This research is part of India 2006 Investment Climate Survey initiative that focused on enterprises in the manufacturing, retail, micro (unorganized), and software/information technology sectors. A separate survey was conducted for each sector.
India 2006 Micro Investment Climate Survey targeted establishments with 10 or fewer full-time paid employees. The research covered 1549 manufacturing enterprises from Delhi, Ludhiana, Mumbai, Thane, Howrah and Hyderabad. The following industries were surveyed: auto components, drugs and pharmaceuticals, chemicals, electrical goods, electronics, food processing, garments, leather, textiles, metal and machine tools.
Unorganized (micro) manufacturing employs the vast majority of India's manufacturing workforce. Unorganized manufacturing firms are not integrated into the supply chain, thus limiting the transfer of technology. Possibly due to the legacy of the small scale reservation policy, much of the manufacturing activity in the unorganized sector is geared toward producing final products for the consumer market, rather than intermediate products and parts for the organized sector.
Being part of the organized sector, often referred to as the “formal sector,” increases a firm's bargaining power (for example, it has easier access to finance). However, international experience suggests that despite the advantages, unorganized enterprises often wish to remain informal, because organized firms are subject to more regulations. In India, the 10-worker threshold is especially important because labor laws on wages and benefits are applied to units above this size. Firms can avoid being part of the organized sector in two ways: operating “under the radar” by simply not registering, or by not growing.
The Investment Climate Surveys (ICS) collected information on the investment climate constraints the sectors faced, such as infrastructure, access to land, relationship with the court system, crime, government administration, use of financial services, and labor force. In addition, the surveys collected basic information on the firms, such as ownership structure, number of years of operations, and revenues and costs. The data and results from the ICS were intended to help develop policy reforms that would further promote growth and productivity of firms in India.
Kind of data
Sample survey data [ssd]
Producers and sponsors
Micro enterprises were identified as establishments with 10 or fewer full-time paid employees.
The closest and most relevant data on the micro (unorganized) sector was 56th round of data provided by National Sample Survey Office (NSSO). These data have been chosen as the base frame for sampling.
The following steps were used to select cities in the sample:
Step 1: Identification of states: For each of the manufacturing subsectors, seven states with maximum number of manufacturing units were identified. Delhi, a city-state, was considered for selection despite having a relatively low proportion of units when compared with other, bigger states in the country.
Step 2: Selection of cities: In each identified state, districts having a large number of manufacturing units in each subsector were identified.
Step 3: Selection of cities for each manufacturing subsector. For final selection of districts for each manufacturing subsector, the following criteria were applied:
• Maximum availability of each specific manufacturing subsector in districts;
• Appropriate coverage of each region in the country. The following six cities across four regions were selected: North (Delhi and Ludhiana), West (Mumbai and Thane), East (Howrah), and South (Hyderabad);
• To cover the manufacturing subsectors underrepresented in the selected cities (for example, chemicals and leather), two additional cities were identified where these subsectors were easily available: Bangalore and Kanpur. These two additional cities also served as reserve cities in case some manufacturing subsectors were not available in a sufficient number in the main cities.
Each city was split into clusters that were designated as "industrial clusters" or where these types of enterprises were most likely to operate. This was done through discussions with municipal, government, trade organizations and chambers of commerce. Once these clusters were selected, snowballing techniques were applied to identify enterprises in various industry sectors.
After discussions with local trade experts, a quota was fixed for each of the three types of enterprises based on size: household enterprises, tiny enterprises (<= 5 employees), and micro enterprises (>5 and <=10 employees).
To obtain the sample size for each manufacturing subsector in each of the selected cities, the following steps were followed:
• Meet the proportion of each manufacturing subsector;
• Meet the proportion of each manufacturing subsector in each of the selected cities;
• Some adjustments were made to ensure that there would be no oversampling in some cities and manufacturing subsectors, and to include those subsectors that were not covered by the NSSO in the 56th round (auto components, drugs and pharmaceuticals, and so on). These adjustments were done based on past experience and subjective judgments.
Dates of collection
Mode of data collection
The current survey instrument is available:
- Micro Investment Climate Survey Questionnaire.
Confidentiality of the survey respondents and the sensitive information they provide is necessary to ensure the greatest degree of survey participation, integrity and confidence in the quality of the data. Surveys are usually carried out in cooperation with business organizations and government agencies promoting job creation and economic growth, but confidentiality is never compromised.
Firm-level data is available to the public free-of-charge. In order to access the data, users must agree to abide by a strict confidentiality agreement available through Enterprise Analysis Unit website by clicking on "External users register here" at https://www.enterprisesurveys.org/Portal
Where necessary please site the source as "Enterprise Analysis Unit - World Bank Group www.enterprisesurveys.org"