Indian government is confident that ‘Make in India’ policy will be a game changer for MSME sector as it will create a great synergy between Indian MSMEs and MNCs. ‘Make in India’ campaign is likely to get Indian companies as well as global firms to invest and partner in the manufacturing sector is a well drawn out concept and is the most relevant for India’s MSMEs.
‘Make in India’ campaign can attract the foreign MNCs to bring in their investment, set up venture/angel funds to take advantage of the inherent depth of the MSME Sector in terms of range of products and services, marketing networks and the ability to grow fast.
Another advantage in Indian MSME Sector the foreign partners would experience is that production process in this sector is already underway. The various networks required for undertaking the production process are already established.
The foreign MNC is just required to bring in investment and technical know-how to achieve excellence in these areas. The MSME sector in India is diverse in terms of its size, levels of technology employed and range of products and services produced. The products in this segment range from auto components, micro-processors, electronic components to electro-medical devices.
MSMEs have shown constant growth rate of over 10 percent in recent years much ahead of the large-scale corporate sector. This sector contributes 8 percent of the country’s GDP, 45 percent of the manufactured output and 40 percent of its exports. The MSMEs provide employment to over 80 million persons through over 36 million enterprises producing over six thousand products.
India is one amongst very few countries which has a legal framework for the MSME Sector in the form of MSMED Act 2006 which has established provisions under which issues like public procurement and delayed payments are addressed.