NITI Aayog Releases Report on Enhancing MSME Competitiveness

On 1st May, 2025, NITI Aayog, in collaboration with the Institute for Competitiveness (IFC), released a comprehensive report titled “Enhancing Competitiveness of MSMEs in India”, outlining strategies to strengthen the role of Micro, Small, and Medium Enterprises (MSMEs) in India's economic growth.

Key Points

Sector-Specific Analysis: The report covers textiles, chemicals, automotive, and food processing industries, identifying structural bottlenecks and policy gaps.
Access to Credit: There has been an improvement in MSME access to formal credit, rising from 14% to 20% for micro and small enterprises, but a credit shortfall persists with only 19% of MSME credit demand being met.
Skill and Technology Gaps: The report highlights skill shortages, lack of formal training, and inadequate technology adoption as key challenges affecting productivity and competitiveness.
Policy Recommendations: NITI Aayog advocates for a restructured Credit Guarantee Fund Trust, improved awareness of government schemes, and an adaptive cluster-based policy framework.
Cluster Development: Outdated technologies and weak branding are key constraints; the report stresses the importance of improving market linkages and state-level policy implementation.