India's MSME Sector Performance and Government Initiatives

India's Micro, Small, and Medium Enterprises (MSME) sector continues to demonstrate significant economic impact, contributing approximately 31.1% to GDP, 35.4% to manufacturing output, and 48.58% to exports as of January 2026. The sector employs more than 38.9 crore people, making it the second-largest source of employment after agriculture. The government revised the MSME definition effective 1 April 2025 based on investment and annual turnover parameters to provide enterprises greater expansion room while maintaining policy support benefits.

Formalization and Digital Transformation

Registrations under the Udyam Registration Portal and Udyam Assist Platform crossed 8.7 crore as of June 2026, significantly expanding the formal enterprise base. The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) completed 25 years of operation, approving 29.03 lakh guarantees amounting to ₹3.77 lakh crore during January to November 2025. The guarantee coverage ceiling was enhanced from ₹5 crore to ₹10 crore to enable larger collateral-free support for MSMEs.

Sector-Specific Performance

Khadi and Village Industries achieved sales of ₹1.27 lakh crore during 2025-26, while the coir sector witnessed exports reaching ₹6,614.40 crore in the same period. The MSME Samadhaan Portal received 2,56,892 applications involving delayed payment claims worth ₹55,244.29 crore as of June 2026, with 58,148 cases successfully disposed by MSE Facilitation Councils. The CHAMPIONS Portal received 39,494 grievances during 2025-26, resolving 39,387 at a 99.72% disposal rate.

Public Procurement and Market Access

Through the MSME Sambandh Portal, 118 Central Public Sector Enterprises procured goods and services worth ₹31,443.32 crore during FY 2026-27, with 54.51% sourced from MSEs benefiting 29,769 enterprises. At the 44th India International Trade Fair 2025, MSME, KVIC, NSSH, and Coir Pavilions showcased under the "Vibrant MSMEs, Viksit Bharat" theme, receiving the Silver Medal in the 'Empowering India' category. A total of 292 stalls were allotted to MSMEs and Vishwakarmas from 29 States and UTs, with over 67% allotted to women entrepreneurs and 34% to SC/ST entrepreneurs.

Key Government Schemes and Impact

The PM Vishwakarma scheme achieved its 30 lakh beneficiary registration target within two years instead of four, with over 24 lakh beneficiaries completing basic skill training. The scheme sanctioned ₹5,133 crore to 5.98 lakh beneficiaries as collateral-free loans at concessional rates, while 7.91 lakh beneficiaries were digitally enabled.

The Prime Minister's Employment Generation Programme (PMEGP) supported over 10.84 lakh micro-enterprises since inception with ₹29,623 crore in margin money subsidies, generating employment for more than 97 lakh people as of May 2026. Applications are now available in 19 regional languages excluding English and Hindi.

The MSME Champions Scheme showed significant progress across its three pillars: MSME Innovative approved 833 Host Institutes for incubation, 21 MoUs for design, and supported 191 Patents, 807 Trademarks, 99 Designs, and 06 GI registrations through IPFCs. Under MSME Sustainable (ZED), over 93.61 lakh MSMEs registered with 6.68 lakh enterprises certified as of May 2026. The MSME Competitive (LEAN) scheme registered 65,647 MSMEs with 18,961 enterprises certified.

The Self-Reliant India (SRI) Fund assisted 761 MSMEs with investments worth ₹2,851 crore as of May 2026, with Budget 2026-27 providing an additional ₹2,000 crore to augment the fund. The National SC-ST Hub supported 19,000+ SC/ST entrepreneurs from January to October 2025, organizing 111 Special Vendor Development Programmes and 3 major conclaves. Public procurement from SC/ST-owned MSEs increased from ₹99 crore in 2015-16 to over ₹3,731 crore in 2024-25, accounting for 1.93% of total public procurement as of December 2025.

Cluster Development and Traditional Industries

The Micro and Small Enterprises Cluster Development Programme approved 612 projects as of June 2026, with 364 projects completed providing Common Facility Centres and upgraded infrastructure. During 2025-26, 11 projects with total cost of ₹253.23 crore were approved with 2 completed. The SFURTI scheme established 513 clusters benefiting 3.03 lakh traditional artisans, with 376 clusters functional as of June 2026 and 18 new clusters becoming operational in 2023-24 benefiting 11,810 artisans.

The RAMP Scheme, supported by the World Bank, approved 398 proposals worth ₹3,211.75 crore from all 36 States and UTs, impacting over 55 lakh MSMEs across the country. The Technology Centre network includes 18 operational centres with 20 new Technology Centres and 100 Extension Centres being developed. As of November 2025, 25 Extension Centres are operational, having trained 53,963 youth and supported 1,357 MSMEs, while 9 new centres under TCSP trained 59,357 individuals and assisted 1,520 MSMEs.