INTRODUCTION
Household, rural, and traditional industries are other names for cottage industries or cottage manufacturing. The artists, with the help of their families and part-time workers, make items at home using basic tools and raw materials. The items are then used at home and sold in the nearby village. They are also raided with other goods as a barter system. Cottage Industries are typically extremely small businesses that are founded in homes or other modest structures. A governmental institution called the Khadi and Village Industry Commission (KVIC) supports cottage industries as well as village industries.
All family members must take part in the development of the cottage industries.Capital subsidies are the most common sort of government assistance given to Bthis sector of the economy. Another choice is self-help groups. In India, small-scale and cottage industries produce about 40% of the nation's overall industrial output.
IMPORTANCE OF COTTAGE INDUSTRIES
A unique position for the cottage industry exists in India because of the country's extremely diverse socioeconomic and geographic structure. These fit very well with Gandhi's rural development philosophy. The Government of India has given the cottage sector significant incentives to shine from the plan after plan because of the unique position it occupies in India's development landscape.
However, this industry has been experiencing serious risks due to emancipation, globalisation, and privatisation since 1990. This is because of economies of scale brought about by larger companies producing the same items according to the current paradigm's tenet that the stronger will survive.
- Increased employment opportunities provided by cottage industries ultimately reduce poverty and inequalities.
- This economic sector is one of the most crucial for balancing regional rural economic development.
- Since women play a significant part in these businesses at the managerial and working levels, the cottage industry is also regarded as vital for women's empowerment.
- In contrast to large units, these industries (handicrafts) are environmentally friendly, energy-efficient, and have low emission levels.
- Cottage industries make good use of local talent. Due to their rarity, several of these old skills gain prominence.
- Little cash is needed for the cottage industry.
- Because most cottage industries are found in tiny towns and villages, there is less strain on agriculture due to population growth. So they aid in diversifying the rural economy.
- If correctly utilised, these industries have a strong export potential. These sectors' historic, distinctive, and eco-friendly goods are in high demand worldwide.
TYPES OF COTTAGE INDUSTRIES
India is renowned and well-known for its diverse culture, traditional cottage industries' handicrafts, and a large variety of food products, among other things.
THE TYPES OF COTTAGE INDUSTRIES PRESENT IN INDIA ARE:
CARPET WEAVING COTTAGE INDUSTRY : This type of cottage industry is often found in countries with a long history of carpet making, such as Iran, Turkey, and India. Carpet weaving is a labor-intensive process that involves several people working together to create a single carpet. The process typically starts with the spinning of the yarn, which is then dyed to the desired color. The next step is to knot the fibers to form the pile of the carpet. This is typically done by tying the yarn around the warp threads in a specific pattern to create the desired design. Finally, the carpet is sheared to create a uniform pile height and the edges are finished to prevent fraying.
Carpet weaving cottage industries typically use traditional techniques that have been passed down through generations. These techniques may include the use of natural dyes, hand-spun yarn, and knotting patterns that are specific to a particular region or culture. Carpet weaving cottage industries provide employment opportunities and generate income for families and communities, and they also play a role in preserving cultural traditions and skills.
COTTON WEAVING COTTAGE INDUSTRY : Cotton weaving cottage industries are often found in countries with a large cotton-growing industry, such as India and Egypt. The process of cotton weaving involves several people working together to produce textiles, such as clothing and other household items, using cotton as the primary material. The process typically starts with the spinning of the cotton fibers into yarn, which is then woven into cloth on a loom. The cloth is then dyed and finished to create the final product.
Cotton weaving cottage industries typically use traditional techniques that have been passed down through generations. These techniques may include the use of natural dyes and hand-spun cotton yarn. Cotton weaving cottage industries play an important role in supporting local economies by providing employment opportunities and generating income for families and communities.
METAL WORKS COTTAGE INDUSTRY : Metal works cottage industries are often found in areas where metalworking has a long history, such as India and Africa. The process of metalworking involves the production of metal goods, such as tools, jewelry, and other decorative items, using traditional metalworking techniques. This can include forging, casting, and other processes that require specialized skills and knowledge.
Metal works cottage industries typically use traditional techniques and tools, such as hand-forged hammers and anvils, to create their products. These cottage industries play an important role in supporting local economies by providing employment opportunities and generating income for families and communities. They also play a role in preserving cultural traditions and skills.
SILK WEAVING COTTAGE INDUSTRY : Silk weaving cottage industries are common in countries with a long history of silk production, such as China and India. The process of silk weaving involves several people working together to produce silk textiles, such as clothing and other items, using silk as the primary material. The process typically starts with the cultivation of the silkworm, which is then used to produce the silk thread. The silk thread is then woven into cloth on a loom, dyed to the desired color, and finished to create the final product.
Silk weaving cottage industries typically use traditional techniques that have been passed down through generations. These techniques may include the use of natural dyes and hand-spun silk yarn. Silk weaving cottage industries play an important role in supporting local economies by providing employment opportunities and generating income for families and communities.
In conclusion, cottage industries are a vital part of many local economies and play an important role in preserving cultural traditions and skills. They are characterized by small-scale production, the use of traditional techniques and tools, and a reliance on local resources. By providing employment
PROBLEMS FACED BY COTTAGE INDUSTRIES
The major problems faced by Cottage industries are listed below:
- LACK OF TIMELY AND SUFFICIENT CREDIT AVAILABILITY : Cottage industries often face difficulties in accessing credit at reasonable rates, which can limit their ability to expand and improve their operations.
- INADEQUATE MANAGEMENT : Due to their small size, many cottage industries are managed by individuals with limited business experience, which can result in ineffective decision-making and inefficiency.
- INFRASTRUCTURE GAP : Cottage industries often operate in rural areas that lack the necessary infrastructure, such as access to electricity, transportation, and communication, which can make it difficult for them to compete with larger businesses.
- TECHNOLOGICAL STALENESS : Cottage industries often lack access to the latest technology and equipment, which can limit their competitiveness and efficiency.
- LIMITED RAW MATERIAL AVAILABILITY : The availability of raw materials is a critical factor for cottage industries, and limited access to quality raw materials can affect their ability to produce high-quality products.
- MARKET-RELATED ISSUES : Cottage industries often struggle to access markets, both domestically and internationally, due to limited resources, lack of marketing and promotion, and limited distribution networks.
- COMPETITION FROM BIG BUSINESSES AND IMPORTS : Cottage industries face competition from larger businesses, both domestically and internationally, which can result in price competition and reduced market share.
- EXCESSIVE MUNICIPAL TAX BURDEN : The high level of municipal taxes imposed on cottage industries can increase their operating costs and reduce their competitiveness.
- PREVALENT ILLNESS : The workers in cottage industries often suffer from poor health due to poor working conditions and inadequate facilities, which can limit their ability to produce quality products and reduce their efficiency.
These problems need to be addressed by the government and other relevant stakeholders in order to support the growth and development of the cottage industry sector.
GOVERNMENT POLICIES FOR DEVELOPMENT AND PROMOTION OF COTTAGE INDUSTRY IN INDIA
In India, Small-scale enterprises have been given an important place for both ideological and economic reasons. It is well documented that the small scale industries have an important role in the development of the country. It contributes almost 40% of the gross industrial value added in the Indian economy. Government's approach and intention towards industries in general and SSIs in particular are revealed in Industrial policy Resolutions. There are many Government Policies for development and promotion of Small-Scale Industries in India.
THESE ARE MENTIONED AS BELOW:
1. Industrial Policy Resolution (IPR) 1948
2. Industrial Policy Resolution (IPR) 1956
3. Industrial Policy Resolution (IPR) 1977
4. Industrial Policy Resolution (IPR) 1980
5. Industrial Policy Resolution (IPR) 1990
The Industrial Policy Resolution (IPR) is a set of guidelines and policies set forth by the Indian government for the development of the country's industry sector. Over the years, the Indian government has issued several Industrial Policy Resolutions (IPR) with the aim of promoting industrial growth and development. The following is a brief overview of each of the IPRs issued in India:
- THE INDUSTRIAL POLICY RESOLUTION (IPR) 1948 was the first industrial policy of independent India. It aimed at promoting the development of the Indian economy by encouraging the establishment of small-scale industries, also known as cottage industries. This policy emphasized on the development of small-scale industries in rural areas to generate employment and increase production.
- THE INDUSTRIAL POLICY RESOLUTION (IPR) 1956 was an updated version of the 1948 resolution. It aimed to encourage the growth of large-scale industries as well as small-scale industries. It also aimed at achieving self-reliance in the production of goods and services, and reducing dependence on imports.
- THE INDUSTRIAL POLICY RESOLUTION (IPR) 1977 marked a shift in the government's approach to industrialization. It placed greater emphasis on the development of heavy industries and promoted the public sector as the driver of industrial growth. This policy aimed at promoting the development of basic and key industries, such as steel, cement, and power, and reducing the dependence on imported technology.
- THE INDUSTRIAL POLICY RESOLUTION (IPR) 1980 was an update to the 1977 resolution. It aimed at promoting the development of small-scale industries and encouraging the growth of the private sector. This policy aimed to increase competition, reduce red tape, and provide greater freedom to the private sector to drive industrial growth.
- THE INDUSTRIAL POLICY RESOLUTION (IPR) 1990 was a major overhaul of the previous policies. It marked a significant shift towards liberalization, privatization, and globalization. This policy aimed at promoting the growth of the private sector, particularly in high-tech industries, and reducing the role of the public sector. It also aimed at removing barriers to entry for foreign companies and encouraging foreign investment in the Indian economy.
Overall, these different Industrial Policy Resolutions have helped to shape the industrial sector in India and have played a significant role in the country's economic development.
CONCLUSION
Small Scale Industries (SSI) play a vital role in the Indian economy. They provide employment opportunities to millions of people, contribute to the country's Gross Domestic Product (GDP), and help in the overall economic development of the nation. SSI's are also known for their flexibility and adaptability to changing market conditions, making them an essential component of India's business landscape. However, SSI's in India still face several challenges, including access to credit, lack of technology, and limited marketing and distribution channels. The government has taken various measures to support and encourage the growth of SSI's, such as offering tax incentives and subsidies, setting up special economic zones, and providing easier access to finance. With the right support and policies in place, SSI's in India have the potential to grow and thrive, thereby contributing to the country's economic growth and development.