The SME sector in Pakistan employs around 80% of non-agricultural labour force and significantly contributes to the value-addition in manufacturing, total exports, and the country’s GDP. Small and Medium Enterprises Development Authority’s (SMEDA) 2007 SME policy attempted to provide support to the SME sector in terms of easing regulations for doing business, providing improved access to finance, human resource development and technological upgrades, but due to coordination bottlenecks, its implementation failed. A revised SME policy that addresses the sector’s current challenges and opportunities is required, which is based on consultations with various intra-governmental departments, private sector organisations, and drawing from existing studies on the SME sector from organisations such as the Pakistan Skills Development Fund (PSDF) and donor-funded research.
The draft report was shared with the Ministry of Industries and Production (MOIP), Government of Pakistan which eventually resulted in the approval of the SME Policy 2021, now available online.
This study was funded by USAID in 2018-2019.
