Clarification on Establishment of MSMEs

Last updated: 07 August 2021

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The Ministry of MSME has clarified that the government does not establish Micro, Small, and Medium Enterprises (MSMEs) in India. Instead, these are private ventures funded by entrepreneurs. While the promotion and development of MSMEs fall under the purview of State Governments, the Central Government actively supports these businesses through various schemes and policy initiatives to boost their competitiveness.

The Micro, Small and Medium Enterprises (MSME) sector consists of private players and investments in this sector are made by the entrepreneurs themselves. The Ministry of MSME does not establish micro, small and medium enterprises in the country. Promotion and development of enterprises is a State subject. However, the Central Government supplements the efforts of the State/UT Governments through various schemes, programmes and policy initiatives for promotion, development and enhancing the competitiveness of MSMEs in the country.

MSMEs can avail the benefits of schemes being implemented by the Government such as Prime Minister's Employment Generation Programme (PMEGP), Rural Employment Generation Programme (REGP), Micro Units Development & Refinance Agency (MUDRA), Credit Linked Capital Subsidy for Technology Upgradation Scheme (CLCS-TUS), Scheme for Khadi, Village and Coir Industries, International Cooperation Scheme, Procurement and Marketing Support Scheme, Scheme for Credit Guarantee Fund for Micro and Small Enterprises, etc.

MSME Clarification: Government Does Not Establish Businesses

This information was given by Union Minister for Micro, Small and Medium Enterprises, Shri Narayan Rane in a written reply in Lok Sabha today.

FAQ :

No, the Ministry of MSME does not establish micro, small, and medium enterprises. These are private sector businesses with investments made by entrepreneurs.

The promotion and development of enterprises is a State subject, meaning it is primarily the responsibility of the State Governments.

The Central Government supplements the efforts of State/UT Governments by implementing various schemes, programmes, and policy initiatives aimed at promoting, developing, and enhancing the competitiveness of MSMEs.

MSMEs can benefit from schemes such as the Prime Minister's Employment Generation Programme (PMEGP), MUDRA, and the Credit Linked Capital Subsidy for Technology Upgradation Scheme (CLCS-TUS), among others.

This information was provided by Union Minister for Micro, Small and Medium Enterprises, Shri Narayan Rane, in a written reply in the Lok Sabha.

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