The MSME sector hopes for enhanced availability of credit, increased funding channels. The MSME sector constituted around 29.15 per cent of the country’s GDP in 2021-22. The sector stressed on the need for a balanced banking relationship.
In the fiscal year 2023-24, up to September 2023, the Ministry of Micro, Small and Medium Enterprises reported that the share of exports from products specified for MSMEs constituted 45.56 per cent of the country’s total exports, showing an increase from 43.59 per cent in 2022-23.
Stakeholders have been expecting for a customised package that can improve access to institutional credit at competitive rates. The need is in line with India’s goal of achieving a $5 lakh crore economy, which would ultimately strengthen the sector’s role.
The budget should prioritise financial inclusion and ease of doing business, fostering a conducive environment for growth. Measures such as simplified regulatory procedures and reduced compliance burdens can empower startups and MSMEs, promoting a more agile and competitive landscape.
It was pointed out that in alignment with the digital era, investments in digital infrastructure, cybersecurity, and skill development are essential for the sustainable growth of startups and MSMEs. A comprehensive budget addressing these expectations will not only fortify their financial foundations but also propel these sectors to play a more significant role in driving economic recovery and job creation.
For the sector to reach its fullest potential and increase its contribution to the Indian economy greater availability of institutional credit is the need of the hour. In the upcoming interim budget Industry experts are hoping for incentivised lending rates, credit guarantee schemes, and increased funding channels to enhance financial resilience for the MSME sector.
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