The document summarizes key information about Micro, Small and Medium Enterprises (MSMEs) in India. It discusses how MSMEs are defined and categorized based on investment levels. It outlines the significant contributions of MSMEs, including major contributions to GDP, exports, and employment in India. It also discusses recent government policy initiatives to support MSMEs such as easing the registration process, establishing a framework for revival and rehabilitation of stressed MSMEs, and launching portals to help MSMEs access schemes and track grievances.

1. MICRO, SMALL AND MEDIUM ENTERPRISES (MSME SECTOR) SINCE
2007 ASSISTANT PROFESSOR
RANJANI SHUKLA
TRCAC

2. INTRODUCTION
• The Micro, Small and Medium Enterprises Development Act, 2006 is
an Act of the Parliament of India.
• According to the act, "any buyer who fails to make payment to MSMEs, as per
agreed terms or a maximum of 45 days, would be liable to pay monthly
compounded interest at three times the bank rate notified by RBI".
• Industries are divided into 2 categories. Manufacturing and services. They are
further divided into micro, small and medium.
• According to the Act, enterprises have been categorised units into those engaged
in manufacturing and those providing or rendering services.
• Both categories have been further divided as Micro, Small and Medium on the
basis of their investment in plants and machinery (for manufacturing enterprices)
or in equipment (for providing services).

3. INTRODUCTION

5. GOVERNMENT
SUPPORT

6. ROLE/SIGNIFICANCE OF THE MSME SECTOR
• Contribution to GDP: According to the MSME Ministry’s FY19 annual
report, the MSME sector is dominated by micro-enterprises. India has 6.33
crore MSMEs out of which 6.30 crore -- 99.4 per cent are micro-enterprises.
• Employment Generation: The MSME Sector generally uses labour
intensive techniques of production and therefore has capacity to create more
employmement per additional investment as compare to large – scale secotr.
• Contribution to Exports: Currently, MSME's contribute around 49% to
the country's exports. Export items from this sector includes leather
products, readymade garments, knitwear, sports goods, processed foods,
chemical and allied products and engineering goods.

7. ROLE/SIGNIFICANCE OF THE MSME SECTOR
• Mobilisation of capital and entrepreneurial skills: Large scale
industries tend to get localized and concentrated in certain areas whereas
MSMEs are most decentralized and are spread throughout the
country. These industries encourage competitiveness promote spirit of
enterprise risk taking and innovation
• Equitable distribution of income and wealth: MSMEs have higher
potential to generate employment leading to income generation and better
income distribution. it brings more equitable distribution of national income
and wealth be'cause the ownership pattern of these industries is more
widespread.

8. ROLE/SIGNIFICANCE OF THE MSME SECTOR
• Regional dispersion of industries: MSMEs are more widely spread
throughout the country as many of them are set up to meet local needs and make
use of locally available resources. About 55% of registered MSMEs were located
in rural areas.
• Support to large scale industries: A large number of MSMEs
are ancillary producing products that directly or indirectly assist large scale
industries. The large-scale manufacturing sector benefits from the MSME sector
through supply of components, spare parts, intermediate goods and support
system like processing and maintenance.

9. ROLE/SIGNIFICANCE OF THE MSME SECTOR
• Support to agricultural sector: The support provided by this sector to
agriculture is in the form of supply of inputs, processing facilities and consumer
goods for consumption in rural areas.
• Rural based cottage industries provide employment to surplus labor from
agriculture thus favorably affecting agricultural productivity.
• They also help in reducing the problem of seasonal unemployment in rural areas.

10. RECENT POLICY INITIATIVES
Ease of Registration Process of MSMEs: (Udyog Aadhar Memorandum):
o On 3rd October 2014, Prime Minister Shri Narendra Modi in his 'Man ki Baat'
announced UAM, to simplify forms to enable ease of registration of MSMEs.
o The simplified one-page registration form UAM was made after consultations
with the States and stakeholders, on the basis of recommendations made by
the Kamath committee on Financial Architecture and observation/approvals
by Department related Parliamentary standing Committee, National Board
for MSME and Advisory Committee for MSMEs etc.

11. RECENT POLICY INITIATIVES
Framework for revival and rehabilitation:
• In order to provide a simpler and faster mechanism to address the stress in the
accounts of MSMEs and to facilitate the promotion and development of MSMEs, the
ministry of Micro Small and Medium Enterprises Government of India white it's
Gazette Notification dated May 29, 2015 notified a 'Framework for Revival and
Rehabilitation of Micro, Small and Medium Enterprises'.
• Reserve Bank of India after continuous follow-up, has also issued guidelines to the
banks on 17 March, 2016.
• Under these guidelines' banks have created or structure for finalizing corrective
action plan for revival and rehabilitation of MSMEs.

12. RECENT POLICY INITIATIVES
MyMSME:
o To facilitate the enterprises to take benefit of various schemes by the office
of Department commissioner (MSME), his office has launched a web-based
application module, namely, MyMSME.
o This has also been converted into a mobile app enterpreneurs will be able to
make their applications and track it on their mobile itself.

13. RECENT POLICY INITIATIVES
Direct benefit transfer in the M/O MSME:
o All welfare and subsidy schemes of governments of India have been brought
under Direct Benefit Transfer with the aim of reforming government delivery
system by re-engineering the existing process in welfare and subsidy
schemes for simpler and faster flow of funds.
o And to ensure accurate targeting of the beneficiaries de-duplication and
reduction of fraud.

14. RECENT POLICY INITIATIVES
• Digital payments:
• Government of India is making efforts for promoting a less cash economy
and to provide the facility of seamless digital payments to all citizens of India
in a convenient manner.
• Promotion of digital payments has been accorded highest priority by the
Government of India to bring each and every segment of our country under
the formal fold of digital payment services.

15. RECENT POLICY INITIATIVES
• Grievance Monitoring:
• The ministry attempts to all the grievances on Centralized Public Grievance
Redressed Monitoring System (CPGRAMS) and the number of
pending grievance on CPGRAM 31st December was 61.
• The ministry has started an MSME Internet grievance monitoring
system (eSAMADHAN) to track and monitor other grievances and suggestions
received in the Ministry.

16. RECENT POLICY INITIATIVES
• MSMEs SAMADHAAN: To Address Delayed Payment to MSEs:
• Section 15-24 of the Micro Small and Medium Enterprises Development
(MSMED)Act 2006 deal with the issues relating to the delayed payments to micro
and small enterprises by the buyers to the MSE supplier.
• In the case of delay in payment beyond 45 days MSEs suppliers may approach the
Micro and Small Enterprises Facilitation Council(MSMEFC)constituted under the Act
in all States/Union territories.

17. RECENT POLICY INITIATIVES
• MSMEs – SAMBANDH:
• The Ministry of Micro Small and Medium Enterprises notified the public
procurement policy for Micro and Small Enterprises which mandates 20% of
annual procurement from MSEs including 4% from enterprises owned by SC/ST
entrepreneurs by the Central Ministries/Departments and Central Public Sector
Enterprises (CPSEs).
• For effective implementation and monitoring of the policy, the Ministry
launched the Public Procurement Portal titled "MSME-SAMANDH" on 8th
December 2017.

18. RECENT POLICY INITIATIVES
• Technology Centre Systems Programme (TCSP):
• To expand and upgrade the network of technology centers (Tool Rooms and
Technology Development Centres) in the country, Ministry of MSME is
implementing TechnologyCentre Systems Programme (TCSP) at an estimated
Projected Cost of rupees 2200.
• TCSP has been conceptualised to create an innovative ecosystem with following
components which will engage with each other to create value:
• Establishment of physical infrastructure
• Engaging the services of world class Technological Cluster Manager
• To establish a web portal for creating a technology platform to meet various needs
of MSME.

19. ANY QUESTIONS?