In celebration of World MSME Day, R. Gopinath Rao, Deputy Director of the MSME Development & Facilitation Office in Bangalore, delivered a compelling address highlighting the pivotal role of Micro, Small, and Medium Enterprises (MSMEs) in the Indian economy. Speaking to a distinguished gathering of dignitaries and industry stakeholders, Rao underscored the sector’s contributions to employment and economic growth while addressing the multifaceted challenges it faces.
The Backbone of Economic Growth
Rao began by acknowledging the vital importance of MSMEs, emphasizing their contribution to economic development and employment generation. “MSMEs are the backbone of our economy, supporting millions of livelihoods and driving economic progress,” he stated. Recognizing this, both central and state governments have launched numerous initiatives to bolster the sector.
Overcoming Challenges: Access to Finance, Marketing, and Technology
One of the primary challenges facing MSMEs, according to Rao, is access to finance. Many proprietors struggle with securing adequate funding to upgrade and expand their operations. To mitigate this, the Development & Facilitation Office (DFO) and other MSME Ministry field offices play a crucial role in providing support. The introduction of the TReDS (Trade Receivables Discounting System) platform, for example, allows MSMEs to receive payments within 48 hours, easing their working capital management.
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Marketing support is another critical area where MSMEs need robust backing. The Ministry’s procurement and marketing support schemes reimburse MSMEs for expenses incurred during participation in trade fairs, both domestic and international. This initiative aims to make MSMEs more competitive, help them develop networks, and explore new markets and products.
Emphasizing Quality and Environmental Standards
Rao stressed the importance of product quality for MSMEs. The ZED (Zero Defect Zero Effect) certification program encourages MSMEs to adopt quality-oriented practices and environmentally friendly processes. Karnataka ranks fifth in the country for ZED certifications, reflecting the state’s commitment to quality and sustainability. “The quality of products produced by MSMEs is critical for their success in the market,” Rao noted.
Leveraging Public Procurement and Cluster Development
Under the Public Procurement Policy of 2012, all public sector undertakings, ministries, and government-funded departments are mandated to procure at least 25% of their requirements from micro and small enterprises. This policy has significantly boosted MSME participation in the public procurement process. In the last financial year alone, over ₹73,000 crores worth of goods and services were procured from MSMEs.
Additionally, the cluster development program supports MSMEs by establishing common facility centers. These centers, with grants up to ₹30 crores, provide shared resources and facilities, promoting collaborative growth. Infrastructure development, including roads, power, and water supply, is also crucial for creating a conducive business environment.
Embracing Digital Transformation and Collaborative Networks
Rao highlighted the importance of digital transformation for MSMEs. Simplified registration processes, such as the use of Aadhaar, have made it easier for businesses to register and access government schemes. “In today’s digital age, it is imperative for MSMEs to continually upgrade and update themselves,” he emphasized.
Collaborative networks and community growth are equally important. Sector-specific groups and business networking events foster collaboration and mutual support, enabling MSMEs to compete effectively in a globalized market. “The days of individual competition are over. Today, collaboration and connectivity are key to success,” Rao remarked.
Future Outlook: Government Support and Entrepreneurial Spirit
Looking ahead, Rao expressed optimism about the future of MSMEs in India. The government’s commitment to supporting MSMEs through various schemes and initiatives, such as the reintroduction of the barcode system, aims to facilitate the growth of micro and small enterprises. “The government is dedicated to creating a supportive ecosystem that enables MSMEs to thrive,” he affirmed.
Rao congratulated all the entrepreneurs on International MSME Day, acknowledging their daily challenges and triumphs. “For entrepreneurs, every day is a challenge, but it is also an opportunity. By embracing digital transformation, quality standards, and collaborative networks, MSMEs can significantly contribute to making India a global manufacturing hub,” he concluded.
As the event drew to a close, the message was clear: the future of MSMEs in India is bright, with ample opportunities for growth and success, supported by a robust framework of government initiatives and collaborative efforts.
A Collaboration for Success
The Confederation of Indian Micro, Small and Medium Enterprises expresses its sincere gratitude to the Development & Facilitation Office, Government of India, Bangalore, for their partnership in making this event a resounding success. Additionally, the co-presenters, Global Council for the Promotion of International Trade, Nutty Treats and Foods Pvt Ltd, Vivamoney Solutions Pvt Ltd, and Owlsurf Digital, are acknowledged for their invaluable support.
