📷 Image: Wikimedia Commons / Ministry of Micro,Small & Medium Enterprises, Gove
Business
India’s MSMEs Drive Economy, Yet AI Adoption Remains Low
✍️ YourStory.com
🗓 22 Jul 2026, 02:08 PM
👁 45
Small and medium enterprises contribute significantly to India’s GDP, but a recent survey shows that most of them have not integrated artificial intelligence into their operations.
India’s micro, small and medium enterprises (MSMEs) account for roughly 30% of the country’s gross domestic product and employ about 40% of the workforce. They are the backbone of the economy, especially in sectors such as manufacturing, retail and services.
A recent industry survey, however, reveals that only a small fraction of these firms have adopted artificial intelligence tools. While a handful use AI for inventory management or customer analytics, the majority rely on manual processes and legacy software.
Experts point to several barriers: limited awareness of AI benefits, high upfront costs, and a shortage of skilled personnel who can implement and maintain such systems. Many MSMEs also lack the capital to invest in the necessary infrastructure.
The government has announced a number of schemes to bridge this gap, including subsidies for AI training and the creation of digital hubs in industrial clusters. The challenge remains to translate policy into widespread practice so that MSMEs can harness AI to boost productivity and competitiveness.
A recent industry survey, however, reveals that only a small fraction of these firms have adopted artificial intelligence tools. While a handful use AI for inventory management or customer analytics, the majority rely on manual processes and legacy software.
Experts point to several barriers: limited awareness of AI benefits, high upfront costs, and a shortage of skilled personnel who can implement and maintain such systems. Many MSMEs also lack the capital to invest in the necessary infrastructure.
The government has announced a number of schemes to bridge this gap, including subsidies for AI training and the creation of digital hubs in industrial clusters. The challenge remains to translate policy into widespread practice so that MSMEs can harness AI to boost productivity and competitiveness.