 | www.i4donline.net
•
• •
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changes and the need for them to use their resources with extreme care Ability to be aware of changes in consumer demand given their closer communication with customers Ability to supply small but sophisticated markets Ability to perform well in new industries like software and scientific instruments Ability to outperform large firms in operations such as design and new product development
Their main disadvantages include: • Lack of financial and venture capital and banking credit to engage in R&D and other activities leading to innovation • Lack of highly skilled personnel required for innovation • Inability to communicate sufficiently with other companies, foreign markets, and government agencies • Inability to reap the benefits of increasing returns to scale given their small size • Lack of capital to grow in response to an increased demand • Inability to register patents and exposure to constraints derived from other companies’ patents • Difficulty to comply with regulations In practice, the advantages of MSMEs tend to be the disadvantages of large firms and vice versa. Micro and small businesses face less favourable environments than medium-sized and large firms, although they can slip easily into informality which enables them to avoid taxes, regulations and other burdens such as social security payments. On the other hand, mediumsized companies face more obstacles than large firms as regards financing, taxes, regulations, inflation, corruption, crime and anti-competitive practices, especially in Latin America and Central and Eastern Europe (Schiffer and Weder, 2001). That is why the best way for micro, small businesses to become more efficient and more innovative in developing countries is by becoming part of the supplier networks of global medium-sized and large companies, which forces them to adopt the latter’s higher quality standards enforced by international organisations like ISO.
The case of MSMEs in Mexico The heavy economic weight of micro, small and medium-sized enterprises in developing economies is particularly evident in Latin American countries like Mexico. According to the National Institute for Statistics, Geography and Informatics (INEGI), MSMEs account for at least 50 per cent of Mexico’s gross domestic product (GDP) and generate as much as 72 per cent of total employment (Castro Reyna, 2008). In terms of number of establishments, MSMEs account for virtually all—99.8 percent—of the country’s company population (Chart 1). Chart 1. Mexico: Business Establishments by Size (Percentages)
Source: 2004 Economic Census, General Results, p.10
Moreover, over nine out of ten MSMEs correspond to micro shops with up to 10 employees, most of which are units with no more than two self-employed workers! This proportion has been growing over the last decade: micro businesses accounted for only three out of four MSMEs in the 1994 economic census (Angeles Cornejo, 1997: 53). Conversely, large companies - those with 251 and more employees - account for only 0.2 per cent of Mexico’s business population. Such a highly skewed business structure implies that the chances for innovation activities to flourish in Mexico can be said to be quite limited given that innovation ability is directly related to firm size, as it is the case in developing countries in general. In line with those features, two thirds of MSMEs are family businesses and only 15 per cent are run by managers or assistants close to the owning family (Chart 2). This means that the management practices, organisational structures and entrepreneurial outlook prevalent in most MSMEs in Mexico are rather informal and not optimally efficient as those common in full-fledged, professionally-run companies.
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Chart 2. Mexico: Family Character of MSMEs (Intention of owners after stepping aside from top management)
Source: Inter Ministerial Commission for Industrial Policy, Ministry of the Economy, p. 3
Accordingly, mortality rates are high among MSMEs in Mexico. As many as nine out of ten new ventures go out of business within five years, ¾ do so after two years, and half close down within the first year of operations. Only one out of ten of those that manage to stay in business more than ten years get to grow, mature and succeed in their respective markets (http://olganza.com, July 31, 2006). Likewise, as much as 86 per cent of MSMEs lack any type of certification. Only six per cent have ISO 9000 certification and up to seven per cent some other modality of this kind of certification (CIPI, 2003, p. 32). This means that the prospects for MSMEs to get hooked into international production networks are far from encouraging. Their ability to export and their possibilities to improve their quality standards via innovations like the adoption of just in time management systems or the implementation of numerical control machines are equally limited. The point is, therefore, that most MSMEs in Mexico lack the conditions and the resources for improving their organisational structures, business practices, management methods, and technological standards, and so their ability to innovate in a wide, Schumpeterian sense. This conclusion is qualified to some extent, though, by the fact that a significant proportion of MSMEs are already using computers and the Internet for conducting their business, and that some of them operate in leading-edge industries and so have the urge to be efficient and innovative in order to survive.
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ICT use and business upgrading Although using a different classification, select, Mexico’s leading ICT market research firm, estimates that 25 per cent of micro and small businesses have access to PCs and the Internet; the figure doubles in the case of large and medium-sized enterprises (Chart 3). In subsequent studies, Select has estimated that the proportion of MSMEs using PCs in their business operations has increased up to 30 per cent (Ramírez, 2008). A different picture is seen in the 2004 economic censuses where data on the use of ICTs by MSMEs in key operations are more complete thanks to a more detailed classification used by the Mexican government to conduct and compile the censuses. Chart 3. Firms’ Access to PCs & the Internet by Size (Percentages)
Source: Select (2006), p. 72
The use of PCs and the Internet by micro businesses is substantially more limited than in the case of small, midsized and large enterprises, especially in administrative processes (Chart 4). The use of those technologies is particularly limited in dealings with customers and suppliers by businesses of all sizes. This is notably the case of micro and small firms: only less than 10 per cent use ICTs for Chart 4. Use of ICTs (PCs & Internet) in business operations
Source: 2004 Economic Census, General Results, p. 12
Chart 5. Use of ICTs in design & business process improvement
Source: 2004 Economic Census, General Results, p. 12
that purpose compared to ¾ and above 90 per cent in the case of the other three categories, respectively. On the other hand, ICTs are used to a lesser extent in design and technical processes by enterprises in all categories, especially in the improvement of business processes (Chart 5). This indicates that business upgrading is not a priority among entrepreneurs in Mexico and, more significantly, that interest in upgrading is virtually non-existent among micro enterprises which account for the large bulk of MSMEs in this country. Those results are most revealing in view that business upgrading is an allencompassing process that includes all the efforts aimed at improving the companies’ efficiency, productivity, and competitiveness, and so their ability to innovate which is a necessary element for any upgrading strategy to succeed. After all, innovation can be geared at the upgrading of the innovating firm or at the generation of new products or new technologies for sale on the market.
MSMEs in leading-edge industries in Mexico The sheer size of the MSME ‘sector’ implies that its constituent units operate in most sectors of the Mexican economy. This circumstance in turn implies that not all of those units operate in traditional, inefficient industries and also that a significant number of them operate in some of the most advanced and innovative industries as either producers or specialized suppliers. Thus, these companies can be assumed to use ICTs as a matter of course and even to be born innovative already. The case of the software industry illustrates those observations. Of the 206 companies i4d | September 2008
Table 1. Mexico: Software Companies, 2004
Companies Size Micro Small Medium-sized Large Corporate Total
No. 63 117 14 11 1 206
% 30.6 56.8 6.8 5.3 0.5 100
No. of Employees <15 16 to 100 101 to 250 251 to 1000 >1000
Average No. of Employees 7 60 175 600 1500
Source: Ramírez Bustos (2005), Table 25, with data from AMITI.
registered with Mexico’s Information Technologies Industry Association (AMITI) in 2004, over four fifths were micro and small businesses with an average of fewer than 60 employees and as much as 94 per cent had fewer than 250 people (Table 1). Moreover, a survey on 1,296 IT service companies conducted that same year confirmed those figures. The survey revealed that 43 per cent were micro businesses, 39.5 per cent small firms, nine per cent medium-sized companies, and only 8.6 per cent large enterprises and corporations (Ramírez Bustos, 2005: 42). A similar structure is found in the electronics industry in the state of Jalisco, reputed as the Mexican Silicon Valley or Silicon Valley South (Palacios, 2001). The overwhelming majority—94 per cent—of that industry’s company population in 2006 corresponded to small and medium-sized
firms operating as specialized suppliers and design centres; only the remaining six per cent were large subsidiaries of some of the world’s top corporations in this industr y (CADELEC, 2007).
Conclusion In sum, the Mexican case substantiates the assertion that a direct relationship exists between firm size and innovation ability, especially in developing countries where such ability does increase with the size of business establishments. Since MSMEs account for virtually the whole of Mexico’s business population, it can be concluded that innovation capabilities are very limited in Mexican business establishments in general. This conclusion is qualified, though, by the fact that many MSMEs operate in industries like software design and electronics where all companies are required to be efficient and innovative from the outset. The above adds ground for the claim that innovation is no longer reserved for large corporations; it is now a common ability of smaller businesses as well even in developing countries. It also shows that nowadays firms are becoming efficient and
innovative at smaller scales of operation which means that scale economies are giving way to the prevalence of economies of scope and specialization. Finally, it is in order to point out that given their widespread sectoral presence and heavy economic weight, it is both improper and inaccurate to conceive of and regard MSMEs as a single ‘sector’ as is the convention worldwide. This convention has become a stereotype that obscures the wide diversity of the myriad business establishments bulked up into the MSME basket as to size, product mix, industry sector, technological endowments, productivity level, and innovation capabilities. It is thus imperative, for both analytical and policy purposes, to transcend such stereotype and break the MSME basket down into as many categories as necessary so as to acknowledge the wide diversity of its contents. That is a necessary condition for governments in all latitudes to design sound policies to foment entrepreneurship and promote the upgrading of MSMEs by inducing managers and enterprising individuals to make a sustained effort in that direction. Only in this way will they be able to lever up the efficiency, innovativeness, and competitiveness of their businesses, especially in developing countries like Mexico and others in Latin America.
References: 1.
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Schumpeter, J. (1934) The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle. Cambridge, MA: Harvard University Press. Ocampo, José Antonio (2007) Industrial development: Some stylized facts and policy directions. Pp. 1-4 in DESA, Industrial Development for the 21st Century: Sustainable Development Perspectives. Ernst, Dieter (2001) “From digital divides to industrial upgrading: Information and communication technology and Asian economic development”. East-West Center Working Papers, Economics Series, No. 36 (October). Observatorio PyME (2004) “Salvados por la tecnología: a la creación de valor por la innovación tecnológica” [Saved by technology: value creation through technological innovation]. Serie Contra viento y marea: Historias de PYMES en la Argentina. Buenos Aires: Fundación Observatorio PyME <http://www.observatoriopyme.org.ar/ pdf/clarinfasc.pdf> Ruiz, Andrés Fernando (2001) “La innovación en las PYMES” [Innovation in SMEs]. Gestiopolis, July <http://www.gestiopolis.com/canales/economia/articulos/no19/ inopyme.htm#> Schiffer, Mirjam and Beatrice Weder (2001) “Firm size and the business environment: Worldwide survey results”. Washington, D.C.: International Finance Corporation, The World Bank, Discussion Paper Number 43. Castro Reyna, Claudia (2008) “Pequeñas y medianas empresas, enfrentan el reto de ser competitivas” [Small and medium-sized enterprises face the competitiveness challenge]. El Empresario, March 10 <http://www.elempresario.com.mx> Angeles Cornejo, Oliva (1997) “Evolución de las micro, pequeñas y medianas empre
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sas en México, 1982-1996” [Evolution of micro, small and mid-sized enterprises in Mexico, 1982-1996]. Pp. 43-62 in Isabel Rueda Peiro, Las Empresas Integradoras en México. CIPI (2003) Observatorio PyME México. Reporte Analítico de Resultados 2002 [Mexico SME Observatory. Analytic Results Report 2002]. Mexico: Inter-ministerial Commission for Industrial Policy, Ministry of the Economy. Ramírez, Jennefer (2008) “Las MPyMEs continúan siendo un gran reto para la industria de TIC” [MSMEs continue to be a major challenge for the ICT industry]. Tecnología y Negocios, Number 212, March 4. Select (2006) Visión México 2020. Políticas Públicas en Materia de Tecnologías de Información y Comunicaciones para Impulsar la Competitividad de México [Mexico 2020 Vision. Public Policies on Information and Communications to boost Mexico’s Competitiveness]. Mexico: Information Technologies Mexican Association, Electronics and Information Technologies National Chamber, and Digital Mexico Foundation. Ramírez Bustos, Juan Antonio (2005) “Information and communication technology (ICT) for development of small and medium-sized exporters in Latin America: Mexico. United Nations Publication no. LC/W.51. Santiago, Chile: Economic Commission for Latin America and the Caribbean, United Nations. Palacios, Juan J. (2001) Production Networks and Industrial Clustering in Developing Regions. Electronics Manufacturing in Guadalajara, Mexico. Guadalajara: University of Guadalajara Press. CADELEC (2007) “Industria electrónica en Jalisco 2006” [The electronics industry in Jalisco 2006]. Cadena Productiva de la Electrónica [Electronics Supply Chain], A.C.
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MINISTRY OF MSME, GOVERNMENT OF INDIA
Indian MSMEs: The engine of growth Government of India has developed key strategies to promote and support the MSME sector to promote competitiveness, quality upgrading, finance, technology, etc. This has resulted in a dramatic positive change in the sector
Jawhar Sircar Additional Secretary and Development Commissioner (MSMEs), Government of India jawharsircar@yahoo.co.in
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India devised a definitive development strategy since Independence for achieving economic growth with self-reliance, social justice and alleviation of poverty. In this strategy, the micro, small and medium enterprise (MSME) sector has been accorded a pivotal role in the industrial resurgence of India. Since the 1950s, India has adopted a conscious policy for promotion and development of MSMEs, in view of their vital role in generation of employment, dispersal of economy and better utilisation of resources. The MSME Development Organisation, was set up in 1954 as an apex body for sustained and organised growth of MSMEs in the country. In the next two years, the National Small Industries Corporation, the Khadi and Village Industries Commission (KVIC) and the Coir Board were also set up. The promotional and developmental policies provide support in the areas of finance, technology and quality upgradation, marketing and infrastructural support, entrepreneurial development and fiscal incentives to the MSMEs. The policies to encourage the development of micro and small industries, which include khadi, village and artisanal enterprises, is a vital component of the Indian industrial growth. The continuous support provided to the sector has resulted in the development of a large reservoir of first generation entrepreneurs and has facilitated the sector to acquire a place of prominence in the socio-economic development of the country. The number of MSMEs in India is estimated to be over 13 million, employing is over 42 million. The export from the MSME sector is estimated at around US$ 40 billion during 2005-06. Further, with the ten-fold increase in the permissible investment limit. The sector is
estimated to account for upto 45% of the manufacturing output of India and nearly 40% of the national exports. The MSME sector has consistently registered a higher growth rate than the overall industrial sector. During 2006-07, the MSME sector in India registered a growth rate of 12.6%, as compared to the overall industrial growth of 11.5%. The Government has taken several initiatives and measures for enhancing the competitiveness of SMEs in the present global environment. The most important among them is the enactment of the â&#x20AC;&#x2DC;MSME Development Act, 2006â&#x20AC;&#x2122;, which aims to facilitate the promotion and development of MSMEs and enhance their competitiveness. The Act came into force from 2nd October 2006. The Government has also announced a comprehensive package for promotion of micro and small enterprises, which comprises the proposals/ schemes having direct impact on the promotion and development of MSMEs, in view of the rapidly evolving economic environment, wherein being competitive is the key to success.
Ready to compete in the global arena For enhancing the competitiveness of the Indian manufacturing sector, the Government has launched the National Manufacturing Competitiveness Programme (NMCP). This programme has 10 components that seek to introduce the best elements of industrial competitiveness in the SME sector, which has been unable to afford such practices and techniques. The objective of this programme is to strengthen the sector so as to enable it to withstand global and organised competition and thrive through better technologies and skills. Some of the NMCP components under implementation are: i4d | September 2008
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To protect the intangible assets of our traditional enterprises, under the ‘Intellectual Property Rights (IPR)’ component of NMCP where support will be provided for registration of Patents and Geographical Indications. The Guidelines of the scheme are on the DC MSME website. The INCUBATOR scheme of NMCP aims at supporting businesses based on new ideas. Under the scheme, Knowledge Institutions like Engineering Colleges, Research Labs, etc., will be provided financial support for handholding each new idea/ entrepreneur. The scheme of Quality Management System and Quality Technology Tools (QMS/QTT) focuses on enhancing the competitiveness of the products of the MSME sector. The scheme plans to train future workers of the industry coming out of ITI in Quality Tools, i.e., techniques of in-process quality improvement with training programmes at the cluster level. Under the Mini Tool Room scheme, Ministry of MSME proposes to invite competitive bidding from entrepreneurs and associations to set up Tool Rooms in Public Private Partnership (PPP) mode. They will be more competitive and user friendly and will not be bound by Government procedures and competitiveness will be the only criteria for selection of promoters. Other components of NMCP seek to address issues of ICT, Lean Manufacturing, Energy, Design and Marketing.
Cluster development In the past few years, the Government has been focusing on Cluster Development through which different clusters of such enterprises are given the benefit of a whole variety of interventions, ranging from exposure to skill development, from credit to marketing and from technological improvements to better designs and products. So far, 408 clusters have been approved for interventions under this programme. The Government has also set up an Empowered Group of Ministers (EGoMs) to come up with a holistic integrated approach that would further strengthen the Cluster Development Programme in the country.
Credit for MSMEs For strengthening the delivery of credit to the MSMEs, the Government announced a ‘Policy Package for Stepping up Credit to Small and Medium Enterprises (SME)’ so as to double the credit flow to this sector within five years. This has resulted in a significant increase in credit flow from Public Sector Banks (PSBs) to the MSEs sector. Further, the credit flow from PSBs to the MSE sector has registered a growth of over 20%, during the last three years. The Government is also making continuous efforts to supplement bank finance of MSMEs with other financial options like risk capital and other forms of equity, receivables financing and factoring services, etc. Advanced MSMEs have started realizing the importance of these alternative non-debt sources of funding to raise resources. In the Union Budget 2008-09, the Government has announced setting up of a Risk Capital Fund of INR 20,000 million in Small Industries Development Bank of India (SIDBI) to provide equity support and venture capital to the MSMEs. September 2008 | www.i4donline.net
Focus on skills development The Government has also taken up skill development as a high priority area through various measures like enhancing the training capabilities of the Tool Rooms, MSME Development Institutes and other organization under the Ministry of MSME. Towards meeting the targets envisaged under the Skill Development Mission launched by the Government, these agencies conducted programmes for skill development for nearly 0.18 million trainees during 2007-08. The Ministry has set an ambitious target to enhance the training capabilities of its existing organizations to 500 thousand trainees in the near future. Further, the Ministry of MSME provides all such trainings to disadvantaged sections of the society like SCs/STs, women, etc. free of cost.
Entrepreneurship development The Government has launched Rajiv Gandhi Udyami Mitra Yojana, for “Promotion and Handholding of Micro and Small Enterprises”. The objective of the scheme is to help and facilitate potential first-generation entrepreneurs to complete various formalities and tasks necessary for setting up their enterprises. The Scheme aims to assist entrepreneurs, who have successfully completed entrepreneurship/skill development training of at least two weeks duration, or have undergone vocational training from ITIs. The Scheme would be implemented through various lead agencies, i.e., Udyami Mitras, namely, Entrepreneurship Development Institutions (EDIs), Central/State Government Public Sector Enterprises (PSEs), Entrepreneurship Development Centres (EDCs), NGOs, Industry Associations and other organisations engaged in entrepreneurship and promotion of MSEs.
Subsidising credit to MSMEs The Ministry of MSME has also recently launched a new Central Sector Credit Linked Subsidy Scheme called ‘Prime Minister’s Employment Generation Programme (PMEGP)’. Under the Scheme, INR 47350 million, including INR 2500 million towards Forward and Backward linkages, has been earmarked to generate around 3.7 million employment opportunities in the country, during the next four years. It is a significant initiative with attractive subsidy levels for promoting self-employment setting up micro enterprises with special focus on rural areas. The upper limit of the cost of project that could be setup in the manufacturing sector is INR 2.5 million while that in the business/service sector is INR 1 million. The KVIC has been given the overall responsibility for implementing PMEGP at the national level, it will directly do so in rural areas, as defined in the KVIC Act, through its State Offices and State Khadi and Village Industries Boards (KVIBs). Implementation of PMEGP in urban areas and other rural areas will be done through the State Governments.The strengthening of the MSME sector has opened new vistas for enterprises across the globe to invest as well as collaborate with the Indian MSMEs. A number of MSME segments provide ample opportunities for investments and collaboration, such as food processing industry, IT industry/IT-enabled services, machine tools, pharmaceuticals, medical equipment, textile machinery, mining equipment, auto-component, etc.
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SANTA CLARA UNIVERSITY, USA
Global Social Benefit Incubator Programme You might not expect Silicon Valley venture capitalists to care about safe drinking water for impoverished residents in India or sanitary napkins for girls in Kenya. But for two weeks at Santa Clara University, area executives, financiers, and professors once again taught a class of social entrepreneurs from developing countries how to apply Silicon Valley business principles to their own emerging, socially vital enterprises. The global food crisis added urgency to the sixth annual Global Social Benefit Incubator (GSBI), that took place at Santa Clara University 17-29 August 2008. Media was also invited to attend any of the sessions. Most of the 16 entrepreneurs who attended are working on businesses that improve the lives and increase the economic selfreliance of their countries poorest residents. That, they hope, can help offset the devastating effects of food inflation on people living on less than $2 a day. For instance, David Okello of Coast Coconut Farms in Kenya, is working on establishing coconut-oil “micro-franchises for millions of poor East Africans. Program alumni such as the micro-lending Web site Kiva.org or African solar-radio maker Freeplay Foundation now collectively serve or benefit hundreds of thousands. “Instead of just focusing on how to make their own ventures successful, GSBI participants are also contributing to the economic and social well-being of their countrymen, said Albert Bruno, GSBI academic dean. The program helps attendees complete a cohesive business plan, generate ideas for funding sources and investors, and find ways to overcome indigenous policy and cultural obstacles.
Social entrepreneurs This year’s attendees included four entrepreneurs with projects for water purification or access in the developing world; three with ideas for alternative or green energy production; five with economic-development and equality ventures, and four with health and education projects. Among them is Deepinder Mohan, whose company, Environment Planning Group Limited, specializes in reverse-osmosis technology for purifying water in rural and urban India. Thomas Stehl attended to advance Haiti-based Med and Foods for Kids. The company helps feed malnourished or HIV-positive children and adults by distributing a fortified peanut paste known as a Ready-to-Use Therapeutic Food to care providers in Haiti. Zipporah Ongwenyi attended for Binti Africa Foundation of Kenya, which provides poor women and girls in Kenya rural areas with low-cost, locally produced sanitary pads.
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About the Global Social Benefit Incubator The two-week business “boot camp is sponsored by the University Center for Science, Technology, and Society and the Leavey School of Business. Each year several hundred organizations from around the globe apply to participate in GSBI - and 15 to 20 are invited to attend. Most have already won awards or recognition from institutions such as the Tech Museum or the World Bank. The program features hours of classroom instruction in marketing, management, micro-loans, and business models; it matches attendees with carefully selected mentors such as retired Silicon Valley executives Brad Mattson, founder of Novellus Systems and Mattson Technology, and Jeffrey A. Miller of JAMM Ventures and former Chairman of the Board for Documentum. The in-residence portion of the program culminates in a business plan presentation by each entrepreneur to an elite group of panelists composed of seasoned entrepreneurs, venture capitalists, and senior executives. This year panelists include Lise Buyer, a former Google executive now a principal with privatecompany advisory firm Class V Group; Russ Hall, a founder of the philanthropic advisory firm Legacy Venture; and Ted Moser, managing director at Mercer Management Consulting. For more information http://www.scu.edu/sts/gsbi/ i4d | September 2008
INTERVIEW : RAJEEV KARWAL, FOUNDER AND CEO, MILAGROW, INDIA
Venture catalyzing MSMEs “We help realise the true potential of a business because an idea does not fail, it is the people and organisations who fail ideas. And that is what Milagrow does, it does not let an idea fail.”
Rajeev Karwal is the founder and CEO of Milagrow Business and Knowledge Solutions. In a career spanning over 25 years, Rajeev Karwal has spearheaded business change, restructuring and corporate revival plans across a spectrum of organisations
Can you please share with our readers the philosophy and motivation of Milagrow Business and Knowledge Solutions for MSMEs? During my career spanning over 25 years I have worked with some of the largest corporates and the largest successes in India including Onida, LG and Reliance Retail. I have also worked with Philips and Electrolux. Each of these companies are in their own right extremely big and successful. But there comes a time when, you have to listen to your inner voice. I was a firm believer in India and its growth potential, I felt that the Small and Medium Enterprises (SMEs) in the Indian marketplace have a huge potential but no one is really providing more than lip-service to their cause. They get exploited by larger organisations, Indian as well as International, they are unable to retain manpower, they are not able to conceive good advertising or go-to-market strategies etc. The Government’s role is also limited. In 1991-92 when I was in Spain, I decided that once I return to India I will work for development of this sector. I was very clear that if we engage September 2008 | www.i4donline.net
to help this sector, then obviously social good is at the heart of our business but we will be a for-profit organisation, not a ‘for-profiteering’ one, and that we will engage with the sector from strategy to execution. So, Milagrow as a firm is a very unique firm in India which has ‘from strategy to execution mindset’ and we act as a ‘Venture Catalyst.’ All our relationships are long term, a minimum of 1 year, and we have various business verticals, including Startup, Scale-up, Turnaround, CEO Mentoring and Operational Excellence or business process re-engineering for the SMEs. You mentioned a phrase, ‘Venture Catalyst’, I am presuming that this is different from Venture Capitalist. Could you elaborate on the phrase? Venture Capitalist is someone who provides the Financial Capital, and to maybe extend the logic, a consultant is an Idea Capital provider. Milagrow, by acting as a Venture Catalyst, not only provides the Idea Capital that facilitate the Financial Capital, but also the Management Capital. It is the
most important determinant of success or failure of a small or medium enterprise. Management Capital is the capital which guides how an Idea and Financial Capital can be put to best use and execution and that is what Milagrow does. We do not just do it on a small scale with limited number of people or one office. We have 4 offices in the country. We have 90 consultants and subject matter experts spread across the country, across functions and industries. To elaborate further on this, what Milagrow does, is it takes the business of a SME to the next level be it a startup or a scale-up or at times it can be a turnaround situation also for the SME. Currently, nobody in India focusses on the turnaround of a SME, it can at times involve reinventing the entrepreneur himself or herself by changing the way the SME functions and then comes Business Processes Re-engineering which is very important for them in order to compete with the best in class in their industry. How do you assist MSMEs reach their true potential? What we do is, we engage with an enterprise to assess their Strengths, Weaknesses, Opportunities and Threats (SWOT) in the initial stage. We bring in the external perspective, match it with the internal perspective and develop a shared view of the SWOT. Thereafter, we identify the processes essential for lasting success of the organisation. We create an enabling environment in an organisation from a 360 degree perspective. If required, we work on Product Development and Manufacturing too. We have a unique MPartnering model details of which is available on our website (www.milagrow.in) After the initial stages,
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more focused initiatives are rolled out and our senior management works on various functional or geographical initiatives with the in-house management of the organisation. Its not just about giving advice or creating a strategy but making sure that all initiatives are conceived well, executed, audited and institutionalised. Only then you can say that the project taken up is a success. Please share a few success stories of your interventions. If you look at our website where we have testimonials, you will see that most of our clients are happy with us. As for case-specific examples, there is a company in the lighting sector where a new product entry was big mover in the marketplace but it was not generating much revenue for the company. Today, within 7-8 months of our association, for the last 3-4 months they have been recording the highest sales ever with this new product category. There’s an international client who actually saved almost US$ 26 millions in terms of working capital and almost US$ 22 millions in terms of product costing. We engage on a 360 degree basis, there is a client who completely reinvented himself on the branding perspective. There is another small client, who within one year of our association has tripled his turnover. What happens is that sometimes SMEs do not know what world’s best is or what world scale is. They sometimes don’t even have the basic contacts or networking which is very essential for giving a push to their creative products or services and they struggle. An organisation like ours gets them into the right zone for them to take full advantage of their ideas, products or services. In an increasingly globalising world, and one that benchmarks quality of products and services, how do your interventions make a difference? We have experts who have seen what world class and world scale is. If you look at the Mentors and Partners engaged with us, right from PS Pai, who was on the Wipro board, and also took the Murugappa Group from 4,200 to 7,300 Crores, to Dr Jagdish Sheth who is the inspiration for Milagrow, who nurtured CK Prahalad and has had tremendous amount of success consulting with very large organisations. From Professor Anil Gupta who is the Vice-Chairman of National Innovation Foundation to my own self. Dr Kinnera Murthy who was the Dean of Administrative Staff College of India, to Sunil Gupta who was the Senior Vice President at JWT. Pradeep Chanda who was instrumental in turning around HMV and has also written a book on this. To Maureen Johnson who is based out of London and was the Managing Director of ‘The Store’ which was the WPP Group’s retail brain and Liyan Zhang who is an SME expert based out of Tianjin, China. We have deployed very good people in the organisation who know what the world’s best benchmarks are, V Azhakeson for example who is based out of Bangalore, knows, what is the best quality and product procedure for a the Consumer Electronics or Home Appliances industry. He is the person who helped us deliver product cost-savings and the working capital savings which I was mentioning earlier. He is the R&D specialist of Home Appliances as well as Electronics and Telecom. You have to bring in the right people and this is what SMEs don’t get anywhere else in India or from any other organisation.
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What are some of the key constraints that MSMEs face that have to be addressed immediately? I think there are two or three problems that MSMEs face today. One is Finance, which comes at a very high cost for them because a lot of banks find this sector lucrative, they lend money to this sector at a much higher rate and sometimes when they lend it with a collateral the cost is almost 18-20%. As it is, the SMEs have uncompetitive sourcing sometimes. These conditions make it difficult for SMEs to scale up. The private equity venture capitalist organisations also put up terms that are unhealthy to this sector. As a result of these circumstances, the sector is forced to go out of the tax network and raise finances from the market, then they do not maintain proper balance sheets etc. The second issue is the go-to-market strategy. Most of the organisations don’t know how to build a sales and marketing network across the country or abroad or build brands. The third biggest challenge is to attract, develop and retain good talent with them. Its something that makes a huge difference between a successful and unsuccessful organisation.The sector is unable to provide an ecosystem that would attract and retain branded employees. The moment an enterprise brings a specialised person or an employee learns specialised skills on the job he is poached by a bigger organisation. Thus, it becomes a situation where you move two steps forward and three steps back. When you talk about attracting and retaining good talent, does it mean that Milagrow also helps MSMEs in issues relating to Human Capital? Right now we are not providing manpower but we definitely have a free service for SMEs where we list their vacancies. We have seen good traffic coming to our website where we put potential employees directly in touch with these organisations. What policy changes are required to create a conducive environment for MSMEs to function effectively? I think, it is very important for these organisations to be given some sort of a protection from the financial sharks that exist. Their tax rates should be brought down drastically, instead of putting a fixed percentage, maybe some sort of a slab system can be introduced. I read somewhere that every year almost 5 to 10 thousand enterprises go ‘sick’. Its not documented but people in the unorganised, micro and small sector also go through similar kind of problems that farmers in India go through. The Government is doing a lot now, but its probably too late for the generation that is in the employable age. So I think the Government should bring in some policies which support the current crop of entrepreneurs who may not be employable by large organisations but can do something to earn their own living. Are the problems faced by MSMEs in India the same as faced by enterprises in other parts of the developing world? Yes, similar problems are being faced in other parts of the world too. But there are certain differences, let’s take China for example, I think China is much more ahead in terms of understanding these issues of executing strategies to eliminate some of the problems. They are developing all parts of China now, they are providing access to inland waterways at subsidised rates. The i4d | September 2008
Yellow River which runs through major parts of the country supports transportation and shipping. What happens that way is that enterprises can exist in the interiors of the country where the cost of running an enterprise from the land perspective or the salaries perspective is more economical. Whereas in India, suppose someone in Nagpur wants to sell something in Kolkata, its very hard for him to do so with the current road conditions and fuel costs. The problems are the same everywhere, but some countries are doing better. What about Brazil, which is quite different from China? Yes, Brazil is quite different from China but they have developed the Alternative Energy route which is ethanol, and I think because of that they have fuel cost efficiency or energy efficiency which is one of the best in the world. But still, I think the industry has a long way to go in terms of developing. Even today, tourism is one of the best industries for Brazil but as they move forward, I think Brazil will face tougher times than it has in the past In what ways does Milagrow help a startup micro enterprise? On a macro level, the issues pertaining to micro enterprises are the same as that of SMEs. The thing is a Micro-enterprise may or may not have fee-paying ability but if an idea has potential then we don’t mind taking our returns on a longterm basis where we can end up taking stakes in the company and still become an incubator where we can make an organisation sit in our premises across our 4 offices. Our people can build, operate and transfer, help with their sales and distribution network. So, there are various methods which we have in order to engage with them, including revenue sharing. People feel very happy because there is no organisation like ours, saying that okay fine, come, sit and our people will help you go to the market and develop products which are ready to go to the market.
What is the role of Information and Communication Technologies in enabling MSMEs to function successfully? It is a very important question that you have asked, most of the hardware, software and telecom majors are hardly doing anything to serve this huge sector. Just by reducing the slabs or de-specing an equipment you can’t say that you’re catering to the sector. If someone has to buy an ERP of Oracle or SAP, it is a huge cost and if you buy Microsoft’s proprietary technology then you have to pay for each user license etc. It becomes very complicated and scares people away. There should be a large initiative on Open Source and Shared Hardware which needs to be taken for this sector. Milagrow has invested in a company called, ‘deeprootlinux’ based out of Bangalore which is the only Open Source Software organisation which is developing products for Indian needs. We are also lobbying with the Government that they should come out with a Hardware Strategy to help organisations in this sphere. Can a cluster approach make a difference to the productivity and marketability of MSMEs? Yes, of course, it can. What should be done is, there are lots of initiatives of the Government which are being taken in the right direction but they are not interlinked, for example, there is an ITI public private partnership mode which the Government of September 2008 | www.i4donline.net
India has adopted. Why not link it to the cluster that is nearby and develop people for that cluster? Initiatives like the National Manufacturing Competitiveness Council (NMCC) and India Brand Equity Fund (IBEF) are taken but they are far and few between. India is a very large country and this sector is spread across industries, so I think, identifying clusters and then giving them 360 degree help to make them competitive is the best way to assist them. I think, China has done it very successfully. We are on that path but still a lot needs to be done. I do agree that a 360 degree cluster approach is the best way of making industries in a geographical area or a sector globally competitive. Can rural India’s micro enterprises benefit from Milagrow, and how do you expect to reach over 640,000 villages across the country? Its a big challenge, we have just 4 offices right now. We are in the private domain, we do not want funding from anyone because if you take funding then financial returns start to guide your objective. For the next 2 years, I’ve set a target of about 25 offices. This figure will make us the largest in this space, where we will be at least close to the State-level MSMEs. Through the network of government and educational institutions , we want to reach out to every nook and corner of the country but it will take some time. I am also the National Incubation Chair for the National Innovation Foundation where we have about 65,000-66,000 innovations but not every innovator can be turned into an entrepreneur and this is another challenge which needs to be tackled. Let’s see if, at a latter stage we can tie up with some of the micro-credit firms who are reaching out to every corner of the country and funding enterprises. If there are some possible scale-up models, then we might take them up in the next couple of years or Milagrow can tie up with these initiatives. Please share with us the kinds of services rendered and how entrepreneurs can directly contact you for availing your services. First on the business solutions, we have Startup, Scale-up, Turnaround, CEO Mentoring and Operational Excellence as five industry practices. We also do weekly mentoring clinics free of cost for enterprises which cannot afford our fee and services otherwise. And also reach out through the TIE Conference (Together In Excellence), to the entrepreneurs. Apart from this, we are also studying various sectors, in our knowledge vertical, we have completed 3000 SME, 11 clusters, 5 State-wide studies which is the largest of its kind and the Ministry had called us to give a presentation of the same. We are now starting a capacity building initiative, led by Dr Kinnera Murthy, through which we will reach out across the country with programmes specially suited for MSMEs for example, Access to China, Access to Germany etc., to compete and collaborate with companies there. So, as explained, we are taking initiatives to reach every part of the country. Of course, a portal will also come up but since access to the Internet is limited in the country, we are tackling the problem with the capacity building programmes. Furthermore, the studies that we conduct take us to every nook and corner of the country. We plan to reach out to them and slowly expand our services and our ability to service this sector.
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A MODEL BASED ON MCKINSEY 7S FRAMEWORK
Implementing ICTs in Indian agribusiness By overcoming infrastructural, technological, social and organizational constraints, India can lead its way to successful implementation of ICTs in agribusiness
Sapna A Narula Assistant Professor College of Agribusiness Management GB Pant University of Agriculture & Technology, India sapnaaroranarula@rediffmail.com
Introduction
empower them with right information enabling them to take informed decisions at various stages of supply chain right from purchasing inputs to marketing their produce. (Narula, 2008)
India is marching ahead towards second green revolution, the main component of which is market led-extension. In the light of emerging global agricultural trade and organized food retailing, efficient forward and backward linkages are needed in order to link farmers to global markets. The limiting factors for our farmers in maximizing their farm incomes are poor market linkages, poor access to quality farminputs, services and technology and lack of information about Government resources, institutions and services and schemes. The farmers are also lacking in real time information about consumers, market demand and prices and hence are prone to exploitation by stakeholders in value chain. This has resulted in inefficiencies across the supply chain rendering them incompetitive in global market. To remove the inefficiencies, we need to create competitive agri-supply chains benefiting all stakeholders for which the information flow across the chain is a prerequisite. In f o r m a t i o n a n d c o m m u n i c a t i o n technologies have played an important role for agribusiness systems in developed countries and can do much more in developing countries like India where most of the farmers are small, marginal and resource poor. The technology can
The existing ICT models ICT innovations can be of great help in offering a communication platform for linking farmers to markets. Various IT initiatives in Indian agriculture have been started at national level by Government of India. Some of the popular service models among them are Kissan Call Centers, (www.kisancallcenter.net) and web portal initiative (www.agmarket.nic. in) providing market price information across various agricultural markets in India. Under the Government of India’s National e-Governance Plan, the AGRISNET, proposed Common Service Centers and Village Knowledge Centers which will help India harness the emerging potential of ICTs comprehensively for the benefit of farmers and all partners of agribusiness offering both synergy and value addition. The commodity exchanges such as MCX and NCDEX are also using ICT extensively for facilitating commodity trade. Besides national initiatives, states have also come up with various initiatives, eg, in Assam (ASHA) and Kerala (Kissan Kerala and e-krishi).
Informational needs of farmers
Nikhil Sharma Consultant MART nikhil.sharma@martrural.com
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Pre-sowing
Pre-harvest
Post-harvest
Market Information
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•
•
•
• • •
Information on agri-inputs such as seeds, fertilizers, pesticides Credit Weather Soil testing
• •
•
Good agricultural practices Pest management Time and techniques of harvesting Packaging
• • • •
Post harvest management Storage Grading and standardization Logistics Market information
• • •
Alternative market channels Commodity prices Mandi information Consumer behaviour i4d | September 2008
After the emergence of food retailing in the country and rising opportunities for global markets, the private sector is also leveraging the power of IT to explore rural potential, as a result of which it has also started initiatives viz., knowledge centers of MSSRF, e-Choupal of ITC, Ikisan of Nagarjuna Fertilizers & Chemicals Ltd. Besides, corporates viz., TAFE, Mahindra and Mahindra and several others are adopting new business models backed by ICT. The efforts of Cooperative sector can’t be ignored either with examples of Dairy Information Services Kiosk (DISK) of NDDB and wired village WARANA.
Constraints and challenges in implementation of ICT models Though many models exist in the field of agribusiness, some are running quite successfully, whereas others have a long way to go. The success of these models depend on how effectively and efficiently farmers are able to make use of these technology initiatives so as to really extract benefit out of these. The very first challenge these models have to meet is that of sustainability. Initially, these projects must be funded by Government and other development agencies, but to succeed in the long run, they need to generate means for revenue generation. The implementation of these innovations at field level suffers due to many barriers such as technological, socio-economic and those related to human resource and their capacity building. Some of the constraints identified are revenue generation, infrastructural gaps such as electricity connection, Internet connectivity, installation and maintenance, commitment of stakeholders, selection and capacity building of operators and awareness among stakeholders. Besides this, social, economic and regional diversity acts as a hurdle in implementation of these projects. Challenges of information delivery • How will the information be shared with stakeholders in the marketing value chain? • What information is needed by stakeholders? • How to ensure the timely delivery of relevant information? • How to deliver the content? • What value proposition should be delivered? • How to link the information hub to various service providers? • Which agencies should be involved?
Strategic implementation through 7S McKinsey framework There is a lot of strategic interest for both private and public organizations to make these models a success, yet the major hindrances lie at the field level. The McKinsey 7S framework has been chosen to suggest an implementation model as it combines rational and hard elements with soft and emotional elements, which are again interconnected and interrelated. (Fig. 1) This approach could be useful in explaining the implementation issues in agricultural marketing information networking models, as it involves many stakeholders right from farmers, intermediaries, extension officials, government officials and implementation agencies. Most of the implementation problems mentioned above lie mainly with human resource and hence require soft touch. September 2008 | www.i4donline.net
Here, the model itself has been assumed as an organizational unit to explain the structure, systems, strategy, style, staff, skills and shared values. The strategic enablers are linked with the 7S framework of strategy implementation, where schemes, structure and systems are considered the ‘hardware’ of success and style, skills, staff and shared values make up the ‘software’. When these ‘soft’ variables are present, companies are usually more successful at strategy implementation. These elements are thus linked with the strategic enablers or key factors that influence the integration of IT models to enhance business efficiency, focusing on beneficiaries. The various S’s when applied in context of implementation of agricultural marketing information network mean the following: Strategy: The networking model must define its strategy in terms of resource generation, funding sources, designing an information service mix for target beneficiaries. The sustainability issue is very important in such models, as to how revenues will be generated and how the ICT model is to be linked with agricultural marketing institutions in order to facilitate agricultural marketing. The product-service mix and communication strategy to farmers is also very important for awareness about the information on marketing and commodity prices. Without a well planned strategy, the business model will not be able to achieve its objectives. The integration of the model with revenue streams such as providing e-governance, social networking, education, health and a virtual market delivering goods can help in drawing revenues. Structure: The information networking schemes involve many organisations. The AGMARKNET scheme, for example, involves officials of Directorate of Marketing and Inspection, National Informatics Centre, State Department of Agriculture officials, extension officials etc. The structure of the consortium needs to be designed in such a way that it facilitates speedy decision-making. A networked structure having minimum hierarchies and involving people from all stakeholder organizations with clear cut roles is needed for implementation including those under PPP (Public Private Participation). The more the layers, the less will be the benefits delivered to beneficiaries Systems: They comprises of the procedures and policies of the organizations which define how things should be done to achieve the objectives. The systems must allow flexibility in terms of resources and approaches as different geographical areas may need different approaches. The systems of collecting information and updating the same and methods of content delivery are to be defined. The delivery of SMART (specific, measurable, accurate, relevant and timely) information is possible only through SMART systems. The control systems also need to be employed in order to see that the set procedures and policies are in place. The control system will help identify gaps in service delivery, if any. Style : Beliefs and actions of managers determine the outcome of implemented strategy. A participative style of management suitable for the need of rural areas must be adopted. The local communities such as farmers and intermediaries must be involved in the awareness programmes and selection of kiosk operators. The success of these schemes depend upon how the managers are able to work with such collaborative models. The management must apply the bottomsup approach for encouraging and motivating employees working in this area.
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Staff: This deals with people dimension of a relationship and managing the social structure of a relationship cross-functionally. This is an important aspect of strategy implementation in this area. People are involved at every step in such type of information system. The people involved are data collectors, officials incharge of updating data, kiosk operators, who deliver the information and the people who install and maintain the kiosks. Most of the models are making use of the local entrepreneurs, who are selected among the local folk. The selection of these entrepreneurs plays an important role. If a person involving the local community, having good educational qualification, mental aptitude, enjoying good relationship in the village is selected, he is able to deliver better benefits to the farmers. The role of opinion leaders is also important. Skills: Enabling skills imply that the company ensures that employees know how to do their jobs and stay abreast with innovation in tasks, technology and techniques. Skills imply distinctive capabilities of people and organization which differentiate themselves from others. The skill sets of the persons involved in collecting, updating and delivering information needs to be updated from time to time. The staff must be fully equipped to deliver the services to farmers. Unless fully trained, they will not be able to deliver the information. Capacity building of the staff is one area which is to be looked into. Shared values: Shared values ensure that all concerned share the same guiding values. For every ICT project, we must define the mission, vision, goals and objectives which will be shared among the employees of partnering institutions. These values must pertain to economic, social and national benefits.
Conclusion It is concluded that all the Sâ&#x20AC;&#x2DC;s of 7S framework are critical to the success of these models but soft elements such as style, staff, skills and shared values are more important in implementation. In order to deliver the right benefits to the farmers, financial viability is a must. It must ensure speedy and timely service to attract more farmers. Moreover, the infrastructural bottlenecks such as speed of internet, electricity availability, lack of trained manpower are some of the important issues which need to be addressed. Human resource is an important element, without which these schemes can never be implemented. A right strategy regarding sustainability, a participative style of management, selection and capacity building
Figure 1: McKinsey 7S Framework
of staff involved are very critical to the success of these models. The operational and control systems also play an important role. Hence, an implementation strategy involving communities at the grassroot level and collaboration with local authorities/ companies would help rural masses and promoters reap benefits of these ventures. Â&#x201E; References: 1.
2.
Narula S. A., (2008) Leveraging ICT to Link Farmers to Markets: A Case of Indian E-Business Models Paper presented in International Conference on Technology and Innovation in Marketing held at IMT, Ghaziabad during 18-19 April, 2008 and published in conference proceedings, Technology and Innovation in Marketing, eds. Rajat Gera, Allied Publishers, New Delhi, 2008,pp Sikka, B.K., Sharma, M.L., Singh S. & Narula, S.A.; (2005) on E-Marketing of Apples in Uttaranchal Conference Proceedings of Indian Society of Agricultural Marketing, Pantnagar, published in Indian Journal of Agricultural Marketing, Vol 19, No. 2, Conference Spl., May-August, 2005.
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i4d | September 2008
CLIMATE CHANGE NEWS UN: Slashing fossil fuel subsidies could help in reducing gas emissions A recent report by the UN Environment Program (UNEP) says reducing subsidies on fossils fuels can play an important role in reducing greenhouse gas emissions. The report argues that many of these subsidies benefit wealthier sections of society and divert national funds from policies to help the poor. UNEP launched the report titled ‘Reforming Energy Subsidies: Opportunities to Contribute to the Climate Change Agenda’ on 26 August 2008 in Accra, Ghana, during the latest round of UN Framework Convention on Climate Change (UNFCCC) global climate change negotiations. The report says globally around 300 billion U.S. dollars, or 0.7 percent of global GDP is spent on energy subsidies annually. The report states that most of these funds are used to reduce the real prices of fuel, coal, gas and electricity generated by fossil fuels. According to the report, Russia is providing the largest subsidy, around $40 billion annually to reduce the price of natural gas, followed by Iran, which spends $37 billion, and then China, Saudi Arabia, India, Indonesia, Ukraine and Egypt. After launching the report, UNEP also announced a mechanism under the Kyoto Protocol, which allows industrialised countries to invest in cleaner energy projects in developing countries. The mechanism is helping the developing economies like China, Brazil and India. Six countries; the Democratic Republic of Congo (DRC), Madagascar, Mauritius, Mozambique, Mali and Senegal have started their own Clean Development Mechanism (CDM) initiatives over the past 18 months.
Film contest by World Bank to highlight climate change The World Bank has launched a worldwide competition to highlight the social aspect of climate change. The contest is open for all who wishes to raise their voice September 2008 | www.i4donline.net
to showcase the impact of climate change in social life.
The submitted film should showcase the consequences of climate change through one of following theme categories; conflict, migration, the urban space, rural institutions, drylands, social policy, indigenous peoples, gender, governance, forests, and/or human rights. To judge the winners, a combination of public voting system and a jury will be used. The film which receives the highest number of public voting will be announced in honorable mention category. The award winners will receive an all-expenses paid trip to Washington DC for a screening of their film and an opportunity to attend a series of networking and learning events organised by the Social Development Department of the World Bank in December, 2008.
UNFCCC highlights climate change issues in Accra talks The United Nations Framework Convention on Climate Change (UNFCCC) stated that important progress on a number of key issues related to climate change has been made at the UN-sponsored climate change conference held in Accra, Ghana. While highlighting the discussion points of the conference, Chief of UNFCC, Yvo de Boer stated that there was an encouraging and important debate on the important topic of deforestation and
forest degradation, which was crucial since emissions from deforestation accounts for about 20 per cent of the greenhouse gas emissions. A working group also discussed ways to improve the Kyoto Protocol’s Clean Development Mechanism (CDM) that allows industrialised countries to offset some of their own emissions by investing in cleaner energy projects in developing countries. The meeting also discussed sectoral approaches, through which the countries can address emissions from a whole sector of their economy. Around 1600 participants, including government delegates from 160 countries and representatives from environmental organisation, business, industry and research institutions, attended the meeting.
KPMG and CII releases a joint report on climate change A new report, released by KPMG and Confederation of Indian Industry (CII), attempts to gauge what Indian companies can do to fight against climate change. The report, ‘Climate Change: The impact and opportunities for Indian industry’ was published on 27 August 2008 jointly by KPMG and CII. While releasing the report, Executive Director of KPMG, Arvind Mahajan, said, “The Indian companies should take proactive measures to ensure adequate risk appraisal and management as well as leverage opportunities arising out of climate change. They need to do proper due diligence for Clean Development Mechanism (CDM) projects to assess the quantum of carbon credits expected to be generated.” Indian businesses also need to consider tax and regulatory issues and
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devise strategies to ensure that they can maximize the benefit from the CDM process. The report suggests need to develop a structured approach consisting of the following components: 1. Measurement of the carbon footprint of the business 2. Projecting the likely carbon footprint if the business continues to grow under the ‘Business As Usual’ scenario 3. Analysis of the risk of climate change issues to the sector and the business 4. Identification of opportunities within the business, and beyond (CDM projects, clean technologies, renewables, etc) to maintain growth, but with a different approach 5. Preparation of time bound action plan for reducing the carbon footprint compared to the projected carbon footprint 6. Institutionalize the action plan in business processes 7. Institutionalize a measurement and verification system to monitor progress against the plan 8. Periodically report progress to stakeholders
Toyota joins UNEP’s initiative CN Net to cut greenhouse gas emissions The European branch of the world’s largest car maker, Toyota, has joined an initiative of the United Nations Environment Programme (UNEP), called Climate Neutral Network (CN Net). The CN Net initiative brings together organisations that pledge to significantly reduce greenhouse gas emissions. CN Net is a web based network which includes government
resources, local authorities, private companies and others to reduce their carbon footprints or even neutralise them. Apart from Toyota, other five companies which joined the CN Net are; the Carbon Association of Australasia (Australia), CO2focus (Norway), EcoSecurities (UK), Green Cabs (New Zealand), and Wairau River Wines (New Zealand). Under this initiative, Toyota Motor Europe will share ideas and their best experiences with the rest of the growing CN Net community. Toyota, which has sold more than 1.5 million hybrid cars worldwide is the first car manufacturer to join CN Net.
UN to help Pacific Island countries to fight climate change The United Nations and Samoa are planning to establish an InterAgency Climate Change Centre to help Pacific island countries to combat the impact of global warming in their region. Speaking at the 39 th Pacific Islands Forum, held between 19th-21st August 2008, Secretary General of the United Nations, Ban Ki-moon stated that ‘Climate Change is not science fiction’. The new agency will provide its support in the mitigation, adaptation and reduction of the risk of disaster facing the Pacific Islands. Many Pacific Island countries are already experiencing a rise in sea level as a consequence of climate change. An FAO report, published in July, shows that climate change is already affecting the world’s oceans, citing the effect on the growth, reproduction and disease among fishes. According to the report, fishing
industries around the world are most vulnerable. The industry employs around 42 million people globally and most of them are from developing countries.
World Bank: Developing countries need 170 billion dollars to adapt to the impact of climate change The World Bank announced in the Accra Climate Change Talks that a total of 170 billion dollars is required between now and 2030, so that developing countries mitigate and adapt to the impact of climate change. While speaking on the sidelines of the Accra Climate Change Talks, Fund Manager of World Bank, Eduardo Dopazo said that the private sector is expected to account for 80 percent of the sum, which is required for the following factors: • Developing countries will require 85 billion dollars to provide electricity, which will cover 100 percent of their citizens by 2030. • Another 35 billion dollars per year is required to ensure that the electricity is generated by utilizing green energy technologies. The Global Environment Facility has funded projects worth more than 378 million dollars in the last 17 years under the Clean Development Mechanism (CDM). The total value of projects funded worldwide under CDM is more than 2.4 billion dollars. Around 27 projects are located in Africa with India and China accounting for the bulk of projects under the CDM.
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i4d | September 2008
Â&#x201E; INTERVIEW: V K JAIN, PROFESSOR AND DEAN OF SES, JNU
Climate change and energy security
V.K. Jain Professor, School of Environmental Sciences vkj0400@mail.jnu.ac.in What are the current research initiatives on climate change in the School of Environmental Sciences (SES), Jawaharlal Nehru University? School of Environmental Sciences (SES), Jawaharlal Nehru University doesnâ&#x20AC;&#x2122;t have a separate area on climate change and research on the same. A L Ramanathan, Associate Professor, SES, Jawaharlal Nehru University, is doing some pioneering work on nutrient dynamics in costal ecosystems and is looking at the changes in water quality in the Sunderban Delta. He has put in a few years of research on the same topic and is measuring the impacts of climate change on these mangrove regions. Ramanathan is also leading a glacial research programme on Hindukush Himalayas to investigate the behaviour of glaciers under the present environmental conditions. Is climate change a burning issue? Yes, of course climate change is a burning issue. Climate change has far reaching implications and it circumscribes all major September 2008 | www.i4donline.net
V K Jain, Professor and Dean of the School of Environmental Sciences (SES), Jawaharlal Nehru University, New Delhi spoke to Jayalakshmi Chittor and Rajat Banerjee, members of i4d team. He shares his perspectives on climate justice, mitigation and adaptation strategies. dimensions; scientific, social, humanitarian and climatological. Though it is mainly an issue of the west yet in view of the present circumstances and conditions, it has implications for all. The entire debate on climate change and climate justice issues originated in the West, they have West has developed the requisite infrastructure to fight the issue. What in climate change is the most important issue? Economics of climate change is the most important issue. Is energy and energy security key factors in climate change? Energy is central to climate change. Energy consumption through fossil fuels (a predominant source of energy) determines the level of gas emissions visĂ -vis climate change. Energy security is strategically important until other sources of renewable energy are explored and harnessed accordingly.
What according to your opinion is the would-be source of energy in the coming future? It is Hydrogen. Hydrogen has the potential to carry a lot of energy and can be produced from water by the method of electrolysis. Moreover, hydrogen is not only costeffective, it is also a clean source of energy and has long term benefits. It is being used as an alternate source of fossil fuel in some developed countries but is not available for commercial purposes. The fuel cells of hydrogen really create a win-win situation for energy issues per se. We have to move from carbon-intensive technology to hydrogen-intensive technology. What is your idea about creating an alternative platform to address climate change? Yes, I think there is a need to create platforms at different levels of decisionmaking and intervention. There should be climate forums in individual states and climate cells under each ministry. There is a need to create awareness and action. What are your opinions on carbon credit? How do you think that the recent carbon credit initiatives (meant for corporate emitters/non-emitters) will lessen the amount of greenhouse gas emissions and foster Clean Development Mechanism (CDM)? All Clean Development Mechanism efforts like carbon trading for the corporate emitters/non-emitters are affirmative initiatives to reverse greenhouse gas emissions and protect the environment. But trading of carbon on the basis of carbon footprint should not be restricted to corporate groups. It should be extended to the individuals as well. Government should implement a policy on carbon trading in which
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each individual irrespective of their economic status, will be allocated a definite amount of carbon usage. People who have less carbon prints should be compensated and be given credits (by MCX (Multi Commodity Exchange), NCDEX (National Commodities and Derivatives Exchange limited)or banks) for not using the requisite amount of carbon. These credits may be later encashed by the individuals. This policy will make all individuals and firms more energy efficient and thus save a lot of renewable energy. It will also imply lesser amount of bio-degradable waste. Through this effort, social equity and the right to energy security will be achieved. Are there enough scientific apparatus and equipment to track climate change events as well measure the amount of toxic gas emissions? Yes, of course there are quite a few equipments to gauge the level of greenhouse gas emissions. Is there a human dimension in this entire debate on climate change? Yes, definitely all present studies pertaining to climate change, climate change mitigation and adaptation strategies and climate justice issues are measured on the basis of anthropogenically induced parameters. Now there is scientific evidence to relate the emission of greenhouse gases and global warming.
What is your idea on the abrupt changes in the hydrological cycles including sealevel rise and ice-cap meltdown? It is true that hydrological cycles have changed and glacial ice has been melting. The incidence of extreme weather events has increased and the time-cycle has changed. Changes in hydrological cycles have already been indicated in the IPCC (Intergovermental Panel on Climate Change) reports which state that frequency and severity of extreme weather events will be higher. With regard to ice-cap meltdown, there are divergent views. While it is true, many researchers claim that ice sheets in both the Arctic and Antarctic circles have been melting, it is also claimed that the volume of overall ice has increased. There are lot of debates and discussions on the adaptation and mitigation strategies. How do you think mitigation and adaptation strategies are relevant in the Indian context? There is no gainsaying that adaptation and mitigation are important areas of concern when we talk of climate change. But from an Indian perspective, neither adaptation nor mitigation strategies are quintessentially important issues. Many people of India have been living in adverse climatic conditions for years. They have been adapting (both scientifically and not-so-scientifically) to different clime changes and extreme weather events. The main need is to develop awareness about
the whole range of issues including the climate change implications. We should be prepared to take the economic opportunity of climate change. What are your opinions on using alternate and renewable sources of energy? The action can be brought about right away. The mid and lower middle class is wasting a lot of energy. The research effort on developing renewable energy resources should continue. Finding substitutes for non-renewable sources of energy is a key issue. In the long run, it is the new and cost-efficient technology that will have the say. Utilizing the resources in a proper manner is also important. What is your idea about using biogas and biodisels as alternate sources of energy? There is a lot of speculation and concern over the use of biodisels and biogas as alternate sources of energy. There is a need of further research on this area. Using agricultural land for other crops or using agricultural products for the generation of energy, are controversial issues because it involves food security. There are experiments going on in the Western countries to find out the effectiveness of these alternate sources of fuel. But in the case of developing countries, taking recourse to biodisels and biogas may be cost-effective in the short run, but the reverse in the long run. I think, there is an urgency to expedite research on drought-resistant plants.
‘Green IT’ can save $800bn The ICT industry can reduce its emissions by 15% and save more than $800 billion in energy costs by 2020, says International Telecommunication Union (ITU) Director Malcolm Johnson. The industry currently contributes 3% to global emissions, a contribution that is set to double in the next two years. Speaking at the South African Telecommunications Networks and Applications Conference (Satnac) this week in Johannesberg, Malcolm said that ICT could contribute to the fight against climate change by lowering its energy consumption. As an example, he pointed to the Google data centre in Oregon, USA where energy consumption is equal to that of the entire city of Geneva, Switzerland.
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In a study conducted by ITU in the UK it was noted that the ICT industry has not done much in terms of fighting climate change. Conversely, its the energy industry that has done the most to combat the phenomenon. While highlighting other key challenges during his speech, he reaffirmed ITU’s commitment to combat cyber-crime and reported that the organisation has formulated a body to address the challenge. The ITU is also looking at standardising its forums across the world to close the gaps in telecommunication standards among developed and developing nation. http://www.itweb.co.za/sections/computing/2008/0809091031. asp?O=FPTOP&S=Green%20IT&A=GIT i4d | September 2008
CASE STUDY: CHENNAI, INDIA
An integrated approach to Agro-informatics This article presents a model of an Integrated Knowledge Centre based on the specificities of particular village (without much ICT4D activity) and on the lessons learned from existing models
Introduction The aim of this paper is three fold: (a) to highlight the power and promises of ICTs by taking a specific village close to Chennai, India, as a illuminating case; (b) a critical appreciation of the existing agro-informatics services and (c) to evolve a blue-print for setting up of a truly integrated knowledge centre. The village – Natham is just 50 kms away from Chennai and this brings out many stark ironies which highlights the long road ahead. Natham is not only in one of the most progressive and ICT friendly states – Tamil Nadu - but also in the vicinity of an important IT hub – Chennai. Yet, this village does not have much to show in terms of the use of “ICTs for Development” (ICT4D). This village has been chosen not only for its paradoxical state but also for the fertile ground that it can be, for effective play of ICT4D. Thus, this ‘case study’ is different in the sense that it does not study the functioning of ICTs in a village but takes the village in its varied dimensions and explicates how a context-based integrated knowledge delivery mechanism can effectively realize the idea of ‘ICT4D’.
Natham village – A profile
John Bosco Lourdusamy Assistant Professor Dept of Humanities and Social Sciences IIT Madras jbl.hss@gmail.com Anima Singh M.Sc Agricultural Economics - 2nd year Banaras Hindu University (BHU) animabhu@gmail.com
September 2008 | www.i4donline.net
Natham has about 350 families and a population of 1500. The total land area is approximately 270 hectares out of which 188 hectares (69% of total land area) is cultivated. Of this, 51% is irrigated and rest is rain fed. 21% of the total area is waste land. There is frequent scarcity of irrigation water and bore well is the only source of irrigation. The main occupation of the villagers is farming but most of the farmers being small or marginal, have small fragmented lands. Rice is the sole staple food crop here and is cultivated for two to
three seasons along with some pulse crops like black gram and green gram. Some large farmers grow plantain, jasmine, sambangi and rose. The farmers face numerous problems related to cultivation, harvesting and prices. The nearby villages are more or less urbanised. Most farmers have sold their land to industrialists and the youth work in industries. But in Natham most people still depend upon farming for their livelihood though some have started leaving parts of their lands uncultivated and taking jobs in the nearby industries. The educational level of the village is not satisfactory. The local primary school lacks proper infrastructure and sufficient teachers. The better-off families send their children to private schools in a nearby town and the poor people send their children to the local primary school. Since there is no high school in that village, the students have to travel four kms for the same. Some girls are discouraged from pursuing further studies due to lack of transport facilities. Health and sanitation facilities in the village are poor with no drainage and sanitation systems. There is only one Primary Health Centre four kms away from the village. Thirteen Self Help Groups (SHGs) exist in the village but they have not been very successful in making any innovative micro-enterprises due to lack of awareness and training. Interestingly, the village is on a National Highway (with no transportation facility within the village) and is also has cable television connectivity. Yet, the village does not have access to information about latest technologies, farming techniques. This has also to do with the people’s preferences and what benefit they look for and derive from existing communication tools like the TV
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Community activities must always include engaging the young children
and radio - an important concern to be addressed while planning any information or knowledge centre anywhere.
More ‘E’ in E-xtension One of the important ways through which the benefits of science has been taken to rural India is through the Agricultural Extension schemes of various institutions and laboratories. But agriculture extension systems do not seem to have had the desired effect – especially in case of small farmers and in terms of providing localised solutions. Moreover, such activities have been more problem-solutions centric than opportunities-centric i.e., looking for more possibilities creatively rather than only providing solutions to existing problems. Most importantly, the information flow is not as dynamic and as interactive as one would want it to be for maximum effectiveness. Also, the flow is largely unidirectional i.e., from ‘lab to land’ and supply driven rather than demand driven. Finally, it’s reach has not been to the desired extent, as seen in Natham village where there is hardly any functioning extension mechanism. Considering these lacunae, if the extension services assumed a new form and direction by becoming more electronic and more networked, favourable results could be expected. In the course of this paper, a brief over-all survey of some of the initiatives in this direction and some of the services that are offered or proposed to be offered are presented.
Challenges and limitations The initial experiences of ICT integration in agriculture have brought out some of the limitations and challenges that confront the endeavour. One of the most important challenges is the spread of information about these information initiatives themselves. It is very important, especially in the initial stages to bring awareness among people and to generate faith and interest in such services. Even where they are prominently located and known, there are other problems related to infrastructure – like erratic electricity supply or problems with regard to telephone, Internet connectivity
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etc. Going to the kiosk and not finding the required information or solution can cause loss of their enthusiasm and even cynicism in the long run. One of the most important factors in the efficacy of the endeavour is its ability to transcend the caste-gender equations which are pronounced in rural settings. It would be self-defeating if women and marginalised sections have difficulties or inhibitions in utilising the new initiatives. Here, it is important to be pro-active with regards to ownership/management of the kiosks (greater role for women SHGs or for Dalits) and to the location of the kiosks (putting some of them specifically in areas inhabited by the most marginalised or poor). But the most important need is to have an integrated approach. The mere digitisation of few aspects or just faster delivery of certain information or solutions in specific areas (like pesticide) are not in themselves bound to make much and over-all impact if the inter-relatedness of the village life and set-up is not taken into consideration and approaches framed appropriately. Even if the endeavour is limited to agricultural information delivery and enhancing productivity, it can not ignore other aspects like lack of basic education and awareness or of mental make-up to make any interaction successful. Also it is of no use if the village has a kiosk which only aims to deliver latest agricultural information to enhance productivity, but has no information on how to deal with the increased produce. So, it is imperative to have a facility which is more of an ‘integrated knowledge centre’ than an electronic information delivery mechanism. Integration has to be the key word and key component of the initiative. In the next two sections we have showcased a particular village and its broad attributes and the shape the integrated knowledge centre for that village can acquire to reflect the integrated approach.
Integrated agro-informatics The most important challenge in Natham, is the ever increasing disincentive to practice agriculture. There are various pull and push factors contributing to this. On the pull side, one sees the high prices that the neighbouring villagers have received for their land from industrialists or real estate dealers. The farmers are also attracted by factory jobs that are comparatively financially secure. On the push side, the main factors are: water-scarcity and erratic monsoons, rising input costs, labour shortage, low procurement prices and no knowledge of value addition possibilities or better bargaining opportunities. Thus in such a scenario, if one was to provide the villagers with just information about crops and pesticides, the villagers may not be interested. Any meaningful intervention has to be multi-dimensional so as to meet the combined onslaught of the various pull and push factors that farmers face. To start with, the Integrated Knowledge Centre, has to be set up not as a separate kiosk but within the small library that has already been built in that village under a State Government scheme for villages. The centre, would have popular newspapers and magazines. This is important because this would attract people from all social brackets, especially the elders and farmers. With just books and computers the centre may become a more student or youth centric place. The growth of the centre at every stage will also have to be shaped by this principle of inclusiveness i4d | September 2008
Photo Credit: (c) Dan, 2006 Clean water and sanitation are important aspects of a healthy community
and more importantly the sense of ownership. It would be ideal to have a women SHG run and maintain the centre. But the management and participation should be more communitarian. In this regard, the Participatory Rural Appraisal (PRA) technique should be utilised to initially identify the information needs of the community. There should be a local group of youth, women and elders to study the pulse of the villagers. This group would play a crucial role in the monitoring and further shaping of the centre. The centre should also have a hybrid technology use profile – i.e., using a variety of technologies and instruments (not just computers) starting from simple newspapers to cell phone technology, television, multimedia projector for screenings, bulletin boards, public address system, voice based archives and touch screen systems. The underlying principle here is to broadbase the access by transcending barriers of literacy and educational attainments. This is also required for the multiplicity of functions that the centre will have to focus on in future such as to provide alternative employment, sources of income, value addition techniques, marketing techniques, ways to make more profit out of every square foot of land by using it rather than selling it to the industrialists. This will suppliment the knowledge imparted on scientific farming techniques for bringing down input costs and about better varieties of crops for better returns. An important characteristic of this partnership and participants-sensitive based approach is to learn already exists and preserve the indigenous knowledge by a process of reverse flow whereby local knowledge is mainstreamed without being exploited and commercialised. Apart from the above activities, the integrated knowledge centre can additionally take up other specific activities, such as • Screening of films on the use of new technologies, farming practices and their impact • Training programmes in the village using available multimedia technologies – especially for SHGs on innovative microenterprises, cottage industries, etc. • Success stories of different sectors like successful women entrepreneurship, successful cultivation technique etc can be showcased in the centre to attract and inspire farmers September 2008 | www.i4donline.net
• •
• • •
•
Online discussions on alternative industries, value-addition techniques Newsletters in the library to provide information related to agriculture, weather, cottage industries, marketing, education, health, etc. Arrangements for video conferencing with experts so that villagers may directly pose their problems in real-time Promotion of group activities which will help the villagers identify as well as solve many of their problems themselves Creation of innovative learning environment for children and youth using animations, educational CDs, TV programme recordings, etc. Promotion of youth and student activities which would induce them to learn science with relevance to their local environment and resources and to thus bring about local transformations using their own knowledge and judgment instead of all scientific solutions being sent ready-made from outside.
Conclusion However, the specific components, activities, modules, etc., have to evolve dynamically through mutual partnership between the empowered villagers and institutions, rather than unilateral prescriptions and diagnosis as to what the villagers need and what they should have. Thus, the need for a different kind of foundational principle, approach and orientation. This sensitive, need-based and multi-pronged approach is needed with regard to the rural development scenario, especially agriculture. References: i ii
Most of the views/arguments presented here are based on direct visits to knowledge centres in Tamilnadu and Pondicherry regions and interaction with stakeholders. Summarized from Shaik.N.Meera et al, ‘Information and Communication Technology in Agricultural Development: A Comparative Analysis of Three Projects from India’, Agricultural Research and Extension Network, Paper No. 135, Jan 2004, p.2; www.odi.org.uk/agren/papers/agrenpaper_135.pdf K.A.Raju, ‘A Case for Harnessing Information Technology for Rural Development’, The International Information & Library Review, 36(3), Sept 2004, pp. 4-5
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FMRP, BANGLADESH
Financial accountability through ICTs Introduction In the context of developing countries, the concept of ‘Good Governance’ in the democratic process of government mechanism is highly related with four factors. These are: transparent decisionmaking, stakeholders’ participation, effective public financial accountability relationships between a country’s governing bodies and its executive management and ethical practices. A transparent public financial system is a strong platform to establish good governance. For example, where there are effective relationships of financial accountability, performance is likely to be managed and reported fairly and honestly. ICT application in public financial management can make the entire process of public financial management process easier. It can minimize systematic corruption, mitigate fraud, waste and abuse in the public funds. One successful example of ICT application in public financial management is Financial Management Reform Programme (FMRP). It is a fiveyear programme executed by the Ministry of Finance, Government of Bangladesh and supported by UK Department for International Development (DFID) and the Royal Netherlands Embassy (RNE).
Financial sector reforms in Bangladesh From 1971, Bangladesh had a poor record in developing financial management skills in both the public and the private sector. By the mid 1980s, the GoB was hard pressed to provide any effective data about its finances. To create a better public financial management system in Government mechanism an inter-ministerial committee was appointed to address the need for
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improved public financial management in 1991. The Committee on Reforms in Budgeting and Expenditure Control (CORBEC) was led by the Ministry of Finance and was given responsibility to analyze the problems and prepare recommendations for reform. In this perspective, CORBEC set out a series of objectives for the Government’s reform programme; analyzing some of the existing problems. The committee identified that manual processes, unsatisfactory systems and procedures of accounting and bank reconciliation were the main barrier for lack of adequate and accurate financial information on a timely basis. In addition, the committee identified a repetitive budgetary system, the lack of updated, comprehensive financial rules and regulations, the inadequacy of trained manpower and a training system to meet financial management needs across the government. However, on the basis of the problems and recommendations, they have built
ICT application in public financial management for better governance leads to efficiency in services and cost savings to the country
the foundations for governance systems. It included the computerization of the budgeting system in the Ministry of Finance for data capture, financial and economic analysis, budget forecasting, electronic linkage and transfer of budgeting and accounting data between Ministry of Finance and Accounts offices etc. and other initiatives. As a result of these, officials, legislators, civil society and donors now have considerably better information on state finances, which in turn is enabling improvements in policy making, management and external accountability, albeit starting from a very low base. The Reforms in the Budgeting and Expenditure Control (RIBEC) Programme was in October 1992. RIBEC phase 1 proposed an implementation plan for the programme. 9 months later, Phase 2 began in January 1995 which was planned to be a comprehensive reform effort across GoB consistent with the CORBEC’s vision. They also identified some of the interventions which had to be addressed immediately. These were: sector wide introduction of new technology; new systems of financial management, new procedures, publicsector wide training for adoption of the new technology, systems and procedures and institutional changes in key elements of the PFM structure. RIBEC 2 was a big project but there was little or no ownership of the process by the Government; it was a traditional donor-driven “Technical Assistance Programme” and eventually, the project was discontinued. The next 20-month phase of the project (RIBEC 2B), comprised of easily defined targets, focusing on simpler aspects of technical capacity development which were more mechanical in nature. It was noted that the success of these i4d | September 2008
reform could not be achieved through technical excellence and consultations alone. Hence, the DFID staff consciously began to employ diplomatic and political strategies. As a result, the quality of accounting improved, and a strong financial management system developed. At the end of RIBEC 2B, a further 3 years of assistance was agreed upon, known as RIBEC 2000. The scope of the programme involved engaging more ministries and deepening the focus on priority areas such as the management of accounts.
It has also been said in the DFID FMRP project document that “Whilst the RIBEC projects have made a major contribution to improving the quality and comprehensiveness of financial information, the evaluation recognized that the improved financial information was not being used to inform resource allocation decisions and there were questions over the sustainability of project activities. The FMRP has been designed to consolidate the achievements to date and address these weaknesses. The Contribution of the RIBEC projects to public sector reform in Bangladesh is unique. There are no other major initiatives in public sector reform at the present time and the RIBEC projects are often cited as the only initiative which has made a substantial impact.” In 2002, the next phase of assistance, the Financial Management Reform Programme (FMRP) was approved with five components. The main objectives of FMRP are: to improve the efficiency and effectiveness of the allocation of resources and to achieve more equitable and improved public service delivery.
FMRP The programme has been designed to build upon the previous financial reform initiatives piloted by the DFID funded Reforms in Budgeting & Expenditure Control (RIBEC) project. FMRP comprised of five components: to provide improved audit reports and well researched reports on other financial management issues for parliamentary scrutiny of public accounts; to enhance aggregate fiscal management and to develop the regulatory framework for financial and performance management; to enhance resource allocation and utilization, and financial, resource and performance management capacity in the ministries; to enhance financial management reporting systems; to build the capacity of the Financial Management Academy as a centre for excellence in financial management training to the Government.
How ICT is used In Bangladesh, The Office of the Comptroller and Auditor General (CAG) receives and disburses the Government fund on behalf of Ministry of Finance. So CAG has to be well informed about the decentralization and allocation of Government fund. FMRP developed a Wide Area Network (WAN) in the central unit which is connected to 64 District (regional) Accounts Offices (DAO) for capturing data. Online connectivity is also available with the departmental Accounts Office. So, any transaction of field offices is automatically recorded in the central server. Thus total expenditure of that respective institution is tracked from the CAG office. The robust and automated information system reduces the repetition of work and data errors and creates a quick way September 2008 | www.i4donline.net
to see the Government allocation and expenditure of respective ministries and agencies. If this type of flow of information of the public financial management can be ensured then it also have a positive impact on national budget.
Impact of FMRP FMRP has created a long term effect on the whole system of financial management. The use of Information and Communication Technology (ICT) in FMRP ensures the possibility of availability of more accurate and timely delivery of financial information . In addition, resource allocation has been enabled, decentralization of budget has been increased, the expenditure of entire ministry can clearly be identified. It has also increased the staff ’s skills. As a result, technical improvements have also led to institutional change. The whole budgetary system has been improved. It has also contributed in the Medium Term Budgetary Framework (MTBF), which is related with digitization system. The financial digitized system helps to justify accurate expenditure and fixation of future planning for expenditure and allocation.
Why it is successful We have seen some critical factors behind the success of FMRP. When ICT is used in the implementation of the programme it is used as an integrated tool, not as an intervention method. So usage of technology has not become a challenge for project implementation. The programme has also provided training to build the technical skill and capacity of project personnel for smooth running of project activity. Besides the technical aspect, ownership has been the central point for the success of the process. Even GoB officials are keen to point out that ownership of the reforms has been higher than most other donor supported initiatives in Bangladesh. Thinking out of the project is one of the critical success factors of FMRP. It has also been seen that in most of the cases the individuals involved had drive and participated in the reform process. In addition, a culture of innovation and reform has developed among senior civil servants in the Ministry of Finance.
Conclusion FMRP would be a successful example for financial management reform where technology is used as a tool and not as an intervention method. If we go through the insights of that project we can see the term “computer operator” has not been used in their work plan. The team is not just thinking about project implementation but is really trying to formulate a transparent and accountable public financial management system and in the process, using technology as an integrated tool. The framework of FMRP is a good strategy to control and monitor the whole financial management system of a country in an effective manner. The strategy of FMRP to control public financial system is a good way to clear the path for good governance. Thus, FMRP provides the groundwork to establish a clear framework of public financial management system and creates a platform or scope for wider replication of the idea of FMRP in Government entities for many developing countries. Suparna Roy suparnaroy@pmo.gov.bd
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netgov Speak: Lead up to IGF 2008
Part V: Social networking and Internet governance In this issue of netgov Speak, in the lead up to Third Internet Governance Forum, to be held in Hyderbad, India, we bring you a hot topic for debate on governing Social Networking sites. With the proposal of EU to bring forth a new legislation to regular these sites, it opens up the issues that confront lawmakers and law enforcement agencies on one hand to those who campaign for the value of digital freedom on the other.
www.nixi.in
In Collaboration with:
Is there a need to monitor the content on social networking sites?
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On 27 May 2008, the European Network and Information Security Agency (ENISA) issued a position paper for drawing up a new legislation that would regulate social networking sites. ENISA, which was created in 2004 to oversee online security measures in the 27 EU countries, in which it pointed out that social networking sites such as Facebook and MySpace need more regulation to protect their users against security risks. “Social networking sites are very useful social tools but we must make recommendations for how to better protect people from the risks these sites create,” said Andreas Pirotti, executive director of ENISA and author of the report. In Pirotti’s opinion, network security is under a permanent threat from spammers or criminals. “Internet security is extremely important, considering how much business takes place online now.” Some of the threats related to social networking identified by ENISA are related to face recognition, digital dossiers, reputation damage, social engineering attacks on enterprises, phishing attacks, ID theft and others. The report of the organisation includes 19 recommendations to social networks on ways to improve security practices. Among other things, ENISA calls for a regulatory review of social networking frameworks, an increased transparency of data handling practices, more education for users on security, and the discouragement or even banning of social networking in schools. A study conducted by enterprise IT management company CA and the National Cyber Security Alliance in 2006 found out that the majority of users of social networking sites were not very aware of the security issues involved. 83 percent of them admitted having downloaded unknown files from unknown users and 74 percent said that they were easily providing the personal data online.
Also, a Symantec report issued in 2007 showed that social networking sites offer easy pickings for phishers. The security practices of the respective sites make it easier to invade and to spread attacks to more people.
The booming social networking space and web 2.0 technologies With more than 130 hugely popular community networking sites, and booming rapidly, social networking on the Internet has taken a new dimension in defining the ethos and culture of the use of Internet. The social networking spaces have evolved in an organic way and have used several interactive tools including feeds, polls, commenting, sharing, and modular tracking services like birthday tracker, rss feeds, digg it, etc, which allows knowledge to flow freely. This evolution has created a new ethos of knowledge sharing and digital rights for the masses. People no more need to be technically savvy to publish, code or upload content on the Internet. Such a free flow of information from various quarters is not without its set of problems, and potential challenges that face regulators, lawmakers and enforcement agencies, who worry about its potential for misuse. According to Venkatesh Hariharan, Co-founder of Open Source Foundation of India, “Social Networking Sites are very useful to form communities with likeminded people. For example we have been actively engaged in a community which is against software patents, and a candlelight vigil, using Facebook, and other networking media. This is especially valuable when people are distributed across the country, and globally, online communities makes it possible to mobilise the support at i4d | September 2008
very short notice, which otherwise is not possible! Even though these communities are asynchronous, they are faster, and more responsive that email discussion lists.”
Social networking sites have a huge youth following! In a survey conducted among the youth in India on the value of social networking sites and their value to the users, the respondents strongly felt that the social networking sites like Orkut, Facebook, Myspace and LinkedIn must not be regulated and it should permit free flow of information. The respondents, however, felt that they should have more control and checks of who could and could not view their profiles and to have a system by which they could regulate who coud access their information. Kriti Madhukar, a first year college student of Delhi University, is an “Orkutter” who is adept at multi-panel chatting, sharing photos, planning events, sharing music, and discussions, and having fun catching up! She has also experimented with Facebook, Hi5, and says, “social networking space is an important aspect of today’s urban youth. We cannot imagine that only less than a decade ago, the Internet was not so robust or even accessible in many parts of the world. It is very important to create more such opportunities for also the rural folks in India, who speak innumerable languages, and once they have access to public Internet, they should immediately be able to join the social networking space.” Social networking sites have also created an empowering avenue for early learners, people who are otherwise not social to explore the world for friendship, learning, sharing, peer support, etc. These social networks have evolved as a result of more openness in accessing and publishing on the net. It has also led to a world of challenges while experiencing the power of freedom of expression. The current debate to examine the privacy and security issues and whether they must be regulated faces many contrasting perspectives. The European Union, as cited above, would like to address several issues and has provided a concrete picture of how to handle the concerns, in the rapidly expanding universe of social networking space.
Sociology of online social networks Some of the social impacts of networking sites are worth reflecting on. LinkedIn, for example, is a professional, business network, which is used extensively across the world, and in India too, for job scoping and senior executive searches. It is also used to create a network of professional interest and to build alliances. The kind of services that the network provides makes it of different value than that of generic social networking sites that allow gathering in cyberspace based on social aspects, like friendship, interactions, informal dialogues, and peer-to-peer sharing of data, images, audio and video footages, that are now getting more and more prevalent. One of the key issues that worries parents, teachers and policy makers is whether these online social networking sites are “child safe”. The responsibility lies at all levels. Parents have to play a direct role in keeping a watch on their children’s behaviour online, September 2008 | www.i4donline.net
the networking sites should have their norms and standards of what content can be shared, and governments have to be more rigourous in the laws on admissible content, though it is one of the most chalenging assignments. Owners/promoters of the online social networking sites have the responsibility to create mechanisms to vote out unfavourable site, and to block users who post irresponsible materials. Yet, there remains some key concerns relating to privacy, quality of content, IPR issues, both from the point of view of security and ownership of content. There could be two opposing schools of thought: one, which advocates for no-holds-barred and open sharing, and another that ensures that the community space is “safe, secure, and condusive”. The debate thus is very interesting.
Identity issues in social networking sites Identity thefts is a major issue that worries most users, even in countries where privacy issues are not that seriously taken. There have been instances when intruders have stolen identities and personal information, impersonated and sent out posts that cause serious concerns. The recent Mumbai wifi hacking case, which misused the identity and IP of the person to send out terror mails, is an example of the risks that we are subjected to when nefarious persons steal identities and further their vicious and malafide intents. The issue is more serious with bankers getting interested to address the privacy issues as well as ecommerce applications wherein the identity thefts are happening in greater numbers. Cybersecurity is still a nascent area of law and administration, and the police departments across the world are gearing up to be responsive and be aware of the nuances of laws of the land, and how they are applicable. A lot of work on awareness creation among the police officers is also essential, as per the views of a Human Rights and Freedom of Expression Activist, who has been associated with advocacy work around the rights of expression.
The debate continues... with more questions than answers! Readers are invited to share their views/experiences/ new issues to raise, to be part of the debate, on the social and security impacts of online social networking sites. Have your say! Please write to: response@i4donline.net info@i4donline.net
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Interview
“A mechanism of self-governance is needed for social networks” off alone - and hope that these will be sufficient safeguards to their well being. As an added precaution, we also sometimes supervise their activities and the things they are consuming on other media. More than finding technical solutions to safety in being online, it is a question of education and training and some amount of supervision to ensure that the child is complying to your idea of what is good for it. A call for sanitising the internet or for insisting on child safety is more or less redundant, only, in fact, adding to the dark glamour of the web and inciting younger users to go and search for material which they would otherwise have ignored.
Nishant Shah, Director - Research, Centre for Internet and Society, Bangalore www.cis-india.org, nishant@cis-india.org Should social networking sites be governed, and if yes, in what way? A call for either monitoring or censoring Social Networking Sites has long been proved ineffectual, with the users always finding new ways of circumventing the bans or the blocks that are put into place. However, given the ubiquitous nature of SNS and the varied age-groups and interests that are represented there, governance, which is non-intrusive and actually enables the users towards a better and more effective experience of the site, is always welcome. The presumed notion of governance is that it will set processes and procedures in place which will eventually crystallise into laws or regulations. However, there is also another form of governance - governance as provided by a safe-keeper or a guardian, somebody who creates symbols of caution and warns us about being cautious in certain areas. In the physical world, we constantly face these symbols and signs which remind us of the need to be aware and safe. Creation of a vocabulary of warnings, signs and symbols that remind us of the dangers within SNS is a form of governance that needs to be worked out. This can be a participatory governance where each community develops its own concerns and addresses them. What is needed is a way of making sure that these signs are present and garner the attention of the user. How do we address the concerns that some of the social networking spaces are not “child safe”? The question of child-safety online has been one of the most raging debates ever. Several models like the cybernanny to monitoring the child’s activities online have all been suggested at different times and have more or less failed. The concerns of what happens to a child online are the same concerns as what happens to a child in the physical world. When the child goes off to school, or to the park to play, we train and educate them about things that they should not be doing - do not talk to strangers, do not take sweets from strangers, do not tell people where they leave, don’t wander
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What are the issues, especially around identities and profile information privacy rights of users of social networking sites? The main set of issues, as I see it, around the question of identities, is the mapping of the digital identities to the physical selves. The questions would be : what constitutes the authentic self? what is the responsibility of the digital persona? Are we looking at a post-human world where the online identities are equally a part of who we are and some times even more than that? Does the older argument of the Original and the Primary (characteristics of Representation aesthetics) still work when we are talking about a world of ‘Perfect Copies’ and ‘Interminable networks of selves’ (characteristics of Simulation)? How do we create new models of verification, trust and networking within a SNS. Sites like facebook and Orkut, with their ability to establish looped relationships between the users and the notion of inheritance friend of a friend of a friend of a friend, or even testimonials and open ‘walls’ and ‘scraps’ for messaging are already approaching these new models of trust and friendship. How do we strike a balance between the freedom of speech and need to maintain law and order - when it comes to monitoring social networking sites? I am not sure if the ‘freedom of speech and expression’ and the ‘maintaining of law and order’ need to be posed as antithetical to each other. Surely, the whole idea of ‘maintaining law and order’ already includes maintaining conditions within which freedom of speech and expression can be practiced. Instead of monitoring social networking sites to censor and chastise (as has happened in some of the recent debates around Orkut, for example), it is a more fruitful exercise to ensure that speech, as long as it is not directed at direct offense towards an individual or a community, needs to be registered and heard. Hate speech of any sort should not be tolerated - but that is a fact that is already covered by the judicial systems around the world. What perhaps, is needed online, is a mechanism of selfgovernance where the community should be able to decide the kinds of actions and speech which are valid and acceptable to them. People who enter into trollish behaviour or hate speak, automatically get chastised and punished in different ways by the community itself. To look at models of better self-governance and community mobilisation might be more productive than producing this schism between freedom of speech on the one hand and the maintenance of law and order on the other. i4d | September 2008
STATUS OF MSMES IN AFRICA
ICTs and MSMEs: A look at Africa Defining Micro, Small and The distribution of MSME in Medium Enterprises (MSMEs) some regions of Africa are as Going by the European Commission’s definition Micro, Small and Medium Enterprises (MSMEs) comprise of enterprises that employ less than 10 persons and have an annual turnover not exceeding two million euros, and/or an annual balance sheet total not exceeding two million euros. There is no universal definition of SMEs since the sector is diverse and flexible that resists any narrow categorisation. The definition of Micro, Small and Medium Enterprise (MSME) is based on five main parameters; labour, capital, loan size, fixed asset and annual sales turnover. Organisations often use one criterion to define MSMEs. The size limit is one of the most common definitions in developing countries. Some countries use one criterion to define this sector while others may have definitions with multiple criteria. Eg, South Korea defines MSME on the basis of ‘capital or assets’, while Canada defines this term on the basis of ‘number of employees’ and ‘gross sales or taxable income’.
follows: Burkina Faso: 30 per cent of Gross National Product (GNP) is generated by Micro, Small (craft) Enterprises that employs about 900,000 people (or 18% of the labour force) (figures from OECD 2000)1.
MSMEs market in Africa
Nigeria: With a GDP of over $40 billion, Nigeria has the second largest economy in Africa. In 2002 and 2001, the GDP of Nigeria was $43.4 billion and $42.5, respectively 2. According to estimates from the World Bank3, MSMEs comprise of 87 per cent of all firms operating in Nigeria. Around 75 per cent of the poor depend on a farm or non-farm MSME for their livelihoods. Around 80 per cent (approximately 6.7 million) of the MSMEs and small business account for 15 per cent of the total (about 1.3 million) and medium enterprise account for 5 per cent of the total (around 420,000).
Among developing nations, making the MSME sector viable has become a matter of strategic importance for eradicating poverty which would subsequently lead to the nation’s economic development. The sheer size and variety of activities that the sector supports at varying geographical conditions and economic scales makes its success imperative for development that is sustainable and truly democratic. In Africa particularly, MSMEs constitute over 90 per cent of business operations and contribute towards over 50 per cent of the nation’s total employment opportunities and Gross Domestic Product (GDP).
Mozambique: In Mozambique, agriculture, livestock and fisheries sector have a share of 33 per cent of the GNP with 80 per cent of the labour force employed in these sectors. The services sector has the largest share of the GNP at 44 per cent and employs 15 per cent of the officially registered total labour force; the industry sector contributes towards 23 per cent of the GNP and employs 5 per cent of the labour force. Around 50 per cent of Micro Enterprises carry out their business from private homes and do not have formal business education1.
September 2008 | www.i4donline.net
Ghana: The MSME sector in Ghana supports around 30 per cent of the workforce and contributes to 6 per cent of the GDP. Around 70 per cent of enterprises are Micro and Small Enterprises (MSEs). It is estimated that nearly 40 per cent of Ghana’s National Income (GNI) is contributed by micro to informal activities (GOVG, 2003)4. It is believed that these micro and small firms can more easily trigger growth in the economy than the large ones due to their numbers and the niches they occupy in the national economy (Bussel, 2001)5. Namibia: In the Namibian economy, the private sector is dominant in most industries with the exception of transport and the utilities sectors. MSME sector in Namibia accounts for 62 per cent of GNP, in which 65 per cent of all registered enterprises employ less than 10 employees and mainly work for the trade and services sector. Small Enterprises account for only 2 per cent of the total manufacturing turnover1.
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ICT usage in African market In most African countries, MSMEs are challenged by the globalisation of production and the shifts in the importance of various determinants of competitiveness.
but at the same time they consider it important or very important. Out of 60 per cent, 46 per cent stated that they do not need fixed telephone lines, 31 per cent stated that fixed telephone lines are too
Table 1: MSEs stated that particular ICT item is either important or very important for their business operation, distinguished by whether the business possesses the item or not
Don’t have it (%)
Have it (%)
Total (%)
Fixed lines
58.9
98.9
82.4
Mobile phones
68.5
99
95.4
Post Box
24.3
82.8
59.8
Computer
49.6
97.6
71.8
Internet Connection
39.1
95.4
52.2
Post Box: Around 35 per cent of micro and small enterprises continue to use a postal box to communicate with their customers and clients. Most of them use postal service for formal communication (business purposes) as against using mobile phones for the same. And around 20% of MSEs use the postal service to order supplies.
Source: Research ICT Africa (RIA)
The rapid spread of ICT and decreasing prices of communication tools has made the world a smaller place. In 2005, the Research ICT Africa (RIA)6 conducted a research across 13 African countries, to examine ICT readiness in MSEs. The research was conducted in Botswana, Cameroon, Ethiopia, Ghana, Kenya, Mozambique, Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda, and Zimbabwe. The research analyses the use of different ICTs tools by MSEs. Mobile phones: According to the research, around 76% of the MSEs use mobile phones to stay in touch with their clients and 48% of them use fixed-line telephones. Out of 76%, 53% utilise mobile phone for their personal use. Comparing fixed lines to mobile phones in terms of desirability, mobile phones are rated as more important than any other category. On an average, 83% of small and micro enterprises use a mobile phone for business purposes. (Table 2) Fixed Line: Though Table 1 shows that 60 per cent of MSEs do not have fixed line phones
much expensive. This shows that mobile phones are clearly fulfilling the role of fixed telephones with the convenience of flexibility and low incremental payments. (Table 3) Internet Connectivity: People who do not have computers are divided into two categories; one who believe that there is no need of computers and second, who believe that computers are too expensive for them. Around 45% of the MSEs believe that a computer
ICT initiatives for MSMEs African Development Bank (ADB): The bank has created a dedicated division for ‘Micro-Finance and SME Development’ to support micro enterprises through microfinance. The bank is engaged in capacity-building of the market to avail appropriate instruments and mechanisms for MSMEs growth and enhance access to finance. The division has following objectives :
Table 3: Share of MSEs having a fixed line phone
Informal (%)
Semi-formal (%) Formal (Business) (%)
All (%)
Manufacturing
17.2
48.3
83.8
39.0
Construction
16.5
54.0
80.6
43.1
Services
26.5
60.3
83.1
54.8
All
23.6
58.1
83.0
51.2
Source: Research ICT Africa (RIA)
with Internet connection is too expensive for them. Out of this 45%, 89 per cent belong to informal and semi-formal sector. Similarly, 45% believe that there is no need to own a computer. But both categories use cyber cafes for Internet surfing. Around
Semi-formal (%) Formal (Business) (%)
•
•
•
Table 2: Share of MSEs having access to mobile phones for business purposes
Informal (%)
20% of micro and small enterprises do not have an Internet connection but they use cyber cafes for their work. Around 72 per cent of MSEs believe that computers are an important tool for their business. Out of this 72%, 52% believe that computers with Internet connection is very important for business. (Table 4)
All (%)
Manufacturing
80.5
84.5
85.9
82.7
Construction
86.1
92.0
94.0
89.7
Services
83.4
82.6
82.7
82.9
All
82.9
83.3
83.7
83.3
Enhancing the financial systems in order to better serve the MSME sector and improving the financial environment for MSMEs Enhancing the growth and competitiveness of MSMEs in a globalised economy Promote par tnerships with development partners and technical partners as well as towards enterprise development in Africa.
International Finance Corporation (IFC): The IFC promotes private sector
Source: Research ICT Africa (RIA)
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i4d | September 2008
Conclusion
Table 4: Share of MSEs having Internet access
Informal (%)
Semi-formal (%) Formal (Business) (%)
All (%)
Manufacturing
1.3
11.6
41.5
12.1
Construction
0.9
14.0
44.8
16.4
Services
4.2
19.2
41.4
20.5
All
3.3
17.7
41.7
18.7
Source: Research ICT Africa (RIA)
development through its investment, technical assistance and advisory work. The Division of SME sector supports micro, small and medium-sized enterprises by providing access to finance, linking small and medium enterprise to investments, regional facilities and improving the businesses enabling environment. In cooperation with Africa’s Private Sector Development Department, IFC, Small and Medium Enterprise Department, IFC Africa, and IFC Financial Markets have developed a joint program to bring expertise and resources for MSMEs. The joint programme was launched to support MSME development in selected SubSaharan countries. The programme aims to increase the contributions of MSMEs to employment and national growth by supporting three complementary main pillars: (i) access to financial services; (ii) access to business development services, including strengthening inter-firm linkages (both domestic and foreign) and access to information; and (iii) improvements in the business environment for MSMEs. United Nations Industrial Development Organisation (UNIDO): UNIDO established a Cluster / Network Development Programme so as to provide access to training, information and advice on business management for SMEs. The projects in UNIDO’s programme on clusters and networks development are customized to the requirements of individual countries, their SME sector and local policies and initiatives for private sector development. Broadly speaking, there are three aspects to such projects: • Organisation and development of clusters • Development of networks of SMEs • Development of linkages between SMEs and larger enterprises September 2008 | www.i4donline.net
UK Commission for Africa: It advocated the creation of an African Enterprise Challenge Fund, to be backed by US$ 100 million of investment, and is designed to support private sector initiatives targeted at SME development. Industrial Development Corporation (IDC) of South Africa: IDC is a self-financing, state owned national development finance institution that provides financing to entrepreneurs and businesses engaged in micro and small industries. In partnership with other organisations, the IDC identifies and promotes investments in viable new industries, particularly in promotion of SMEs, regional investment diversification and job creation.
Challenges faced by MSMEs • • •
• •
• •
Political and economic instability; Limitations in absolute market potential; Informal or non organised (bringing the SMEs into the formal sector is expected to generate increased revenue through taxation and Formalisation can help the SMEs to get protection under legislation.) Standardisation and benchmarking Lack of a coherent regulatory framework and a legal/policy environment which is conducive to business Small local markets and undeveloped regional integration Micro-credit institutions remain fragile and modest in size etc.
The descriptive analysis of the data on MSEs shows that investment in ICT is an important determinant of total productivity. The use of different levels of ICT tools – telephone, mobile phones, computers and Internet connectivity are also linked to the level of education of the workforce. A factor limiting MSMEs growth is the substantial time lag between ICT investments and their effects. Its also possible that the lack of ICT implementation reflect the time lag before investments in these technologies begin to payoff. The presence of governments, regional organisations and private companies can help the establishment and growth of MSEs through the use of local suppliers and distributors. Initiatives for encouraging and stimulating new businesses by providing seed funds, training, capacity building and businesses opportunities in their supply chain will provide social micro and macro economic advantages. Most African countries have ICT development plans or e-Commerce programmes to empower micro and macro enterprises. The donor community is also enthusiastic about the role of ICT4D as it facilitates participation of the formerly excluded in all kinds of interaction, from democratic processes to markets. Ritu Srivastava, ritu@csdms.in
References: 1. 2.
3.
4.
5. 6.
Organisation for Economic Co-operation and Development (OECD), http://www.oecd.org/ Percentage was quoted in the World Bank report 2002 was reported as being from the Corporate Affairs Commission (CAC) in Abuja, Nigeria. Percentage was quoted in the World Bank report 2003 was reported as being from the Corporate Affairs Commission (CAC) in Abuja, Nigeria. GOVG (2003): The ICT for accelerated development (ICT4AD) policy. Graphic Communications Group, Ghana Government, Accra. Bussel van, P. (2001): Market Study on MSEs and Business Development Service Providers. ResearchICT Africa (RIA); http://www.researchictafrica.net/index.php
Call for abstract for the first edition of the Zero-In magazine Theme: Distance Learning/Education and training as an e-Infrastructures application Abstract submission deadline: 24 September 2008 Abstract acceptance notification deadline: 1 October 2008 Full papers submission deadline: 15 October 2008 More information: http://www.beliefproject.org/e-magazine.
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LAUNCH OF TELECENTRE ACADEMY, SUDAN
Road to sustainability GDCO initiatives: Gedaref Digital City Organization (GDCO) is a non-profitable NGO (Gedaref Sudan). It is the founder of the first digital city in Sudan (2005) and the first National Telecentre Academy in Africa and the Arab world (2008). GDCO has strong partnership with the great people of Eindhoven through the digital city of Eindhoven (DSE) where 750 computers were donated to establish many Telecentres and ICT projects for community development in Sudan. http://gedarefcity.org/. GDCO became the winner of i4d 2007 award in the ‘overseas’ category and eINDIA2008 award in ‘Best innovations at the Grassroots Telecentres’ category. GDCO is the only organisation in Sudan dealing with the people with special needs (disabled) through ICT. GDCO trains them for free, provides free computers to deaf to keep at home, GDCO work very hard in training these disabled. The academy will be a great tool for enhancing capacity of all disadvantaged groups.
National Telecentre Academy (SuNTA)’ in Gedaref (Sudan) to encourage community development through ICT and as a media for development. 8.
9.
10. The main objectives of Sudan National Telecentre Academy (SuNTA) are :1. Utilising ICT4D in Sudan 2. Bridging the digital divide created by the information revolution
Launching the SuNTA website
Establishing SuNTA Though telecentres are not in the priority books of the Sudanese community, they
have a great role in expediting development and enhancing capacity building of the community. The 5th East Africa Telecentre Leader Forum (9th to 10th June 2008; http:// www.gedaref.com/5theatlf/) established the first national Telecentre academy, ‘Sudan
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11.
advanced training programmes in the fields of information technology and cognitive skills for practitioners in telecentres Co-ordination between the working organisations and institutions in ICT to achieve the shared goals and to establish and operate telecentres Utilising available infrastructure of partners to operate telecentres by securing funds according to regulations and priorities, securing logistics and basic subsidiaries Providing the Government with technical support and consultancies to execute its technical programmes Establishing Sudan Telecentres National Network, to include all institutions (public and private) and concerned organisations that work in the fields of digital technology and knowledge, beside having partnerships to support, exchange experiences and information
3. Fostering inclusion of the disabled within the society through information telecommunication technology 4. Initiating effective database systems for perfect planning to achieve a comprehensive development in Sudan 5. Seeking financial and technical support from funding institutions, including civil society organisations (national and international), governments and private sectors 6. Enhancing exchange of experience and knowledge with the global telecentre network and the information societies 7. Setting local programmes’ contents as required for capacity building, implementation of specialised
In eINDIA2008 conference and at the Telecentre forum V N Rajasekharan, the Vice Chancellor of Indira Gandhi National Open University (IGNOU), his Excellency Elbasheir Sahal, State Minister of Education
(Gedaref state, Sudan) Dr Basheerhamad Shadrach, Senior Programme Officer, telecentre.org, Vignesh Sornamohan, CSDMS, members of Sudan Telecentre National Network and Ahmed Eisa, the Chairman of GDCO launched SuNTA web: http://sudantelecentreacademy.org/ i4d | September 2008
UNLIMITED POTENTIAL PROGRAMME, MICROSOFT, MALAYSIA
How do ICTs empower women? Given the proper training in ICT enabled tools, it is seen that women can do wonders by equipping themselves better in the society
Iriani Zulkifli Community Affairs Manager Microsoft Malaysia Sdn Bhd v-iriaz@microsoft.com
September 2008 | www.i4donline.net
Gone are the days when women were looked upon only for the role of a ‘caregiver’. With today’s technological pace of development and innovation, they are able to impart relevant skills training from home that are valuable enough for the 21st century and beyond. The transition was inevitable for Information Communication Technologies (ICT) pervading presence in all facets of today’s life. To be able to send an e-mail from one’s mobile phone or conduct banking transactions online is no longer a luxury or convenience just for the techsavvy but rather a necessity for all. And this necessity knows no bounds - it doesn’t matter if one is an IT professional or a housewife.
How can women embrace ICT? One of the constant comment, about mothers or caregivers is that they never understand their children . Traditionally, many are at a loss for words whenever they engage in conversation with their children, who, with immense exposure to multiple forms of media and entertainment via ICT, are more technologically savvy. The pace and speed at which children learn ICT leave many adults gasping for air in their wake. The choices? Learn to understand your children or be left behind. But, given the proper training and tools, it is seen that many women do wonders with ICT. They are not necessarily the run-of-the-mill IT professionals who have post-graduate qualifications in space-age electronics technologies. Having run the UP programme in Malaysia for over two years, it has been found that some of the most heartening and empowering stories comes from single mothers. Yes, women who not only have to work to support their children and keep the family economically
afloat, but have to run and manage the family as well. Societal discrimination and prejudices have rendered one blind to the sacrifices these disadvantaged women have to make and the personal struggles they have to endure to even get a chance for a better life.
Substantiating examples Dayang Satiah Nasir received the Microsoft Unlimited Potential (UP) programmes ICT skills training with Pertubuhan Wanita Sabah (PEWASA) at the age of 43. More than being just additional skills and knowledge to her, she found it had enriched her life and enabled her to find ways to assist in her family’s finances. With the aid of Microsoft Publisher, Dayang learned how to create invitation cards for important occasions like her wedding anniversary or her children’s birthdays. This has assisted in reducing her family’s expenditure. It is also widely mistaken that much of this training is best reserved for well-to-do housewives who still have enough time on their hands even after a shopping spree and evening tea with friends.
39
YWCA VTOC and its trainers
Some of these women have to travel more than 60 km just to reach an NGO centre for such ICT training. For single mother Irene Syam Norhayati, who understands the values of such skills, it is a small price to pay for the potential of opening doors in a world that is ever evolving and progressing. Her village in Sabah is so remote that even basic technology and infrastructure is lacking. Due to her tenacity, she has learned how to use Microsoft Word to write letters and has even progressed to use PowerPoint for the presentations of her Neighbourhood Committee activities. This is a far cry from the days when she had to write her notices and information on manila cards and post them on the local village community hall. On the other hand, young Poh Lin didn’t have to write on manila cards or stay at remote areas of the country. Her mother was a drug addict, her father an odd job worker. She used to roam around Petaling street in search of food at the age of three. Her father finally threw her mother out as she was unable to kick her addiction. At the age of nine Poh Lin was found by a Home and taken in. Only then was she able to begin formal education. Not long after she completed her final year secondary school exams, her father suffered from a stroke and was unable to take care of her. The Home then referred Poh Lin to the YWCA where, along with her vocational training, she learned ICT skills training under the UP programme. This young woman completed a one year Culinary and Baking course at the YWCA Vocational Training and Opportunity Centre
(VTOC) in Kuala Lumpur, and went on to gain employment with a renowned hotel. She often recounts that the first question she was asked during the job interview at the hotel was: “Do you know how to use the computer?” Understandably, there was a sense of utmost pride when Poh Lin presented her certificate from the programme. Not only was she able to get a job, but also a starting salary of RM1500. This is an astounding feat for a child who once roamed the streets begging for food, and who did not have the formal and proper channels and process of education as most children do. Another worthy example is Sembagavali who, in her early 20s, aspired to be a caregiver. She was accepted for the Caregiver course at the YWCA VTOC where she learnt ICT skills. She showed initiative and was proactive in searching for job opportunities online, a skill acquired through the UP programme. She soon found a job with a boutique hotel and, in the meantime also applied for a scholarship to go on further with her studies in nursing. Sembagavali was accepted for both. Had she not had the ICT skills to find these opportunities, it might have been more difficult for her to progress in her chosen profession.
ICTs for senior citizens Senior citizens in their 70s and 80s probably do not see the value of learning ICT skills, as opposed to the younger generation who supposedly have the whole world in front of them. Those in this age group have a set of barriers to overcome - the fear of embracing something which is new including technology which appears most daunting. More often than not, it is so intimidating that it totally prevents them from even thinking of trying. Individuals like Nancy and Patricia, who dared to learn ICT skills, have found a world of change that not only fits their lifestyle, but is enriching as well! Nancy, a line dancing instructor, can now find line dancing steps as well as music for her classes via the Internet. Meanwhile, Patricia learned how to e-mail and IM (Instant Message) to her family members all over the world. ICT has brought them greater access to the world and connected them in a cost effective and efficient manner. For Nancy, gone are the days when she used to spend hours and days sifting through stores looking for a few photos of dance steps or, in Patricia’s case, exorbitant phone bills from calling grand children on far-away continents. ICT has definitely made the world smaller and more accessible.
Conclusion
WCA Melaka centre
40
It’s heartening to see many young women and even senior citizens thriving as a result of the Programme eager to learn more once they overcome the fear of using ICTs. There are many more wonderful stories that have come as a result of the great work of a small group of women without whom the UP programme would not be what it is today. These heroes have helped many underprivileged and underserved women stand on their own feet and create opportunities for themselves. Not all heroes come in body-fitting nylon suits and flowing capes. These heroes are everyday women, like one and all, except they perform extraordinary acts of kindness and fortitude on a regular basis that most would participate in perhaps only occasionally in life, if at all. i4d | September 2008
society and make something for themselves, and UP Programme, Microsoft is privileged with the honour of working with the NCWO and YWCA since 2006. The partnership continues to grow and progress.
CLP centre in Sebarang Prai, Penang – YWCA Malaysia’s partner
Partner organisations The National Council of Women’s Organisations (NCWO) is the largest umbrella organisation in the country, with over 120 affiliates in Malaysia alone, not to mention the numerous affiliations worldwide. NCWO has advocated women’s rights and provided important programmes for women over the years. The Young Women’s Christian Associations (YWCA), which has existed for a century, is another home to heroes. It has opened its doors to various underprivileged and marginalised girls from every corner of the country, regardless of race, colour or creed. Some are from places so remote they have to take multiple forms of transport in order to even reach the Centre.
Back row from left to right: Iriani, June Yeoh, Juwita Suwito. Front row left to right: Sandra Simon, Pamela Passman (Microsoft Corporation Vice President).
Microsoft Malaysia’s NGO partners and their trainers Within these two organisations, there are two women that would humble even the most accomplished individuals. Dato’ Ramani Gurusamy is one of the kindest and gentlest souls one would ever come across, but threaten to offend a woman’s rights, and she pounces faster than a hungry tiger. A stalwart for women’s rights and development, women today have people like Dato’ Ramani and her compatriots to thank for the modern day woman’s ability to earn equal pay and equal opportunity in jobs. And as we all know, heroes work in teams. Those who have opened eyes and minds also include people like Mrs. June Yeoh, whose strength is greater than any world leader and whose mastery in finances will rival any Fortune 500 company executive. Mrs Sandra Simon is another person that must be mentioned. A volunteer who almost never says, No, her ICT skills are matched only by her big heart and warm demeanor. These are heroes that don’t demand media or PR. They don’t ask for any special favours for the work they do. They do it because at the end of the day, equipping women with the necessary 21st century skills
PEWASA Sabah centre
PEWATAN Kelantan centre launch PEWASA Sabah centre NCWO partners with PEWASA in Sabah, Pertubuhan Wanita Kelantan (PEWATAN), Lembaga Kebajikan Perempuan Islam in Terengganu (LKPI), Women’s Institutes (WI) in Perlis, NCWO Pahang and NCWO Kedah while YWCA partners with its sister organisations in Negeri Sembilan, Melaka, Pahang, Ipoh, Penang Island and Kuala Lumpur and a partner, Compassionate Link Programme (CLP) in Butterworth, Penang. These are two organisations that have tirelessly ensured that women and the underserved receive an equal opportunity to contribute to September 2008 | www.i4donline.net
Microsoft Malaysia’s NGO partners and their trainers
is what matters. They know they are helping to create better lives for these individuals and families, and that the women they train have the skills to help lead Malaysia become a knowledge-based economy. Women of Malaysia salute you.
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Bytes for All... eASIA 2008 Upcoming event: eAsia2008 - Asia’s ICT Event 11-13 November, 2008 KLCC, Kuala Lumpur, Malaysia http://www.www.e-asia.org, http://www.i4donline.net
Telecentre.org Grant telecentre.org, a global community of people committed to improving the capacity and sustainability of community telecentres around the world, announced the telecentre.org academy Curriculum Commons Grant of USD 125,000 for improving the quality and standard of grassroots knowledge workers, commonly referred to as telecentre managers. telecentre.org is a collaborative social investment programme initiated by Canada’s International Development Research Centre (IDRC), Microsoft Corporation Pvt Ltd and the Swiss Agency for Development and Cooperation (SDC).
More on Telecentres Deconstructing Community Participation in Telecentre Projects (Savita Bailur): The paper critiques the assumed link between community participation and telecentre success; finding no hard evidence of a relation and a problematic understanding of the term ‘community’ - asks that telecentre policy-makers and implementers treat this causality in more complex terms than at present. http://www.sed.manchester.ac.uk/idpm/research/publications/wp/di/di_wp31.htm
Manthan Awards Manthan Award South Asia 2008 will recognise the best ICT and e-content practices and innovations for development. There are 15 categories: e-business; e-learning; e-culture; e-government; e-health; e-enterprise and livelihood; e-entertainment; e-education; e-environment; e-inclusion; e-localisation; e-news; e-youth; m-content and community broadcasting. The Manthan Award is an initiative of Digital Empowerment Foundation with support from Department of Information Technology, Government of India, World Summit Award and others. http://www.manthanaward.org
Online Gold? Online ‘Gold Farming’: Developing Country Production for Virtual Economies (Richard Heeks). Latest additions to the Development Informatics online working paper series: http://www.sed.manchester.ac.uk/idpm/research/publications/wp/di/di_wp32.htm
Researching ICT-based enterprise in developing countries Analytical Tools and Models (Richard Heeks). Provides a guide for those researching ICT-based enterprises in developing countries. Offers a series of frameworks for analysis from basic classificatory models to those that can analyse competitive strategy, impact, context and the enterprise lifecycle. In each case, provides an explanation of basic concepts, and a sense of what research using
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the particular framework would offer. http://www.sed.manchester.ac.uk/idpm/research/publications/wp/di/di_wp30.htm
Bytes for all is 9 Loyal Bytes For Allian Deidre Williams wrote in from the West Indies: As far as I can remember Bytesforall was born about this time of the year. Once again - thank you - you keep me in touch with all sorts of things that I might not hear about otherwise, and have been doing that consistently for the last several years.
The banker’s role? Jeff Buderer wrote about an invitation to enter the CitibankChangemakers.net global online competition, “I notice that Citibank is a major sponsor. Not that I am against all and any form of corporate sponsorship...but I am just wondering what is the goal of Citibank in this process and what is their influence on the process. My thought is that all those ‘opinion leaders’ should not so much be influencing the process and seeking to forward their corporate agendas in the process so much as listening to people in the grassroots.”
m-Health, Chennai Nuwan Waidyanatha reported that a series of four meetings were held between August 3-5, 2008 at the Indian Institute of Technology - Madras campus on defining the project design and goals in relation to the real-time biosurveillance pilot programme. The programme brought together partners from North America (University of Alberta and Carnegie Mellon University) who joined the meeting through Skype; while the Indian and Sri Lankan partners met, face-to-face, at IIT-M’s Rural Technology and Business Incubator. http://lirneasia.net/2008/08/rtbp-partner-meeting-repot/
Digital Green The Digital Green project is developing a participatory framework for agricultural extension The DG content repository is videocentric. This is important for a developing and predominantly rural country like India, which, by optimistic estimates, has an adult literacy rate of less than 60%. In farming communities, the literacy rate is substantially lower. The video based approach has several important advantages to traditional forms of agricultural content, which is typically not in the local language, intended for a literate audience, uses expert terminology, lacks grassroots level practicalities, and remains inaccessible in a sea of scattered media. Farmers, by the nature of their occupation, rely on their auditory and visual senses and video, though not perfect, comes closest to capturing the scene in detail. Video creation tends to be faster and less expensive than other types of media, as advanced preparation in “lesson”-planning can minimise post-production editing. http://research.microsoft.com/research/tem/dg/database.htm
Video Repository: Digital Green is an agricultural training and advising system that seeks to benefit rural farmers by disseminating i4d | September 2008
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Bytes for All... targeted information through digital videos. A list of 127 agro-based videos was made available. http://research.microsoft.com/research/tem/dg/repos.htm
Educational Technology QUEST Alliance held a Symposium on Education & Technology in Schools -- Converging for Innovation and Creativity in Bangalore in end-August 2008. Sethi says: “The symposium is aimed to bring together education and education technology practitioners, policy makers, scholars and experts, academicians and students for an exchange of ideas and to showcase innovations on educational technology in India. The symposium is designed to encourage in-depth dialogue and explore different perspectives on issues and challenges related to technology use in Indian classrooms.” http://www.questalliance.net
Edu Powerpoints Friends at the NGO Sangath in Goa pointed to this site, that contains tonnes of educational presentations (Power Points, mostly). Check it out: http://pppst.com/ Pete’s Power Point Station. It describes itself thus: “Free presentations in PowerPoint format, and free interactive activities for kids.” Links to resources in language, arts, math, science, social studies, seasonal and special themes, reading and writing, music drama and dance, plants and animals, health and safety, abc’s fairy tales, physical education, geography, nutrition and the food pyramid, three branches of government, reading comprehension, countries and continents and regions, and special need kids, rhyming words and confusing words, parts of speech, world languages, ancient history, bullying, library skills, children’s literature and authors, advertising and propaganda, world history, codes and ciphers and secret messages, clip art, templates, tutorials and more.
OLPC in the News The One Laptop Per Child project is in the news, with Nicholas Negroponte visiting India over it, including with a visit to Khairat village (outside Mumbai) where it has been implemented.
BdOSN Code Sprint Bangladesh Open Source Network (www.bdosn.org) in association with CSE Society and SUST OSN announced that a two-day Code Sprint will be organised at CSE Dept, SUST on 8-9 August, 2008. A sprint is a time-boxed period of software development focused on a given list of goals but with variable scope. Sprints have become popular events among some Open Source projects. http://www.bdosn.org
m-Health India Krishnan Ganapathy, a practicing neurosurgeon, is the former president of the Neurological Society of India and current September 2008 | www.i4donline.net
president of the Apollo Telemedicine Networking Foundation. He is also the co-founder of the Telemedicine Society of India, a member of the National Task Force on Telemedicine and an adjunct professor at IIT Madras and at Anna University. He is currently involved in preliminary studies on the clinical evaluation of patients based in rural areas of India, Bhutan, and Bangladesh using wireless telephony. Along with his colleague Aditi Ravindra, Dr. Ganapathy is one of the leading thinkers on mobile health in India and around the world. http://mobileactive.org/krishnan-ganapathy-without-india-there-no-mhealth
Teacher’s Toolbox It contains quite some useful info and links. Including some on art, blogging, books, cartoons, chess, competitions, digital story telling, digital video, educational software, English, homework, humour, math, morning tea, phonics games, phonics resources, podcasting, poetry, problem solving, professional development, reading comprehension, science education, “shameless selfpromotion”, stress reduction, stressbusters, things they don’t tell you at university, thinking skills,Web 2.0, website resources, word games and writing. http://adrianbruce.com/teacher-toolbox/
Mobiles usage in low incomes From Favelas to Townships: Mobile Use in Low-Income Populations [By Corinne Ramey] Mobile phone use is booming. There are close to 3.5 billion mobile phones in use, and mobile penetration rates are increasing quickly, especially in developing countries. This rise of mobile phone use by low-income and so-called ‘base-of-the-pyramid’ users raises a number of questions. Are lowincome people using mobile technology in different ways than their higher-income counterparts? How can mobile phones be designed and used in ways that are useful to the low-income group people? Two new studies--one of favelas in Brazil and the other of a low-income township in South Africa--seek to answer these questions. http://www.mobileactive.org/favelas-townships-mobile-use-low-income-populations
Software for kids Aren (5) explains the goodies that come with the GNU/Linux operating sytem, from a kids point of view – specially Gcompris, some games and more. http://softwareforkids.wordpress.com OR http://www.youtube.com/ watch?v=fjcfWizHQXw
Bytes for All: www.bytesforall.org or www.bytesforall.net Bytes for All Readers Discussion: http://groups.yahoo.com/group/ bytesforall_readers To subscribe: bytesforall_readers-subscribe@yahoogroups.com Bytes for All Discussion summary compiled by: Frederick Noronha, India, fred@bytesforall.org
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Books received For a Breath of Fresh Air: Ten years of progress and challenges in urban air quality management in India 1993-2002 Author: Tapan K Ghosh, Editorial and Production Consultant Publisher: Environment and Social Development Unit, South Asia Region, The World Bank (India Country Office) Pages: 146 The economic boom that India went through during the 1990s gave rise to robust urban growth which caused a spurt in air pollution in major In d i a n c i t i e s . T h e magnitude of this spike was such that it became a cause of national concern and elicited global attention. The level of suspended particulate matter (SPM) recorded in the large metropolitan cities of India, especially Delhi, Kolkata, Mumbai, Hyderabad and Chennai, far exceeded the ambient air quality standards adopted by India and many other countries. Alarmed by the sudden spike in pollutants in the atmosphere, the Government implemented a slew of policy interventions the most publicised of which was the conversion of Delhi’s public transport system to run on Compressed Natural Gas (CNG) in 2000 – 2002. Following the success of the initiatives in Delhi, the Supreme Court of India directed a number of highly polluted Indian cities to prepare “action plans” to address the issue of urban air pollution. This report assesses the impact of the interventions in 5 metropolitan cities so as to enable them and other Indian cities to formulate better strategies for combating urban air pollution. The comprehensive study addresses four basic concerns: • Efforts that have been made to address air pollution • Impact of those efforts on air quality • Key factors that affect air quality and should be considered in future intervention programmes, and; • Impact of changes in air quality on human health. The book is highly recommended for all development policy makers.
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PAN Localization: Working Papers 2004 – 2007 Author: PAN Localization Project Teams Publisher: Centre for Research in Urdu Language Processing, National University of Computer and Emerging Sciences, Pakistan and IDRC Canada ISBN: 978-969-8961-05-3 Pages: 533 PAN Localization project has been working since early 2004 to develop language computing capacity across Asia. The scope of the project encompasses language computing in a broader sense, including linguistic standardization, computing applications, development platforms, content publishing and access, effective marketing and dissemination strategies and intellectual property rights issues. Countries directly involved in this project include Afghanistan, Bangladesh, Bhutan, Cambodia, Laos, Nepal, Sri Lanka and Pakistan. The book accumulates the research reports and papers written by the individual country teams between 2004 and 2007 on a variety of topics that they worked on. Readers may find it interesting that the papers presented in the volume have been classified on the basis of languages, not countries. The reason for this classification being that countries in Asia most often have many languages. The papers carry a wealth of information on the research being conducted by the respective country teams to enable local language computing in: • Bengali, (Spell Checker, text to speech software, integrating Bengali in OpenOffice.org) • Dzongkha, (Fonts) • Khmer, (Lexicon development, Spell Checker) • Lao, (Fonts, Keyboard) • Nepali (Lexicon development, NepaLinux, Live-CD); and • Sinhala (Lexicon development, text to speech system) Above are just some examples of the kind of papers presented in the volume that show the kind of development taking place in the region that will bring enable people from diverse backgrounds to harness the wealth of information that is available online. i4d | September 2008
Whatâ&#x20AC;&#x2122;s on Africa 16 October 2008 World HIV/AIDS Conference Johannesburg, South Africa http://www.mcguireglobalrecruitment.com
27-31 October 2008 Africa Media and Broadcasting Congress 2008 Sandton Convention Centre, Johannesburg http://www.terrapinn.com/2008/mediaza/
21-30 October 2008 World Telecommunication Standardization Assembly (WTSA-08) Johannesburg http://www.itu.int/net/home/index.aspx
10-12 January 2009 6th Conference on e-Learning Applications Cairo, Egypt http://www.aucegypt.edu/ResearchatAUC/conferences/ elearning/Pages/default.aspx
Australia 5-7 November 2008 Broadband World Australia 2008 Sydney http://www.terrapinn.com/2008/broadbw/
Europe 14-17 October 2008 10th Congress of International Mechanization and Energy in Agriculture Antalya, Turkey
Salzburg, Austria http://www.inter-disciplinary.net/ci/Cyber/ cybercultures/c4/cfp.htm
India 15-17 October 2008 WEB 2.0 & Beyond Mumbai, Maharashtra http://www.informedia-india.com/client/Index.aspx?i d=conference&sub=program&ConfID=144
3-6 December 2008 Internet Governance Forum Hyderabad, Tamil Nadu http://www.intgovforum.org/
11-13 December 2008 Renewable Energy Asia 2008 New Delhi
12-13 December 2008 2nd International Conference on Science and Technology (ICSTIEâ&#x20AC;&#x2122;O8) Permatang Pauh, Pulau Pinang www.icstie.com
15-17 December 2008 International Conference on Environment 2008 (ICENV 2008) Penang http://chemical.eng.usm.my/ICENV2008
Singapore 16-18 February 2009 Open Source Singapore-Pacific-Asia Conference & Ex5 po 2009 (OSSPAC) http://www.osspac.com
Thailand
20-25 March 2009 Green Energy Summit 2008 Bangalore, Karnataka
20-23 May 2009 World Renewable Energy Congress 2009Asia Region (WREC) Bankok
http://www.greenenergysummit.com
Japan 24-28 August 2009 The 3rd International Symposium on the Environmental Physiology of Ectotherms and Plants Tsukuba http://www.nias.affrc.go.jp/anhydrobiosis/isepep3/ index.html
Malaysia
http://www.thai-exhibition.com/entech
United Arab Emirates 9-10 November 2008 BankTech Middle East Congress Dubai http://www.banktechmideast.com
17-19 April 2009 3rd IEEE/ACM International Conference on ICTD2009 Doha Qatar http://www.ictd2009.org
United Kingdom
4-6 November 2008 The World of Health IT 2008 Copenhagen, Denmark
25-27 March 2009 Gender and Education Association International Conference London
http://www.worldofhealthit.org/
26-27 November 2008 Internet Marketing Conference Stockholm, Sweden
http://www.ioe.ac.uk/fps/genderconference09
http://www.internetmarketingconference.com
September 2008 | www.i4donline.net
http://www.geocities.com/sama_ukm
http://web.iitd.ac.in/~rea2008
http://www.akdeniz.edu.tr/ageng2008
13-15 March 2009 4th Global Conference: Cybercultures - Exploring Critical Issues
29-30 November 2008 6th. International Conference on Gender Studies (SAMA6) Penang
11-13 November 2008 KLCC, Kuala Lumpur, Malaysia
29-31 March 2009 Governance of New Technologies: The Transformation of Medicine, IT and IP University of Edinburgh, Edinburgh www.law.ed.ac.uk/ahrc/script-ed/conference.asp
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IN FACT
Micro, Small and Medium Enterprises Micro, Small and Medium Enterprise (MSME): Profile
www.nmcc.nic.in
Old Definitions New Definitions Number of micro and small enterprises
12.8 million
13 million*
Employment
31 million
41 million*
Production (at current prices)
$ 140 billion
NA
Export $
33 billion
NA
Share in GDP
6%
8-9%
Share in manufacturing output
39 %
45%
33%
40%
Share in exports
* The statistics relating to micro and small are based on 3rd All India Census conducted during 2001-02 when the old definition was in vogue. The statistics relating to new definition are based on unofficial sources. Final picture will emerge from the 4th All India Census conducted during 2007-09.
Manufacturing sector Enterprises
Investment in plant & machinery*
Micro Enterprises
Does not exceed US $62500
Small Enterprises million
Between US $60,000 and 1.25
Medium Enterprises million
Between US $ 1.25 million and 2.5
Service Sector Enterprises
Investment in equipments
Definition before 2 October 2006:
Micro Enterprises
Does not exceed $25,000
Classification Investment ceiling for Plant and Machinery or Fixed Assets Manufacturing Enterprise Service Enterprise
Small Enterprises
Between $25,000 and 0.5 million
Medium Enterprises
Between $ 0.5 and 1.25 million
Micro
Up to $62,000
Small
Between $ 60,000 to $0.25 million
Medium
Not defined
Up to $25,000
Not defined
Medium industries: A profile • The Medium Enterprises has been defined under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, enacted on 2 October 2006 • The statistics relating to Medium Enterprises would be captured in the 4th All-India Census to be conducted/ completed during 2007-09 • Informal sources, suggest the number of medium enterprises in India to be 10-15 thousand. Further, it is estimated that they contribute about 2% to GDP, over 5% to the manufacturing output and around 10% to the national exports
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*Fixed costs are obviously higher According to the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, the Micro, Small and Medium Enterprises (MSME) are classified in two classes: Manufacturing enterprises: The enterprise which is engaged in the manufacturing or production of goods pertaining to any industry specified in the Development and Regulation Act, 1951. The manufacturing enterprises are defined in terms of investment in Plant and Machinery. Service enterprises: The enterprises engaged in providing or rendering services and are defined in terms of investment in equipment. The limit for investment in plant and machinery/equipment for manufacturing/service enterprises, as notified, vide S.O. 1642(E) dated 29-09-2006 Source: http://www.laghu-udyog.com/ssiindia/MSME_OVERVIEW.pdf i4d | September 2008
11 - 13 November 2008 Kuala Lumpur Convention Centre (KLCC), Kuala Lumpur , Malaysia
knowledge for change
Ministry of Energy, Water and Communications (MEWC) Government of Malaysia
Call for papers! The organisers invite papers on the above mentioned conference themes. Abstracts should be submitted, in no longer than 400 words
REGISTER NOW! Visit us at: ister www.e-asia.org/reg
at papers@e-asia.org Last date for submissions is 7 October 2008
tion mail us at For further informa .org e registration@ -asia
eASiA 2008 Partners Gold Sponsors
International Supporting Partners Sarvodaya
ICT4D
Country Partner
n
Movement
Telecentre Network Partners
Exhibitors
Supporting Partners
GLOBAL
速
KNOWLEDGE PARTNERSHIP
GKP The World Bank
For sponsorship and exhibition enquiry : sales@e-asia.org For e-asia 2008 event information: info@e-asia.org