Sector profile

Manufacturing MSMEs

Micro, small and medium enterprises make up most of India's industrial units. This page covers their contribution to output and exports, and the Uttar Pradesh support for new and expanding MSME manufacturing units.

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Brass craftsman at work in a small utensil workshop in Punjab — Photo: Harvinder Chandigarh via Wikimedia Commons, CC BY 4.0

Importance to the Indian economy

MSMEs contributed 30.1% of India's GDP (GVA share) in 2022-23, up from 27.3% in 2020-21 (Ministry of MSME, via PIB). They are also central to trade: MSME-related products made up 45.73% of India's exports in 2023-24 (DGCI&S data, Department of Commerce).

In Uttar Pradesh, the One District One Product (ODOP) clusters, such as Moradabad metal craft, Firozabad glassware and Kanpur leather products, are MSME-led. A well-structured project can combine the state MSME policy with central credit and guarantee schemes.

The last three years in official data

Figures as published by the Government of India source linked against each year. We do not estimate or fill gaps.

Share of MSME GVA in India's GDP%

2020-21

27.3%

2021-22

29.6%

2022-23

30.1%

Bars start at zero and are scaled to the largest value shown.

Year	Value (%)
2020-21	27.3%Source: Ministry of MSME, PIB (PRID 2035073)
2021-22	29.6%Source: Ministry of MSME, PIB (PRID 2035073)
2022-23	30.1%Source: Ministry of MSME, PIB (PRID 2035073)

Share of MSME-related products in India's exports%

2021-22

45.03%

2022-23

43.59%

2023-24

45.73%

Bars start at zero and are scaled to the largest value shown.

Year	Value (%)
2021-22	45.03%Source: Department of Commerce, Lok Sabha USQ 3557 (DGCI&S data)
2022-23	43.59%Source: Department of Commerce, Lok Sabha USQ 3557 (DGCI&S data)
2023-24	45.73%Source: Department of Commerce, Lok Sabha USQ 3557 (DGCI&S data)

What is not shown, and why: The latest official MSME GVA share we could verify is for 2022-23; later years are not shown.

UP incentives for this sector

The Uttar Pradesh policy that applies to this sector, with the main incentives as stated in the policy or on Invest UP. Rates, caps and eligibility conditions are summarised; the policy text and its guidelines decide each case.

In force

Uttar Pradesh MSME Promotion Policy 2022

Promulgated 28 Sep 2022, for five years or until a new policy is notified

Incentive	Support (as per the policy)
Capital subsidy (Bundelkhand & Purvanchal)	25% micro, 20% small, 15% medium
Capital subsidy (Madhyanchal & Paschimanchal)	20% micro, 15% small, 10% medium; maximum ₹4 crore; +2% for SC/ST and women
Interest subsidy (micro units)	50% of term-loan interest for 5 years, up to ₹25 lakh
Stamp duty	100% / 75% / 50% exemption by region; 100% for women entrepreneurs
EPF reimbursement	100% of employer contribution for 5 years

Source: Invest UP policy page; Policy document (PDF)

Full guide: UP MSME Promotion Policy

Applicable across sectors. A manufacturing project of ₹50 crore or more can also be evaluated under the UP Industrial Investment & Employment Promotion Policy 2022 (valid to 3 Nov 2027), and an MSME unit under the UP MSME Promotion Policy 2022. As a rule only one state policy can be used for the same investment, so compare the sector policy with these general policies on your own numbers before applying. Central schemes can often be combined with state support: see subsidy stacking.

Sources

Scheme terms change; verify on the official portal; last checked 4 Oct 2026. This page is general information for planning, not a guarantee of eligibility, sanction or disbursement. See our Terms of Use & Disclaimer.

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