Assessing the Business Ecosystem for Indian SMEs: A Resource-Based View

Abstract

The purpose of this study is to develop a MSME business facilitator index (MSME-BFI) to investigate the major factors which lead to the growth and development of MSMEs in the top performing and poor performing states of India. The data for various parameter for estimating the index such as infrastructure (road and electricity), human resources (labour participation rate and literacy rate), information communication uses (computer and internet), fiscal discipline and other economic indicators is collected from different government surveys and reports. The study revealed that states should focus on labour force, infrastructure, ICT technology, credit facilities, financial management and economic governance for the growth of MSME’s. There exist major disparities in the performance of the MSMEs, when divided into top performing and poor performing states, respectively. The research helps policymakers and government to focus on the leading barriers/factors which lagged the states to achieve the higher economic development.