2 days ago
MSMEs survey: 61% say govt skill and talent programs ‘ineffective', 88% agree govt spend pushes capex plan, finds report
A majority of the Micro, Small and Medium Enterprises (MSMEs) surveyed in a Cushman & Wakefield report on the sector, felt that skilling and talent programmes run by the government are ineffective for them, ANI reported.
As many as 71 per cent of manufacturing MSMEs, felt that government-run skill-training programmes haven't helped them. Overall, 61 per cent of MSMEs said the initiatives had not reached them, and 39 per cent affirmed that they had received benefits, the report added.
All companies surveyed had less than 500 employees. The report titled, 'Elevating India's Manufacturing Resilience: Charting the Path to Self-Reliance', found that 'government skill and talent initiatives aren't reaching the sector effectively. The gap is widest among small firms.'
Further, it found that even though MSMEs employed four of every five manufacturing workers, and produced 40 per cent of the sector's output; these workers generated only 14 per cent as much as each worker in a large plant.
Similar manufacturers in emerging economies have reached almost 30 per cent; in advanced economies the gap is even smaller, the report observed.
Apart from various skilling schemes, the government has earmarked ₹ 2,500 crore for 12 sector-specific plug-and-play parks to speed plan setup, slash capex, help SMEs and attract Foreign Direct Investments (FDI). Here, a chunk of 88 per cent respondents agreed that government spend on infrastructure has influenced their capex plans.
Further, 93 per cent of respondents report better operating efficiency and profitability where modern parks and corridors are in place.
Another notable 88 per cent of respondents plan to expand operations, driven by infrastructure projects such as Bharatmala, Sagarmala, Dedicated Freight Corridors, and the National Industrial Corridor Development.
Additionally, 95 per cent reported improved access to logistics.
And 94 per cent of large enterprises credited infrastructure upgrades as central to their growth strategies.
'India must address deep-rooted cost and capacity gaps — especially in logistics, integrated facilities, and MSME productivity,' according to Gautam Saraf, Executive MD, Mumbai & New Business, Cushman & Wakefield.
The report noted that challenges persist for the MSME sector. High logistics costs, low warehousing capacity (0.2 sq. ft. per urban resident vs. 47.3 in the US), minimal domestic value addition (17 per cent vs. China's 25 per cent), and skill gaps, especially in MSMEs, threaten long-term competitiveness.
'Plug-and-play industrial parks, multimodal logistics networks, and improved land aggregation frameworks are not just enablers; they are essential levers for converting policy momentum into production-ready outcomes,' Saraf added.
