May 2013 | Industrial Spectrum
If reports are anything to go by, Indian SMEs are going green and this is not just about green technology. SMEs across the board are adopting greener technology. Increased exposure to environment-friendly solutions is prompting small companies to adopt green technologies and resort to non-polluting modes of production.
Earlier the main deterrent was the high cost, according an official of the Confederation of the Indian Industry (CII). High cost of clean and energy efficient technologies acted as a deterrent for these small units to go green. A near total lack of indigenous development of green technologies was cited as the main culprit. However, the scenario is changing as SMEs are now collaborating globally to adopt cleaner, greener practices.
Many Indian SMEs are entering into tie-ups with firms across the world to develop green manufacturing technologies and eco-friendly production processes, according to a report recently published in the Economic Times. In an important development SMEs, which have been in quest of environment friendly technologies, signed an agreement with the European Association of Chambers of Commerce and Industry. The agreement was signed with Federation of Indian Micro and Small & Medium Enterprises (FISME) in this regard. According to a FISME official, formalising cooperation with Europeans would positively impact the efforts of SMEs’ access to green technologies. Indian SMEs are continuously under pressure of supply chains to improve and upgrade technologies which are environment-friendly and sustainable.
The European Union needs “more robust” SME policies in order to create jobs and economic growth and to face up to globalisation and energy and environmental challenges, EU competitiveness ministers concluded at an informal meeting in Lisbon recently. Besides, as part of their social responsibility and support to environmental concerns of the country, SMEs are adopting energy efficient, zero emission technologies. The Gujarat example seems to have inspired companies across the country to adopt these technologies as SMEs in Vapi, Ankleswar and other industrial areas of Gujarat have proved that greener technologies are cost-effective in the long run.
Through the FISME programme, co-funded by the European Union and implemented by Euro Chambers, the Indian SMEs will connect to an association of more than 1,200 European industry bodies and which voices the interests of over 19 million member enterprises in 45 European countries.
However, it’s not smooth going. Particular focus should be given to developing new methods of financing for start-ups and reducing the “disproportional regulatory and administrative burden” placed on small companies in comparison with larger ones, said industry sources, citing a study showing that, on average, where a big company spends `62 per employee because of a regulatory duty, a small business might have to spend up to 700. “That’s clearly a big difference,” says the CII official.
It has been estimated that manufacturers and assemblers of electronic equipment in India alone generate about 1,200 tonnes of electronic waste per year. India’s burgeoning scrap business also attracts substantial amount of degraded components from the developed countries, which adds to the alarming volume of e-waste is a critical issue. However, this problem has been addressed to a certain extent through the initiation of environmental protection and pollution control measures across the globe.
This also sends a message to buyers out there, especially in the western markets. Companies are opting for environment management systems (EMS) to send a strong message to their environmentally conscious buyers in the world market. Some big IT companies like Wipro and Infosys have already begun sharing their internal green computing practices with their clients. Increasing awareness about such technologies is enabling SMEs to tread the green path in the face of growing environmental concerns. Green practices by SMEs will pave the way for a cleaner and greener environment for future entrepreneurs ability in adopting the right cleaner production concepts in production process, know-how in eco-product design, identifying a cost-effective pollution control technology, understanding the local and global legal requirements in environmental protection, proper ways in responding global environmental supply chain pressures, strategic planning for long-term environmental improvement and obvious constraints from capital and human resources.