Representative image: Garment workers cut fabric to make shirts at a textile factory of Texport Industries in Hindupur town in Andhra Pradesh..
Credit: Reuters File Photo
Bengaluru: About 35,567 micro, small and medium enterprises (MSMEs) across India, which have registered on the central government’s Udyam Portal, have shut down in the ongoing financial year (2024-25), as on February 28, 2025.
In total, over the past five years, 75,082 MSMEs have shut down across the country. This is since the portal was launched on July 1, 2020 with targets under ease of doing business, according to a reply by the Minister of State for MSMEs Shobha Karandlaje, in Rajya Sabha on Tuesday.
The current year’s closures make up about 47.4% of the closures. In fact, the number has almost doubled since the previous year (2023-24), which saw 19,828 MSMEs shut down.
The number of shutdowns in 2024-25 is nearly the same as the cumulative total number of MSMEs shut down in the preceding four years. From 175 units closing in FY21, this went up to 6,222 in FY22, followed by 13,290 shut in FY23, and another 19,828 in FY24, a clear trend of more MSMEs ceasing operations each year.
In her written reply, Karandlaje did not elaborate on the reasons for the closures.
Maharashtra saw the most shutdowns in 2024-25 with 8,472 MSMEs, followed by Tamil Nadu (4,412), Gujarat (3,148), Rajasthan (2,989), and Karnataka (2,010).
This comes despite the recent push given in the Union Budget to MSMEs including investment and turnover limit boosts as well as increased credit guarantees.
The total number of MSMEs registered across Indian states and UTs are 6.05 crore, as of February 28.
There was no data provided on jobs lost due to these closures. However, as per a previous reply in July 2024 by the Minister for Micro, Small and Medium Enterprises (MSMEs) Jitan Ram Majhi in Lok Sabha, around 3.18 lakh jobs were said to be lost with 49,342 enterprises closed till then (since July 2020).
Majhi had given reasons such as “change in the company owner, certificate not required anymore, duplicate registration, and such other reasons”. Reports have previously pointed to multiple reasons such as complex and unfavourable policies, shortage of raw material and skilled labour, amongst several others.