Introduction

Micro, Small and Medium Enterprises (MSME) are a driving force in India's development. They act as a vital link in the country's industrialisation through production, employment and exports, widening the entrepreneurial base and putting local raw materials and indigenous skills to work.

Why the sector matters

• MSMEs dominate the industrial landscape, employing a large share of the labour force and carrying tremendous export potential.
• They contribute roughly 29.7% of GDP and about 49.66% of exports.
• The sector provides employment to nearly 60 million people through around 28.5 million enterprises — making it the largest employer after agriculture.
• MSMEs are complementary to large industries, working as ancillary units and forming an integral part of the value chain. This builds a supportive environment for indigenous skills, grass-roots innovation and entrepreneurship development.

A wide product range

The sector produces everything from simple consumer goods to high-precision, sophisticated finished products. Recognising its potential for national development, the government encouraged this segment in both the pre-reform and post-reform periods, to serve the goals of self-reliance and rural industrialisation.

Traditional and modern industries

In India, MSMEs include both traditional and modern small industries. The sector has eight sub-groups: handlooms, handicrafts, coir, sericulture, khadi and village industries, small-scale industries and powerlooms. The Khadi and Village Industries and Coir segment is a major contributor to the sector's growth.

Global partnerships and national missions

• Many global companies increasingly look to Indian MSMEs for strategic partnerships, drawn by their innovative strength in low-cost manufacturing and local skills.
• MSME Tool Rooms are credited with providing at least 10 components for Mangalyaan (the Mars Orbiter Mission), India's first inter-planetary mission, and vital inputs for satellites such as those in the Chandrayaan programme.
• For Chandrayaan-2 (launched 22 July 2019), institutions like the Central Tool Room and Training Centre (CTTC), Bhubaneswar and the Institute for Design of Electrical Measuring Instruments (IDEMI), Mumbai developed key components — for the launch vehicle's cryogenic engine, the lunar orbiter's navigational assemblies and the wheel assemblies for the moon launch.

This shows that MSMEs are no longer limited to small business alone: their contribution begins at the ground level and directly shapes even major national missions. The sector therefore holds the key to inclusive growth and plays a critical role in India's future.

Snapshot: 'Romi Bags' of Manipur — Khumbongmayum Dhanachandra Singh, the son of a poor tailor in Imphal, learnt tailoring from his father though his heart was not in it. Stitching a purse from leftover fabric scraps changed his life: friends admired the unique design and asked for more, and he realised there was a market for his work. After studying demand, costs and expected income, he launched his purse-making venture 'Romi Bags' in 1996, and in 2007 won the National Award for bag making under Micro and Medium Enterprises — a story of turning grit, perseverance and hard work into a successful enterprise.