However, all of these studies are related to industrialized countries and therefore their
relevance to an industrializing country like India might be questioned. Two empirical
studies on Indian SMEs conducted in this decade have significant relevance here. The
first one was confined to Karnataka state in India, which covered 648 micro enterprises
on a sample basis and 1358 small scale enterprises on a census basis across all industries
in the manufacturing sector (Bala Subrahmanya et al. 2001). The study found that 258
(about 40 per cent) micro enterprises and 716 (about 53 per cent) small scale enterprises
had undertaken technological innovations primarily due to external factors such as
competition, technological change, customer requirements, and internal factor of selfmotivation.
They were involved in both product and process innovations though
emphasis was relatively more on product innovations than on process innovations. The
major achievements of their innovations comprised competitiveness enhancement in the
form of improved quality, reduced rejection, improved product designs, increased output,
etc. A higher proportion of innovative firms have penetrated the export market relative to
non-innovative firms.