Abstract -- In most of the developing countries, MSMEs constitute the bulk of industrial base and contributes to the significance of GDP. For instance, India has approximately 30 million MSME units and 12 million people are expected to join the work force in the next 3 years. So MSMEs are the largest contributing factor for economic development, creating employment opportunities, export promotions generating FDIs and reducing regional imbalance in the country. MSMEs are the largest absorber of excess labourer working in agricultural sector, even though, it is the largest contributor for the economic development. It has several problems such as land acquiring, infrastructural development problems like power, logistics, capital formation etc. So MSMEs and SEZs go together like water-tight compartment.
markets. SME’s Contribution towards GDP in 2011 was 17% which is expected to increase to 22% by 2012. There are approximately 30 million MSME Units in India and 12 million persons are expected to join the workforce in the next 3 years. MSMEs are the fountain head of several innovations in manufacturing and service sectors, the major link in the supply chain to corporate and the PSUs. By promoting MSMEs, the rural areas of India will be developed. MSMEs are now exposed to greater opportunities than ever for expansion and diversification across the sectors. Indian market is growing very rapidly and Indian entrepreneurs are making remarkable progress in various Industries like Manufacturing, Precision Engineering Design, Food Processing, Pharmaceutical, Textile & Garments, Retail, IT and ITES, Agro and Service sector. The historical definition of small-scale has now been overtaken by the Micro, Small and Medium Enterprises (MSMEs) Development Act of 2006. Depending on whether it is a manufacturing or a non-manufacturing enterprise, we have different levels of investment in plant and machinery for classification as micro small or medium enterprises. MSME ministry's annual report will tell you that 45% of manufacturing output and 40% of total exports come from MSME.
Index Terms — Economic development, FDI, GDP and
orldwide, micro small and medium enterprises
(MSMEs) have been accepted as the engine of economic growth and for promoting equitable development. MSMEs constitute over 90% of total enterprises in most of the economies and are credited with generating the highest rates of employment growth ratio and major share of industrial production and exports. In India too, the MSMEs play a pivotal role in the overall industrial economy of the country. MSMEs in India account for more than 80% of the total number of industrial enterprises and produce over 8000 different types of products. It is estimated that in terms of value, the sector accounts for 45% of the manufacturing output and 40% of the total export of the country. Further, in recent years the MSME sector has consistently registered higher growth rate compared to the overall industrial sector. The major advantage of the sector is employment potential at low capital cost. As per available statistics, this sector employs an estimated of 6 crore persons spread over 2.6 crore enterprises and the labour intensity in the MSME sector is estimated to be almost 4 times higher than the large enterprises. Small and Medium Enterprises (SMEs) play a vital role for the growth of Indian economy by contributing 45% of industrial output, 40% of exports, employing 60 million people, create 1.3 million jobs every year and produce more than 8000 quality products for the Indian and international
MEDIUM AND DEVELOPMENT ACT, 2006:
Micro, Medium and Medium Enterprises Development Act, 2006 is a legal frame work for...