Role of MSMEs in Indian Economy: Key Aspects
MSME sector is crucial for economic development in India, offering employment and supporting industries. Understand its classification, importance, challenges, and solutions for growth.
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Vivekanand College, Kolhapur (Empowered Autonomous) Name of the Subject: Fundamentals of Entrepreneurship Name of the Topic: Micro Small and Medium Enterprises Name of the Teacher: Mr. Satish Nishikant Chavan
INTRODUCTION OF MSME The MSME sector constitutes an important part of Indian Economy. It is regarded as backbone of development and engine for economic Development. It plays a crucial role in employment generation. According to the report of NSS in 2015-16 there were around 633.8 L unincorporated non-agriculture enterprises in the country providing jobs to 11.10 Cr people out of which 360.42 L in manufacturing sector and remaining in service sector. Another importance of MSME s is that they act as a supporting industry to many large Industries. Its role has increased in the mission of Make in India. Hence the role of MSME in Job creation and industrialization has become a boon to the country.
IMPORTANCE OF MSME 1. Creates large amount of Employment 2. Help in export promotion 3. Helps in maintaining economic stability 4. Low cost wages and overhead 5. Fair distribution of wealth. 6. Simple management structure. 7. Balanced regional development. 8. Use of local resources. 9. Capital mobilization 10. Stimulates Entrepreneurship Development.
Problems of MSME 1. Insufficiency of credit from banks 2. Tuff Competition 3. Low quality Infrastructure 4. Shortage of Raw Material 5. Problem of advance technology 6. Lack of marketing channel 7. Underutilization of the capacity 8. Problem of recovery 9. Initial obstacles 10.Institutional Obstacles.
Remedies 1. Equitable distribution of raw material 2. Provision of adequate finance 3. Marketing assistance 4. Industrial Education and training 5. Provisions of Infrastructural facility 6. Development of technology and methods of production
Steps in formation of Small Enterprises Identification of business opportunity Generation of Business Idea Feasibility study Preparation of business plan Location Clearance Permits required Licensing and Registration
