MSMEs Need To Integrate With Global Value Chain: Union Minister

The integration of micro, small and medium enterprises (MSME) is critical for the financial viability of Global Value Chains (GVCs), stated Pratap Chandra Sarangi, Hon Minister of State Animal Husbandry, Dairying and Fisheries and Micro, Small and Medium Enterprises, Government of India at an E-Conference on Enabling the MSMEs for Global Value Chains, on the occasion of International MSME Day organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The minister stated that not only do MSMEs provide a low-cost way of operations but also with their geographical reach and innovation capabilities, MSMEs form the cornerstone for fostering global economic growth. However, as Global Value Chains (GVCs) grow and the value addition capabilities of MSMEs increase, mechanisms would have to be formed to enable those MSMEs to be able to form their own value chains without fear of competition, the minister stated.

He stated that in the process of integration to global value chain, MSMEs face many challenges therefore efforts must be made to strengthen MSME sector locally to enable their penetration and reach globally. He revealed that the role and potential of Indian MSMEs along with the need to improve their efficiency, productivity and quality needs to be viewed in the context of a globally competitive landscape.

With the Government increasing opportunities for local MSMEs and reducing dependence on imports, Indian MSMEs will be able to scale up operations and gain higher market share across the various sector, he added. He also stated that the Ministry of MSME is taking steps towards making these enterprises global and improve the overall business environment, by making it more conducive and transparent for all stakeholders.

Private sector engagement in various bottlenecks of value chain and supply chain system is critical for success of various policies announced by the government, he said. While the Government works on creating a level-playing field for the Indian MSMEs, these players will have to embrace technology and focus on value addition to enhance competitiveness in the global arena, the minister added. The global economy is set to undergo massive changes post the coronavirus shock and provides India with a lifetime opportunity to strengthen its manufacturing prowess and position itself as a critical hub in global value chains, he pointed out.

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