Undoubtedly, Small and Medium Enterprises play a highly significant role in India’s developing economy. They contribute to economic growth, employment, reduction of poverty and thus aptly are considered as the engines of growth. Apart from this, Entrepreneurship and Innovation activities enhance competition and productivity growth as well. In addition, SMEs are more productive because they are more flexible and can adapt to the changes in the market.

Given the paramountcy of the sector, it is critical to ensure that our SMEs remain competitive both nationally and globally. Indian SMEs face a formidable challenge in this regard. The up-dation of GOI Science, Technology and Innovation Policy 2013, provided a big impetus to build an innovation ecosystem and to enhance the role of the private sector to do the same. The Ministry of MSME, apart from providing them financial subsidy and incentives to buy machinery, file trademarks, and expert advice, runs various schemes and programs to support the technological and other innovations in Indian SMEs.

Initiatives:

• First and foremost initiative that needs mention is is the huge allocation of Rs 3794 crore in the current FY Union Budget for enhancing the financing and innovative capacity of the MSME Sector.
• Pradhan Mantri MUDRA Yojana is another milestone reduction in tax rates to 25 per cent made by the Government during the last financial year, again, has proved the way for making available additional capital to the SME sector.
• A scheme for promotion of innovation, rural industry and entrepreneurship (ASPIRE) was launched on 16thMarch 2015. The most important component of this scheme is setting up 100 livelihood and 20 technology related incubators.
• With a view to generate employment opportunities in rural as well as urban areas of the country through setting up of new self-employment ventures/projects/micro enterprises, Prime Minister Employment Generation Programme was launched on 15th August 2008.
• Another boost provided by the Government for the growth of MSME sector is the CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) the whole idea behind which has been to provide financial assistance to these industries without any third party guarantee/ or collateral. The assurance to the lenders that in case of default by them, a guarantee cover will be provided by trust in the ration of 50/75/80/85 percent of the amount so given.
• The Revamped Scheme of Fund for Regeneration of Traditional Industries (SFURTI) has further been infused with Rs 1.25 crore in 2018-19 budgets.

Conclusion:

India’s small and medium business are using their advantages such as size, agility and innovation as their top three strategies for driving revenue growth in 2018. Thus, the efforts of the Government have started bearing positive results and showing remarkable improvement and India has succeeded in attaining 57th rank in 2018 Global Innovation Index.