Ministry of Industries plans capacity building program for SMEs

KARACHI: The Ministry of Industries and Production has planned a capacity building program for small and medium enterprises (SMEs) under National Business Development Program (NBDP) to provide demand based trainings for SMEs.

An official said SMEs access to capacity building services was considered to be one of the most important elements of support for improving their business performance and growth. SMEs generally do not have resources to employ in-house experts to manage and grow their business operations, and can also not afford to spare time and resources to acquire quality assured training from credible Training Service Providers (TSPs).

The TSPs on the other hand, find it difficult to access SME training market due to its geographic dispersion, information asymmetry and issues of affordability on part of SMEs. “In order to address the above, NBDP intends to facilitate interaction between the TSPs and SMEs by addressing the market access and affordability issues”.

NBDP aims capacity building and training of trainers of private sector business development service providers (BDSPs) for enhancing their usability for SME sector as well as improve the affordability of SMEs for acquiring such training by offering subsidy on the training fee for programs offered by selected TSPs.

NBDP, a PSDP funded project of Ministry of Industries and Production, has initiated pre-qualifying and engaging services of TSPs to offer training and capacity building support to small and medium businesses on various aspects of business management.

Pre-qualification is open to the TSPs that have not been blacklisted or debarred by any government, semi-government and autonomous organizations in Pakistan.

The official said SMEs often lacked expertise in basic business management skills, and generally did not have resources to engage external experts. “Even in the instances where possibility of hiring service providers is available, the small business entrepreneur does not have enough domain knowledge to determine the scope of service to be delivered by the experts. This lack of comprehension acts as a major barrier in determining the value for money that has to be paid as service fees”

Therefore, NBDP intends to provide quality assured advice, information and templates that can be adopted and implemented by the small and medium business for enhancing their understanding of various aspects of business management and operations.

SMEs constitute nearly 90 percent of all the enterprises in Pakistan; employ 80 percent of the non-agricultural labor force; and their share in the annual GDP is 40 percent, approximately. However, unlike large enterprises in the formal sector, a small and medium enterprise is constrained by financial and other resources.

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