Abstract:
❖ Statement of Problem
It has been witnessed from the progress and evidences that small and enterprises SMEs has
played a significant role in development of economy in developing countries.
The study aims at finding how SME sector is playing its role in economic development of
Pakistan.
❖ Research Method
• Research Design...........Correlational & explanatory research.
• Research Instrument.....Secondary data.
• Treatment of data.......Statistical software EViews, by using functions of Descriptive
statistics, ADF Unit root test, Correlations, Co-integration analysis and OLS
Regression.
❖ Findings
The empirical findings of study revealed positive association between SMEs and GDP, EXP, FDI
and EMP. The findings suggest that SME sector in Pakistan is playing a significant role in
increasing domestic production, earning foreign exchange, attracting foreign investment and
creation of employment opportunities which leads to economic development in the country.
❖ Conclusion & Recommendations
SME sector is playing a vital role in economic progress of Pakistan by contributing significantly to
GDP, EXP, FDI and EMP. SME sector in Pakistan represent about 30% of the national GDP, 25%
of exports of manufactured goods and 35% of manufacturing value added. Thus, SME sector has a
significance contribution to the economic growth, competitiveness and employment opportunities.
(SBP Prudential Regulations for SME Financing).
There is a need of concentrated policies and framework, business organizations, trade associations
and economists for development of SME sector. Government should come up with aggressive SME
development polices for different divisions in order to promote and internationalization of SMEs
of Pakistan.
