The interim budget 2023–24 from India’s Finance Minister, Nirmala Sitharaman, will likely highlight the MSME sector in the Lok Sabha. The industry, which generated 29.15% of the nation’s GDP in 2021–2022, should benefit from regulations that promote innovation and growth.
As India approaches USD 5 trillion, Finance Minister Nirmala Sitharaman should present a special package for small and medium-sized businesses that guarantees increased institutional credit at competitive rates to help the MSME sector grow. The Lok Sabha will hear Sitharaman’s 2023–24 interim budget on February 1. This is the government’s last major economic document before the general election.
The Union Budget 2024–2025 would likely affect MSME growth. The MSME industry contributed 29.15% of GDP in 2021–2022.
The Federation of Indian Micro and Small & Medium Enterprises expects to redress the power imbalance between banks and MSMEs, which advantages lenders.
Industry players expect measures to encourage innovation and sustainable growth in the sector as the government focuses on this area. According to Samit Garg, MD, E-Factor Experiences, supportive initiatives are needed for long-term development and global competitiveness.
Tax cuts, easier financing for small and medium-sized firms, and infrastructure support can also boost industrial expansion. “Additionally, recognising the significant role of events in tourism, the industry looks forward to initiatives that strengthen this synergy and economy,” he said.
MSMEs drive Indian ecosystem growth. MSMEs developed due to rapid technological innovation in response to changing client demands, global trends, and unstable market conditions.
“MSMEs need technology to make smart decisions. Delphin Varghese, AdCounty Media co-founder, says “technology can help MSMEs gather and analyze data, encourage efficient resource allocation, boost operational efficiency, and maximize returns.” She added that the government expects MSMEs to receive funding for technological and infrastructure improvements.
Stakeholders anticipate budgets to help the ONDC effort, which can benefit from data and process standardization and unrestricted access to several e-commerce platforms.
AI may alter MSMEs. “AI in e-commerce platforms can propel MSME growth, boosting profits and sales for a sustainable future,” said Tagglabs founder Hariom Seth.
We assist modernizing the legal framework, granting tax incentives, and establishing digital payment and logistical infrastructure to enable MSMEs to engage in e-commerce. This will help MSMEs expand their customer base, save costs, and improve customer service “Kulsum’s Kaya Kalp CEO Zameer Malik said.
MSME exports account for 48% of India’s exports with over 11 crore workers. The budget can solve MSMEs’ challenges and maximize their potential.
Conclusion
On February 1, India’s Finance Minister Nirmala Sitharaman will present the interim budget 2023–24 before the Lok Sabha. This budget would likely impact MSME growth. In 2021–2022, the sector contributed 29.15% to GDP. The government is anticipated to resolve the power imbalance between banks and MSMEs, which benefits lenders. Industry stakeholders want infrastructure funding, financial access, and tax benefits to spur innovation and long-term growth. The government should fund infrastructure and technology developments for MSMEs, the backbone of the Indian economy. The government is expected to support the ONDC project, which reduces entrance barriers and allows access to multiple e-commerce platforms.
