Consider the following statements : Small-scale industries are, in most cases, not as efficient and competitive as the large-scale ones. Yet the Government provides preferential treatment and reservations in a range of products to the small firms because small-scale industries I. provide higher employment on a per unit capital deployment basis. II. promote a regional dispersion of industries and economic activities. III. have performed better in export of manufactured products than the large scale ones. IV. provide jobs to low-skill workers, who otherwise may not find employment avenues elsewhere. Which of the above statements are correct ?

Small-scale industries are promoted because they are labour-intensive and can generate more employment per unit of capital, a point highlighted in educational/policy material stating high employment potential with less capital [1]. Policy literature also explicitly records that protection and promotion of small units aimed to achieve wide/regional dispersal of industrial production, supporting statement II [2]. Statement III is not supported: small units were often perceived as lacking competitive strength, technology and market access, so they did not necessarily outperform large firms in exports [2]. Statement IV is partly true—small manufacturing uses semi‑skilled labour and provides local employment—but the sources do not assert they are the unique employment avenue for low‑skill workers, so the best-supported pair is I and II [3].

Sources

1. [1] https://egyankosh.ac.in/bitstream/123456789/12341/1/Unit-16.pdf
2. [2] https://www.sciencedirect.com/topics/social-sciences/small-scale-industries
3. [3] FUNDAMENTALS OF HUMAN GEOGRAPHY, CLASS XII (NCERT 2025 ed.) > Chapter 5: Secondary Activities > Small Scale Manufacturing > p. 40