Micro, Small and Medium Enterprises (MSMEs) play very significant role in almost all countries of the world irrespective of their development stage. Developed countries like Japan, China, Malaysia, Taiwan, the United States of America and the United Kingdom have developed through the MSMEs many aspects of business such as employment generation, export, tax, income, innovation, competitiveness. The recent wave of Globalization has influenced overall business of the world. The MSMEs have prospered better under this wave of Globalization. Particularly in India, they have made a significant impact on income distribution, social stability, domestic resources utilization technique, structural and regional development, exports, employment and creation of a broad entrepreneurial base. Hence, the MSMEs' are rightly regarded as the backbone of modern Indian economy. With the advent of planned economy in 1951, and the subsequent industrial policy of the Government of India, both planners and the Government have earmarked for small and medium industries a special role in the economy.

The concept and definition of SSI units small-scale industry have changed over year with the changing circumstances and pressing problems of the Indian economy. Various institutions, government agencies, individuals had defined small-scale industries in different ways. They may be classified3. They may be classified3 into a) functional definitions that are based on the product methods or the nature of marked served as the demarcating factors and b) the definitions that gave importance to the size of employment and/or investment of the units. On the basis of first category definition of functional classification Nanjundan analyzed the concept of small industry in terms of its basic characteristics3 like little specialization in management, close personal contact, handicaps in obtaining capital and credit and no dominant in the market4.