India's Budget 2024 Unveils Bold Plans to Empower MSMEs and Fuel Growth
India's latest Union Budget has placed a strong emphasis on supporting micro, small, and medium enterprises (MSMEs). These businesses already form the backbone of the economy, contributing nearly 30% to GDP, 35% to manufacturing, and over 45% of exports. The government's new measures aim to address long-standing challenges while positioning MSMEs as key drivers in India's push for a $5 trillion economy.
The Budget outlines six core pillars to bolster MSME growth: scaling up manufacturing, reviving legacy industries, fostering champion enterprises, infrastructure expansion, long-term security, and the development of City Economic Regions. A major focus is improving liquidity and credit access, with TReDS 2.0 strengthened to ease financial constraints. Additionally, the revival of 200 legacy industrial clusters and targeted textile sector initiatives seek to enhance cost efficiency and global competitiveness.
To tackle regulatory hurdles, the government will deploy 'Corporate Mitras'—trained professionals who will guide MSMEs through compliance procedures. Access to risk capital is another priority, with the SME Growth Fund allocated ₹10,000 crore and the Self-Reliant India (SRI) Fund receiving ₹2,000 crore. These funds are designed to help enterprises adopt new technology, bridge skill gaps, and expand market reach.
Infrastructure development also takes centre stage, with a 9% rise in public capital expenditure. This investment is expected to generate new opportunities for MSMEs, particularly in construction, logistics, and tourism. Meanwhile, the Securities Transaction Tax (STT) on futures and options has been raised, reflecting a short-term focus on market adjustments.
The Budget's measures directly target the biggest obstacles faced by MSMEs: funding shortages, regulatory complexity, and technological barriers. With dedicated funds, regulatory support, and infrastructure growth, the government aims to create a more enabling environment. The success of these initiatives will be critical as MSMEs continue to drive employment, production, and exports in the coming years.
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