Updated on December 17, 2024 12:25:27 PM
The Make in India for MSMEs is one of key pillars of transformational development in India. Intended especially for Micro, Small, and Medium Enterprise (MSMEs), Make in India initiative is designed to promote domestic production and strengthen the internal markets as much as possible to minimize the dependence on imported products. The Make in India scheme is contributing a lot towards the competitiveness of MSMEs in the global market by enhancing the appropriate environment for innovation, infrastructure and digital linkages. So, by stressing the need of local sourcing and indigenous technology, Make in India for MSMEs has a significant role for growth of Indian industries.
The Make in India for MSMEs is largely aimed at making India a manufacturing hub especially for the micro, small and medium enterprises. Make in India initiative seeks to formulate a strong support structure of the MSMEs through the promotion of homegrown technologies and increasing the supply chain. By doing so, the government wants to increase production, optimize supply chains and foster vertical integration. The Make in India scheme defines the Micro, Small, and Medium Enterprises with the help of MSMED Act and also offers any required legal protection for the growth of such enterprises. The Make in India for MSMEs aligns with the Production Linked Incentive (PLI) scheme and the Public Procurement Orders to enable MSMEs to compete effectively in the domestic and international market.
The Make in India initiative for MSMEs offers multiple benefits to small businesses, the economy, and the industrial landscape:
Several policies under the Make in India framework focus on enhancing the growth and competitiveness of MSMEs:
The PLI Scheme aims at making domestic manufacturing attractive for the MSMEs through financial incentives linked with production levels. This scheme is applicable to different fields such as electronic, textile, and automotive industries.
The PPP-MII Order prioritizes local suppliers, which benefits MSMEs by offering them preference in government contracts. This policy ensures that suppliers with a significant percentage of local content have better chances of winning tenders.
Under the PPP-MII Order, suppliers are categorized to determine eligibility for purchase preference. These categories include:
There are some products which are specifically designated for procurement by MSMEs or Class-I local suppliers in terms of the PPP-MII Order. This helps prevent entities that do not qualify from tendering for certain government procurements and safeguards MSMEs, providing them with leverage.
In a government tender, bids are classified according to their ranking and supplier status:
| S. No. | Name of Bidder | Rates Quoted | Price Ranking | Status of Bidder |
|---|---|---|---|---|
| 1 | A | 100 | L1 | Non-MSE Non-Class-I Local Supplier |
| 2 | B | 110 | L2 | Non-MSE but Class-I Local Supplier |
| 3 | C | 112 | L3 | MSE but Non-Class-I Local Supplier |
| 4 | D | 115 | L4 | Non-MSE but Class-I Local Supplier |
| 5 | E | 118 | L5 | MSE but Non-Class-I Local Supplier |
| 6 | F | 120 | L6 | MSE Class-I Local Supplier |
While Make in India initiative for Micro, Small and Medium Enterprises (MSMEs) has driven growth, addressing ongoing challenges is key to fully realizing its potential:
Make in India for MSME sector performs a crucial function of consolidating domestic production systems, employment generation as well as innovation. With support for local sourcing, development of infrastructure, and attracting funds, the Make in India scheme helps in making MSMEs competitive within the domestic markets as well as international markets. However, issues like inadequate infrastructure, technology acquisition hurdles, and competition from international actors still persist. Eliminating such challenges and enhancing policy effectiveness will be crucial for MSMEs to harness the benefits of Make in India for empowering sustainable growth and enhancing India's recognition as the manufacturing giant.
At Professional Utilities, we leverage our industry knowledge and expertise to help businesses navigate complex regulations, minimize risks, and optimize operations for maximum efficiency and profitability.
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The Make in India initiative focuses on encouraging MSMEs to manufacture products in India and reduce the reliance on imported goods to foster growth and improvement of domestic industries.
Make in India supports local production, generates employment, encourages investors, fosters technology advancements, and enhances access to markets for MSMEs. Some of these advantages assist small businesses to offer products or services that are equal to those of large businesses both in their own country and in the global market.
They are the Production Linked Incentive (PLI) Scheme that offer incentives to domesticate production and the Public Procurement Order (PPP-MII) that promotes indigenous suppliers within the government tenders. These policies basically target development and improvement of the MSMEs.
MSMEs have problems such as infrastructure decay, inability to adapt to new technologies, competition from international firms, and problems with the effective implementation of policies. They are critical ones that need to be addressed as the best way to SME the full potential of the initiative.
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