MSME: Challenges of significant contributor and policy initiatives
The MSME sector accounts for over 80% of businesses and contributes to more than half of the employee share. The share of the formal MSME sector in the GDP is up to 40% in emerging economies. The importance of the sector in India’s economic growth cannot be over-emphasized. With the presence of over 63 million MSMEs employing over 110 million people staggered across services, the manufacturing sector contributes nearly 30% to GDP.
As of 7th January 2022, the MSME portal has a total registration count of 1.32 crore, of which 1.27 crore has been classified as micro-enterprises. Enterprises registered on the portal employ 9.6 crore people, of which 2.3 crore are women. There are 1.5 lakh exporting units, which have contributed a cumulative ₹ 9.7 lakh crore worth of exports.
MSME growth has been tremendous in India in the past few years and its growth potential is enormous. However, despite their potential, these businesses are facing challenges. A few of the critical challenges are –
- Access to finance
- Lack of infrastructure
- Limited access to market
- Limited access to technology
- Difficulty in complying with government regulation
