Small And Medium Enterprises

( Nurseries for entrepreneurship and innovation )

Definition:
The Government of India has enacted the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 in
terms of which the definition of micro, small and medium enterprises is as under:
(a) Enterprises engaged in the manufacture or production, processing or preservation of goods as specified
below:
(i) A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 25 lakh;
(ii) A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. 25 lakh but
does not exceed Rs. 5 crore; and
(iii) A medium enterprise is an enterprise where the investment in plant and machinery is more than Rs.5 crore but
does not exceed Rs.10 crore.
(b) Enterprises engaged in providing or rendering of services and whose investment in equipment (original cost
excluding land and building and furniture, fittings and other items not directly related to the service rendered or as
may be notified under the MSMED Act, 2006 are specified below.
(i) A micro enterprise is an enterprise where the investment in equipment does not exceed Rs. 10 lakh;
(ii) A small enterprise is an enterprise where the investment in equipment is more than Rs.10 lakh but does not
exceed Rs. 2 crore; and
(iii) A medium enterprise is an enterprise where the investment in equipment is more than Rs. 2 crore but does
not exceed Rs. 5 crore.

Description:

Micro, small and medium enterprises sector has been recognised as an engine of growth all over the
world and is characterised by low investment requirement, operational flexibility, location wise
mobility, and import substitution.
Acc. to the latest reports by the SMB Chamber of Commerce and the Ministry of Micro, Small and Medium
Enterprises, India currently has more than 48 million SMEs.Indian SMEs have grown at a stable pace of 4.5% in the
last 5 years.
According to the latest Economic Survey, Indian SMEs employ close to 40% of Indias workforce. After the
agriculture sector, SMEs rank second in fostering employment opportunities.
However, in January-February 2013, SMEs saw a decline of 51% in investments through the Private Equity
(PE) routein just one year. The sector fell from USD 306.27 million to USD 151 million Funds focussing on SMEs are
having difficulties in raising money because of the prevailing conditions. The total gap in MSME funding is estimated
at USD126 million.. Although banks have been slowly trying to bridge this gap, stringent reforms from the government
are required.
Micro, Small and Medium Enterprises (MSME) contribute nearly 8 percent of the countrys GDP, 45 percent
of the manufacturing output and 40 percent of the exports.

News:Small and medium traders on Thursday appealed to the Centre to constitute a 'Board of Internal Trade' to look into the
issues of the SME sector even as it alleged that "unethical practices" followed by online retail marketers have created
an "uneven playing field" for them.

Emerge: (NSE SME PLATFORM)

New option for emerging companies for raising capital. It was a major landmark for the SME sector to

have a new avenue for raising capital in an efficient manner. India has high entrepreneurial
potential and the SME sector has been a key engine of economic growth, job creation,
wealth distribution, and effective mobilization of resources (capital and skills).

It is a platform provided by NSE to smes to raise capital for Apex,working capital,acquisition ,R &D,and any
other requirement.
Post issue capital less than 25cr.
Issue size-no restriction.

Benefits of Emerge:

Listing improves credibility and profile.

Listing attracts new class of long term investors.
Easier to list.as lower time ,effort and cost to get listed..
Seprate segment in nse.