Over 35,000 MSMEs Closed in 2024-25, Nearly Double of Last Year
New Delhi: As many as 35,567 micro, small and medium enterprises (MSMEs) across India, registered on the Union government’s Udyam portal, have shut down in the ongoing financial year (2024-25) as on February 28, Minister of State for MSMEs Shobha Karandlaje said in a written reply in Rajya Sabha, reported Deccan Herald.
Without elaborating on the reasons behind the shutdowns, she said that since the portal was launched on July 1, 2020, a total of 75,082 MSMEs have shut down across the country.
The current year’s closures make up about 47.4% of all closures, and almost double of the previous year (2023-24), which saw 19,828 MSMEs shut down, as per the newspaper.
Maharashtra saw the most number of shutdowns this year with 8,472 MSMEs closed, followed by 4,412 in Tamil Nadu, 3,148 in Gujarat, 2,989 in Rajasthan and 2,010 in Karnataka.
Since the data misses one month of the year, the actual number of shutdowns in 2024-25 may be higher.
Also read: Balancing Reform and Reality: The GST Dilemma for MSMEs
Notably, the Udyam portal was launched for the ease of doing business – something the Union government has been promoting in recent years. The MSME sector also received a number of sops in the Union Budget including investment and turnover limit boosts and increased credit guarantees.
The total number of MSMEs registered across states and UTs, as of February 28, stands at 6.05 crore. However, The Wire has earlier reported why the surge in registrations on Udyam portal demands closer scrutiny.
The number of MSMEs shutting down operations have remained particularly high since the Covid-19 pandemic. However, no data has been provided on jobs lost due to these closures.
The latest information on job losses is from July last year, when Union minister for MSMEs Jitan Ram Majhi told the Lok Sabha that over three lakh people were made jobless due to the closure of nearly 50,000 small businesses in the last 10 years, as reported by Mint.
In a written reply, the minister has said that out of the million registered MSMEs, 49,342 had closed, resulting in the loss of 317,641 jobs.
Majhi had told the House that the closures “are attributed to various reasons including changes in company ownership, redundant certificates, and duplicate registrations”.
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