Lok Sabha Question No. 298 (STARRED), answered on 2025-03-20
Subject: Challenges Faced by MSMEs
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri  Chhotelal, Adv. Chandra Shekhar

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA STARRED QUESTION NO. *298 TO BE ANSWERED ON 20.03.2025

## CHALLENGES FACED BY MSMEs

*298.

SHRI CHHOTELAL: ADV. CHANDRA SHEKHAR:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether  it  is  a  fact  that  the  Medium,  Small  and  Micro  Enterprises  (MSMEs)  are  facing challenges  including  issues  such  as  formalization  and  inclusion,  limited  access  to  finance,  markets, technology and digitalization, infrastructural bottlenecks and skilling; and
- (b) if  so,  the  initiatives/measures  being  taken  by  the  Government  to  remove  these  bottlenecks, strengthen MSMEs and enhance their competitiveness?

## ANSWER

## MINISTER OF MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI JITAN RAM MANJHI)

- (a) and (b): A statement is laid on the Table of the House.

## STATEMENT REFERRED TO IN REPLY TO PARTS (a) AND (b) OF THE LOK SABHA STARRED QUESTION NO. *298 FOR ANSWER ON 20.03.2025.

- (a): A  revised  definition,  based  on  the  twin  criteria  of  investment  and  turnover,  was  adopted  on 01.07.2020 to define Micro, Small and Medium Enterprises (MSMEs) and Udyam Registration Portal (URP) was launched for registration of MSMEs. To bring Informal Micro Enterprises (IMEs) under the formal ambit of MSMEs, Udyam Assist Platform (UAP) was launched on 11.01.2023. The year-wise details of registered MSMEs are given below:

| Year-wise details of Registered MSMEs on URP and UAP in the Country   | Year-wise details of Registered MSMEs on URP and UAP in the Country   | Year-wise details of Registered MSMEs on URP and UAP in the Country   | Year-wise details of Registered MSMEs on URP and UAP in the Country   | Year-wise details of Registered MSMEs on URP and UAP in the Country   | Year-wise details of Registered MSMEs on URP and UAP in the Country   |
|-----------------------------------------------------------------------|-----------------------------------------------------------------------|-----------------------------------------------------------------------|-----------------------------------------------------------------------|-----------------------------------------------------------------------|-----------------------------------------------------------------------|
| Financial Year                                                        | As on 31.03.2021                                                      | As on 31.03.2022                                                      | As on 31.03.2023                                                      | As on 31.03.2024                                                      | As on 15.03.2025                                                      |
| All India                                                             | 28,29,746                                                             | 79,52,575                                                             | 1,64,99727                                                            | 4,13,93,255                                                           | 6,13,37,576                                                           |

Once an enterprise is formalized, it becomes eligible to avail the benefits of various schemes, subject to meeting the eligibility criteria, as per the guidelines. Under various schemes and measures of the Government, there are provisions for special incentives to ensure inclusiveness. For example, under Credit Guarantee Scheme (CGS) for Micro and Small Enterprises (MSEs), collateral free loan up to a limit  of  Rs.  500  lakh  (w.e.f.  01.04.2023)  to  MSEs  with  guarantee  coverage  up  to  90  %  for  various categories  of  loan  is  provided.  The  details  of  the  number  of  guarantees  provided  and  the  amount  of guarantees approved for Micro and Small Enterprises, are given below:

| Duration                                    | 2000-01 to 2019-2020   | 2020-2021 to 2024-2025   |
|---------------------------------------------|------------------------|--------------------------|
| Number of Guarantees Approved               | 43,53,591              | 64,81,482                |
| Amount of Guarantees Approved (In Rs crore) | 2,28,704               | 6,55,987                 |

- (b): To support and strengthen the MSMEs Sector, the Government implements various measures, which,  inter-alia,  include  measures  for  formalization  of  enterprises,  measures  to  provide  access  to financial support, marketing support, technological support, infrastructure, skilling, etc.
- (i)   For providing ease of access to finance, in addition to CGS, Schemes, such as, Prime Minister's Employment Generation Programme (PMEGP) for setting up of new micro enterprises in the non-farm sector by providing Margin Money subsidy on the Bank loan, Special Credit Linked Capital  Subsidy  Scheme  with  a  provision  of  25%  subsidy  to  SC/ST  MSEs  on  institutional finance for procurement of Plant & Machinery/Equipment, PM Vishwakarma Yojana, Pradhan Mantri Mudra Yojana, etc., are implemented. The details of the units assisted under PMEGP are, as given below:

| Details of the Units assisted under PMEGP from FY 2014-15 till FY 2023-24   | Details of the Units assisted under PMEGP from FY 2014-15 till FY 2023-24   | Details of the Units assisted under PMEGP from FY 2014-15 till FY 2023-24   | Details of the Units assisted under PMEGP from FY 2014-15 till FY 2023-24   |
|-----------------------------------------------------------------------------|-----------------------------------------------------------------------------|-----------------------------------------------------------------------------|-----------------------------------------------------------------------------|
| Number of Units Assisted                                                    | Sanctioned Loan Amount                                                      | Margin Money (MM) Subsidy                                                   | Employment Opportunities Generated                                          |
| 6.86 Lakhs (Micro Enterprises)                                              | Rs. 53,296 Crores                                                           | Rs. 19,739 Crores                                                           | 54 Lakhs                                                                    |

- (ii)  Public  Procurement  Policy  for  Micro  and  Small  Enterprises  Order  2012  provides  an  assured market  share  to  Micro  and  Small  Enterprises  (MSEs).  Procurement  and  Marketing  Support Scheme  (PMSS)  extends  benefits  to  MSEs  for  market  access  through  participation  in  Trade Fairs/ Exhibitions, Vendor Development Programmes, adoption of Modern Packaging Technique,  e-Commerce  platforms,  etc.  The  number  of  Enterprises  benefitted  under  various components of PMSS are as follows:
- (iii) The network of Technology Centres / Tool Rooms in the country supports MSMEs in providing access  to  advance  manufacturing  technologies,  training  &  skilling  and  business  consultancy services to make them competitive. ZED 2.0 Scheme has been launched for improved efficacy of certification levels and for enhancing quality and competitiveness. To digitally empower MSEs, the Trade Enablement and Marketing Scheme has been launched.
- (iv) The Government implements Micro and Small Enterprises Cluster Development Programme to enhance  the  productivity  and  competitiveness  of  MSEs  by  extending  financial  assistance  to establish  Common  Facility  Centres  (CFCs)  in  the  existing  clusters  and  establish/up-grade infrastructural facilities in new/existing industrial estates/areas/flatted factory complexes.
- (v)  Entrepreneurship and Skill Development Programme promotes new enterprises, build capacity of existing MSMEs and inculcate entrepreneurial culture in the country.

| Financial Year   | No. of Enterprises benefitted   |   Expenditure (Rs. in Crore) |
|------------------|---------------------------------|------------------------------|
| 2020-21          | 3,276                           |                        12.48 |
| 2021-22          | 2,332                           |                         5.17 |
| 2022-23          | 22,998                          |                        27.49 |
| 2023-24          | Around 35,000                   |                        68.69 |

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