SME meaning - SME stands for Small and Medium Enterprises. The SME definition in India as per Section 7 of Micro, Small & Medium Enterprises Development Act, 2006 is based on the investment amount as per the sectors these cater to. The two types of SMEs- manufacturing and services, are classified as-
|Classification of Companies||Investment Threshold||Turnover Threshold|
|Small Enterprise||Between Rs.1 crore and Rs.10 crore||Between Rs.5 crore and Rs.50 crore|
|Medium enterprise||Between Rs.10 crore and Rs.20 crore||Between Rs.50 crore and Rs.100 crore|
The importance of SMEs is paramount in India as they contribute more than 24% to the services sector GDP and more than 6% to the manufacturing sector GDP of India as per CII. SMEs also account for around 45% of all exports in India and employ more than 120 million individuals. In India, there are more than 63 million registered and unregistered small and medium enterprises.
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