MSME plays a vital role in the socio-economic development of a country. They contribute approximately 29.7% of GDP and 49.66% of exports, acting as a vital link in industrialisation in terms of production, employment and exports.

MSME are the second largest employers of human resources after agriculture, providing employment to nearly 60 million people. They generate more employment opportunities per unit of capital invested as they are labour intensive and less capital intensive. This helps prevent migration of rural population to urban areas and promotes balanced regional development.

MSME provide ample opportunities for entrepreneurship by channeling latent skills into business ideas with little capital investment. They use local raw materials and indigenous skills, and enjoy low cost of production due to locally available resources and low overhead expenses.