Q.‘Creativity and Innovation is the key to MSME’. Justify the statement.

Since small units cannot compete with large firms on scale, capital or technology, their real competitive strength has to come from somewhere else — from creatively combining resources into new products, markets and methods. …

The statement is justified. Reasons:

• Entrepreneurship is essentially creative — The entrepreneur innovates by combining factors of production into new goods and services. Creativity shows up as new products, new markets, new input sources, technological breakthroughs and newer organisational forms — doing things better, cheaper and faster. This creative act is what turns an idea into an enterprise.
• It is the source of MSME competitiveness — Small units cannot match large firms in scale, finance or technology, so their competitive strength lies in innovation and low-cost, skill-based manufacturing. This is why global companies seek strategic partnerships with innovative Indian MSMEs.
• Creativity unlocks entrepreneurship from little — With little capital and almost no formalities, latent skills and creative ideas become businesses (as in the 'Romi Bags' story, where a purse stitched from scrap fabric grew into an award-winning enterprise).
• It reaches the highest achievements — MSME innovation supplied components for Mangalyaan and Chandrayaan-2, proving that creative small units contribute even to national missions. …