MSME Day 2024- Background, Theme and its Definition
Important Day
4 min read
Every year since 2017, 27 June has been observed as Micro Small Medium Enterprise(MSME) Day. The day highlights the contribution of the MSME sector to a country’s economic development and employment generation. According to the United Nations, MSMEs account for 90% of businesses, 60 to 70% of employment, and 50% of Gross Domestic Product worldwide.
Background to the MSME Day
On 6 April 2017, the United Nations General Assembly passed a resolution to observe 27 June as the Micro Small Medium Enterprise(MSME) Day.
The first MSME Day was observed on 27 June 2017.
Theme of the MSME Day
The theme of the 2024 MSME Day is MSMEs and the SDG.
The Sustainable Development Goal (SDG) was adopted by the United Nations General Assembly in 2015. It has identified 17 goals like an end to poverty, protecting the planet and ensuring peace and prosperity for the international community which is to be achieved by 2030.
Definition of MSME in India
The Micro Small and Medium Enterprises Development (MSMED) Act 2006, which came into effect on 2 October 2006, defines the MSME sector in India.
The act initially divided enterprises into the manufacturing and service sectors. However, the government of India amended the MSMED Act 2006 in 2020 and abolished the distinction between the two sectors.
At present, MSMEs are defined on the twin criteria of- investment in plant and machinery and annual turnover (sales).
Classification as per the amended MSMED Act with effect from 1 July 2020.
|
Classification of Enterprises |
Investment limit in Plant and Machinery |
Annual Turnover Limit |
|
Micro Enterprises |
The maximum investment limit is Rs 1 crore |
The annual turnover shall not be more than Rs 5 Crore |
|
Small Enterprises |
More than Rs 1 crore and up to Rs 10 crore |
More than Rs 5 core up to Rs 50 crore. |
|
Medium Enterprises |
More than Rs 10 crore and up to Rs 50 crore. |
More than Rs 50 crore and up to Rs 250 Crore |
MSMEs and the Indian Economy
The MSMEs play a vital role in the Indian economy. According to the government of India, the following are the contributions of the MSMEs.
|
Financial Year 2019-20 |
Financial Year 2020-21 |
Financial Year 2021-22 |
|
|
Share of MSME in Gross Value Addition in Indian GDP |
30.5% |
27.2% |
29.2% |
|
Share of MSME in Manufacturing Output |
36.6%, |
36.9% |
36.2% |
|
Share of MSME in Export |
49.4%, |
45.0% |
43.6% |
Source PIB
