MSMEs Contribute 31.1% To GDP, Nearly 49% To Exports: Govt

New Delhi, May 15 (KNN) Micro, Small and Medium Enterprises (MSMEs) continue to play a critical role in India’s economy, contributing around 31.1 percent to the country’s GDP, accounting for 48.58 percent of total exports and generating nearly 35.4 percent of manufacturing output.
 
Sector Supports Employment And Regional Growth 
 
As per official data, the MSME sector comprises over 7.47 crore enterprises engaged in manufacturing, services and trade activities, while providing livelihoods to nearly 32.8 crore people, making it the second-largest source of employment after agriculture. 
 
A significant share of these enterprises operate in rural and semi-urban areas, supporting local supply chains, promoting non-farm employment and driving regional economic development.
 
Government Pushes MSME Formalisation 
 
The government has expanded support for MSMEs through formalisation, credit access, equity funding and payment protection measures. Over 7.9 crore MSMEs and informal micro enterprises have been registered under the Udyam platforms as of March 2026. 
 
Credit support has been strengthened through the Credit Guarantee Fund Trust for Micro and Small Enterprises and Small Industries Development Bank of India, with the guarantee ceiling raised to Rs 10 crore under Budget 2025-26 and enhanced benefits for transgender entrepreneurs.
 
Equity financing has also been expanded through the Self-Reliant India Fund, which supported 682 MSMEs with investments worth Rs 15,442 crore by November 2025, while Budget 2026-27 allocated an additional Rs 2,000 crore for micro enterprises. 
 
The Emergency Credit Line Guarantee Scheme issued guarantees worth Rs 3.61 lakh crore, benefiting 1.19 crore borrowers and helping prevent MSME loan defaults.
 
To tackle delayed payments, the government strengthened protections under the Micro, Small and Medium Enterprises Development Act, 2006, operationalised 161 facilitation councils, and used the MSME Samadhaan Portal to clear dues worth Rs 1.65 lakh crore. 
 
Focus Remains On Rural Entrepreneurs And Artisans 
 
It has also promoted self-employment through the Prime Minister's Employment Generation Programme and the PM Vishwakarma Scheme, supporting lakhs of entrepreneurs and artisans.
 
The government said continued coordination between digital platforms, financial institutions and grassroots implementation agencies will remain critical to ensuring that policy benefits reach rural entrepreneurs, artisans and first-generation business owners who form the backbone of India’s small business ecosystem.
 
(KNN Bureau)