For India's surging economy, small is beautiful

Mumbai

FOR Rohan Sharma, business has never been better. Sales at his carparts company in the western Indian state of Gujarat are booming and the order book has almost doubled in the past year.

His Bhagirath Coach & Metal Fabricators has just invested nearly US$120,000 in new machinery and plans to spend up to US$1.2 million this year to expand capacity.

That's an encouraging sign for Asia's third-largest economy, where stressed balance sheets at big firms and heavy reliance on bank credit, which has dried up following a surge in troubled loans, have stymied efforts to revive private investment.

Mr Sharma does not face such constrain…