{"id":39801,"date":"2025-03-25T21:22:05","date_gmt":"2025-03-25T15:52:05","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=39801"},"modified":"2025-03-25T21:22:06","modified_gmt":"2025-03-25T15:52:06","slug":"govt-revised-criteria-classifying-msmes","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/25-03-2025\/govt-revised-criteria-classifying-msmes","title":{"rendered":"Govt Notifies Revised Criteria for Classifying MSMEs"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/ Economy<\/strong><\/p>\n\n\n\n<p><strong>In News<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The government has notified significant revisions to the turnover and investment criteria for classifying Micro, Small, and Medium Enterprises (MSMEs), which will come into effect from April 1.<\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"e8ccac\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"768\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/03\/new-msme-classification-criteria-as-per-union-budget-2025.png\" alt=\"new msme classification criteria as per union budget 2025\" class=\"not-transparent wp-image-39802\" style=\"--dominant-color: #e8ccac; width:440px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/03\/new-msme-classification-criteria-as-per-union-budget-2025.png 1024w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/03\/new-msme-classification-criteria-as-per-union-budget-2025-300x225.png 300w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/03\/new-msme-classification-criteria-as-per-union-budget-2025-768x576.png 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><strong>Significance of MSMEs<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Dynamic &amp; Vibrant:<\/strong> Evolving over five decades, MSMEs play a vital role in India&#8217;s economic and social development.<\/li>\n\n\n\n<li><strong>Employment:<\/strong> Employs 24.14 crore people, making it second only to agriculture in job creation.\n<ul class=\"wp-block-list\">\n<li>Nearly 40% of the 6.13 crore registered MSMEs are women-owned.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Ancillary Role:<\/strong> Complements large industries, serving as ancillary units and boosting inclusive industrial development.<\/li>\n\n\n\n<li><strong>Rural Reach: <\/strong>Helps industrialise rural and backward areas, reducing regional disparities.<\/li>\n\n\n\n<li><strong>Global Footprint:<\/strong> Produces a diverse range of products and services for both domestic and international markets.<\/li>\n\n\n\n<li><strong>Self-Reliance Mission:<\/strong> With over 6 crore units, MSMEs are key to building a strong, self-reliant India.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges of MSMEs<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Limited Access to Finance:<\/strong> Many MSMEs lack formal credit history, collateral, or proper documentation to secure loans from banks.\n<ul class=\"wp-block-list\">\n<li><strong>Example:<\/strong> According to SIDBI, only 16% of MSMEs get formal credit; the rest rely on informal sources or NBFCs at higher interest rates.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Low Technology Adoption: <\/strong>Most units still operate with outdated machinery, affecting productivity, quality, and scalability.\n<ul class=\"wp-block-list\">\n<li><strong>Example: <\/strong>Textile MSMEs in Surat still rely on traditional looms, limiting their ability to compete with Chinese manufacturers.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Limited Market Access &amp; Exports:<\/strong> MSMEs contribute 48% to India\u2019s exports, but only a small percentage are directly exporting.\n<ul class=\"wp-block-list\">\n<li><strong>Example: <\/strong>Handicraft MSMEs in Rajasthan often lack online platforms or export licenses to scale internationally.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Skill Shortage &amp; Labour Issues: <\/strong>Over 70% of MSMEs face difficulty in hiring skilled manpower, as per a FICCI survey.<\/li>\n\n\n\n<li><strong>Delayed Payments from Buyers: <\/strong>Larger companies delay payments, choking the cash flow of MSMEs.\n<ul class=\"wp-block-list\">\n<li><strong>Example:<\/strong> MSMEs supplying to government PSUs often face delays of 3\u20136 months, disrupting working capital cycles.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Initiatives to Boost MSMEs\u00a0<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Udyam Registration Portal:<\/strong> A simplified online portal for MSME registration, providing them with a unique identification number and facilitating access to various government schemes.<\/li>\n\n\n\n<li><strong>Public Procurement Policy for MSEs<\/strong>: Mandates that a certain percentage of procurement by government ministries and PSUs must be sourced from MSEs.<\/li>\n\n\n\n<li><strong>Entrepreneurship and Skill Development Programme (ESDP)<\/strong>: Conducts various training programs to promote entrepreneurship and develop skills relevant to MSMEs.<\/li>\n\n\n\n<li><strong>Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE):<\/strong> Provides collateral-free loans up to \u20b95 crore to MSMEs. The guarantee coverage varies based on the loan amount and category of the borrower.<\/li>\n\n\n\n<li><strong>Pradh<\/strong><strong>an Mantri Mudra Yojana (PMMY):<\/strong><strong> <\/strong>Offers loans up to \u20b910 lakh to non-corporate, non-farm small and micro-enterprises. These loans are categorized as &#8216;Shishu&#8217; (up to \u20b950,000), &#8216;Kishore&#8217; (above \u20b950,000 and up to \u20b95 lakh), &#8216;Tarun&#8217; (above \u20b95 lakh and up to \u20b910 lakh) and \u2018Tarun Plus\u2019 ( between 10 lakh to 20 lakh).<\/li>\n\n\n\n<li><strong>Scheme of Fund for Regeneration of Traditional Industries (SFURTI): <\/strong>Organizes traditional artisans into clusters to make them more competitive and provide sustainable employment.<\/li>\n\n\n\n<li><strong>PM Vishwakarma:<\/strong> Provides comprehensive support to artisans and craftspeople, focusing on skill development, toolkits, credit access, and market linkage.<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: TH<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The government has notified significant revisions to the turnover and investment criteria for classifying Micro, Small, and Medium Enterprises (MSMEs), which will come into effect from April 1.<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-39801","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/39801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=39801"}],"version-history":[{"count":1,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/39801\/revisions"}],"predecessor-version":[{"id":39803,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/39801\/revisions\/39803"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=39801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=39801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=39801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}