Uttar Pradesh has ranked among top three states with a 9% national share of MSMEs, according to a CBRE-CREDAI report.
As per the report, Uttar Pradesh (UP) has emerged among the top three states in India as a significant contributor to India’s Micro, Small, and Medium Enterprises (MSME) sector, underscoring the crucial contribution of MSMEs in shaping India’s economy.
The report further highlights a regional concentration of MSME activity, with states such as Maharashtra, Tamil Nadu, and Uttar Pradesh collectively constituting a substantial portion of the country’s MSME landscape.
The three states account for nearly 40% of the total MSMEs registered in India. This emphasizes not only the diverse distribution of MSMEs across the nation but also the significance of these states in driving the overall vibrancy and economic impact of the sector.
Some of the policy initiatives, which have supported the MSME ecosystem in Uttar Pradesh includes 50% interest subsidy for micro units capped at Rs 25 lakh, approved projects with 10 acres or more eligible for annual infrastructure interest subsidy of up to 50%, capped at Rs 2 crore annually, 100% stamp duty exemption in select regions; also, women entrepreneurs and MSME industrial park developers.
“As the MSME sector continues to play a pivotal role in shaping India’s economic tapestry, Uttar Pradesh’s emergence as a powerhouse reaffirms its significance in driving growth and reducing regional imbalances. The transformative shift in MSME financing, fuelled by technology and collaborative partnerships, is dismantling barriers and fostering a resilient, innovative entrepreneurial landscape,” said Anshuman Magazine, Chairman, India, Southeast Asia, Middle East & Africa, CBRE.
The report highlighted the construction sector, contributing approximately 8% to the GDP, as a strategic opportunity for Indian MSMEs. With the construction sector poised to become the third largest globally in the next three years, unorganized firms in this domain are expected to derive significant benefits by registering under the MSME ambit.
The integration of digitization, traditional banking systems, and open protocols has created a more inclusive financing ecosystem, dismantling barriers for a broader segment of MSMEs. The collaboration between traditional banks and fintech firms serves as a key driver of this transformative journey, combining banking expertise with fintech agility and data-driven capabilities.
“Uttar Pradesh’s dominance in the MSME sector is a testament to the state’s vibrant entrepreneurial landscape and the efficacy of government initiatives. The Udyam scheme has been instrumental in fostering the growth of MSMEs, and the state’s strategic incentives have played a pivotal role in propelling India’s MSME landscape,” said Boman Irani, CMD, Rustomjee Group, National President, CREDAI.
