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Develop SME Clusters

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With more than 2.4 million small and medium business registered on its portal in India,  India is a priority market for Alibaba.com. With a robust Indian SME sector, Alibaba.com is consistently educating Indian SMEs to leverage e-commerce to grow their businesses. Here's what Brian Wong, Vice President, Global Supplier Development, Alibaba.com, has to say about his expectations from Union Budget 2012

The last year has been trying for local SMEs with the increasing cost of borrowing and fluctuating currency rates, making it increasingly difficult for smaller businesses to expand to overseas markets. Impending the possible changes in current government policies, we are hopeful that the government will introduce reforms for the MSME sector as they are the backbone of India's economy. At Alibaba.com, we believe government investment in the development of SME clusters across the country would be in their self-interest and in the interest of local business owners to stimulate economic growth and global trade. We hope that some sustainable relief measures in terms of subsidies for India's small medium industry will be among the initiated policies.

One of the most critical elements for India to reach its export targets is to boost broadband infrastructure in the country which will enable Indian SMEs to be competitive in the international marketplace. While 3G spectrum has enhanced internet usage, it hasn't filtered down to the general population. The lack of affordable high-speed Internet service (broadband) in India, particularly in Tier II and Tier III cities, is among the major contributing factors to the lack of widespread adoption of e-commerce by local businesses. We hope that the National IT Policy will help take the Internet to villages of rural India to facilitate access by local business owners to global trade through e-commerce.

Further, the Ministry of Commerce, through the Department of Industrial Policy and Promotion (DIPP), has recently launched the ‘e-biz' initiative to simplify clearance and compliance processes for industries, addressing the procedural and regulatory needs of businesses right from the inception stage. We expect that this initiative will provide a catalyst for entrepreneurship in the country, and their ability to expand their businesses through the web via e-commerce. We look forward to an increased investment by the government in this direction to get more businesses and processes online to optimize reach within and beyond India's borders for entrepreneurs and small business owners.

The Internet infrastructure of a country is fast emerging as a strong, critical economic contributor. In Australia, for example, reports have shown that the Internet directly contributed to more than $50 billion, or 3.6%,  of Australia's national GDP last year(Source: Deloitte Access Economics/The Connected Continent). We've witnessed similar trends in other countries around the world as well. And, as such, we believe that India's proposed budget should provide reliable and affordable broadband access to rural and remote areas by appropriate combination of optical fibre, wireless and other technologies, to truly connect India to the world.

We do hope that this budget would be an MSME-friendly budget with focused improvements for the country's internet infrastructure. Providing more reliable and accessible internet broadband in India will lead to a healthier e-commerce environment allowing local SMEs to reach new customer bases thereby stimulating further growth for India's future.