Role of Manufacturing Startups & MSMEs In India's ‘Viksit Bharat’ Vision

For India to realize its ambition of becoming a developed nation, it must first address a fundamental gap—enhancing its manufacturing standards and uplifting its Micro, Small, and Medium Enterprises (MSMEs). This was the core message delivered by BVR Subrahmanyam, CEO of NITI Aayog, at a recent event organized by the Confederation of Indian Industry (CII) in New Delhi.

The Indian government has set its sights on transforming the country into an economic powerhouse. However, the journey to a ‘Viksit Bharat’ (Developed India) is not just about economic expansion but also about raising the quality, efficiency, and technological prowess of Indian enterprises—especially MSMEs, which form the backbone of the nation’s industrial fabric.

MSMEs: The Pillars of India’s Growth Story

India's MSME sector is the second-largest in the world after China and accounts for about 30% of the country's GDP. It also contributes nearly 50% of exports and employs over 110 million people. Despite these impressive figures, MSMEs continue to face challenges that hinder their scalability and competitiveness.

Subrahmanyam highlighted that while large enterprises often have the resources to overcome regulatory and operational challenges, MSMEs struggle due to their limited access to technology, skilled labor, and international markets. “Medium enterprises of today are the large enterprises of tomorrow. The government must support their transition from micro to small, small to medium, and medium to large enterprises,” he emphasized.

Key Challenges Hindering MSME Growth

India’s MSMEs have immense potential, but several critical challenges limit their ability to compete globally. According to Subrahmanyam, three major roadblocks are:

1. Technology Upgradation: Many MSMEs still rely on outdated manufacturing processes and lack the financial bandwidth to invest in automation and digital tools.

2. Availability of a Skilled Workforce: Despite India’s strong STEM education foundation, there remains a skill gap in sectors crucial to MSME development.

3. Quality Certifications: Many Indian MSMEs struggle to meet international quality standards, preventing them from integrating into the global supply chain.

Without addressing these hurdles, India’s dream of becoming a developed nation will remain just that—a dream.

Dx-EDGE: A Digital Lifeline for MSMEs

Recognizing these challenges, the government is ramping up efforts to digitize and modernize MSMEs. A significant step in this direction is the launch of ‘Digital Excellence for Growth and Enterprise’ (Dx-EDGE)—a new initiative unveiled by Subrahmanyam at the CII event.

Dx-EDGE is designed to equip MSMEs with the necessary digital tools, knowledge, and support system to make them competitive and resilient. The initiative is backed by CII, NITI Frontier Tech Hub (NITI FTH), and the All India Council for Technical Education (AICTE).

The key objectives of Dx-EDGE include:

• Enhancing MSMEs' digital and business capabilities

• Providing affordable access to technology

• Facilitating collaborations between MSMEs, academia, and technology providers

• Integrating MSMEs into the global supply chain

By leveraging digital transformation, Dx-EDGE aims to enable MSMEs to embrace innovation and future-proof their businesses.

The Role of Digital Adoption in MSME Growth

Industry leaders at the event underscored the urgency for digital adoption. SCL Das, Secretary, Ministry of MSMEs, stressed that embracing new technologies is essential for MSMEs to survive global competition. “MSMEs are central to India’s economic expansion, export growth, and climate adaptability. Digitalization is no longer a choice but a necessity,” he noted.

Debjani Ghosh, Distinguished Fellow, NITI Aayog and Chief Architect of NITI FTH, echoed this sentiment, stating, “Future-proofing MSMEs through technology is critical to realizing the vision of Viksit Bharat. Dx-EDGE will enable MSMEs to embrace innovation, strengthen resilience, and thrive in an increasingly digital world.”

Prof. (Dr.) TG Sitharam, Chairman of AICTE, emphasized the need for job creation, especially as millions of young Indians enter the workforce. He pointed out that India’s strong foundation in STEM education can play a pivotal role in bridging the skills gap in MSMEs.

Chandrajit Banerjee, Director General of CII, reinforced the significance of MSMEs in India’s economic framework. He asserted that Dx-EDGE will be instrumental in closing the technology adoption gap in the sector, ensuring that Indian enterprises remain competitive in a rapidly evolving global market.

With the introduction of Dx-EDGE and a renewed focus on regulatory reforms and skill development, India is taking critical steps toward empowering its MSMEs. However, for these efforts to bear fruit, sustained government support, industry participation, and policy implementation will be crucial.

India stands at a defining moment in its economic journey. If the country successfully raises its manufacturing standards, streamlines regulatory processes, and ensures seamless digital adoption among MSMEs, it will not only enhance its industrial competitiveness but also solidify its position as a global manufacturing hub.

The road ahead is challenging, but with the right strategies and sustained efforts, India can turn its ‘Viksit Bharat’ dream into a reality. The success of MSMEs will be the true measure of India’s development journey, and initiatives like Dx-EDGE are a step in the right direction.