The federal government has decided to adopt the definition of State Bank of Pakistan (SBP) for Small & Medium Enterprises (SMEs) to provide incentive grant to this sector under "Certification Incentive Programme for SMEs under PQI Initiative 2025." According to official documents, the government has launched "Incentive Programme for SMEs" at a cost of Rs 745.810 million to provide incentives to SMEs in the export-based manufacturing sector.
The official document reveals that at the time of inception of this project in 2014-15, the definition of SME was taken from Small & Medium Enterprises Development Authority (SMEDA) and SBP documents by incorporating them in PC-1 of the project. According to approved SME policy 2007, SMEs are those enterprises having employment size up to 250 persons with a paid up capital of Rs 25 million and having annual sales turnover up to Rs 250 million.
While, SBP broadly categorizes SMEs, one as small enterprises (SEs) with employment size up to 20 persons having sales turnover up to Rs 75 million and medium enterprises (MEs) with employment size up to 21-250 persons (manufacturing & services sectors) and 21-50 persons (trading sector) having annual sale turnover from Rs 75 million to Rs 400 million.
However, the SBP revised its definition for employment size and sale volume for SMEs. In view of this situation, which created hurdles for SMEs to benefit from certification programme under PQI Initiative 2025, the Ministry of Science & Technology sought the approval from Central Development Working Party (CDWP) to approve this project with the revised definition of SBP for SMEs and presented a position paper in its last meeting few days back.
According to salient features of the project, it provides incentives to SMEs in export based manufacturing to acquire the services of international/national accredited certification bodies through Pakistan National Accreditation Council.
It aims to achieve the objective of increasing the competitiveness of Pakistani products in international markets through better conformance to international standards & regulations and higher level of protection of health and safety of consumers.
The objective of the project is also to provide incentives to SMEs in developing a certification framework for meaningful participation in global supply chains and enhancing exports. it will also establish linkages between Ministry of Science & Technology, R&D organizations and academia with SMEs for identification of their technical issues and offering their performance and services. Federal Government set aside Rs 200 million in Public Sector Development Programme (PSDP) 2018-19 for the project, which has been approved at a total cost of Rs 745.810 million.
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