Union Budget 2025 revises MSME ( Micro, Small, and Medium Enterprises ) investment & turnover thresholds

In the Union Budget announced on February 1, 2025, Finance Minister Nirmala Sitharaman introduced significant revisions to the classification criteria for Micro, Small, and Medium Enterprises (MSMEs) in India . The investment and turnover thresholds have been increased to better accommodate the growth and expansion of these enterprises.
Revised MSME Classification Criteria (2025)
Enterprises Type | Investment in INR | Turnover in INR |
---|---|---|
Micro Enterprises | ₹2.5 crore | ₹10 crore |
Small Enterprises | ₹25 crore | ₹100 crore |
Medium Enterprises | ₹125 crore | ₹500 crore |
These adjustments represent a 2.5 times increase in the investment limits and a 2 times increase in the turnover limits compared to the previous criteria established in 2020.
Previous MSME Classification Criteria (2020)
Enterprises Type | Investment in INR | Turnover in INR |
---|---|---|
Micro Enterprises | ₹1 crore | ₹5 crore |
Small Enterprises | ₹10 crore | ₹50 crore |
Medium Enterprises | ₹50 crore | ₹250 crore |
The reclassification aims to provide a more inclusive framework, allowing a greater number of enterprises to benefit from MSME schemes and support mechanisms. These measures reflect the government's commitment to strengthening the MSME sector, which plays a crucial role in India's economic development by contributing significantly to employment, manufacturing output, and exports.