Volume: 8, Issue: 1
INTRODUCTION
State Financial Corporations act as promotion agencies and play a very important role in stimulating and accelerating industrial growth in the backward areas of states. The main objective of the SFCs is to promote and develop tiny, small, ancillary and medium scale industries. They also try to overcome regional imbalance. The SSls constitute a very important segment of the Indian economy as they help in dispersal of industries, rural development and decentralization of economic power by generating employment in the country. In India, Small and Medium Enterprises play a vital role in the growth of the economy. According to Dr. Vasant Desai (2006) Small scale industries contribute as much as 45 per cent of industrial production, 65 per cent of employment generation and 35 per cent of the India's exports. The SME sector is the second largest employment generating sector, after agriculture. It provides employ ent to more than 28.28 million people.
