The UN General Assembly in its 74th Plenary held on the 6th April, 2017 declared 27th June as Micro, Small and Medium-sized Enterprises Day, recognizing the importance of Micro, Small and Medium-sized Enterprises in achieving sustainable development goals and in promoting innovation, creativity and sustainable work for all.
What is a micro-, small, or medium-sized enterprise?
The criteria for defining the size of a business differ from country to country. In India, the definition of micro-, small and medium-sized enterprises is established according to Investment in Plant & Machinery/equipment and Annual Turnover.
All enterprises are required to register online on Udyam Registration Portal and obtain ‘Udyam Registration Certificate’.
According to the data provided by the International Council for Small Business (ICSB), formal and informal Micro-, Small and Medium-sized Enterprises (MSMEs) make up over 90% of all firms and account on average for 70% of total employment and 50% of GDP.
These enterprises, which generally employ fewer than 250 persons, are the backbone of most economies worldwide and play a key role in developing countries. These types of enterprises are responsible for significant employment and income generation opportunities across the world and have been identified as a major driver of poverty alleviation and development.
MSMEs tend to employ a larger share of the vulnerable sectors of the workforce, such as women, youth, and people from poorer households. MSMEs can even sometimes be the only source of employment in rural areas. As such, MSMEs as a group are the main income provider for the income distribution at the "base of the pyramid".
Micro, small and medium sized enterprises are vital in achieving the Sustainable Development Goals, in particular in promoting innovation, creativity and decent work for all.
Efforts to enhance access to finance for SMEs across key sectors of national economies are an important element of implementation of the Sustainable Development Goals (SDGs). SDG targets 8.3 and 9.3 call for enhancing the access of SMEs to financial services. In addition, SMEs are an important element in the implementation of SDG 8 (decent work and economic growth) and SDG 9 (industry, innovation and infrastructure.
This year we celebrate the 5th anniversary of the Micro, Small and Medium-sized Enterprises Day - MSME Day. Small businesses are the backbone of our economies. They account for over 70% of businesses and more than 50% of jobs around the world.
Resilient recovery is the focus of this year’s events. We honour the entrepreneurs in societies everywhere as they face the triple threat of COVID-19, conflict and climate.
The COVID-19 crisis has taught us that the pandemic and containment measures do not impact everyone in the same way. Among the private sector, Micro-, Small and Medium-sized Enterprises (MSMEs), especially those led by women, youth, ethnic minorities and migrants, suffered the most. An International Trade Centre survey on COVID-19 impact among businesses in 136 countries has shown that nearly 62% of women-led small businesses have been strongly affected by the crisis, compared to just over half of firms led by men, and women-owned are 27% more likely not to survive the pandemic.
Did you know?
Source : UN
Micro, Small and Medium Enterprises (MSME) sector has emerged as a highly growing and dynamic sector of the Indian economy over the last decade. India
has more than 6 crore entities falling under the MSME category.
As per Central Statistics Office (CSO), share of MSMEs in the Gross Value Added (GVA) in All India Gross Domestic Product (GDP) for the year 2020-21 is 30%. Further, as per 73rd Round of National Sample Survey (NSS) Report on Unincorporated Non-Agricultural Enterprises’ (July 2015-June 2016), 11.10 crore workers are estimated to be in the MSME sector.
The growth of Micro, Small and Medium Enterprises depends on various factors such as access to market, quality of products, availability of timely credit, upgradation of technology etc. For capacity building of Indian MSME sector, Ministry of MSME is implementing various schemes for skill development, technology upgradation, marketing support and access to credit to MSMEs. Besides, a provision has been made in Public Procurement Policy which mandates 25 % of annual procurement from Micro and Small Enterprises (MSEs) by Central Ministries/Departments and CPSEs, thus providing marketing opportunities to MSEs for their growth and development.
To counter the impact of Covid 19, Government has taken a number of initiatives under the Atmanirbhar Bharat Abhiyaan to support the MSME sector. Some of them are:
Ministry of MSME also launched Zed Certification Scheme, an initiative to certify Indian MSMEs based on well defined parameters of quality, safety, production, cleanliness, energy, and environment etc. This scheme will provide financial support on system, testing and product certifications and for handholding and technology upgradation also, Zed certification scheme will also includes upto 95% subsidy on certification cost.
Given the sector's significant contribution to the economy, the Budget has increased outlay for the sector from Rs. 15,699.65 Crores in 2021-22 to Rs 21,422 crores in 2022-2023.
Last Modified : 1/11/2023
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