How Indian MSME Sector Has Performed In 2023? Let's Take A Look!

MSEMs, or micro, small and medium enterprises, have always been an important pillar of India's GDP. If we look at the data from recent years, MSMEs have significantly contributed to economy in multiple ways such as employement generation, export promotion, regional development, income generation etc. 

However, In 2023, MSMEs are navigating a mixed landscape of challenges and successes. Despite facing a dip in their contribution to the GDP, down to 29 percent in 2021-22 from a pre-pandemic peak, the sector has hit a historic milestone with over 3 crore registrations on the Udyam portal. This surge reflects a growing interest and a promising growth path for MSMEs.

On the export front, MSME product exports reached an impressive $200 billion, but their share in India's total exports dropped to a five-year low of 44 percent. And adding a positive note above all, the number of women-led MSMEs has increased by 37 percent, reaching 1.17 crore, making up 37.13 percent of the total MSMEs registered since the Udyam portal's launch in 2020. 

Let's have a detailed look at how the MSME sector has performed in 2023?

MSMEs Contribution To GDP In 2023 Declines

In the fiscal year 2021-22, the contribution of micro, small, and medium enterprises (MSME) to India's gross domestic product (GDP) stood at 29 percent, marking a decline from the sector's pre-pandemic peak. Data presented in the Parliament reveals that the share of MSMEs in the nation's overall output, measured in terms of gross value added, reached 31 percent in the financial year 2018-19. However, this share experienced a downturn during the pandemic period.

MSME Export: Declining Share Amidst a Global Surge in India's Overall Exports

In the fiscal year 2022-23, MSME product exports reached an impressive $200 billion, yet their proportion in India's total exports dwindled to a five-year low of 44 percent. Notably, MSME products had constituted approximately half of all exports in 2019-20 prior to the onset of the pandemic. However, there has been a discernible decline in their share since then. Interestingly, India's overall exports witnessed a substantial surge, escalating by 44 percent within the same timeframe—from $313 billion in FY20 to surpassing $450 billion in FY23.

More Than 3 Crore MSMEs Registered On Udyam Portal

In a noteworthy development, the MSME sector has marked a historic milestone by surpassing 3 crore registrations. This substantial increase in registrations not only underscores the heightened interest and participation of micro, small, and medium enterprises but also signals a robust growth trajectory for the sector. The surge in registrations suggests an expanding landscape of entrepreneurial ventures and a proactive approach by businesses to formalize their presence. This milestone serves as a testament to the resilience and vitality of the MSME sector, showcasing its pivotal role in contributing to economic growth and fostering a culture of entrepreneurship.

Number Of Women Led MSMEs Increases By 37%

The proportion of MSMEs led by women entrepreneurs within the total MSME registry overseen by the MSME Ministry has experienced a notable increase. As per information shared by Minister of State in the MSME Ministry, Bhanu Pratap Singh Verma, in response to a written query in the Rajya Sabha, the count of women-owned MSMEs recorded on the government's Udyam portal reached 1.17 crore, constituting 37.13 percent of the overall 3.16 crore MSMEs registered since the portal's launch on July 1, 2020, post-Covid.

In contrast, during this year's monsoon session, Verma had apprised the Parliament that the share of women-owned MSMEs among the over 2.10 crore units registered as of August 1, 2023, was 19.43 percent. This registration tally encompassed registrations from the Udyam Assist Platform (UAP) introduced by the government in January of the same year, facilitating the registration of micro-enterprises not subject to Goods and Services Tax for priority sector lending benefits.

The forefront in women-led MSME registrations is held by several states, with West Bengal taking the lead with 18.13 lakh registered units, followed by Maharashtra with 13.38 lakh registered units, Tamil Nadu with 9.90 lakh registrations, Bihar with 8.82 lakh registrations, and others contributing to this positive trend.

Join Our Thriving Entrepreneurial Community

Follow TICE News on Social Media and create a strong community of Talent, Ideas, Capital, and Entrepreneurship. YouTube  | Linkedin | X (Twittrer) | Facebook | News Letters