Short Answer Questions · Q1
Q.What is MSME?
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✓ Free question
MSME = Micro, Small and Medium Enterprises, India's classification of business units by investment in plant and machinery and turnover, and a driving force in production, employment and exports.
What MSME means
- MSME stands for Micro, Small and Medium Enterprises.
- These are business units classified by their size, measured by investment in plant and machinery and turnover — a basis chosen because it suits India, where capital is scarce and labour is abundant.
The three categories
- Micro — investment up to 1 crore, turnover up to 5 crore.
- Small — investment up to 10 crore, turnover up to 50 crore.
- Medium — investment up to 50 crore, turnover up to 250 crore.
Why they matter
- MSMEs are a driving force of India's development through production, employment and exports.
- They contribute roughly 29.7% of GDP and about 49.66% of exports, and employ nearly 60 million people through around 28.5 million enterprises — the largest employer after agriculture.
- They are governed by the MSMED Act, 2006.
✓Final answer
MSME = Micro, Small and Medium Enterprises — units classified by investment in plant and machinery and turnover, a driving force in India's production, employment and exports, governed by the MSMED Act, 2006.
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