"The resurgence of MSMEs in India"
The Indian Micro, Small and Medium Enterprises (MSME) businesses form the backbone of India’s manufacturing and services sectors. It is reported that about 99% of the enterprises in India are either micro or small in size. There are approximately 63.39 million MSMEs across various sectors in India. The Indian MSME industry is expected to contribute approx. 50% to the country’s GDP by 2025. The industry is the second-largest employment generator in India as of FY 2022, with more than 111 million people employed.
The MSME sector took a significant hit during the pandemic. Nearly 5,900 businesses shut down during FY 2020-21 and 2021-22. With a substantial part of MSME business transactions being dealt with in cash, the working style, low scale of operation, and poor financial management put businesses in a difficult position with the unexpected onset of Covid-19.