Propagating Growth through Inter-Dependence: A Case of SEZ Units and Its Related Ancillary Units

Abstract

Around the 1960s, after studying the success story of China’s deliberate government intervention in playing an instrumental role in boosting exports and gaining momentum in industrial growth, India followed its footsteps and developed special clusters with sectoral and geographic concentration called Special Economic Zone. Simultaneously the government also gave attention to the naturally built clusters that occupy the driver’s seat for propelling economic activities in Micro, Small and Medium Enterprises (MSME) sector. Though the growth of both these clusters is driven by government policy, their difference in size and prime purpose projects the possibility of dependence of MSME units on SEZ units. The possibility of dependence of MSME units on SEZ units seems to be more because of the larger size of SEZ units and their demand for procuring ancillary requirements like raw material, packaging, transportation support and similar support from their related small and medium sized units. Therefore the current research paper strives to find out the inter-dependent relationship between SEZ units and its related ancillary business units.