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The study highlights the
importance of capital budgeting. Capital Budgeting,
mostly defined as a decision-making process that enable manager to estimate and
identify projects that are valuable to the company, is usually the dominant task
facing any financial manager and his/her team. It is the most important task
for managers.


The study also
explains about SME’s in India. SME sector of India
is considered as the backbone of economy contributing to 45% of the industrial
output, 40% of India’s exports, employing 60 million people, create 1.3 million
jobs every year and manufacture more than 8000 quality products for the Indian
and international markets. With around 30 million SMEs in India, 12 million
people expected to join the workforce in next 3 years and the sector growing at
a rate of 8% per year, Government of India is taking different measures so as
to increase their competitiveness in the international market.

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The study also
highlights Role and importance of SME’s in Indian economy. The small and medium
scale industries are very important to our country in instruct to survive and
especially to those who needs job. The SME’s creates employment invention. The
basic problem in India is increasing population. The SME’s helps in generating
employment. This problem is solved to larger extent by SME’s. The rural and
semi urban areas remain untouched from talent and infrastructure. The SME’s
helps in utilising resources.


The study also explains about Role
of banks for development of SME’s in India. The
various bank loans available to SME’s codes and standards, common rule for
lending MSME sector.


The study highlights various schemes for SME’s.
Schemes includes credit linked subsidy scheme for technology up gradation,
Quality up gradation for small scale, financial assistance. The scheme also
depends upon various type of industry.



In short,
Capital budgeting is most important technique for investment decision. There
are 6 types of techniques in capital budgeting i.e. Payback Period, Accounting
Rate of Return, Internal Rate of Return, Discounted Cash flow, Net Present
Value. Small and Medium Enterprises plays an important role in growth of the
Indian economy. The project gives an overview of capital budgeting techniques
use in Small and Medium Enterprises, problems faced by SME’s , Role and
importance of SME’s, schemes for Small Enterprises, common guidelines for
lending to MSME sector, Banking codes and standards. The reason for SME’s faces
the problem in India is no proper management, no proper procedure, lack of

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