Govt plans new support framework for medium enterprises — shift away from ‘one-size-fits-all’ MSME policy

NEW DELHI : India is working on a new set of schemes and incentives specifically designed for medium enterprises, sources told. This marks a major shift from the current one-size-fits-all approach of MSME policies, which group micro, small, and medium enterprises under a single framework.

Sources say that medium enterprises—larger than micro and small firms but still below large industries—often miss out.

Existing policies tend to focus more on micro and small enterprises, leaving medium firms underserved, especially when it comes to technology adoption, global market access, and easier credit.

To address this, Niti Aayog, along with the MSME ministry, has started work on three key projects aimed at making medium enterprises globally competitive.

The plan includes:

• Dedicated schemes to support technology upgrades, export readiness, and easier access to credit—areas where medium enterprises often struggle.
• Convergence of MSME schemes into simplified ‘benefit baskets’, making it easier for medium enterprises to know what support is available and how to apply.
• Cluster development push to strengthen industrial hubs where medium enterprises operate, helping them scale up faster and improve exports.

In the recent Budget, the government has already doubled the credit guarantee cover for micro and small enterprises to ₹10 crore, unlocking ₹1.5 lakh crore of additional credit over five years, sources said.

For well-performing exporter MSMEs, the term loan limit has been raised to ₹20 crore, helping them expand faster in global markets.

Sources say this targeted approach will separate policies for micro, small, and medium enterprises, ensuring each gets tailored support, instead of being clubbed into a single category—a crucial step to make India’s MSME sector more competitive globally.