As someone who closely associates with our MSMEs, I have spent this year monitoring developments that shaped the year for our small businesses. And as we stand at the fag-end of 2025, this year was defined by resilience, challenge, and caution in a shifting global environment. The story was the same for all, from local service providers to export-focused manufacturers. In short, 2025 was a year of survival for our MSMEs.

Yes, on the positive side, many businesses have finally begun to stabilise operations after several turbulent years post-COVID and I saw a gleam of hope as digital adoption deepened meaningfully across sectors. To top it, export-oriented MSMEs also saw selective recovery in engineering goods, pharmaceuticals, textiles, leather, and food processing. I’m really proud to notice that the majority of the MSMEs have embraced GST compliance tools, online procurement, digital payments, and even cloud solutions faster than in previous years. For many other small businesses, digital marketplaces, especially Tradeindia, was successful in providing new pathways to domestic and international buyers.

Meanwhile my sources in the government circles say that credit access has also improved marginally this year. A friend of mine in the banking sector told me that formal lending to MSMEs grew, and government-backed guarantee schemes and refinancing support continued to provide relief; this is no doubt very good news. And with our government’s relentless backing, women-led enterprises and first-time entrepreneurs received greater visibility through local incubators and state-level initiatives.

But, that was the rosy picture of 2025. On the other hand, at the global level, uncertainty exerted pressure on our small exporters. The continuation of tariffs from the US against our goods added strain on key export segments making it harder for many MSMEs in steel, aluminium, and select manufactured products to compete in one of most global export markets. I feel sad that these tariff barriers compelled numerous businesses to recalibrate their markets or to absorb cost pressures, thus reducing their profit margins and slowing growth.

In addition, as is the story every year, our small businesses continued to struggle with delayed payments, complex compliance requirements, and uneven implementation of policies across states. For many micro enterprises, working capital stress never truly eased. Many small businesses had to shut shop in 2025 due to rising input costs, high logistics expenses, and fluctuating energy tariffs. 

And that’s not all. Meanwhile technology adoption amongst MSMEs still remained uneven. A large segment of businesses adopted digital tools, but did that without adequate training. This sadly led to dependency rather than empowerment. Above that while cybersecurity risks increased, but awareness lagged far behind with enforcement agencies being found with no teeth.

Another missed opportunity this year, which I have to discuss, is cluster-based support. MSMEs, as we all know, operate in tightly linked ecosystems, yet most government interventions remain very fragmented. And because our businesses lacked cluster-based support, skill development, market access, and finance continued to function in isolation. This I will say limited any long-term impact, whatsoever.

In contrast to the many challenges of 2025, the recent India–New Zealand trade agreement offered a positive outlook with the pact expected to lower tariff barriers, enhance market access, and open new avenues for our MSMEs, particularly in agriculture, textiles, and engineered goods. 

So as we close 2025, one clear message from the MSME community is that they are not asking for any handouts. Instead they are asking for predictability, timely payments, simpler compliance, and genuine partnership. I hope 2026 will be a better year. Fingers crossed!