Micro Small Medium Enterprises — Policy Reforms

Entry	Year	Description	Impact
MSMED Act, 2006 (Section 7 Amendment)	2020	The definition of MSMEs under Section 7 of the MSMED Act, 2006, was significantly amended as part of the Atmanirbhar Bharat Abhiyan package. This amendment removed the distinction between manufacturing and service enterprises and introduced a composite criterion based on both investment in plant and machinery/equipment and annual turnover. The thresholds for all three categories (Micro, Small, Medium) were substantially increased.	This amendment aimed to encourage MSMEs to grow without fear of losing benefits, simplify the classification process, and bring more enterprises under the MSME ambit. It was a strategic move to boost domestic manufacturing, employment, and exports, aligning with the vision of a self-reliant India. The exclusion of export turnover from classification criteria further incentivized export-oriented growth.