Around 18% of the MSMEs are getting subsidies per year from the government. What about the rest? The data states that 90,000 out of 5 Lakhs MSME applicants get subsidies in a year. The number is less than it should be. A lot of MSMEs are facing this issue. For the financial year 2024-25, a budget of Rs. 22,000 crore is allocated to MSMEs and their development. However, there is still a need for a lot of changes and development in the industry.
How Government Will Increase The MSMEs Growth Rate?
A lot of MSMEs register themselves for subsidies every year. However, only a few get them. The data states that only 90,000 out of 5 Lakh MSME applicants get the subsidies. There can be a lot of reasons behind it. The Union Minister of State MSM, Shobha Karandlaje said that they have submitted the proposal to the Finance Minister that can help increase the subsidies for MSMEs. The budget for the MSMEs also increased in the current financial year focusing more on their growth.
Thus, it will be easy to add more advantages to them in their favour. There are a lot of imports in the country leading to the economy becoming import-oriented. However, PM Modi is focusing on increasing the exports from the country. It will be possible with the help of MSMEs. Thus, he is encouraging the public Sector Undertakings (PSU)to purchase the raw materials from MSMEs rather than importing them. Thus the PSU are also focussing on submitting the memorandum to Prime Minister Narendra Modi for purchasing from MSMEs.
There are a lot of changes going on in the industry. It is encouraging new methods for improving the segment. Things like easy credit facilities from the government and efforts to improve the payment cycle of MSMEs highlight the growth of the sector. The number of MSME applicants getting subsidies per year is currently 18%. It is expected to increase in the future. Subsidies are a crucial thing for the MSME’s growth. It helps them earn a high margin and profitability by getting the raw material at a cheaper cost.
The government is also encouraging domestic manufacturing. It will help in increasing the employment opportunities in the country. A lot of MSMEs are still in the struggling mode expecting betterment and support from the government. We will provide more details about the upcoming changes in the industry. MSMEs are the backbone of the Indian economy and contribute to the majority of the GDP of the country. Stay tuned for more information.