MSME Outlook: The Way Forward
As the economy revival path unfolds, the MSME sector will be one of the key pillars to ensure that recovery is inclusive and sustainable. The dynamics of the MSME sector have changed for the better during the last year. Going forward, key driving forces for MSME sector will be:
Ease of doing business for MSMEs
With GST having completed 4 years, linking of the sectoral definition with turnover will ensure easy identification, streamlining and last-mile delivery of benefits. Further, registrations on the Udyam portal will enable data-backed policy decision.
Tech adoption
COVID pandemic has pushed companies into adopting tech platforms to access markets, bypassing geographical barriers. Going ahead, as the digital space grows, technology will enable MSMEs to be global players in the true sense.
Fintech lending
With their capacity to dispense credit quickly and conveniently, fintech lending has the potential to transform the MSME lending landscape by delivering credit to last mile. The fintech space, though at a nascent stage, impetus of the Government and the regulators will provide it sustainable growth.
PLI schemes
The Government announced an outlay of ₹1.97 lakh crore for PLI Schemes in 13 key sectors, for creating national manufacturing champions and generating employment opportunities. PLI schemes will be a cornerstone to boost domestic manufacturing and will provide market opportunities to MSMEs.
Structural reforms have set the pace for MSMEs’ journey towards unlocking their full potential and contributing to the vision of a US$ 5-trillion economy. Union Budget, 2021-22 has provided much-needed growth stimuli for the sector, and the Atmanirbhar Bharat package has truly taken forward the long-term growth sustainability and profitability of MSMEs.
