The SME sector in India at present comprises of 26.1 million units which entails employment to over 60 million persons. More than 6,000 products from this segment contribute to about 8 per cent of the GDP besides garnering 45 per cent of the total manufacturing output and 40 per cent of the exports from India. The government expects a stellar show from the Indian SME sector during the 12th Five Year Plan Period (2012-13 to 2016-17) which then would result in the country to achieving an overall growth rate of 9 per cent y-o-y.
A new body, the National Innovation Council has been constituted by the Prime Minister to encourage and promote innovation in every sector of the economy and MSME sector has got a special emphasis under this Innovation Council. Also a Sectoral Council has been constituted for the MSME sector which has started functioning under the Chairmanship of Secretary (MSME). The Ministry of MSME is implementing the National Manufacturing Competitiveness Programme (NMCP), which includes programmes like establishment of new Tool Rooms, enhancing of product and process quality, cost reduction through lean manufacturing techniques and design clinic amongst others. A Credit Guarantee Fund Trust for Micro & Small Enterprise (CGFTMSE) has been initiated by the government. Under the scheme, credit facilities extended to micro and small enterprises are guaranteed up to 75 per cent of the amount in the event of a default.