OBC entrepreneurs own nearly 30% of India’s MSMEs

Around 41% of OBC-owned units are located in Tamil Nadu, Maharashtra, and Rajasthan. Other Backward Classes (OBC) own nearly 30% of micro, small and medium enterprises (MSME) in the country.

As on March 31, 2022, the number of MSMEs owned by OBCs was 23.31 lakh units, out of a total of about 80.16 lakh units in the country. Of the OBC-owned units, around 41% are located in three States — Tamil Nadu (14.5%), Maharashtra (14.4%) and Rajasthan (12.4%), according to a perusal of the data furnished by the Office of the MSME Development Commissioner exclusively to The Hindu. The data was compiled on the basis of the units that have registered themselves with the authorities through the Udyam portal.

According to the social category-wise distribution, the General Category accounts for the highest share of the MSME units with 61.8%. In absolute figures, there are 49.56 lakh units belonging to this category. As many as 6.8% of the units — around 5.43 lakh — are owned by the Scheduled Castes, while the Scheduled Tribes run about 1.68 lakh units with 2.1% share. A little over 18,000 units come under the category of “Unidentified”.

As per a June 2020 notification of the Union Ministry of MSME, a micro enterprise has been defined as one where the investment in plant and machinery or equipment does not exceed ₹1 crore and turnover does not exceed ₹5 crore; a small enterprise as one where the investment in plant and machinery or equipment does not exceed ₹10 crore and turnover does not exceed ₹50 crore; and a medium enterprise as one where the investment in plant and machinery or equipment does not exceed ₹50 crore and turnover does not exceed ₹250 crore.

As regards the OBC-owned enterprises, Tamil Nadu has the highest number of such units with 3,37,016, of which 3,23,441 units come under micro enterprises; 12,778 under small enterprises; and 797 under medium enterprises.

Maharashtra follows the southern State closely with 3,35,920 and its break up is: 3,31,770 micro enterprises; 3,944 small enterprises and 206 medium enterprises.

The northwestern State of Rajasthan comes third with 2,89,857 units owned by the OBCs. It has about 2.86 lakh micro units: 3,585 small enterprises and 150 medium enterprises.

The fourth, fifth and sixth slots go to the northern States of Uttar Pradesh (approximately 2.38 lakh units); Bihar (1.71 lakhs); and Madhya Pradesh (1.56 lakhs), respectively.

In Tamil Nadu, 39.4% of the total number of about 8.56 lakh units belong to the OBCs, which is about 10 percentage points higher than the all-India average figure of 29%. But in Maharashtra, it is only about 20.6%, whereas in Rajasthan, the share is a little short of 46%.