How MSMEs Are Supporting India's Economic Spine?

Current Scenario of India’s MSME Sector

India’s MSME sector contributes 30% of India’s GDP growth. According to MSME Annual Reports 2023-24, the government-sanctioned Budget Estimate (BE) of 22,137.95 crores and Revised Estimate of 22,138.01 crores INR (RE) for the respective year. Moreover, maximum MSMEs are now embracing digital technology and innovative ideas to survive the competitive market.

The Ministry of Micro, Small, and medium enterprises have provided various aid for the MSME sectors of India. As a result of which, MSME Registration is issued to various startup businesses to offer some of these subsidies listed below-

• Reducing interest rates
• Assuring Tax Benefits
• Sanctioning Government subsidies and grants
• Expanding job scopes, by assuring employment to over 110 million people
• Contributing 30% towards India’s GDP growth
• Enhancing growth towards India’s Manufacturing Output by 33%
• Increasing India’s total exports by 40% towards the country’s foreign trade

Role of Indian Government for Empowering MSMEs

The Indian government has extended comprehensive help to support the MSME sector. It includes- providing credit support, new enterprise development, Tax benefits, etc.

Apart from that, the Indian government is also known for providing the following assistance as well-

• Simplifying the process to get MSME Registration in the Udyam Registration Portal
• Offering CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) to get bank credit facility easily
• Sanctioning financial loans to various sector depending on their priority
• Avail the percentage of Government tenders and contracts allotted for the MSME sector

Few Ways MSME Registration Leverages Indian Start-ups

The MSME registered start-up firms are known for availing various business benefits. Apart from availing government aid, the Indian start-up firms are leveraged with the following benefits of MSME Registration Certificate listed below-

• Availing Digital MSME Scheme via Udyam Registration
• The Micro, Small and Medium Enterprises with MSME Registration are known to get Bar Code Registration Subsidy by 50% for patent registration
• 75% of actual expenditure is granted to the MSMEs under propitious subsidies launched by the Indian Ministry of MSME

Key Challenges Faced Without MSME Registration by Indian Startups

Although, the Ministry of Micro, Small, and Medium Enterprises provide various aid to start-up firms. However, the startups which are yet to obtain MSME Registration may face some of these challenges mentioned below-

• Limited access to avail credit programs offered by banks and other financial institutions

• Investing in new technologies to avoid financial constraints
• Ability to improve products and services to stay ahead of the competition
• Difficulty in complying with the Labour law, Tax Law and other regulatory Environmental compliances for MSME businesses
• Facing intense competition from large businesses to sustain the competition

Role of Technology to Strengthen Indian MSMEs

The Indian Technology is playing a crucial role to enhance Indian MSMEs in various ways. Apart from transforming global economy, startups with MSME Registration are known for leveraging startup businesses with following advantages-

• Encouraging innovative ideas through email, telephonic systems and social media platform
• Enabling Indian startups to expand their global and domestic market reach
• Helping MSMEs to adapt latest technologies for increasing manpower, enhance profitability, etc.
• Integrating with latest technologies like AI, Machine Learning and other innovative solutions to increase efficiency and enhance business output withing a short span of time.

Conclusion

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