Hyderabad:The Micro, Small and Medium-sized Enterprises Day is celebrated on June 27 every year across the globe. Micro, Small and Medium-sized Enterprises are central to economies around the world.
The United Nations General Assembly designated 27 June as 'Micro-, Small, and Medium-sized Enterprises Day' to raise awareness of the tremendous contributions of micro, small and medium-sized enterprises (MSMEs) to the achievement of the United Nations Sustainable Development Goals (SDGs).
History of the Micro-Small and Medium-sized Enterprises Day
On 6 April 2017, the United Nations General Assembly adopted a resolution designating June 27 as 'Micro-, Small, and Medium-sized Enterprises Day.' The resolution was co-sponsored by 54 member states, representing over five billion people. The International Trade Centre was appointed as the leading agency for this observance.
Understanding MSME's
Micro, Small and Medium Enterprises are businesses that operate on a relatively smaller scale compared to large corporations. These enterprises encompass a wide array of sectors, from manufacturing and agriculture to technology and services. Their distinguishing features include limited manpower, lower capital investment, and localised operations. MSMEs often function as the catalysts for economic inclusivity, as they provide jobs to a significant portion of the population.
Inception
The first Micro—Small and Medium-Sized Enterprises Day was officially held worldwide on June 27, 2017.
Objectives
Micro, Small and Medium-Sized Enterprises Day is annually celebrated for the following purposes:
- To raise awareness of the tremendous contributions of micro, small and medium-sized enterprises (MSMEs) to the global, regional, and national economy
- To highlight the importance of micro, small and medium-sized enterprises in achieving the Sustainable Development Goals
- To promote innovation, creativity, and sustainable business practices
2024 Theme: MSMEs and the SDGs
Leveraging the Power and Resilience of Micro, Small and Medium-sized Enterprises (MSMEs) to Accelerate Sustainable Development and Eradicate Poverty in Times of Multiple Crises. This year's theme focuses on the role of these enterprises in eradicating poverty and achieving the Sustainable Developing Goals. In times of crises – from the cost of living to climate change to debt distress – micro, small and medium-sized enterprises have demonstrated remarkable resilience.
Facts about MSMEs
600 million jobs will be needed by 2030 to absorb the growing global workforce, which makes SME development a high priority for many governments around the world.
In emerging markets, most formal jobs are generated by SMEs, which create seven out of 10 jobs. Access to finance is disproportionately difficult for smaller firms in the least developed countries (LDCs), with 41 per cent of SMEs in LDCs reporting access to finance as a major constraint to their growth and development, by comparison to 30 per cent in middle-income countries (MICs) and only 15 per cent in high-income countries (HICs).
MSMEs: The backbone of economies worldwide
MSMEs employ more than two-thirds of the global workforce, and they contribute significantly to GDP growth. According to the UN, MSMEs account for up to 90 per cent of businesses, 60 per cent to 70 per cent of jobs worldwide, and contribute significantly to global GDP. They play a key role in reducing poverty, narrowing inequalities and creating decent and productive employment and achieving social justice. However, many struggle with low productivity and poor working conditions. Often operating in tough business environments, including in the large informal economy, many find it difficult to access resources and opportunities. Women and young people working in these enterprises face additional constraints and discrimination.
MSMEs in India
There are a total of 633.9 lakh MSMEs in India (according to the Ministry of MSMEs). In India, over 99 per cent of total MSMEs qualify as micro-enterprises that make up to 630.5 lakh enterprises. There are a total of 3.3 lakh businesses that qualify as small businesses i.e. 0.5 per cent of all MSMEs and just 0.05 lakh qualify as medium businesses that sum of 0.01 per cent of all MSMEs. The rural areas majorly consist of 324.9 lakh businesses, while urban areas have 309 lakh businesses.
MSME Statistics
Uttar Pradesh has emerged among the top three states in India as a significant contributor to India's Micro, Small, and Medium Enterprises (MSME) sector, underscoring the crucial contribution of MSMEs in shaping India's economy, as per a CBRE-CREDAI report. Maharashtra, Tamil Nadu, and Uttar Pradesh collectively contribute nearly 40 per cent of all registered micro, small, and medium enterprises (MSMEs) in India.
How do MSMEs help to boost the economy of India?
The MSME industry plays a crucial role in the development of the Indian economy. The sector contributes to about 30 per cent of the country's GDP, 48 per cent of exports, and employs over 11 crore people. The MSME sector also strengthens other industries by providing them with raw materials and ancillary products.
The MSME sector has always acted as a bulwark for the Indian economy, providing it resilience to ward off global economic shocks and to face adversities. The MSME sector is reportedly the second-largest employer in the country after agriculture. The number of MSMEs in the country is expected to grow from 6.3 crore to 7.5 crore in the coming times, growing at a projected Compound Annual Growth Rate of 2.5 per cent.
According to the data presented by the Minister of State for MSMEs in the Rajya Sabha, in the fiscal year 2019-20, the share of MSME Gross Value Added (GVA) in India's Gross Domestic Product (GDP) stood at 30.5 per cent, it slightly declined to 27.2 per cent in 2020-21 but rebounded to 29.2 per cent in 2021-22.
The share of MSME manufacturing output in the overall Indian manufacturing output remained stable, accounting for 36.6 per cent, 36.9 per cent and 36.2 per cent during the fiscal years 2019-20, 2020-21, and 2021-22, respectively. The share of MSME products in India's total exports experienced a decline over the years. While in the fiscal year 2020-21, they constituted 49.4 per cent of India's exports, the share decreased to 45.0 per cent in 2021-22 and further to 43.6 per cent in 2022-23.
The MSME sector has been a significant source of employment in India. As of June 24 2024, The number of MSMEs registered on the Udyam portal, including the Udyam Assist Platform (UAP), has reached 4,60,84,944.
A look at the Schemes & Programmes initiated by the Ministry of Micro, Small & Medium Enterprises
The Ministry of MSME has been consistently enunciating policies resulting in enabling schemes and programmes for enhancing competitiveness of enterprises. New initiatives of the ministry and market-driven economy give rise to an increasing product portfolio. Various ministries extend support in the areas of skill development programmes, market development assistance, technology support, credit flow, public procurement policies, participation in exhibitions both within the country and overseas, etc.
- Credit Guarantee
- Credit Linked Capital Subsidy for Technology Upgradation
- ISO 9000/ISO 14001 Certification Reimbursement
- Micro & Small Enterprises Cluster Development Programme
- Micro Finance Programme
- MSME Market Development Assistance (MDA)
- National Awards (Individual MSEs)
- National Manufacturing Competitiveness Programme (NMCP)
The Schemes/Programmes initiated & implemented by the Ministry inter alia include:
- Prime Minister's Employment Generation Programme (PMEGP)
- Credit Guarantee Scheme for Micro and Small Enterprises (CGTMSE)
- Micro and Small Enterprises-Cluster Development Programme (MSE-CDP)
- Entrepreneurship Skill Development Programme (ESDP)
- Procurement and Marketing Support Scheme (PMS) and National SC/ST Hub (NSSH)
