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India's MSMEs present significant opportunity for sustainable manufacturing shift

With over 2.6 million micro, small and medium enterprises operating across India, experts see substantial potential for scaling cleaner production practices across the sector. The shift could reduce environmental impact while improving operational efficiency.

LSN India · 19 September 2026

India's MSMEs present significant opportunity for sustainable manufacturing shift

India's vast MSME ecosystem, comprising more than 2.6 million registered units, represents a largely untapped opportunity for advancing cleaner production methods, according to industry specialists and sustainability experts. The sector, which employs a significant portion of India's workforce and contributes substantially to GDP, currently operates with varying degrees of environmental compliance and efficiency. Experts contend that widespread adoption of cleaner production technologies and practices could transform the MSME landscape while maintaining competitiveness. Cleaner production encompasses process modifications, material substitutions, and waste reduction strategies that minimize environmental footprint without compromising output quality or profitability. The scale of India's MSME base means that even incremental improvements in individual units could yield substantial cumulative environmental and economic benefits across the nation. Implementation challenges include access to financing, technology transfer, and awareness-building among smaller enterprises. Stakeholders highlight the need for targeted government support, industry collaboration, and knowledge-sharing platforms to facilitate the transition toward sustainable manufacturing practices within the MSME sector.