Exports From Micro Units Surge; SME Share Decline: DGCIS Report

New Delhi, Mar 30 (KNN) India's micro enterprises saw their share of the country's exports rise to 6.63 per cent in January, up from 5.79 per cent in the 2020-21 fiscal year, according to a new report from the Directorate General of Commercial Intelligence and Statistics.

At the same time, the report shows the share of exports from small enterprises fell to 10 per cent from 11.64 per cent, while the share from medium enterprises declined to 11.22 per cent from 12.96 per cent over the same period.

Commenting upon the anomaly, Secretary General of Federation of Indian Micro and Small & Medium Enterprises (FISME), Anil Bhardwaj said that it was largely due to  recession in traditional markets of SMEs comprising of Garments, Leather, Gems and Jewelry to Western markets.

While the Micro segments is thriving because of a large number of Micro units have started exporting through e-commerce route directly to consumers.

“The ODOP initiative of the government and easing of  exports through e-commerce have paved way for rapid rise of exports from micro enterprises”, he added.

Micro enterprises are defined as manufacturing and services units with up to Rs 1 crore investment and Rs 5 crore annual turnover.

Small enterprises have up to Rs 10 crore investment and Rs 50 crore turnover, and mediums have up to Rs 50 crore investment and Rs 250 crore turnover.

The top five exporting sectors for micro, small and medium enterprises (MSMEs) were engineering goods (19.64 per cent), gems and jewellery (12.3 per cent), readymade garments (8.52 per cent), rice (6.22 per cent) and organic/inorganic chemicals (5.7 per cent).

However, exports declined year-over-year for the April 2023 to February 2024 period in the textiles/apparel (-8.44 per cent) and gems/jewellery (-12 per cent) sectors, while engineering goods exports increased 4.65 per cent.

The US, UK and Germany ranked among the top export destinations for Indian MSME exporters.

But all three sectors saw lower exports to the US and EU this fiscal year as slowing Western economies reduced demand.

Freight costs also rose sharply due to the war in West Asia, further impacting Indian exporters' competitiveness in global markets, industry representatives noted.

(KNN Bureau)