MSME- an abbreviation of Micro, Small & Medium enterprises- is the pillar of economic growth in many developed, and developing countries in the world. MSME or SSI enterprises are the foundation of any economy and are an engine of economic growth, advancing impartial improvement for all. Micro, Small & Medium enterprises have emerged as a highly vibrant and dynamic sector of the Indian Economy in the last 5 decades. To encourage the growth of MSME, both state and central governments have conceptualized it in such a way as to provide maximum benefits to the enterprises falling under the MSME sector.
Definitions of Micro, Small & Medium Enterprises In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Micro, Small and Medium Enterprises (MSME) are classified in two Classes:
1. Manufacturing Enterprises– The enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the Industries (Development and Regulation) Act, 1951) or employing plant and machinery in the process of value addition to the final product having a distinct name or character or use. The Manufacturing Enterprise is defined in terms of investment in Plant & Machinery and Annual Turnover.
2. Service Enterprises:- The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment and Annual Turnover.
The limit for investment in plant and machinery/equipment for manufacturing/service enterprises and Annual Turnover, as notified are as under: