MSMEs: Attached Organizations, NSIC & NIMSME

Introduction

MSMEs play a crucial role in fostering entrepreneurship, innovation, and inclusive growth across various sectors. Recognizing their importance, the Government of India has implemented several policies and initiatives to support the growth and development of MSMEs, aiming to enhance their competitiveness, access to finance, technology, and market opportunities.

Micro, Small, and Medium Enterprises Development (MSMED) Act in 2006

• By the MSMED Act in 2006, the enterprises are classified into two divisions:
  • Manufacturing Enterprises: Engaged in the manufacturing or production of goods in any industry 
  • Service Enterprises: Engaged in providing or rendering services
• Manufacturing Enterprises and Enterprises rendering Services are classified as following:
  • Micro-enterprises: The investment limit will be 1 crore and turnover 5 crores.
  • Small enterprises: the investment limit will be 10 crores and the turnover 50 crores.
  • Medium enterprise: the investment limit will be 50 crores and turnover 250 crores. [UPSC 2023] 
• Gross Value Added: As per the latest information received from Ministry of Statistics & Programme Implementation, the share of MSME Gross Value Added (GVA) in all India Gross Domestic Product (GDP) during the year 2019-20, 2020-21 and 2021-22 was 30.5%, 27.2% and 29.2% respectively. 
• Manufacturing Output: The share of MSME manufacturing output in all India Manufacturing output during the year 2019-20, 2020-21 and 2021-22 was 36.6%, 36.9% and 36.2% respectively.
• Bank loans to the Micro, Small and Medium Enterprises  conforming to certain conditions qualify under the Priority sector. [UPSC 2023]

Attached Organizations Under MSME’s

Office of Development Commissioner (MSME)

• Implements the policies and various programmes/schemes for providing infrastructure and support services to MSMEs
• Headed by the Additional Secretary & Development Commissioner (AS & DC), MSME
• MSMEs function through a network of MSME-Development Institutes (DI), Regional Testing Centres, Footwear Training Institutes, Production Centres, Field Testing Stations and specialized institutes. It renders services such as:
  • Advising the Government in Policy formulation for the promotion and development of MSMEs.
  • Providing techno-economic and managerial consultancy, common facilities and extension services to MSME units.
  • Providing facilities for technology upgradation, modernization, quality improvement and infrastructure.
  • Developing Human Resources through training and skill upgradation.
  • Providing economic information services.

Khadi and Village Industries Commission (KVIC)

• Operates as a statutory body; 
• Established in 1956 under “The Khadi and Village Industries Commission Act 1956.
• Objective: 
  • The social objective of employing in rural areas;
  • The economic objective of producing saleable articles; and
  • The wider objective of creating self-reliance amongst people and building up a strong rural community spirit.
• Functions of KVIC:
  • Planning and organizing training programs for those employed or seeking employment in khadi and village industries.
  • Building reserves of raw materials and tools, supplying them to individuals involved in khadi or village industry production.
  • Promoting the sale and marketing of khadi, village industry products, and handicrafts.
  • Encouraging research in the technology utilized in khadi and village industries.
  • Providing financial aid to institutions or individuals engaged in khadi or village industry development, offering guidance through the supply of designs, prototypes, and technical information.
  • Promoting and encouraging cooperative efforts among khadi manufacturers and individuals engaged in village industries.
  • Ensuring authenticity and setting quality standards to ensure products align with these standards.

Coir Board

• A statutory body established under the Coir Board Industry Act, 1953.
• Importance of the Coir Industry:
  • India is the largest coir producer in the world accounting for more than 80 % of the total world production.
  • The Coir sector in India is very diverse and involves households, co-operatives, NGOs, manufacturers and exporters.
  • Example: Of producing beautiful artifacts, handicrafts and utility products from coconut husks which is otherwise a waste.
  • Employment: Employs more than 7.00 lakh persons of whom a majority are from rural areas mainly economically weaker sections
    • Domination of Women: Nearly 80% of the coir workers in the fibre extraction and spinning sectors are women
• Functions
  • Promoting exports of coir yarn and coir products.
  • Regulating under the supervision of the Central Government the production of husks, coir yarn and coir products by registering coir spindles and looms for manufacturing coir products as also manufacturers of coir products.
  • Undertaking, assisting or encouraging scientific, technological and economic research and maintaining and assisting in the maintenance of one or more research institutes;
  • Collecting statistics from manufacturers of and dealers in coir products
  • Fixing grade standards are arranged when necessary for inspection
  • Improving the marketing of coconut husk, coir fiber, coir yarn and coir products
  • Setting up or assisting in the setup of factories for the producers of coir products.
  • Promoting cooperative organization. 
  • Ensuring remunerative return to producers of husks coir fibre and coir yarn and manufacturers of coir products.
  • Advising on all matters relating to the development of the coir industry.

National Small Industries Corporation Limited (NSIC)

• An ISO 9001-2015 certified Government of India Enterprise under MSME
• Aim: To promote and support Micro, Small and Medium Enterprises by providing integrated support services encompassing, Marketing, Finance, Technology and other Services.”
• Functions: NSIC performs three distinct categories of activities to fulfill its mission.
• It runs several schemes and is also an implementing partner for several schemes of the Ministry of MSME. These schemes/ activities include:
  • Consortia and Tender Marketing
  • Credit Support
  • Raw Material Distribution
  • Single Point Registration Scheme (SPRS)
  • NSIC Technical Services Centers
  • E-Marketing/ Digital Services facilitation for MSMEs
  • National Scheduled Caste and Scheduled Tribe Hub
• Technical Support: To MSMEs through ‘NSIC Technical Services Centres’ (NTSCs) and several TICs & LBIs spread across the country. 
  • Services provided through these centers include skill development in Hi-Tech as well as conventional trades, and material and product testing.

National Institute for micro, Small and Medium Enterprises (NIMSME)

• Originally set up as Central Industrial Extension Training Institute (CIETI) in New Delhi in 1960.
• Primary objective of NIMSME was to be the trainer of trainers, NIMSME has widened its scope of activities to consultancy, research, extension and information services.

Mahatma Gandhi Institute of Rural Industrialisation (MGIRI)

• The existing Jamnalal Bajaj Central Research Institute (JBCRI), Wardha was revamped with the help of IIT, Delhi as a national-level institute under the Ministry of MSME in October 2008 called Mahatma Gandhi Institute for Rural Industrialization (MGIRI).
• Objective
• • To accelerate rural industrialization for a sustainable village economy so that the KVI sector co-exists with the mainstream.
  • Attract professionals and experts to Gram Swaraj
  • Empower traditional artisans
  • Innovation through pilot study/field trials.
  • R&D for alternative technology using local resources

Conclusion

• Micro, Small, and Medium Enterprises (MSMEs) are vital engines of economic growth and development in India. 
• With their immense contribution to employment, production, and innovation, MSMEs are crucial for achieving inclusive and sustainable development. 
• As the government continues to implement supportive policies and initiatives, nurturing the MSME sector will remain imperative for fostering entrepreneurship, driving industrialization, and realizing India’s economic potential.