Skip to main content

MSME definition, function and role, different schemes/policies


MSME Definition:
The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006.
Micro, Small and Medium enterprises were defined based on the investment level.
Category
Manufacturing Industries
Service Industries
Micro
Less than 25 lakh
Less than 10 lakh
Small
25 L to 5 crore
10L to 2 Crore
Medium
5 crore to 10 crore
2 crore to 5 crore

Functional contributions of MSME
1. Creates large scale employment:
Since the enterprises falling in this sector require low capital to start the business, it creates huge employment opportunities for many unemployed youth. India produces about 1.2 million graduates per year. And, there is no economy in the world that can provide jobs to so many fresh graduates in one year. MSME is the boon for many of these fresh manpower.
2. Economic stability in terms of Growth and Exports:
MSME is a significant growth driver in India, with it contributing to the tune of 8% to GDP. As mentioned in the table, Exports sector in India constitutes about 40% of contribution from MSME alone. Looking at the kind of contribution of MSME to manufacturing, exports and employment, other sectors are also benefitting from MSME.
3. Encourages Inclusive Growth:
Inclusive growth is on top of the agenda of Ministry for Medium, and Small, and Medium sized enterprises for several years. While poverty and deprivation are a deterrent to the development of India, including marginalized sections of society is a key challenge lying before the Ministry of MSME.
4. Cheap Labor and minimum expenses:
In large scale organizations, one of the key challenges is to retain the human resource through an effective human resource management professional manager. But in case of an MSME, the requirement of labor is less, and it does not need a highly skilled laborer. Hence, the indirect expenses incurred by the owner is also low.
5. Simple Management Structure for Enterprises:
MSMEs do not require a huge capital to start. With limited resources available within the control of the owner, decision-making becomes easy and efficient. As in case of a large corporation wherein a specialist is required for every departmental functioning because of complex organizational structure, a small enterprise does not need to hire an external specialist for its management. The owner himself/herself can manage it. Therefore, it can be run single-handedly.
6. Plays an important role in making “Make in India” possible:
Post the inception of ‘Make in India’, a signature initiative by the prime minister of India, the process of incorporating a new business has been made easy. Since the MSME is the backbone in making this dream a possibility, the government has directed the financial institution to lend more credit to enterprises in MSME sector.

Different Schemes/Policy Benefit to the Needy People (write any 15)
  • ·         Prime minister employment generation programme(pmegp)
  • ·         Performance and credit rating scheme
  • ·         Credit guarantee trust fund for micro & small enterprises (cgtmse)
  • ·         Interest subsidy eligibility certificate (isec)
  • ·         Development of khadi, village and coir industries
  • ·         Science and technology scheme
  • ·         Market promotion & development scheme (mpda)
  • ·         Revamped scheme of fund for regeneration of traditional industries (sfurti)
  • ·         Coir vikas yojana (cvy)
  • ·         Coir industry technology upgradation scheme (citus)
  • ·         Science and technology (s&t) for coir
  • ·         Skill upgradation & mahila coir yojana (mcy)
  • ·         Export market promotion (emp)
  • ·         Domestic market promotion scheme (dmp)
  • ·         Trade and industry related functional support services (tirfss)
  • ·         Welfare measures (pradhan mantri suraksha bima yojana (pmsby))
  • ·         Technology upgradation and quality certification
  • ·         Financial support to msmes in zed certification scheme
  • ·         A scheme for promoting innovation, rural industry & entrepreneurship (aspire)
  • ·         National manufacturing competitiveness programme (nmcp)
  • ·         Credit linked capital subsidy for technology upgradation
  • ·      ISO 9000/iso 14001 certification reimbursement
  •      Marketing support/assistance to msmes (bar code)
  • ·         Lean manufacturing competitiveness for msmes
  • ·         Design clinic for design expertise to msmes
  • ·         Technology and quality upgradation support to msmes
  • ·         Entrepreneurial and managerial development of smes through incubators
  • ·         Enabling manufacturing sector to be competitive through qms&qtt
  • ·         Building awareness on intellectual property rights (ipr)
  • ·         Marketing promotion schemes
  • ·         International cooperation
  • ·         Marketing assistance scheme
  • ·         Marketing assistance & technology upgradation (matu)
  • ·         Entrepreneurship and skill development programme
  • ·         Assistance to training institutions (ati)
  • ·         Infrastructure development programme
  • ·         Micro & small enterprises cluster development (mse-cdp)

·

Comments

Post a Comment

Popular posts from this blog

FACTORS & POTENTIAL ISSUES IN ERP SOFTWARE

Factors to be considered when choosing ERP software 1.       Upgrade vs. replacement.  Evaluate first if you need to get a new ERP system or just an upgrade. Many ERP solutions today are modularized; you can simply integrate a module, for instance payroll, with your current applications. This way you minimize disruption and costs. But if your ERP system is ten years or older, it may be wise to replace it. You can leverage today’s ERP solutions for mobility, integration, scalability and deployment options. Similarly, machine learning, predictive analysis and advanced reporting are pushing ERP to the next level. 2.       Customization.  Aside from ensuring the ERP processes match your key business workflows, look closely at your departments. They may have different priorities and culture, which may even be contradictory. For example, Marketing spends, while Accounting saves or Production lives by daily output, while ...
100 comments
Read more

Different Institutional Setups (SIDCO, SIPCOT, SISis)

Different Institutional Setups SIPCOT - State Industries Promotion Corporation of Tamil Nadu Limited Objectives SIPCOT has rendered fruitful services to the state by identifying, developing, maintaining industrial areas in backward and most backward talukas of the State, which had potential to grow. Establish, develop, maintain and manage industrial complexes, parks and growth centres at various places across the State of Tamil Nadu. SIPCOT's role in assisting the industrialization in the State is not only quantitative but also qualitative. To ensure a good impact with the available limited resources, SIPCOT has created Industrial Complexes and Parks, strategically located in Nineteen places and Twelve Districts, which occupy a place of pride in the State's industrial map. Functions of SIPCOT The Functions of State Industries Promotion Corporation of Tamil Nadu Limited (SIPCOT) are ] Development of industrial complexes/parks/industrial e...
7 comments
Read more

Three Phases of E CRM (E - Business) Unit III

E Business CRM Customer Relationship Management  ( CRM ) is a relationships and interactions with your customers and potential customers. It helps you improve your sales and profitability . The Three Phases of CRM Customer relationship management plays an integral part in a typical company's marketing system CRM is a process of gathering and analyzing customer data, building precise marketing campaigns and managing relationships for optimized retention. 1. Customer Acquisition Acquiring customers has always been the first important step in establishing business relationships. With CRM,  advanced software databases are used to capture key customer data  at the point of first contact. It includes customers’ name, address, phone number, email address and sometimes social media accounts. Entering this data into a computer enables future and ongoing communication access. The other major benefit of starting a formal relationship with new prospects and clien...
15 comments
Read more