New Delhi: A majority of medium enterprises in India use outdated machinery and technology that hampers their competitiveness and prevents them from keeping up with the modern world, according to a report released by NITI Aayog on Monday.
As per the report titled “Designing a Policy for Medium Enterprises”, 82% of medium enterprises reported that they do not have advanced technologies integrated into their business operations.
“Moreover, 60% of these enterprises still rely on outdated machinery, affecting their productivity and product quality,” noted the report, which is based on primary studies and surveys conducted among medium enterprises.
Although the majority of the medium enterprises are aware of information technology tools such as Customer Relationship Management (CRM), Enterprise Resource Planning (ERP), and Human Resource Management Systems (HRMS), their usage remains critically low at just 14%, it said.
“Targeted support and handholding may be essential for medium enterprises, helping them integrate advanced technologies like artificial intelligence (AI), Internet of Things (IoT), and automation into their business operations. This support can include regional hubs or specialized facilities offering consultancy, hands-on training, and access to digital tools,” the report suggested.
The report highlights the critical, yet under-leveraged role played by medium enterprises and outlines targeted interventions to unlock their full potential in the economy.
The report, released by NITI Aayog Vice Chairman Suman Bery, also delves into the structural skew in the Micro, Small and Medium Enterprises (MSME) sector, which contributes nearly 29% to India’s gross domestic product (GDP), accounts for 40% of exports, and employs over 60% of the workforce.
Despite its critical role, the composition of the sector is disproportionately weighted: 97% of registered MSMEs are micro enterprises, 2.7% are small, and only 0.3% are medium enterprises, the report underlined.
However, this 0.3% of medium enterprises contributes nearly 40% of MSME exports, underscoring their untapped potential as scalable, innovation-led units, the report noted.
Published 26 May 2025, 23:51 IST