The Contribution of MSMEs to the Growth of the Indian and Global Economy

The objective of the study was to assess the performance and contribution of MSMEs to both the Indian and the global economy. Secondary data were collected for analysis. The data was qualitatively analysed and presented in the form of tables, and charts using Microsoft Excel. The Analysis of the data gathered confirmed that MSMEs serve as a catalyst to the evenly distribution of development and wealth in the country. It was also found that, even though all states and union territories have their share of the MSMEs, the states of Uttar Pradesh, West Bengal followed by Tamil Nadu, Maharashtra, Karnataka, Bihar, Andhra Pradesh, Gujarat, Rajasthan, and Madhya Pradesh, are the 10 states with the highest number of MSMEs. The findings again indicated that, MSMEs that engage in trade activities dominate the industry. In addition, as much as 51% of Indian MSMEs operates from the rural areas whereas 49% operates from the urban cities. The consistent growth of India’s economy cannot be mentioned without acknowledging the contribution of the MSMEs. The MSMEs sector contributes as much as between 40 and 50 per cent of India’s total export. Again, an average of 30% share of the Gross Domestic Product (GDP) of India is contributed by the MSMEs sector, and an average of 32% to the Gross Value Added (GVA). The MSMEs sector is credited with about 40% of the total employments in the country during the study period. Out of these created employments, 55% are found in the urban cities whereas 45% emanates from the rural areas with 76% of them being male whiles 24% are female.