Despite US tariff challenges, MSMEs show resilience, sectoral indices remain above expansion threshold: SIDBI Survey

New Delhi [India], October 28 (ANI): Despite tariff challenges imposed by the United States, India's micro, small and medium enterprises (MSME) sector demonstrated resilience in the July-September quarter, according to the latest MSME Outlook Survey released by the Small Industries Development Bank of India (SIDBI).

The survey highlighted that all three sectoral indices, manufacturing, services, and trading, remained well above the expansion threshold of 50, indicating continued growth momentum.

It stated "MSMEs continue to show resilience with all the three sectoral indices in manufacturing, services and trading well above the expansion threshold of 50".

The report also stated that while there was a slight moderation in overall business optimism among MSMEs, this was mainly due to emerging global challenges such as the U.S. tariff measures and other external economic pressures.

Nevertheless, the sector maintained steady progress, reflecting the adaptability and strength of Indian MSMEs.

The survey data shared that the composite MSME Business Expectations Index (M-BEI) reflected a positive outlook, projecting the index to rise to 62.26 in the next quarter and further to 66.57 in the quarter one year ahead (July-September 2026).

This optimism is supported by expectations of stronger domestic demand and favourable government measures such as the reduction in Goods and Services Tax (GST) on various products and services. The services sector, in particular, showed robust expectations for future growth.

Sales sentiment, however, softened slightly in the July-September 2025 period. Around 50 per cent of trading and 47 per cent of manufacturing MSMEs reported positive growth, a marginal decline from the previous quarter, while the services sector maintained its earlier momentum.

Looking ahead, revenue expectations remain upbeat, boosted by the festive season.

Export performance saw a dip, with only 43 per cent of MSMEs reporting positive growth in export sales. However, optimism remains high, with 56 per cent of exporters expecting healthy growth in the next year.

Most MSMEs reported stable profit margins, with nearly one in five witnessing improvements. Although around 15-20 per cent of businesses experienced some pressure on profits, overall optimism about the future remains strong.

The SIDBI survey concluded that manufacturing and services are likely to continue their positive momentum in the coming quarters, reinforcing the sector's resilience despite global headwinds. (ANI)

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