MSME Sector Is Backbone of India’s Manufacturing, Industrial Growth: PM

New Delhi, Mar 04: Prime Minister Narendra Modi today addressed the Post- Budget webinars via video conferencing. The webinars were held on MSME as an Engine of Growth; Manufacturing, Exports and Nuclear Energy Missions; Regulatory, Investment and Ease of doing business Reforms. Addressing the gathering on the occasion, he remarked that the post-budget webinars on manufacturing and export are of great importance. Mentioning that this budget is the first full budget of the Government’s third term, he emphasised that the most notable aspect of this budget is its delivery, which exceeded expectations. Shri Modi pointed out that in several sectors, the Government has taken steps beyond what experts had anticipated. He also highlighted that significant decisions have been made regarding manufacturing and export in this budget. 

Pointing out that the country has witnessed consistent Government policies for over a decade, the Prime Minister highlighted that in the past 10 years, India had shown a commitment to reforms, financial discipline, transparency, and inclusive growth. He emphasized that the assurance of consistency and reforms has brought new confidence within the industry. He assured every stakeholder in manufacturing and export that this consistency will continue in the coming years. Encouraging stakeholders to take bold steps and open new avenues for manufacturing and export for the country, Shri Modi highlighted that every country in the world wants to strengthen its economic partnership with India. He urged the manufacturing sector to take full advantage of this partnership.

“Stable policy and a better business environment are crucial for the development of any country”, said the Prime Minister, highlighting that a few years ago, the Government introduced the Jan Vishwas Act and made efforts to reduce compliances. Over 40,000 compliances were eliminated at both central and state levels, promoting ease of doing business, he noted. 

Emphasizing that this exercise should continue, Modi mentioned that the Government had introduced simplified income tax provisions and is working on the Jan Vishwas 2.0 Bill. A committee has been formed to review regulations in the non-financial sector, aiming to make them modern, flexible, people-friendly, and trust-based, he added further and highlighted the significant role of the industry in this exercise. He encouraged stakeholders to identify problems that take longer to resolve, suggest ways to simplify processes, and guide where technology can be used to achieve quicker and better results.

“The world is currently experiencing political uncertainty, and the entire world views India as a growth center”, said Shri Modi, highlighting that during the COVID crisis, when the global economy slowed down, India accelerated global growth. He added that this was achieved by advancing the vision of Aatmanirbhar Bharat and accelerating reforms. He emphasized that these efforts minimized the impact of COVID on the economy, helping India become one of the fastest-growing economies. He said, “India remains a growth engine for the global economy and has proven its resilience in challenging situations”. Pointing out that disruptions in the supply chain affect the global economy, and the world needs reliable partners that produce high-quality products and ensure reliable supply, Modi emphasized that India was capable of fulfilling this need, presenting a significant opportunity for the country. He urged the industry not to be mere spectators but to actively seek their role and carve out opportunities. He pointed out that it is easier today compared to the past, as the country has friendly policies and the Government stands shoulder to shoulder with the industry. The Prime Minister called for a strong resolve, objectivity in seeking opportunities in the global supply chain, and accepting challenges. 

He emphasized that if every industry takes one step forward, collectively, they can achieve significant progress.

Highlighting that 14 sectors were currently benefiting from the PLI scheme, the Prime Minister said that under the scheme, more than 750 units have been approved, resulting in an investment of over ₹1.5 lakh crore, production worth over ₹13 lakh crore, and exports exceeding ₹5 lakh crore. He emphasized that this demonstrates how entrepreneurs can advance in new areas when given opportunities. Shri Modi announced the decision to launch two missions to promote manufacturing and export. He highlighted the focus on better technology and quality products, as well as the emphasis on skilling to reduce costs. He urged all stakeholders to identify new products in demand globally that can be manufactured in India and encouraged them to approach countries with export potential strategically.

“R&D has played a crucial role in India’s manufacturing journey and needs further advancement and acceleration”, remarked the Prime Minister. He highlighted that through R&D, the focus can be on innovative products and value addition to existing products. He emphasized that the world recognizes the potential of India’s toy, footwear, and leather industries and by combining traditional crafts with modern technologies, significant success can be achieved. He noted that India can become global champion in these sectors, leading to a substantial increase in exports. 

Modi highlighted that this growth will create lakhs of job opportunities in labor-intensive sectors and promote entrepreneurship. Mentioning that the PM Vishwakarma Yojana provides end-to-end support to traditional artisans, he urged efforts to connect these artisans with new opportunities and called on all stakeholders to come forward to expand the hidden potential in these sectors.

“MSME sector is the backbone of India’s manufacturing and industrial growth”, said the Prime Minister. He highlighted that in 2020, the Government made a significant decision to revise the definition of MSMEs after 14 years, which eliminated the fear among MSMEs that they would lose government benefits if they grew. He noted that the number of MSMEs in the country has increased to over 6 crore, providing employment opportunities to crores. Shri Modi emphasized that in this budget, the definition of MSMEs has been further expanded to instill confidence in their continuous growth. 

This will create more employment opportunities for the youth, he said, highlighting that the biggest problem faced by MSMEs was the difficulty in obtaining loans. He added that ten years ago, MSMEs received loans worth approximately ₹12 lakh crore, which has now increased to around ₹30 lakh crore. The Prime Minister announced that in this budget, the guarantee cover for MSME loans has been doubled to ₹20 crore. Additionally, customized credit cards with a limit of ₹5 lakh will be provided to meet working capital needs.

Underlining that the Government had facilitated loan access and introduced a new type of loan, Modi highlighted that people are now receiving loans without guarantees, something they never imagined before. Over the past 10 years, schemes like MUDRA, which provide loans without guarantees, have also supported small industries, he said, noting that the Trades portal is resolving many loan-related issues. The Prime Minister emphasized the need to develop new modes of credit delivery, ensuring that every MSME has access to low-cost and timely credit. He announced that five lakh first-time entrepreneurs from women, SC, and ST communities will receive loans of ₹2 crore. He highlighted that first-time entrepreneurs need not only credit support but also guidance and urged the industry to create a mentorship program to help these individuals.

Underscoring the role of states is crucial in boosting investment, Modi emphasized that the more states promote ease of doing business, the more investors they will attract. He pointed out that this will benefit the respective states the most. He encouraged competition among states to see who can make the most of this budget. He noted that states with progressive policies will attract companies to invest in their regions.