(GIST OF KURUKSHETRA) MSME Sector on Growth Trajectory : MARCH -2023
(GIST OF KURUKSHETRA) MSME Sector on Growth Trajectory
MSME Sector on Growth Trajectory
The contribution of the MSME sector to the overall Gross Value Added (GVA) increased from 29.3% in 2018-19 to 30.5% in 2019-20. However, it fell to 26.8% in 2020-21 due to the pandemic.
The MSME sector accounts for more than 90% of industrial units, 40% of total manufacturing output, and 35% of India’s exports.
The MSME sector is the largest employer after agriculture in rural areas and is thus crucial for socioeconomic development of the rural populace.
Challenges for MSMEs
MSMEs grapple with situations like low levels of technology use.
They have limited access to inputs and credit facilities.
They have an unfavourable market environment and fall outside the ambit of formal business and labour regulations.
Rural MSMEs witness more locational disadvantages as compared to their urban counterpart.
The MSME sector was severely impacted by the COVID-19-induced lockdown. They witnessed supply chain disruptions, reduced demands, loss of revenue, etc.
Measures taken by the Government
In order to moderate the economic impacts of the pandemic on MSMEs, the government modified the definition of MSMEs.
Provided financial assistance like equity infusion, and waived the global tender requirement for procurement of up to Rs 200 crore.
The Udyam portal was also launched. MSME registrations on Udyam Portal crossed the one crore mark on August 2022.
In order to transcend MSMEs to formal institutional networks and gain from the schemes and initiatives central government took various measures. For example, registration of unorganized workers on e-shram portal, SVANidhi scheme for street vendors, etc.
To digitally empower the sector, various initiatives like MSME Sampark, MSME Sambandh, MSME Samadhaan, Udyamimitra, etc. were launched.
Open Network for Digital Network will further strengthen its market.
As per the Economic Survey 2022-23, 57% of the total business on GeM was contributed by MSME units. Moreover, female entrepreneurs have contributed nearly 6%.
Some other initiatives include One District One Product, TRIFED (for onboarding Tribal artisans), Emergency Credit Line Guarantee Scheme, etc.