Abstract:
Small and Medium Enterprises (SMEs) in India have proven, beyond doubt that they contribute significantly to the country’s industrial and economic growth (Kumar, 2017). India is one of the fastest growing economies of the world, in the last few years, the economic growth has steadily accelerated and most importantly, remained very stable (As per IMF report, 2019). Since the start of the 21st century, annual average GDP growth has been 6% to 7%, and from 2014 to 2018, India was the world's fastest growing major economy, surpassing China (Kanungo et al., 2018). One of the major factors that is being touted as the backbone of India’s economy is the SME sector. Whether it is agriculture, manufacturing or service industry, SMEs are mushrooming in a myriad of sectors across the country. However, in spite of their contribution to the socio-economic growth of India, SMEs face a number of challenges such as lack of capital due to inadequate access to finance and credit, inability to attract talented and tech-savvy manpower, poor infrastructure and utilities resulting in low production capacity, lack of innovation, technology and digital knowledge gap, lack of marketing know-how and so on. Due to these challenges, the Indian SMEs are unable to sustain and scale to their full potential and become sustainable. It has been acknowledged that the inability of SMEs to remain in business with high failure rate (Franco and Haase, 2010) has attracted a lot of interest, to study the factors that may lead to sustainable growth of SMEs in developing countries (Asa and Prasad, 2014).
