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MICRO, SMALL AND MEDIUM ENTERPRISES IN INDIA-AN OVERVIEW

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DEFINITION OF MSME

In India, the enterprises classified broadly into two categories

1.
2. 3.

Manufacturing and
Those engaged in providing /rendering services. Above both further classified into 1. Micro 2. Small 3. Medium enterprises

based on their investment in plant and machinery/ equipment.

MSME classification based on investment limit in plant and machinery:

Manufacturing Enterprises
Micro
Small

Rs. 2.5 million

Rs. 50 million

(US$ 56000)
(US$ 1.1 million)

Medium

Rs. 100 million (US$ 2.2 million)

Services Enterprises
Micro Small Medium Rs. 1 million Rs. 20 million (US$ 22000) (US$ 0.4 million)
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Rs. 50 million (US$ 1.1 million)

INTRODUCTION - MSME Major plank of Indias Economic Development Strategic Importance due to contributions in terms of Output, Export & Employment To sustain & accelerate growth, MSME sector needs to be thoroughly competitive

PERFORMANCE AND CONTRIBUTION OF MSMEs

MSMEs
45% industrial production 13 Million MSMEs> 8000 products

31 Million Employme nt

40% Exports

SPECIFIC POLICY,BOOSTING THE GROWTH OF TINY, SMALL AND COTTAGE INDUSTRIES:

a) Reservation of items for exclusive manufacturing in small sector b) Preferential credit support measures c) Preferential government procurement policies d) Fiscal concessions e) Infrastructural development like development of industrial estates, testing labs, common facility centers. f) Entrepreneurship development
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Institutional Support Structure for MSMEs in India At Federal

Level
1. Ministry of MSMEs 2. Small Industries Development Organization (SIDO) 3. National Small Industries Corporation(NSIC) 4. Khadi & Village Industries Commission(KVIC)

At State Level
1. Directorate of Industries

MSME

2. District Industries Centres 3. State Finance Corporation 4. State Industrial Development Corporation 5. Technical Consultancy Organisations 6. Entrepreneurship Development 7 Institutions (EDIs)

Others
1. Industry Associations 2. NGOs 3. Banks/Financial Institutions

5. Coir Board
6. Entrepreneurship Development Institutions (EDIs)

INTRODUCTION - MSME

MSMEs are supported by Govt. of India & its agencies as Ministry of MSME National Small Industries Corporation Small Industries Development Bank District Industries Centre For Modernization Productivity Technological Needs Skill Development & Up gradation Adequate & Affordable assistance in Finance
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SOME IMPORTANT SCHEMES OF MINISTRY OF MSME, GOVT. OF INDIA ARE AS UNDER :

1. 2. 3. 4. 5. 6. 7. 8 9 10. 11. 12. 13. 14. 15. 16. 17. Credit guarantee scheme ISO 9000/14001 certification fee reimbursement scheme Micro & small enterprises cluster development programme Credit linked capital subsidy scheme Intellectual property rights for msmes Incubator scheme Quality management standards/quality technology tools Mini tool room Marketing assistance ( bar code) lean manufacturing competitiveness programme Technology up gradation Skill development Marketing & procurement Export promotion Infrastructural development National awards Rajiv Gandhi Udyami Mitra Yojna ( rgumy)

MSME DEVELOPMENT ACT 2006 (MSMED)

MSMED Act 2006 promulgated in order to :

1. 2. 3. 4. 5.

Remove impediments due to multiple laws Introduce statutory consultative and recommendatory bodies on MSME policies Improve registration procedures of MSMEs Statutory basis for purchase preference and credit policies Improve realization of payments of MSMEs
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Micro, Small and Medium Enterprises Development Act, 2006

Salient Features

1. Industry replaced by enterprise which include service enterprises also. 2. Ambit of sector enlarged to cover medium enterprises.

3. Constitution of MSME Board

4. Simplification of registration procedure
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5. Policy of preferential procurement from MSMEs 6. Progressive credit support

7. Penalty for delayed payments

8. Provision for exit policy

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Thank you