Assertion: Countries like India, China, Indonesia and Brazil, etc. have given importance to small scale manufacturing.
Reasoning: Small scale industries are capital intensive and they help in achieving the objective of balanced regional development.

Assertion (A) is true but Reasoning (R) is not correct.

Small scale industry are labour intensive and not high capital intensive.

Small scale manufacturing is distinguished from household industries by its production techniques and place of manufacture (a workshop outside the home/cottage of the producer). This type of manufacturing uses local raw material, simple power -driven machines and semi-skilled labour. It provides employment and raises local purchasing power. Therefore, countries like India, China, Indonesia and Brazil, etc. have developed labour-intensive small scale manufacturing in order to provide employment to their population.