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1. COIR INDUSTRY : PROSPECTS AND CHALLENGES ........................................... 3

2. MSME : THE ENGINES OF GROWTH .................................................................. 4

3. EMPLOYMENT GENERATION THROUGH MSMEs.............................................. 6

4. FOSTERING TECHNOLOGY AND INNOVATION .................................................8

5. MSME FOR INCLUSIVE DEVELOPMENT .......................................................... 10 | 2

1. COIR INDUSTRY : PROSPECTS • The coir industry provides

AND CHALLENGES employment opportunities to skilled
and unskilled workers and full time
What is the importance of coir
and part time employment
industry ?
opportunities to agricultural
• India is the largest producer of coir in
the world and also the largest
consumer of coir and coir products. • India is the largest coir producer in
the world accounting for more than 80
• Indian coir and coir products are in
percent of the total world production.
great demand in domestic and foreign
markets for their special features like • India is also the largest consumer of
price, workmanship, quality and coir and coir products, over 55
charm. percent of the coir and coir products
produced in India is consumed
• It is also eco friendly, decomposable,
non pollutant natural resource.
• The industry employs about 7 lakhs of
• The coir industry provides
coir workers and majority of them are
employment to about 7 lakh people in
from rural areas belonging to
the country out of which 80 percent
economically weaker sections of the
are women.
• The coir industry plays an important
• Women constitute 70 % of the
role in the sustainable development of
workforce and primarily engaged in
spinning and household industries.
• It is agro based, export oriented
What are the problems of the coir
cottage industry, which earns a
industry ?
foreign exchange to the tune of
1630.33 crores. • Insufficient finance

• Inadequate market information

• The growth and development of coir
industry in India has taken place in • lack of storage facilities

areas where there is concentration of • No direct contact with industrial users

coconut cultivation and availability of
• Insufficient market mechanism for
coconut husks.
coir fibre | 3
What is the way forward ? construction of the slope railway lines
and national highways to prevent soil
• Possibilities should be explored to
establish Women Banks in selected
centres to enhance women's 2. MSME : THE ENGINES OF
empowerment. GROWTH

• Government financial institution What is the significance of MSME for

should come forward to assist the India?
workers of coir industry to fulfil their • India is expected to emerge as one of
financial requirement. the leading economies in the world

• Government enforcing agencies over the next decade and the MSME

should enforce various rules, segment is likely to play a significant

regulations, provisions, welfare role in the emergence of the Indian

measures declared by the government economy.

from time to time. • The development of this sector is

• The government should do some hard crucial to meet the national

thinking on the removal of transport imperatives of financial inclusion and

bottlenecks and a system of mobile generation of significant levels of

transportation may be introduced in employment in urban and rural areas

coir industries. across the country.

• For enhancing the sales of coir • It can nurture and support

products in the domestic market state development of new age entrepreneurs

and central governments should who have the potential to create

instruct the public sector globally competitive business from

undertakings to use coir finished India.

goods for the office purposes. • Many developed and developing

economies have demonstrated that
• The directions should be given to the
State Public Works Department to use MSME segment constitutes the

cement flooring with coir mats instead backbone for maintaining growth

of marbles and tiles. rates as well as employment

generation rate and provides stability
• Central and State Governments during economic downturns.
should instruct the Railway Board
and National Highway Authority of • As a catalyst for socio economic

India to use the Geo textiles in the transformation of the country, the | 4
sector is crucial in meeting the delayed payments by Central
national objectives of generating Ministries/Departments/CPSEs/State
employment and discouraging rural - Governments.
urban migration.
• Udyog Aadhaar Memorandum (UAM)
What are the focus areas for MSMEs is a one-page registration form which
to enter into global market ? constitutes a self-declaration format
under which the MSME will self-
• Global mindset.
certify its existence, bank account
• Lean Manufacturing. details, promoter/owner’s Aadhaar
details and other minimum
• Mergers and Acquisition.
information required.
• Complementing larger industries.
• The MSME credit space portal will
• Alternate finance. enable in principle approval for MSME
loans up to Rs. 1 crore within 59
• Prepare for non tariff barriers.
minutes from SIDBI and 5 Public
• Explore options for Co operation, fair Sector Banks (PSBs). It is a strategic
trade, IPR regulations and FDI. initiative of SIBDI led PSB consortium
incubated under the aegis of
• Elimination of waste.
Department of Financial Services

• Enhancement of Technology. (DFS), Ministry of Finance.

• Use of Quality productive tools. • Entrepreneurship Development

Programmes (EDPs) of various
• Total Employee involvement.
durations are being organized on

• Flow of information to all enterprise regular basis by a number of

stakeholders. organizations e.g. national and state

level Entrepreneurship Development
What are the new initiatives of Institutes (EDIs), Micro, Small and
Government in MSME sector ? Medium Enterprises Development
• The Ministry of Micro,Small & Institutes (MSMEDIs) [earlier known
Medium Enterprises (MSME) has as Small Industries Service Institutes
launched MSME Delayed Payment (SISIs)], national and state level
Portal – MSME Samadhaan for Industrial Development Corporations,
empowering micro and small Banks and other training
entrepreneurs across the country to institutions/agencies in private and
directly register their cases relating to public sector etc. | 5
• As the Public Procurement Policy for • MSMEs are important for meeting the
Micro and Small Enterprises (MSME) national objectives of growth with
order 2012 has mandated Every equity and inclusion.
Central Ministry/Department/PSU
shall set an annual goal for • They are important for promotion of
procurement from the MSE sector at industrial development in rural areas,
the beginning of the year, with the use of traditional or inherited skill,
objective of achieving an overall use of local resources, mobilization of
procurement goal of minimum 20 per resources and exportability of
cent of the total annual purchases products.
from the products or services
produced or rendered by MSEs, an • Besides the wide range of services
online portal called MSME provided by the sector, the sector is
SAMBANDH was launched. engaged in the manufacturing of over
6,000 products ranging from
• District level incubation and
traditional to hi tech items.
Acceleration Program will help in
generating new ideas and promote What are the major initiatives by the
new ideas and promote Government ?
entrepreneurship with all the
• Government's policy initiatives like
necessary support.
enactment of the Micro Small and
3. EMPLOYMENT GENERATION Medium Enterprises Development Act,
What is the role of MSME ?
• Pruning of reserved small scale
• According to the estimates, this sector industries list; advising Financial
generates around 100 million jobs institutions to increase their flow of
through over 46 million units situated
credit to SME sector.
throughout the geographical expense
of the country. • Reservation of items for exclusive
manufacture in MSME sector
• The sector accounts for 45 % of
statutorily provided for in the
manufacturing output an 40 % of
industries Act, 1951.
total exports of the country.

• The President, under Notification

• The labor to capital ratio in MSMEs
and the overall growth in the sector is dated May 9, 2007, has amended the

much higher than that in the large Government of India Rules, 1961.
industries. | 6
• Pursuant to this amendment, Ministry and Development (TREAD)” to
of Agro and Rural Industries and promote women entrepreneurs.
Ministry of Small Scale Industries
• The scheme envisages economic
were merged into a single Ministry
empowerment of women through
namely, Ministry of MSME.
trade related training, information
What are the major schemes for and counseling activities related to
MSME? trades, products, services, etc.

• SFURTI : SFURTI is Scheme of Fund What are the challenges ?

for Regeneration of Traditional
• Whatever the bank finance this sector
gets, comes at far higher interest costs
• Ministry of Micro Small and Medium than what large enterprises can
Enterprises (MSME), Govt. of India negotiate.
has launched this scheme in the year
• Long receivable cycles make a mess of
2005 with the view to promote Cluster
working capital management.
• Little access to trained labor,
• Stand up India scheme : The Stand
technical progress and management
up India scheme aims at promoting
support limit their growth.
entrepreneurship among women and
scheduled castes and tribes. • Availability of technology,
infrastructure and managerial
• Stand-Up India Scheme facilitates
competence, and limitations posed by
bank loans between Rs 10 lakh and
labor laws, taxation policy, market
Rs 1 Crore to at least one Scheduled
uncertainty and imperfect
Caste (SC) or Scheduled Tribe (ST)
borrower and at least one woman
borrower per bank branch for setting What is the way forward ?
up a greenfield enterprise.
• The challenge now is to create a policy

• Trade Related Entrepreneurship environment that will encourage the

Assistance and Development growth of more MSME that can hold

(TREAD) : Ministry of Micro, Small their own in a competitive market.

and Medium Enterprises (MSME) is

• The problems faced by MSMEs need
operating a scheme titled “Trade to be considered in a disaggregated
Related Entrepreneurship Assistance manner for successful policy
implementation as they produce very | 7
diverse products, use different inputs more flexible, and more efficient
and operate in distinct environments. processes to produce higher-quality
goods at reduced costs.
• There is a need for tax provisions and
laws that are not only labor friendly • This manufacturing revolution will
but also entrepreneur friendly. increase productivity, shift economics,
foster industrial growth, and modify
• There is a need for skill formation and the profile of the workforce—
continuous upgrade both for labor ultimately changing the
and entrepreneurs. competitiveness of companies and
• The Government could consider
dedicated television and radio Artificial Intelligence (AI) and Machine
programs, similar to agriculture, to Learning (ML) :
help educate entrepreneurs running
• Artificial Intelligence is the broader
small businesses.
concept of machines being able to
carry out tasks in a way that we
would consider “smart”.

Why MSME needs Technological • Machine Learning is a current

application of AI based around the
Infusion ?
idea that we should really just be able
• Technology is the enabler of growth. to give machines access to data and
let them learn for themselves.
• Creating innovation and technology
ecosystem is pertinent for • Both AI and ML can transform the
commercializing inventions for value sales mechanism, data mining, data
added products and services. analytics and sales forecasts.

• The adoption of new technologies is Virtual Reality:

essential for growth and it is
• Virtual reality (VR) is an artificial,
computer-generated simulation or
recreation of a real life environment or
What are the top technological trends
that shape MSMEs ?

Industry 4.0 : • It immerses the user by making them

feel like they are experiencing the
• The rise of new digital industrial simulated reality firsthand, primarily
technology, known as Industry 4.0, is by stimulating their vision and
a transformation that makes it hearing.
possible to gather and analyze data
across machines, enabling faster, | 8
Augmented Reality: Blockchain Technology :

• Augmented reality (AR) is a technology • The blockchain is an undeniably

that layers computer-generated ingenious invention – the brainchild of
enhancements atop an existing reality a person or group of people known by
in order to make it more meaningful the pseudonym, Satoshi Nakamoto.
through the ability to interact with it.
• By allowing digital information to be
• AR is developed into apps and used distributed but not copied, blockchain
on mobile devices to blend digital technology created the backbone of a
components into the real world in
new type of internet.
such a way that they enhance one
another, but can also be told apart • Originally devised for the digital
easily. currency, Bitcoin, the tech community
is now finding other potential uses for
FinTech :
the technology.
• Financial technology (FinTech or
3D printing :
fintech) is the new technology and
innovation that aims to compete with • 3D printing is any of various
traditional financial methods in the processes in which material is joined
delivery of financial services.
or solidified under computer control to

• FinTech is a new industry that uses create a three-dimensional object,

technology to improve activities in with material being added together

finance. (such as liquid molecules or powder
grains being fused together).
• The use of smartphones for mobile
banking, investing services and • 3D printing is used in both rapid
cryptocurrency are examples of prototyping and additive
technologies aiming to make financial manufacturing.
services more accessible to the general
public. • Objects can be of almost any shape or
geometry and typically are produced
• Financial technology companies using digital model data from a 3D
consist of both startups and model or another electronic data
established financial and technology
source such as an Additive
companies trying to replace or
Manufacturing File (AMF) file (usually
enhance the usage of financial
in sequential layers).
services provided by existing financial
companies. | 9
5. MSME FOR INCLUSIVE • The Portal will give information about
DEVELOPMENT the pending payment of MSEs with
individual CPSEs / Central Ministries,
What is MSME ?
State Governments, etc.
• Section 7 of the Micro, Small and
• MSME Sambandh : The Portal will
Medium Enterprises Development
help in monitoring the implementation
(MSMED) Act, 2006 will accordingly
of the Public Procurement from MSEs
be amended to define units producing
by Central Public Sector
goods and rendering services in terms
of annual turnover as follows:
• Using this Online Portal, the
• A micro enterprise will be defined as a Ministries and CPSEs can assess their
unit where the annual turnover does performance.
not exceed five crore rupees;
• MyMSME mobile app was launched
• A small enterprise will be defined as a which provides information on all
unit where the annual turnover is schemes implemented by the Ministry
more than five crore rupees but does of MSME at one place.
not exceed Rs 75 crore;
• Udyog Aadhaar Memorandum (UAM)
• A medium enterprise will be defined is a one-page registration form which
as a unit where the annual turnover is constitutes a self-declaration format

more than seventy five crore rupees under which the MSME will self-
certify its existence, bank account
but does not exceed Rs 250 crore.
details, promoter/owner’s Aadhaar
• Additionally, the Central Government details and other minimum
may, by notification, vary turnover information required.
limits, which shall not exceed thrice
What are the schemes available
the limits specified in Section 7 of the
exclusively for women ?
What are the IT initiatives of the ENTREPRENEURSHIP ASSISTANCE
• MSME Samadhaan : This Portal will
empower Micro and Small • With a view to encourage women in
entrepreneurs across the country to setting up their own ventures,
directly register their cases relating to government implements a Scheme,
delayed payments by Central namely, “Trade Related
Ministries/Departments/CPSEs/State Entrepreneurship Assistance and
Governments. Development (TREAD) during the 11th
Plan. | 10
• The scheme envisages economic as existing micro and small
empowerment of women through the enterprises on loans up to Rs.50 lakh.
development of their entrepreneurial
skills in nonfarm activities.
• MSME-DIs regularly organize a
number of Entrepreneurship Skill
Development Programme (ESDPs)/
• The Cluster Development Programme Entrepreneurship Development
(CDP) being implemented envisages Programme (EDPs)/ Management
diagnostic study of identified clusters Development Programmes (MDPs) to
of traditional skill-based MSEs to train the potential entrepreneurs in
identify appropriate technologies and improving their techno/managerial
their providers and to facilitate knowledge and skill with a view to
adoption of available technology facilitating them to start MSEs in
meeting the specific needs of the end various fields.
• Many of the programmes are tailor
• The Cluster Development aims at made for the target group for SC,ST,
enhanced competitiveness, technology OBC,Women, Minorities and other
improvement, adoption of best weaker sections and exclusively for
manufacturing practices, marketing of women.
products, employment generation etc.
• These programmes are also called
• The scheme provides assistance for “Out-reach Programmes” as they are
capacity building, common facilities, conducted in rural / less developed
marketing etc. areas.



• The Scheme was launched in August • DC (MSME) has formulated a scheme

2000 to ensure better flow of credit to for women entrepreneurs to
micro and small enterprises by encourage Small & Micro
minimizing the risk perception of manufacturing units owned by women
financial institutions and banks in and register in DI/DIC in their efforts
lending without collateral security. at tapping and developing overseas
markets, to increase participation of
• Under the scheme, guarantee cover is representatives of small/micro
provided to collateral free credit manufacturing enterprises under
facility extended by member lending MSME stall at International Trade
institutions (MLIs) to the new as well Fairs/Exhibitions, to enhance export
from such units. | 11