MSME Day 27th June 2024: World MSME Day is celebrated annually on June 27, designated by the United Nations General Assembly and dedicated to recognizing the critical role that MSMEs play in fostering inclusive and sustainable economic development in India and globally.
To be sure, MSMEs have been the backbone of many economies, especially developing countries, contributing significantly to employment generation, poverty reduction, and economic growth. MSMEs operate across various sectors, including manufacturing, services, agriculture, and trade, driving innovation, entrepreneurship, and local development.
The observance of World MSME Day highlights the substantial contributions of MSMEs to the global economy and acts as a platform to raise awareness about the challenges faced by MSMEs. This includes access to finance, technology, skills development, and market opportunities.
According to the United Nations Conference on Trade and Development, formal and informal MSMEs make up over 90 per cent of all companies worldwide, average of 70 per cent of total employment and 50 per cent of GDP.
Despite their significance, MSMEs continue to face challenges, primarily around access to finance. As per the International Finance Corporation (IFC) reports that around 65 million firms, or 40 per cent of formal MSMEs in developing countries, have an unmet financing need of $5.2 trillion annually. This gap is equivalent to 1.4 times the current level of global MSME lending.
Moreover, regional disparities in access to finance also exist. East Asia and the Pacific account for the largest share (46 per cent) of the total global finance gap, followed by Latin America and the Caribbean (23 per cent), and Europe and Central Asia (15 per cent). The financing gap is even more pronounced when considering micro and informal enterprises.
“The gap volume varies considerably by region,” according to the IFC. “Latin America and the Caribbean and the Middle East and North Africa have the highest proportion of the finance gap compared to potential demand, measured at 87 per cent and 88 per cent, respectively. About half of the formal SMEs lack access to formal credit.”
India is home to approximately 63 million MSMEs, as reported by the MSME Ministry’s FY23 annual report. This number is second only to China’s approximately 140 million micro and small enterprises. Indian MSMEs contribute about 30 per cent to the GDP, over 40 per cent to exports, and have created 110 million jobs.
Currently, as per details available on the government Udyam registration portal, 46 million MSMEs were registered with the MSME Ministry and reported 200 million jobs.
In addition to World MSME Day, India also observes National Small Industry Day annually on August 30. This day celebrates the contribution of the small-scale industry to the country’s growth. The Indian government launched an extensive policy package for small industry on August 30, 2000, and since then, National Small Industry Day has been observed to recognize the efforts and achievements of small industries in India.
