Unlocking the potential of MSMEs in skill education and work-based learning in India

Picture this: Students in schools and colleges find a new and exciting way to learn about skills and entrepreneurship. And this is a part of their curriculum in their chosen subject, something that interests them a lot! They are curious, eager to learn more as they observe, interact, and explore the world of MSMEs.

We’re talking about how students could gain immensely from their engagement with the MSME sector, the backbone of the Indian economy. The neighborhood enterprises, mostly micro and small, found in every rural, semi-urban, and urban area, are yet to be tapped for a mutually beneficial relationship with the academic institutions and training centers. Their potential to disrupt skill education and work-based learning is yet to be realized!

Today, sustainable industry-academia collaboration is the need of the hour to introduce students to the world of work, showing them the positive side of acquiring on-demand skills, and providing them opportunities to learn, practice, and apply their knowledge and skills.

Exploring industry-academia partnerships for a growing number of students in higher education

Let’s look at the recent numbers about enrolment in colleges, as per AISHE Report 2021-22:

• The total enrolment in higher education has increased to nearly 4.33 crore in 2021–22 from 4.14 crore in 2020–21.
• GER has increased to 28.4 in 2021–22 from 23.7 in 2014–15 (as per 2011 population projections for the 18–23 age group). Female GER has increased to 28.5 in 2021–22 from 22.9 in 2014–15.
• Among disciplines at the undergraduate level, enrolment is highest in the arts (34.2%), followed by science (14.8%), commerce (13.3%), and engineering and technology (11.8%).

How do we ensure that at least 50% of these students get exposed to the industry while they are pursuing their UG courses? True to the spirit of NEP 2020, MSMEs could play a crucial role in forging innovative industry-academia partnerships, catering to the cultural and economic diversity of India. If education has to meet the needs of the local economy, then local and nearby industries could be the best places to start a dialogue with the MSMEs, and here’s why it matters:

• India has a total of 633.9 lakh MSMEs, with over 99% qualifying as micro-enterprises (630.5 lakh enterprises).
• A total of 3.3 lakh businesses qualifies as small businesses, and just 0.05 lakh qualify as medium businesses.
• Rural areas have 324.9 lakh businesses, while urban areas have 309 lakh businesses.

Top reasons to explore industry-academia partnerships with MSMEs

The top reasons to explore industry-academia partnerships with MSMEs are crucial in:

• Employment generation: Particularly in rural and semi-urban areas, promote economic inclusion, contributing to poverty reduction and social stability.
• Supporting national missions: Realizing national missions like ‘Make in India’ and ‘Vocal for Local’
• Enhancing global competitiveness: MSME’s contribute significantly to India’s exports and enhancing the country’s global competitiveness.

With a strong and ever-growing presence in manufacturing, services, and other sectors, MSMEs form a part of the larger industrial ecosystem in:

Manufacturing

• Pharmaceuticals and chemicals
• Engineering, fabrication and assembly
• Food processing
• Textiles and garments
• Leather products

Services

• Retail and wholesale trade
• IT – ITeS
• Education and training
• Tourism and hospitality
• Healthcare and wellness
• Legal and accounting services

Other Sectors

• Agriculture and allied activities
• Transportation and logistics
• Construction and real estate

Addressing MSME challenges and fostering academic collaboration

Some of the typical challenges faced by the MSME sector include limited access to finance and technology, regulatory compliance, slow business growth, a lack of awareness about government schemes, and so on. However, despite these challenges, MSMEs continue to contribute significantly to India’s economic growth.

Can we make them an integral part of our education system? How can MSMEs participate in realizing our goals of mainstreaming vocational and skill education? Can micro and small enterprises fulfill the need to provide industry exposure and sensitization to millions of students? How do we strike a win-win relationship with MSMEs through internships, apprenticeships, and faculty development?

The answers to the above questions call for a complete re-look at our standard notion of industry-academia partnerships. Most educational institutions are focused on job placements and narrowly define their industry engagements, restricting them to large companies, MNCs, or medium enterprises. Nevertheless, the micro and small segments, though they may not provide placements, can definitely fill the void in industry engagement for educational purposes.

The small hotels, the manufacturing units, the food processing business, the electronics servicing centers, the crafts clusters, the apparel design and production, healthcare, and diagnostic centers—these ubiquitous establishments could be more accessible and approachable than large companies. Interactions on skills, machinery, infrastructure, the production process, customer acquisition, packaging, the supply chain, logistics, and related topics open up exciting topics for students to discover and learn.

In most cases, the constraints in which these micro and small enterprises could offer the students a platform to learn in innovative ways include:

• Fuelling the spirit of inquiry and learning by understanding how things work in reality
• Acquiring different technical skills and analysing business in different sectors

In turn, the students can contribute towards:

• Technology integration opportunities for these businesses
• Waste management and sustainable practices
• Innovative ideas to save costs and human resources

So, how can we untap the potential of MSMEs in contributing to Indian skill education and work-based learning ecosystem? Let’s assume the academic institutions are keen on partnering with these industry sectors, and they initiate a process of collaboration. How can they go about building a relationship with these enterprises, for whom any industry-academia collaboration may not be a priority?

• OEMs like auto part components
• Photocopying, lamination and binding
• Handlooms and handicrafts
• Leather goods production
• Moulding of plastic items
• Restaurants and travel agencies
• Electronic surveillance and security solutions
• Automotive repair services and garages
• Beauty parlours and wellness centers
• Agricultural farm equipment servicing
• Coir and jute products
• Engineering and fabrication services
• Furniture and wooden products

Also read : Government schemes and initiatives that support MSME growth in India

Let’s remember, it’s not always possible to partner with large companies or even medium enterprises. Often, their rules restrict easy access for academic institutions to explore any engagement with the industry. The potential of MSMEs is yet to be unlocked for a mutually beneficial partnership that can also help build a talent pipeline for these enterprises.

Watch out for the next article in this series to learn more about how the skilling and training ecosystem for MSMEs can pave the way for sustainable industry-academia engagement.