The MSME Growth Engine of Indian Economy

The MSME Growth Engine of Indian Economy

 

The micro small and medium enterprises have been accepted as the engine of the Indian economy and for promoting equitable development. MSME is also known as the power engine of the economy. These enterprises have played an important role in the development of the country in terms of creating employment opportunities- MSME employed more than 50 million people, scaling manufacturing capabilities, curtailing regional disparities, balancing the distribution of the wealth and contributing to the GDP-MSME sector 8% of GDP.

The advantage of the sector is it requires less investment, thus creating employment in the large scale and reducing the unemployment problems. Moreover, this sector receives threats from the domestic and international market.

In India, the enterprises have been broadly classified into two categories;

·        Manufacturing and,

·        Those who engaged in providing/ rendering services.

Both categories of enterprises have been further classified into micro, small and medium enterprises based on their investment in plant and machinery. The present celling on investment to be classified as micro, small and medium enterprises is as under;

  Enterprise category

  Investment in plant and machinery

  Investment in equipment

               

Enterprise category

Investment in plant and machinery

Investment in equipment

Micro

The investment in plant and machinery does not exceed Rs. 25 lakh

 

The investment in plant and machinery does not exceed Rs. 10 lakh

Small

 

The investment in plant and machinery is more than Rs. 25 lakh but does not exceed Rs. 5 crore.

The investment in plant and machinery is more than Rs. 10 lakh but does not exceed Rs. 2 crore.

Medium

The investment in plant and machinery is more than 5 crore but does not exceed Rs. 10 crore

 

The investment in plant and machinery is more than 5 crore but does not exceed Rs. 10 crore

 

Opportunities of MSME:

The opportunities in the MSME are enormous due to following reasons:

Less capital intensive.

Extensive promotions and support by government.

Reservation for exclusive manufacture by small scale sector.

Project profiles.

Funding- finance and subsidies.

Machinery procurement.

Technical and managerial skills.

Project profiles.

Export promotions.

Tooling and testing support.

Increasing export potential for Indian products.

Growth in requirements for ancillary units due to the increase in several greenfield units coming up in the large scale sector. The small industry sector has performed exceedingly well and enabled our country to achieve a wide measure of industrial growth and diversification.

Let us take some fundamental importance of this sector in the development of India both in terms of economic and social development.

Create large scale employment: Since the enterprises failing in this sector require low capital to start the business, it creates huge employment opportunities for many unemployed youth. India produces about 1.2 million graduates per year, of the total number about 0.8 million are engineers. And there is no economy in the world that can provide jobs to so many fresh engineers in one year. MSME is the boom to these fresh graduates.

Economic stability in terms of Growth leverage exports: MSME is a significant growth driver in India, with it contributing to the tune of 8% to GDP. Exports sector in India constitutes about 40% of the contribution from MSME alone.

Cheap labor and minimum overhead: In large scale organization, one of the key challenges is to retain the human resource through effective human resource management professional manager. But, in the case of MSME, the requirement of the labor is less, and it does not need highly skilled labor. Hence, the indirect expense incurred by the owner is low.

Plays an important role in making India: Post the inspection “Make in India”, a signature initiative by the Prime Minister of India, the process of incorporating a new business has been made easy. Since the MSME is the backbone in making this dream a possibility, the government has directed the financial institutions to lend more credit to enterprises in the MSME sector,

What is all requires to be registered as MSME?

It is an online process that requires your Aadhar number to get it certified. One can avail the certificate online without any need of the physical copy. Moreover, the process is simplified even further for the enterprises having the MSME Certificate to obtain licenses, approvals, and registrations on any field for their business from their respective authorities. Such that they can produce the Certificate of MSME Registration while making an application itself. Not just that, applicants can reimburse the ISO Certificate Expenses by making an application to the respective authority supported by MSME Certificates.

 

Documents required for MSME registration.

Business Address Proof

Copies of Sale Bill and Purchase Bill

Partnership Deed/ MoA and AoA

Copy of Licenses and Bills of Machinery Purchased

 

MSME Registration Process:

To do the registration, the small and medium scale industry proprietor needs to fill a single form which he can do online just as offline.

On the off chance that an individual needs to do registration for more than one industry, at that point, additionally he/she can do single registration.

To do the registration he/she needs to fill a single form which is accessible at the site which is mentioned below.

The document required for the registration is Personal Aadhar number, Industry name, Address, ledger subtleties, and some regular data.

In this, the individual can give self-confirmed declarations.

There are no enlistment expenses required for this procedure.

When the detail-filled and transfer you would get the enrollment number.

Final Say:

MSME enterprises are one of the most important sectors, and the backbone of the Indian economy. This sector has been instrumental in the growth of the nation, leveraging export, creating huge employment for fresh graduates and uneducated citizens of India. Along with that it is also extending the opportunities to banks to giving more credits to the enterprises of this sector.  At, Unilex Business consultant we can help you regarding MSME registration. To avail MSE registration, you need to send all the required documents at our email ID. As soon as we receive your documents we will work on it and move ahead to next process.