A Study On The Distribution Of Start-Ups And MSMEs Across The 8 North Eastern States And Their Performance On Various Parameters

Abstract

Start-ups and MSMEs are recognised as drivers of growth and employment in India. Accordingly, the central and state governments have introduced multiple schemes, programs and grants to support both Start-Ups and MSMEs in the country. The general belief is that education drives innovation and organisation in business. This study attempts to find the correlation in the 8 North Eastern states between start-up registrations and MSME formalisation against Literacy and Poverty rates. We examined the uptake and use of 2 specific schemes by Start-Ups and MSMEs from the North Eastern states of India. DPIIT, the Start-Up India scheme, is the flagship program towards supporting Start-Ups in the country, and Udyam is a focused program to support MSMEs with a single-window registration platform.

Methods: The research follows a mixed methodology relying on secondary studies and interviews. Multiple government databases, statistical reports, and state-level publications were studied. Selected start-ups from each state were interviewed to understand their perspective on the startup ecosystem in their state and the ranking followed in this study.

Results: The results indicate while Assam, Manipur and Tripura are front runners in per capita numbers for Start-Ups  , Sikkim, Mizoram and Manipur are the best performing states in terms of per capita MSME numbers. Sikkim and Tripura were the most consistent performers while Meghalaya and Nagaland had lowest overall ranks. There appears to be no correlation between literacy levels and state performance, however poverty levels and state performance were found to be correlated. It was found that on average, over 80% of small and medium enterprises were concentrated in 4 districts in each state. The significant disparity between the eight states in terms of numbers and performance imply that there are notable localised differentiators that presently affect the ecosystem and thus warrant a more detailed study on the same.