The MSME sector and MSME Registration are crucial for identifying economic growth in any nation. In emerging nations like India, the expansion of the MSME sector is very important. Many people gain greatly from it in terms of increased employment and financial rewards. One of the key states dominating in the MSME sector is Tamil Nadu. It has produced tiny and micro-scale businesses thanks to its vibrant and active culture. But the state government has also given numerous incentives and awards to various sectors, which has helped the sector's growth even more. The government of Tamil Nadu's assistance to the MSME sector is covered in detail in the parts that follow.
Tamil Nadu is undoubtedly the land of opportunities, especially in the MSME sector. It is filled with people with excellent skills and the ability to deliver consistently and quality services. According to recent statistics, it is the third-largest Indian state in terms of the number of MSMEs, with over five million micro, small, and medium-scale businesses. It has a total population of more than 72.14 million. The state’s total exports currently stand at third position in the country’s total exports, with around USD 46.46 Billion. Businesses in the state have a great opportunity to launch their ventures. Apart from this, the customer base is inclined towards domestic goods.
A description of the MSME sector in Tamil Nadu
In Tamil Nadu, 8% of all MSMEs in the nation are in the MSME sector. Over 49.48 lakh MSMEs exist in the state according to this conversion. Because of this, it has a significant ability to create jobs, with 113.57 workers employed in the industry. Pharmaceuticals to dairy products are among the colorful items offered by a variety of MSMEs in Tamil Nadu. Different micro, small, and medium-sized businesses offer more than 6000 products in total. The MSME sector in Tamil Nadu also ranks first in terms of the quantity of factories it houses, which is a remarkable accomplishment. If trends are to be believed, the sector is growing very quickly and has very promising futures.The employment figures are pretty impressive, and the sector is quickly adding to its workforce. When it comes to MSME sector employment, it comes in first. Moreover, from 5,02,381 in 2012 to 13,78,544, there was an increase in employment across several industries.
State Government Programmes And Initiatives
Tamil Nadu's state government's freedom and assistance are to be recognised for the MSME sector's expansion. It has given several incentives to support firms with money or through building infrastructure. The most effective government initiatives and programmes are displayed here.
➨(NEEDS) New Entrepreneur or Enterprise Development Scheme
The organization in charge of overseeing this programme is the Government of Tamil Nadu's Directorate of Industries and Commerce. The initiative seeks to prepare the next generation by providing them with subsidies to take advantage of economic prospects in MSMEs.In order to give money for entrepreneurial training for youngsters, the programme collaborates with financial institutions. 1000 young individuals, 50% of whom are women, are the annual aim for training. 25% (up to $75,000) of the project's total cost is covered by the subsidies offered under the programme.The cement industry, sericulture, agriculture, and other industries and specializations are all covered by educational institutions. Ages 21 to 35 are the range for applying to the programme.
➨Programme to Generate Employment for Unemployed Youth
The program's goal, as its name implies, is to give unemployed youngsters from the state's economically and socially underdeveloped districts the opportunity to find jobs. Commercial banks and other financial entities provide funding for the training phase. Additionally, the programme provides project cost subsidies. The scheme provides loans to pay 90% of the total project costs (in the case of the general category). For candidates falling within the special categories, the proportion rises to 95%. The age range for applicants to this programme is 18 to 35, and they must have completed the eighth grade. The grants are given at a rate of 25% of the project's cost, up to a maximum of 2.5 lakh.
➨Contracts with the TAICO Bank and Tansidco
The recent action the Tamil Nadu government made to improve the industrial infrastructure was fantastic. It executed two Memorandum of Understandings (MoUs) to implement the loan system to support various MSMEs throughout the state. In order to implement the Industrial Infrastructure Initiative Scheme, it first partnered with Tansidco (Tamil Nadu Small Industries Development Corporation). On the other hand, a second Memorandum of Understanding (MoU) was inked with the TAICO Bank to offer credit and loans to various MSMEs for efficient and continuous company operations. The government has made use of both MoUs to provide different businesses with a liquidity cushion for their daily operations.
➨Capital Assistance
The enterprise receives subsidies in a variety of ways. The capital subsidy is one of the best subsidies. A 25% subsidy on the entire value of equipment is provided under this. The maximum subsidy amount is 150 lakh.
These subsidies are offered at 5% on the value of equipment and machinery (up to 5 lakh) for scheduled groups like women, scheduled castes, scheduled tribes, the differently abled, and the transgender community.
Under this incentive, several blocks (24 total) have been allocated, and new businesses entering any block will receive subsidies in accordance with the block they enter. Additionally, the government has specified which businesses are qualified for capital subsidies and other incentives for specific industries. The 24 sectors that qualify as qualifying industries are listed below.
➣Electricity and electronics
➣Applications and Parts for Aerospace, Space, and Defence
➢The products made of leather
➢components and auto parts
➢Exports of gold and diamond jewelry
➢Device for reducing pollution
➢pharmaceuticals and drugs
➢Plastic (apart from "one-use and throw-away plastics")
➢Rubber
➢Bio-technology
➢medical devices, equipment, supplies, and accessories
➢Sports equipment and apparel
➢Components, infrastructure, and electric vehicle components
➢Textiles for technical and medicinal use
➢the creation of electronic systems
➢preparing food
➢Products as an alternative to "one-time use and throwaway plastics"
➢Processing of Electronic Waste
➢chemicals such as speciality and petrochemicals
➢Inexpensive building supplies
➢Traditional businesses
➢solar-powered machinery
Also read Msme registration for small business
➨The Employment Generation Programme of the Prime Minister
PMEGP is a national-scale project by the Central Government to address the nation's unemployment issues. By offering loans to people to start their MSME enterprises, Tamil Nadu has made excellent use of this programme.
Anyone above the age of 18 may apply for this programme. For both the industrial and service sectors, the maximum amount of financial aid is 25 lakhs. Under the plan, subsidies totaling 35% of the project's cost are also offered.
➨Initiative of the Tamil Nadu Small Industries Development Corporation (SIDCO)
SIDCO is essential to the state's implementation of infrastructure development. It supports marketing efforts and aids in the delivery of raw resources. 118 industrial estates have been built as part of this plan to support MSME growth.
For specialization, several clusters have been developed in various states. For instance, Cuddalore develops ceramic clusters, whereas Chennai, Tiruvallur, Krishnagiri, and other cities build clusters for auto parts.
➨Single Window Portal Implementation
A site dubbed Single Window site, which aids MSMEs in setting up more quickly, has been developed by the state government. Any business can simply obtain no objection certificates (NoCs) from the numerous responsible government ministries using this online service. This removes all legal barriers to starting a small or medium-sized business.
Vision of the State Government for the Development of MSMEs
The MSME sector has several objectives set forward by the Tamil Nadu government. The following items serve as a summary of the state government's mission.
➢The main objective is to draw in investment from individuals. It aims to attract $5 trillion worth of investments by 2031.
➢Along with investments, it also emphasizes expanding employment prospects by hiring 50 lakh people.
➢The government of Tamil Nadu also wants to improve the state's credit system and make banks more accessible.
➢It rationalizes the creation of 100 common facility centers and 15 mega clusters in terms of industries. It will support the expansion of industry as a whole.
