Role Of Msmes In Manufacturing Sector In Indian Economic Development

Abstract

On June 16, 2006 The Government of India has legislated and enacted the Micro, Small and Medium Enterprises Development (MSMED) Act . After 1999, the concept of SSIs was again revised and renamed as (MSMED) Act, the act was operational from
2ndOctober 2006.In the accordance with the provision of (MSMED) Act 2006, are classified in two classes 1.Manufacturing Enterprises and 2.Service Enterprises. This act seeks to facilitate the development of MSMES and to enhance their competitiveness in
domestic as well as global market. This sector plays a significant role in the Indian economy. A catalyst for socio-economic transformation of the country, the sector is critical in meeting the national objectives of generating employment, reducing poverty,
and discouraging rural-urban migration. Exclusive credit plans for MSMEs entails providing lower rate of interest for growing business units and offering them access to banking service at low rate of interest, quick processing and servicing. The sector through more than 6000 products contributes about 8% to GDP besides 45% to the total manufacturing output and 40% to the exports from the country. The MSMEs sector has a whopping 69% share in the employment ambit, till now this sector has employed over 55 million people across India Covering different manufacturing skills sets and capabilities. MSMEs also play a significant role in Nation development through high contribution to Domestic Production, Significant Export Earnings, Low investment need, Operational Flexibility, Indigenous technology, Import substitution, Contribution towards defense fund thereby generating new entrepreneurs by providing knowledge
and training. Despite their high enthusiasm and inherent capabilities to grow, MSMEs in India are also facing a number of problems technological issues, poor supply chain management, insufficient manpower supply. The aim of the paper is to present the role
of Manufacturing sector of MSMEs makes development in Indian economy and to do a research how manufacturing Enterprises effects the fastest growth of Indian economy.