The Micro, Small and Medium Enterprises (MSMEs) form an integral part of the Indian economy, comprising of the manufacturing and services sector broadly. However the outreach of the MSMEs is far more diversified. MSMEs have presence spanning across almost all the sectors and sub sectors thereby making it a highly dynamic sector. MSMEs are complementary to large industries as ancillary units and this sector contributes enormously to the socio-economic development of the country.
The highly vibrant and dynamic nature of the sector over the last five decades has been quite appealing to policy makers, government agencies and research organizations all alike. There are close to 51 million MSME units in the country that employ about 117 million people across various sectors, constituting 40% of the workforce.
MSMEs not only are fundamental in providing large employment opportunities at comparatively lower capital cost than large industries but also play a crucial role in industrialization of the rural and backward areas. As a result, MSMEs contribute to reducing regional imbalances, assuring more equitable distribution of national income and wealth. MSMEs share around 31% to GDP and 43% to exports.
MSMEs play a pivotal role in exports, employment, skill development and startups, thereby making the government more proactive than ever in taking care of this sector. Both the central and state Governments have been working toward the promotion and development of MSMEs in an effort to encourage entrepreneurship, employment and livelihood opportunities. Government is also committed to enhance the competitiveness of MSMEs in the changed economic scenario.
Within this sector, an important role is played by numerous clusters and these clusters contribute to a significant portion of the manufactured exports from India and employment generation. Private and public sector institutions at the Central as well as the State levels are increasingly undertaking cluster development initiatives. The state of West Bengal has as many as 450 clusters spanning across various domains potential sectors for cluster development are leather, zari, gems & jewelry, incense stick, furniture and handicrafts, readymade garments, plastic and plastic processing, e-waste processing, jute, bio-waste management, rubber and so on. The thrust areas from 2018 for MSMEs in the East are agro based sectors, rural art and craft, and wellness.
Eastern India is hugely innovative but only innovation will not help. Instead, collaboration of innovators can bring about more benefits in terms of cluster development as this will lead to obtaining good funding support. Notably, information block, funding availability and trust factor are major hindrances associated with the sector. Hence, structured efforts in e-commerce, integration of central and state governments, simplification in ease of exporting, and addressing of credit availability issues must be dealt with.
Indian Chamber of Commerce is committed to work for the development of the sector through policy advocacy and through leadership by bringing together Industry personnel, Retailers, Manufacturers, Exporters and Policy Makers in the MSME space.