Leading SMEs of India 2021

15 Country No. of Employees Capital / Asset Turnover / Sales Bangladesh P P Brazil P China P P P European Union P P P Japan P P Malaysia P P United Kingdom P P P United States P P Source: Report of the Expert Committee on Micro, Small and Medium Enterprises (2019) Through an enterprise’s life cycle, it should grow to evolve from micro to medium and so on. However, in case of MSMEs, India has witnessed the issue of ‘missing middle’, which implies that micro units have failed to grow into small andmedium- sized businesses and so on over a period of time. This can partially be attributed to the criterion set for the definition of MSMEs. The threshold set in the previous definition was lower as compared to the current scenario of new business set-up and technologies. This led many enterprises to restrict their growth in order to maintain their MSME status and avail various incentives related to tax and financial assistance. 93% 6% 1% Mi cro Sm all Mid-si ze d 324.09 306.43 0.78 2.53 0. 01 0. 04 Rura l Ur ban Mi cro Sm all Medium Source: Annual Report 2020-21 issued by Ministry of Micro, Small and Medium Enterprises Thus, in May 2020, the Honorable Finance Minister, Smt. Nirmala Sitharaman announced revision to the definition of MSME. The new definition of MSME brought in the following changes: • Increase in investment limit • Introduction of additional criteria of turnover • Elimination of difference between Manufacturing & Service sector Dun & Bradstreet