New Delhi: The Economic Survey 2026 has underscored Micro, Small and Medium Enterprises (MSMEs) as the backbone of India’s industrial economy, highlighting their substantial contribution to manufacturing output, exports, employment, and GDP.
Tabled in Parliament by Union Minister for Finance and Corporate Affairs Nirmala Sitharaman, the Survey notes that MSMEs account for 35.4 per cent of India’s manufacturing output, 48.58 per cent of total exports, and 31.1 per cent of GDP, reinforcing their central role in the country’s economic framework.
According to the Economic Survey 2026, India’s MSME ecosystem comprises over 7.47 crore enterprises, employing more than 32.82 crore people, making it the second-largest employer after agriculture.
Globally, MSMEs represent nearly 90 per cent of businesses and contribute over 50 per cent of total employment, positioning India’s MSME sector as a key enabler of inclusive and regionally balanced growth.
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Economic Survey 2026: MSMEs Drive Industrial Credit Growth
The Economic Survey 2026 highlights that MSME credit has maintained a strong and positive trajectory, supported by targeted government interventions aimed at improving access to finance.
MSME credit emerged as the primary driver of industrial credit growth during H1FY26, with year-on-year growth in MSME lending significantly outpacing credit growth to large industries.
The Survey also points to a sharp expansion in SME public markets over the past two years, driven by favourable market conditions and increased participation from digital retail investors, further strengthening capital access for smaller enterprises.
Economic Survey 2026 Notes Impact of Self-Reliant India Fund and Innovation Push
The Economic Survey 2026 highlights the impact of the Self-Reliant India (SRI) Fund, launched to provide ₹50,000 crore in equity funding support to MSMEs.
As of 30 November 2025, the fund has assisted 682 MSMEs through investments totalling ₹15,442 crore.
The Survey also notes that innovation within the MSME sector is being institutionalised through the MSME-Innovative component, which supports incubation, design interventions, and intellectual property rights (IPR) protection.
Also Read: PSBs Sanction 3.96 Lakh MSME Loan Applications Using Digital Credit Assessment Framework
Global Manufacturing and Supply Chain Integration
The Survey states that India accounted for an estimated 2.9 per cent of global manufacturing GVA and 1.8 per cent of global merchandise exports in 2024, signalling significant scope for expanding its global manufacturing presence.
The Economic Survey 2026 emphasises that a calibrated deepening of India’s participation in global supply chains – particularly in labour-intensive and assembly-linked sectors – can advance job-rich industrialisation aligned with the broader Viksit Bharat@2047 vision.
From an advanced manufacturing strategy perspective, the Survey underlines the importance of R&D-intensive and innovative technologies in enhancing competitiveness.
It further notes that infrastructure development, capital markets, digital governance, and services exports will act as key growth drivers, while stressing the need to strengthen India’s national manufacturing mission to build sustained capability, efficiency, and global competitiveness.
Growth in deployment of gross bank credit to MSMEs (Y-o-Y %, select periods)Segment March 2024 August 2024 March 2025 August 2025 Micro & Small Enterprises 14.7 13.4 8.8 20.9 Medium Enterprises 13.3 19.2 18.6 13.1 Total MSME Credit 14.3 15.1 11.7 18.5 Large Industry (comparison) 6.4 7.7 6.2 1.8
Source: Monetary Policy Report, RBI Bulletin (October 2025)
