Why This Report Matters for India’s Economy
NITI Aayog’s 2025 Report Outlines Reforms to Boost MSME Competitiveness: India’s Micro, Small, and Medium Enterprises (MSMEs) play a pivotal role in generating employment, driving exports, and contributing nearly 30% to the national GDP. Recognizing their centrality to economic growth, NITI Aayog, in collaboration with the Institute for Competitiveness, released a report titled Enhancing Competitiveness of MSMEs in India on May 2, 2025. This blueprint arrives at a time when India’s MSMEs face mounting challenges in credit access, skill gaps, and technology adoption, and offers actionable strategies to help them thrive both domestically and globally.
Key Goals of the Report
The report seeks to enhance competitiveness by identifying and addressing systemic issues that hinder MSME growth. These include credit bottlenecks, low vocational training, inadequate market integration, and sluggish technology adoption. It proposes reforms that could help integrate Indian MSMEs into global value chains and improve their ability to adapt to changing economic landscapes. At its core, the report positions MSMEs as agents of transformation in India’s growth journey.
Addressing Credit Gaps and Financial Inclusion
Although formal credit access has improved for MSMEs—from 14% to 20% for micro and small enterprises, and from 4% to 9% for medium enterprises between 2020 and 2024—a vast credit shortfall still exists, with only 19% of overall MSME credit demand met. The report suggests revamping the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to make finance more inclusive and scalable, particularly for micro units in underserved regions.
Skill Development and Workforce Productivity
The report highlights a critical lack of formal vocational training among MSME workers, which hampers productivity and innovation. It recommends enhancing training infrastructure, with a focus on technical upskilling, R&D capacity, and fostering a culture of innovation. By investing in human capital, the report envisions a more productive and future-ready MSME sector capable of competing at both national and international levels.
Technology Access and Market Integration
For many MSMEs, barriers like poor digital infrastructure, high cost of tech adoption, and low awareness limit their capacity to modernize. The report calls for state-level support to encourage technology adoption and digital literacy, especially in eastern and northeastern India. Furthermore, to help MSMEs expand globally, it proposes strengthening logistics partnerships, building direct-to-market platforms, and investing in digital marketing training to increase online visibility and exports.
Static GK Snapshot for Exams
NITI Aayog’s 2025 Report Outlines Reforms to Boost MSME Competitiveness:
| Topic | Details |
| Report Title | Enhancing Competitiveness of MSMEs in India |
| Released By | NITI Aayog in collaboration with Institute for Competitiveness (IFC) |
| Release Date | May 2, 2025 |
| Key Focus Areas | Credit, Skill Development, Technology, Market Access, Policy Reform |
| Credit Recommendation | Revamp CGTMSE for wider coverage |
| Skill Focus | Increase vocational training, R&D, and innovation capacity |
| Technology Proposal | Improve access to digital tools, internet, and modern infrastructure |
| Market Access Strategy | Digital marketing, logistics tie-ups, global linkages |
| Policy Model | Cluster-based, state-level adaptive policies |
