Union budget 2025: What does the MSME sector stand to gain

Finance Minister Nirmala Sitharaman, presenting her eighth consecutive Union budget, reiterated the government's commitment to position India as a global manufacturing hub by extending further support to the MSME (Micro, Small & Medium Enterprises) sector.

The finance minister announced that the investment and turnover limits for the classification MSMEs will be enhanced to 2.5 and 2 times respectively. This will give them the confidence to grow and generate employment for our youth, she noted.

Pointing out that MSMEs are the second engine of India's growth, Sitharaman said the sector is responsible for 45 per cent of India's exports.

A term loan of up to Rs 20 crore for well-run export-oriented MSMEs, a scheme for lakh women and first-time entrepreneurs for term loans for the next five years, and enhancing credit guarantee cover for MSMEs to improve credit access were among the announcements Sitharaman made for the sector.

Announcing a dedicated scheme for India’s footwear and leather sector, the minister said this would lead to the generation of over 22 lakh employment opportunities.

The budget has increased credit guarantee cover for MSMEs. Sitharaman has also announced the introduction of customised credit cards for micro-enterprises.

Focusing on the toys sector, Sitharaman said, "Building on the national action plan, we will implement a scheme to make India a global hub for toys."

Besides, the government will introduce customised credit cards with Rs 5 lakh limit for micro-enterprises.

She said the Kisan Credit Cards would facilitate short-term loans for 7.7 crore farmers, fishermen, and dairy farmers.

She added that term loan of up to Rs 20 crore will be provided to well-run export-oriented MSMEs.