Small- and Medium-Sized Enterprise Growth and Development in the South Asia Region

Small- and medium-sized enterprises (SMEs) in South Asia have not significantly contributed to sustainable growth and job creation, which are essential to offset deep, persistent poverty. In particular, the Bangladesh, Bhutan, Nepal, and Northeast India (BBNNI) subregion has few SMEs, and their contribution to the economy is very limited. One of the ways that ADB proposed to address the three main categories of constraints faced by the countries in the BBNNI region was to provide a regional technical assistance to SEDF. SEDF, established in April 2002, is headquartered in Dhaka and is managed on behalf of the contributing donors by the SME Department of the World Bank Group. SEDF would help SMEs in the BBNI region with a mix of programs by working in conjunction with local financial institutions, training institutions, consultants, and government agencies. SEDF would help increase the operational competence of SMEs, improve their management, and raise their productivity. As a result, this would enhance the number, growth rate, and competitiveness of SMEs, thereby contributing to broad-based and sustainable growth resulting in poverty reduction in the BBNNI region.