The Role of SIDBI in developing the MSMEs in India

Abstract: The Micro, Small and Medium Enterprise (MSME) sector plays a vital role in the growth of our country in creating employment, exports, gross industrial value of output, gross value added, investment in fixed assets, contribution to GDP, and giving boost to manufacture, service and infrastructure sectors. The opportunities in MSME sectors are enormous due to the factors like Less Capital Intensive, Extensive Promotion & Support by Government, Reservation for Exclusive Manufacture, Funding by way of Finance & Subsidies, Reservation for Exclusive Purchase by Government, Export Promotion, great demand in the domestic market , export potential and so on. The number of MSMEs functioning in the country as per Quick Results of 4th All India Census (2006-07), in the registered and unregistered categories are 1.55 Million (5.94%) and 24.55 Million (94.06%) respectively. The Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 has given choice to entrepreneur that the filing of Memorandum (Registration) by Entrepreneur intending to establish a Micro, Small or Medium Enterprise is discretionary and not mandatory. In this study, besides making a brief review of the overall performance of the MSME sector, the role played by the Small Industries Development Bank of India (SIDBI) in empowering MSMEs and acting as the nodal agency for SME schemes of Government of India, have been described.

Key words: MSMED Act, Export promotion, Memorandum, SIDBI, FIVE YEAR PLAN, Census