India’s small businesses generate 14.9m jobs every year, says survey

As political parties in poll-bound India keep attacking the federal government over its failure to create some 20 million jobs every year as promised, a survey by the Confederation of Indian Industry (CCI) covering more than 105,347 micro, small and medium enterprises (MSMEs) in 28 states indicates a 13.9% jump in jobs in this key sector in the past four years.

This translates to 3.3% rise or 14.9 million more jobs per annum in the sector which employs some 450 million people.

Maharashtra, Gujarat and Telangana led the states in generating jobs in MSME sector over the past four years while Maharashtra, Tamil Nadu and Telangana topped in exports, the survey said.

Sectors such as hospitality and tourism, textiles and apparel and metal products absorbed maximum work force followed by machinery parts and transport and logistics.

The survey covering 350 industrial centres predicted steady rise in jobs in the next three years thanks to federal initiatives like the 2% interest rate subvention given to all MSMEs and trade receivables e-discounting system introduced recently.

The CCI survey comes as a big relief for the Modi government which was criticised by opposition parties and media after a newspaper published a leaked and incomplete official study which said unemployment rate in India had risen by 6.1% to a 45-year high in 2017-18.

The government questioned the newspaper report which was based on the results of the periodic labour force survey prepared by National Sample Survey Office.

Calling the report “fake”, the government argued how the country can grow at an average rate of 7% if more people are not employed.