The share of gross value added (GVA) by the MSME sector in India’s gross domestic product (GDP) has recovered further to 30 per cent in the financial year 2022-23 after the impact of the Covid pandemic, showed government data. The share, however, is yet to hit the pre-pandemic level.
As per the information shared in the Rajya Sabha by Minister of State in the MSME Ministry Shobha Karandlaje, the share of MSME GVA in all India GDP stood at 30.1 per cent in FY23, improving from 29.6 per cent in FY22 and 27.3 per cent in FY21.
Amid Covid, the share had dropped from 30.5 per cent in FY20 before Covid.
GVA is a measure of the value of goods and services produced in an area, industry, or sector of an economy. It is essentially the value of output minus the value of intermediate consumption.
For the uninitiated, former MSME Minister Nitin Gadkari in 2020 had targetted 40 per cent share of MSMEs in GDP by 2025 along with a 60 per cent share in exports from nearly 50 per cent in 2020 and 5 crore additional jobs.
India’s MSME sector currently has 4.76 crore enterprises registered with the MSME Ministry through the Udyam portal to avail benefits related to credit, new enterprise creation, exports, public procurement and more. Nearly 2 crore enterprises out of the total count are informal micro enterprises outside the ambit of Goods and Services Tax (GST).
70.56 lakh registered MSMEs are manufacturing enterprises while a whopping 2.06 crore into the services sector.
Meanwhile, MSMEs’ share in all India exports also saw recovery in FY24 to 45.73 per cent after three years of decline, FE Aspire reported recently. As per data shared by Karandlaje in the Rajya Sabha, the percentage share of exports of MSME-related products in all India exports dropped from 49.73 per cent in FY20 to 49.35 per cent in FY21, 45.03 per cent in FY22 and 43.59 per cent in FY23. As of May 2024, the share was 45.79 per cent.