Niti Aayog's Plan to Transform Medium Enterprises
May 26, 2025 14:59
Niti Aayog proposes tailored financial tools, technology integration, and a digital portal to empower medium enterprises and drive India's economic growth.
New Delhi, May 26 (PTI) Niti Aayog on Monday pitched for tailored financial tools, technology integration and a centralised digital portal to transform medium enterprises into future growth engines of India's economy.
In a report titled 'Designing a Policy for Medium Enterprises', the Aayog highlighted the critical yet under-leveraged role played by medium enterprises and outlined targeted interventions to unlock their full potential.
To address challenges faced by medium enterprises, it recommended the introduction of a working capital financing scheme linked to enterprise turnover, a Rs 5 crore credit card facility at market rates and expedited fund disbursal mechanisms through retail banks, overseen by the Ministry of MSME.
The report also suggested the upgradation of existing technology centres into sector-specific and regionally customised India SME 4.0 Competence Centers to promote the adoption of Industry 4.0 solutions.
The Aayog also recommended the establishment of a dedicated R&D cell within the Ministry of MSME, leveraging the Self-Reliant India Fund for cluster-based projects of national significance.
It also called for the development of sector-focused testing and certification facilities to ease compliance and enhance product quality.
The report also suggested the creation of a dedicated sub-portal within the Udyam platform, featuring scheme discovery tools, compliance support, and AI-based assistance to help enterprises navigate resources effectively.
The report emphasised that unlocking the potential of medium enterprises requires a shift toward inclusive policy design and collaborative governance.
With strategic support in finance, technology, infrastructure, skilling, and information access, medium enterprises can emerge as the drivers of innovation, employment, and export growth, it added.
The MSME sector contributes approximately 29 per cent to India's GDP, accounts for 40 per cent of exports, and employs over 60 per cent of the workforce.
Despite its critical role, the composition of the sector is disproportionately weighted -- 97 per cent of registered MSMEs are micro-enterprises, 2.7 per cent are small, and only 0.3 per cent are medium enterprises.
Medium enterprises, though only 0.3 per cent of MSMEs, contribute 40 per cent of MSME exports, showcasing immense untapped potential.
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