IMPACT OF GLOBALIZATION ON THE GROWTH AND COMPETITIVENESS OF SMALL AND MEDIUM ENTERPRISES IN GUJARAT

Abstract

Globalization has significantly reshaped the business environment of small and medium enterprises (SMEs) by widening market access, intensifying competition, increasing technology dependence, and integrating firms into wider production and supply networks. In a state such as Gujarat, where industrialization, entrepreneurship, export orientation, and cluster-based manufacturing are comparatively strong, the effect of globalization on SMEs assumes particular importance. The paper examines the impact of globalization on small and medium enterprises in Gujarat through a descriptive and analytical review of secondary data. The study is based on government reports, Gujarat policy documents, MSME handbooks, and relevant academic literature relating to globalization, competitiveness, and MSME development. The analysis focuses on key dimensions such as market expansion, export orientation, competitive pressure, technology adoption, digitalization, employment generation, and structural challenges faced by SMEs. The findings indicate that globalization has created important opportunities for Gujarat’s SMEs by expanding market possibilities, strengthening export prospects, encouraging quality improvement, and increasing the need for technological modernization. At the same time, globalization has exposed SMEs to greater competitive pressure, compliance burdens, financial constraints, and vulnerability to external shocks. The paper concludes that globalization has acted both as a growth catalyst and as a competitive filter for Gujarat’s SMEs. Its long-term benefits depend on the ability of enterprises to modernize and on the effectiveness of policy support in areas such as finance, digital capability, export facilitation, cluster development, and quality enhancement.