MSMEs contribute 30% to India's GDP, to grow further: Narayan Rane

India's youth would be the flag bearer of the growth and hence need to be supported by better work opportunities, said Narayan Rane

The Micro, Small and Medium Enterprises (MSME) sector contributes one-third to India's gross domestic product and has the potential to grow further, said minister Narayan Rane on Friday.

Addressing the ''Maharashtra MSME Conference'' organised by Associated Chambers of Commerce and Industry (Assocham), Rane highlighted the role of MSMEs in India's growth and the government's focus on promoting the sector with various schemes over the past eight years. He also added that MSMEs need better infrastructure and access to technology and finance.

"Moving forward, there is a collective attempt to popularise and increase acceptance for the 'Made in India' tag within the country and globally. There is also an increasing effort to double the micro industries from the current six crores in the next five years. And, we should focus on grooming high growth industries which will be the future growth drivers of the economy and the country," said Rane.

Rane added that the country's youth would be the flag bearer of the growth and hence need to be supported by better work opportunities, training and an entrepreneurial ecosystem.

Sivasubramanian Ramann, CMD, Small Industries Development Bank of India (Sidbi), said, "Today, there are more than 90 million MSMEs in the country. Of these, 15 million MSMEs are under GST. The remaining MSMEs also need finance from banks and NBFCs but are not on the radar of banks because they don't have Udyam numbers.

"With the Udyam number, banks can categorise lendings to MSMEs as priority sector loans. More than 50 million MSMEs will benefit from a special digital programme that is being set up to provide Udyam numbers to them in the next two years," he added.

The CMD further said that Maharashtra has immense potential and has received Rs 3.5 trillion in funding from about Rs 22 trillion. 

The sector accounts for over 80 per cent of businesses and contributes to more than half of the employee share, said Vinod Pandey, chairman, Assocham National Council on Global Value Chain.

With over 63 million MSMEs employing over 110 million people staggered across services, he added that the manufacturing industry contributes nearly 30 per cent to the GDP.

The ambitious target of a $5 billion economy with a 25 per cent contribution from the manufacturing sector will require the MSME sector to play a pivotal role. In addition to the various facilitating schemes announced by the government to support the industry, ramping up investment into the sector will be crucial, said Pandey.