Staff Reporter | 24 Jul, 2025
The Micro, Small and Medium Enterprises (MSME) sector in the Northeast is fast emerging as a crucial pillar of regional economic development, with new incubation centres, policy reforms, and financial support schemes creating fresh momentum. Yet, credit access, infrastructure challenges, and limited market linkages continue to hamper the full potential of small enterprises across the eight states.
In a recent media report published by the Voice of NE, the sector’s evolving landscape was explored in detail, highlighting a surge in entrepreneurship driven by young innovators, women-led businesses, and grassroots manufacturers. The report underscored how states like Manipur and Assam are leading the charge—with Manipur recording over 12,000 MSME registrations by 2019 and Assam hosting over 1,400 startups as of late 2024.
The story also pointed to recent developments such as the establishment of a new business incubation centre at Nagaland University, announced in July 2025. The centre will support at least 44 startups with mentorship and seed funding, giving a much-needed boost to innovation and self-employment in the state.
However, systemic problems remain. One of the biggest barriers is the persistent credit shortfall. Despite growth in sanctioned loans through Central schemes like Pradhan Mantri Mudra Yojana and RAMP, the region’s credit-deposit ratio remains low—hovering around 45 percent, well below the national average. Many MSMEs are still forced to depend on informal lenders, which limits their long-term growth and sustainability.
To counteract this, institutions like the North Eastern Development Finance Corporation Ltd (NEDFi) have stepped in. In 2023, NEDFi disbursed over ₹550 crore to more than 5,000 MSME projects and provided micro-finance support to nearly nine lakh individuals, 90 percent of whom were women. Complementary schemes under the Credit Guarantee Fund Trust are also helping to de-risk loans for first-time borrowers.
Beyond finance, infrastructure bottlenecks—such as poor roads, erratic electricity, and inadequate logistics—have added to the woes of small businesses, particularly in hill states like Arunachal Pradesh and Mizoram. Market access is another major challenge. Without sufficient support in branding, packaging, and digital platforms, many enterprises remain confined to local markets.
Despite the odds, women entrepreneurs across the region are emerging as strong drivers of change. In Manipur, half of all MSMEs are women-led, and similar trends are taking shape in Assam and Nagaland. Many of these ventures operate in food processing, traditional crafts, and eco-products, combining cultural heritage with modern business models.
As highlighted in the Voice of NE feature, the future of MSMEs in the Northeast depends on strategic policy follow-through, inclusive credit access, digital upskilling, and infrastructure improvement. If supported effectively, the sector could become a cornerstone of sustainable and equitable economic growth in the region.
The recent surge in investor interest, coupled with Central and state-level initiatives, has created a rare opportunity for the Northeast to reimagine its economic path—with MSMEs leading from the front.
