NITI Aayog proposes convergence of 18 schemes for MSMEs

The proposal is outlined in a report titled Achieving Efficiencies in MSME Sector through Convergence of Schemes.

NITI Aayog has proposed the convergence of government schemes for micro, small and medium enterprises (MSMEs) that are currently spread across multiple ministries to improve coordination, reduce duplication, and enhance access for beneficiaries.

The report notes that overlapping objectives and fragmented implementation across ministries have limited their overall effectiveness.

The proposal is outlined in a report titled Achieving Efficiencies in MSME Sector through Convergence of Schemes, prepared by the Administrative Staff College of India (ASCI), Hyderabad. The report was released on Thursday by NITI Aayog member Arvind Virmani and chief executive officer B.V.R. Subrahmanyam.

According to the report, the Ministry of MSME operates 18 schemes covering credit, skill development, infrastructure, marketing support, innovation, technology upgradation, and cluster development. While these schemes have contributed to enterprise growth, the report notes that overlapping objectives and fragmented implementation across ministries have limited their overall effectiveness.

“Effective convergence and rationalisation of schemes can simplify access for beneficiaries and ensure better use of public resources,” the report stated.

The document calls for a coordinated governance framework that would allow ministries and implementing agencies to work together through joint planning, shared data systems, and coordinated outreach. It recommends regular inter-ministerial workshops, joint training programmes, and common beneficiary mobilisation efforts.

The report outlines a two-pronged convergence framework: information convergence and process convergence. Information convergence would focus on integrating data at central and state levels to improve coordination and decision-making. Process convergence would aim to align similar schemes to reduce duplication and streamline service delivery.

In cluster development, the report recommends convergence of the Scheme of Fund for Regeneration of Traditional Industries (SFURTI) with the Micro and Small Enterprises–Cluster Development Programme (MSE-CDP). According to the report, this would help streamline planning, avoid overlap, and optimise resource allocation.

“A coordinated skill development framework will ensure a more structured and responsive training approach for MSMEs,” the report said. It noted that several skill development programmes run by different ministries have similar objectives and could be aligned into a unified structure.

The report also proposes the convergence of the Procurement and Marketing Scheme (PMS) with the International Cooperation (IC) scheme to simplify access to marketing assistance and improve domestic and export market participation for MSMEs. It further suggests aligning innovation-focused initiatives by integrating the ASPIRE scheme with MSME Innovative, with ASPIRE operating as a special category for agro-rural enterprises.

At the same time, the report cautions against indiscriminate merging of schemes. “Convergence efforts must be approached with caution for schemes designed for specific beneficiary groups,” it stated, referring to programmes such as the National SC/ST Hub and the MSME Promotion Programme for the Northeastern Region.

The report also recommends that large flagship programmes, including the Prime Minister’s Employment Generation Programme (PMEGP) and PM Vishwakarma, should remain independent. It said these schemes have “substantial scale, distinct objectives, and focused economic benefits” that require separate implementation structures.