They account for approximately 30% of the gross value added (GVA) in the gross domestic product (GDP) and 36% of manufacturing output. The share of export of MSME specified products in all-India exports is around 44%. More than four crore MSMEs are registered in the government’s Udyam portal.
MSMEs tend to be more labour-intensive than large enterprises and hence are key to providing employment opportunities to India’s workforce. MSMEs face significant challenges including remaining competitive, keeping abreast of changing technology and retaining skilled talent. However, on a day-to-day basis, their biggest challenge is ensuring that they have access to finance at reasonable rates.
Lending a Helping Hand
The 2024 Budget has responded to this challenge through multiple measures. By increasing the limit for Mudra [Micro Units Development & Refinance Agency] loans from Rs 10 lakh to Rs 20 lakh for those who have a good track record of repaying earlier loans, the government has made more funding available to growth-oriented enterprises as well as given an incentive to those who have demonstrated responsible financial management.
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