In the years 2005 to 2013 when this data was tracked, there were 38,138 active Indian companies of which 91% were microbusinesses. Indian ownership of shares in large listed companies has hovered around 1.5%-1.6% over the past decade. Of all employed persons, it is estimated 14.3% Indians are entrepreneurs compared to 22.4% of Bumiputera and 23.2% of Chinese.
Key Issues & Current Interventions
- The capacity of Indian business owners is a key issue and challenge, which ties back to the lack of adequate entrepreneurship skills, domain knowledge, financing and network. However, since the establishment of SEED, a strategic unit reporting to the CCIC to facilitate Indian entrepreneurship, the number of Indian applicants to Government business loan programs has increased significantly. SEED has assisted 29,115 Indian entrepreneurs in securing loans amounting to RM 1.2 billion and has trained over 3,500 Indian entrepreneurs through capacity building programs
- For example, a TEKUN-SEED special scheme, SPUMI, has been instrumental in screening applicants and providing funding to small Indian start-ups. Nearly RM245 million has been disbursed, assisting nearly 18,201 small entrepreneurs.SEED has also partnered with Amanah Ikhtiar Malaysia (AIM) to provide Indian entrepreneurs, specifically women, with access to financing for micro businesses. RM114 million has been disbursed via the SEED-AIM partnership, assisting nearly 9,310 Indian women entrepreneurs.
- Larger businesses are covered by a partnership with SME Bank known as the MY-SEEDS SME scheme (MYS3). To date SME Bank has funded Indian businesses to the tune of RM291 million since the start of the SEED-SME Bank relationship in 2008. Under a pilot started in 2015, the Centre for Entrepreneur Development and Research (“CEDAR”) under SME Bank has also provided training and development services to Indian SME applicants screened and referred by SEED. The success rate of loan application has increased from 31% to 89% for participants of this pilot program.
- Indian businesses in the industrial sector have also seen support from Malaysian Industrial Development Finance Berhad (“MIDF”), which has disbursed over RM100 million to 93 Indian businesses since 2009.
Moving Forward: Recommendations & Initiatives
This Blueprint aims to achieve the following targets: To deliver on these targets, this Blueprint aims to effect the following:
1. Refine and expand suite of SEED programs
SEED’s facilitation programs (under the MIB Implementation Unit) will need to create greater interest in entrepreneurship amongst the Malaysian Indian community, identify greater numbers of potential entrepreneurs as well as to nurture high potential businesses towards scale and revenue growth.
The refinement is to more clearly delineate, and address via multipronged strategies, the different needs of two main segments: ‘IB40 businesses’ i.e. micro and smaller businesses prevalent amongst the IB40, and ‘IM40 businesses’ i.e. SMEs held or partially held by Malaysian Indians in the M40 income strata.
2. Ensure representative Indian participation in Government and GLC procurement
The MIB Implementation unit will, in partnership with MOF, Khazanah and other relevant Government and Governmentlinked entities, establish an outreach, screening, facilitation and monitoring program to increase the participation of capable Indian-owned companies in Government & GLC procurement contracts, including but not limited to vendor development programs