A Micro, Small and Medium Enterprises (MSME) Development Act, 2006 became operational on October 02, 2006. The act facilitates / boosts the promotion, development and enhancing the competitiveness of micro, small and medium enterprises. These include start-ups and other business initiatives which are comparatively small in budget and have limited operations.
The Enterprises are classified in 2 category
- Manufacturing enterprises – engaged in the manufacturing or production of goods in any industry
- Service enterprises – engaged in providing or rendering services.
As per New Scheme ‘Atma Nirbhar Bharat Abhiyan’ or the Self-Reliant India Scheme for the year 2020 by the Government of India has provided a new definition for MSMEs.
As per new definition of MSME turnover to define MSMEs
Investments will no longer characterize MSMEs. In October 2019, Union Minister Nitin Gadkari had said that the revised definition of micro, small, and medium enterprises may grant a unified description for all things related to taxation, investment and more.