Date:April 5, 2023
What is Medium Enterprises in MSME Act?
MSME Law Notes by NB Associates
As per the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 of India, Medium Enterprises are defined as the type of enterprises engaged in the manufacture, production, processing or preservation of goods, and whose investment in plant and machinery or equipment is more than Rs. 10 crore but does not exceed Rs. 50 crore and the annual turnover does not exceed Rs. 250 crore.
Medium Enterprises are larger in scale than both Micro and Small Enterprises and can be found in various sectors such as manufacturing, services, and trade. They play a crucial role in the economy by providing employment opportunities and contributing to economic growth and development.
The MSMED Act provides various benefits and incentives to Medium Enterprises, such as priority sector lending from banks and financial institutions, preferential treatment in procurement, access to credit and capital, and other forms of support to promote their growth and development.
The Act also aims to facilitate the development of Medium Enterprises by providing them with access to technology, skill development, and market opportunities.
The classification of Micro, Small and Medium Enterprises based on the investment in plant and machinery or equipment and the annual turnover of the enterprise enables the government to provide targeted support to the MSME sector, which is crucial for the growth and development of the sector and the overall economy.