The Indian MSME sector is the backbone of the national economic structure and has unremittingly acted as a bulwark for the Indian economy. It has provided resilience to ward off global economic shocks and adversities. The development of this segment is extremely critical to meet the national imperatives of financial inclusion and generation of significant levels of employment in urban, and rural areas across the country. Further, it can nurture and support the development of new-age entrepreneurs who have the potential to create globally competitive businesses from India.
There are around 63.4 million units throughout the geographical expanse of the country, and nearly 20% of the MSMEs are based out in the rural areas, which indicates the deployment of significant rural workforce in the MSME sector and is an exhibit to the importance of these enterprises in promoting sustainable and inclusive development as well as generating large scale employment, especially in the rural areas. In spite of its contribution to the socio-economic growth of India, MSMEs face several challenges, such as inadequate access to finance and credit, poor infrastructure and utilities, lack of innovation, and inability to adopt the technology.
Creating a robust MSME Sector will require efforts towards strengthening the credit structure to help MSMEs amplify their operations. The absorption and upgradation of technology are critically important aspects of the MSME ecosystem. Considering this, centres that offer skill upgradation, consultancy and prototyping training of futuristic technologies such as IoT, artificial intelligence (AI), virtual reality and 3D printing among others must be initiated across the country.
Further, various stakeholders like banks and financial institutions, industry sector majors and MNCs, trade associations, and regulators across ministries at the centre and state level etc, will have to join hands and create a forward-looking framework and ecosystem for the MSMEs.
Data Speaks
1. SMEs contribute 6.11% of the manufacturing GDP, 24.63% of the GDP from service activities and 33.4% of India's manufacturing output.
2. 120 million people depend on India’s MSME sector to earn their livelihood.
3. MSME related products value 147,390.08 million dollars.
4. 48% of India’s export comes from the MSME Sector.
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