TN Raises MSME Subsidies to Rs 600 Crore, Urges Corporate Backing

The Tamil Nadu government has called on large corporations to establish sustained partnerships with micro enterprises through mentoring, market access, and supply-chain integration. Speaking on Wednesday at the fifth edition of the CII Southern Region MSME Procurement Summit in Chennai, Additional Chief Secretary of the MSME Department Pradeep Yadav urged industry leaders to help the state's vast micro, small, and medium enterprise sector scale up and enhance its competitiveness.

Pradeep Yadav noted that Tamil Nadu ranks among the leading states in India for registered MSMEs, hosting more than 43 lakh enterprises. However, nearly 99 per cent of these units fall under the micro enterprise category, making them especially vulnerable to market disruptions and in need of structured institutional and industry backing.

To strengthen the sector, the state government has expanded its budget allocation for MSME subsidies from Rs 320 crore to Rs 600 crore. Yadav stated that financial and institutional support from the government is also being extended to assist smaller firms in the adoption of artificial intelligence.

Addressing procurement mechanisms, Yadav urged both MSMEs and corporate buyers to increase their usage of established digital systems. He recommended platforms such as the Government e-Marketplace (GeM), the Open Network for Digital Commerce (ONDC), and the Trade Receivables Discounting System (TReDS) to improve cash flows and market connectivity.

The summit gathered procurement executives from government departments, public sector undertakings, and private corporations, alongside entrepreneurs, policymakers, and financial institutions. Deliberations centered on corporate sourcing, government and PSU procurement, access to formal finance, defence manufacturing, and emerging commercial opportunities within the deep-tech industry.

CII Southern Region Chairman Ravichandran Purushothaman addressed the gathering, stating that MSMEs must prioritise expanding their operational scale, upgrading capabilities, and achieving global competitiveness. He outlined ongoing CII initiatives designed to speed up sectoral transformation, pointing to targeted programmes that promote export opportunities, digital adoption, and onboarding onto TReDS.

The procurement summit also saw participation from key public sector and aerospace entities, including the Indian Space Research Organisation (ISRO), Hindustan Aeronautics Limited (HAL), NLC India Limited, Tamil Nadu Newsprint and Papers Limited (TNPL), and the Airports Authority of India (AAI).