MSME In India

MSME In India

Indian economy has an important role of Micro, Small and Medium Enterprises (MSME) sector. The importance of MSME spreads entrepreneurial cultures to all sectors of society through various business innovations, satisfies local as well as global markets. To optimize India's MSME sector, Govt. has a dedicated Ministry to promote its growth.

There are many progressive steps taken by MSME and other ministries to increase growth such as acquiring new technology, skill development, market development, credit flow, public procurement, exhibitions both within the country and overseas, etc.

What is Micro, Small and Medium Enterprises (MSME) in India?

Govt. of India has notified Micro, Small and Medium Enterprises Development (MSMED) Act in 2006. This act mainly addresses policy issues affecting MSME as well as the coverage and investment ceiling of the sector. Through out this act, the concept of "enterprise" in India has got recognition in the legal frame work to both manufacturing and services sectors. It featuring three tier enterprises - Micro, Small, and Medium.

Micro, small and Medium Enterprises (MSME) are defined based on their investment in plant and machinery (for manufacturing enterprise) and on equipment for enterprises providing or rendering services.

The present ceilings on investment for enterprises to be classified as micro, small and Medium enterprises are as follows:

Micro Enterprises

  • Manufacturing unit Investment limit in Plant & Machinery upto Rs. 25,00,000/- (25 lakhs or 2.5 million)
  • Service unit Investment limit in equipment upto Rs. 10,00,000/- (10 lakhs or 1 million)

Small Enterprises

  • Manufacturing unit Investment limit in Plant & Machinery upto Rs. 5,00,00,000/- (5 crores or 50 million)
  • Service unit Investment limit in equipment upto Rs. 2,00,00,000/- (2 crores or 20 million)

Medium Enterprises

  • Manufacturing unit Investment limit in Plant & Machinery upto Rs. 10,00,00,000/- (10 crores or 100 million)
  • Service unit Investment limit in equipment upto Rs. 5,00,00,000/- (5 crores or 50 million)

 

The Role of MSME Ministry and Its Organizations

Both Central Govt. and State Govt. are taking efforts to encourage entrepreneurship, employment and livelihood opportunities and enhance the competitiveness of MSME products and services to meet local as well as global markets. The schemes / programmes undertaken by the Ministry and its organizations seek to facilitate / provide:

  1. Adequate flow of credit from financial institutions / banks
  2. Support for technology up-gradation and modernization
  3. Integrated infrastructural facilities
  4. Modern testing facilities and quality certification
  5. Access to modern management practices
  6. Entrepreneurship development and skill upgradation through appropriate training facilities
  7. Support for product development, design intervention and packaging
  8. Welfare of artisans and workers
  9. Assistance for better access to domestic and export markets
  10. Cluster-wise measures to promote capacity-building and empowerment of the units and their collectives