Micro, Small and Medium Enterprises in India: The Challenges of Technology Adoption

The Micro, small and medium-sized enterprises (MSME) sector in India is impressive in its sheer size and diversity of industries and services. On the basis of its characteristics the MSMEs sector is described as, “a nursery of entrepreneur­ship” and the “gateway to global growth”. The 26-million-strong micro, small and medium-sized enterprises (MSMEs) – comprises of one of the most critical sectors in India’s growth story and will play a pivotal role in the country’s eco­nomic future. While a portion of the MSME sector contributes to India’s technology industry, MSME manufacturing and service sectors on the whole have not adopted technology to improve their day-to-day business practices – including interactions with customers and employees, marketing and sales functions, or financial manage­ment – so that they can further grow their business and compete in an increasingly global marketplace. This paper begins by exploring the MSME landscape, with a specific focus on the technology adoption profiles across the sector. It is narrowly focused on the impor­tant topic of technology adoption and is intended to present a comprehensive look at the wide array of barriers that face the MSME sector. An attempt has been made access the profiles of the sector, and the opportunities and challenges it faces, to provide a foundation to examine the use of technology today.