Kohima: Nano enterprises account for nearly 95% of businesses in Nagaland, making them one of the most significant drivers of the state’s grassroots economy, according to Industries and Commerce Advisor Hekani Jakhalu.
Raising an urgent matter under Rule 50 on the “Critical role of Micro, Small and Medium Enterprises (MSMEs) in improving Nagaland’s economy” during the eighth session of the Nagaland Legislative Assembly on Tuesday, Jakhalu highlighted the importance of nano enterprises and the challenges they face.
She said these ultra-small businesses form the backbone of the state’s economic activity, operating across sectors such as livestock, manufacturing, services, trade, tailoring, welding, handicrafts, small shops and street vending.
Despite their large presence, Jakhalu said nano enterprises remain among the most underserved segments of the economy. Many entrepreneurs struggle to access formal financial services and often rely on loan sharks to sustain their businesses.
According to her, the process of obtaining institutional finance is often lengthy and complicated, involving steps such as preparing project reports, departmental vetting and bank approvals. These requirements can be difficult for small entrepreneurs who operate with limited resources and technical knowledge.
Jakhalu suggested that the government revisit existing financial schemes, including the Chief Minister’s Micro Finance Initiative (CMMFI), to better support nano entrepreneurs. She proposed small loans ranging from Rs 10,000 to Rs 50,000, and in some cases up to Rs 1 lakh, to help entrepreneurs meet immediate needs such as purchasing raw materials, equipment, inventory and working capital.
During the discussion, Jakhalu also spoke about the overall growth of the MSME sector in Nagaland. She said MSMEs act as a “silent growth engine” of the state’s economy by creating employment and sustaining livelihoods without heavy dependence on government jobs or financial assistance.
She noted that MSMEs were earlier categorised under the unorganised sector, making it difficult to measure their economic contribution. However, the situation has improved with increased registration under the Udyam portal.
Nagaland recorded 27,083 MSMEs registered under Udyam in 2023–24. After the launch of the Raising and Accelerating MSME Performance (RAMP) scheme by Chief Minister Neiphiu Rio on August 27, 2024, registrations have reportedly increased to more than 48,000, generating thousands of employment opportunities.
Formalisation through Udyam registration allows businesses to access government schemes, credit facilities, public procurement opportunities and other support measures designed to strengthen the MSME ecosystem.
Jakhalu also pointed to the growth of the state’s start-up ecosystem. According to available data, Nagaland currently has 267 registered start-ups, including 92 private limited companies. These ventures generated about Rs 74 crore in revenue and created more than 1,500 jobs during the 2024–25 period.
However, she said several challenges continue to affect MSME growth in the state, including limited access to finance, strict collateral requirements, inadequate banking infrastructure, inconsistent power supply and high energy costs.
Poor road connectivity was also cited as a concern, as it increases transportation costs and delays the movement of goods. Jakhalu further raised the issue of multiple or unregulated taxation faced by businesses, which she said discourages entrepreneurship and deters outside investors.
She added that Nagaland must align its development plans with the national vision of Viksit Bharat 2047.
Jakhalu said that with targeted interventions and stronger policy support, nano enterprises, MSMEs and young entrepreneurs in the state could play a key role in building a self-reliant economy and achieving the goal of Viksit Nagaland 2047.
Advisor for New and Renewable Energy and NSDMA Z Nyusietho Nyuthe also highlighted the importance of the MSME sector in strengthening the state’s economy and generating employment.
Referring to the Survey Report on Employment, Unemployment, Skill and Migration in Nagaland 2025 released by the Directorate of Economics and Statistics, he said the state’s employment rate stands at 83.92%, while the unemployment rate is 16.07%, which is higher than the national unemployment rate.
Nyuthe said MSMEs have significant potential in sectors such as home-based production, food processing, handloom and handicrafts, which could create employment opportunities, particularly for young people.
He suggested training youths in vocational skills such as masonry, plumbing, tiling, electrical works and mechanical services at district headquarters so they can find opportunities in the construction sector.
Nyuthe also proposed introducing a manual job-oriented subject in the school curriculum from Class 5 to Class 12 to encourage skill development from an early stage.
Advisor for Civil Administration Works Division and Taxes Kudecho Khamo said MSMEs help create jobs at lower capital cost, particularly in rural and semi-urban areas, while also encouraging balanced regional development and reducing migration.
He said more than 48,000 MSME units in the state have registered under Udyam, including manufacturing and service enterprises, providing employment opportunities to many youths.
However, he said the sector continues to face challenges such as financial constraints, inadequate infrastructure and limited digital adoption. Improving access to finance, strengthening skill development and introducing effective policy interventions would be necessary to sustain MSME growth.
Khamo also appreciated several initiatives launched by Chief Minister Neiphiu Rio to support entrepreneurship and MSME development, including the Raising and Accelerating MSME Performance (RAMP) scheme, Nagaland Entrepreneurship Impact Forward (NEIF) 2035, the Nagaland Skill Entrepreneurship Development Mission (NSEDM) 2025 and the Chief Minister’s Micro Finance Initiative (CMMFI).
He also mentioned digital initiatives such as the “My MSME” app and the establishment of an all-women BPO centre in Dimapur.
MLA Jwenga Seb said MSMEs recognised under the Micro, Small and Medium Enterprises Development Act, 2006 are the backbone of grassroots economic activity and could help transform Nagaland’s resources into productive industries.
He said the sector could convert agricultural produce into packaged organic foods, develop herbal and wellness products, promote bamboo-based manufacturing and expand the state’s handicraft and handloom industries.
Seb also referred to national initiatives such as the Prime Minister’s Employment Generation Programme, Credit Guarantee Fund Trust for Micro and Small Enterprises, Startup India and Atmanirbhar Bharat Abhiyan.
However, he said several challenges hinder MSME growth in the state, including misuse of subsidy-linked schemes, limited access to credit due to landholding practices protected under Article 371A of the Constitution of India, and inadequate infrastructure, connectivity and market access.
He suggested creating innovative credit mechanisms in collaboration with institutions such as National Bank for Agriculture and Rural Development and Small Industries Development Bank of India. He also called for the establishment of MSME and agro-processing clusters with plug-and-play infrastructure and the promotion of a “Made in Nagaland” branding campaign to expand market access for local products.
Advisor for Social Welfare Wangpang Konyak said that in the absence of large industries and corporate investments, MSMEs remain the most viable source of employment for young people and play an important role in strengthening the rural economy.
He highlighted that value addition through food processing, bamboo furniture manufacturing, weaving, spice grinding and branding could significantly enhance farmers’ income and make rural areas economically sustainable.
Konyak also emphasised the need to promote local production to help retain money within the state and reduce dependence on outside markets.
He said MSMEs also help preserve Naga cultural heritage by promoting traditional crafts such as handloom, bamboo work and indigenous designs while creating livelihood opportunities for artisans.
He also called for improved infrastructure such as cold storage facilities, warehouses, rural markets and food processing centres to reduce post-harvest losses and support farmers and entrepreneurs.
In his closing remarks, Speaker of the Nagaland Legislative Assembly Sharingain Longkumer said around 48,000 MSMEs are currently registered in the state and appreciated the Department of Industries and Commerce for presenting a comprehensive data analysis.
He said that if the data were evenly distributed, each assembly constituency could have around 800 registered enterprises.
Longkumer encouraged legislators to examine how many of these are nano and micro enterprises and assess their turnover and contribution to the local economy. He urged members of the House to coordinate with the concerned department and contribute inputs to strengthen policies and support MSME growth in their respective constituencies.
Concluding the discussion on the critical role of MSMEs in improving Nagaland’s economy, Chief Minister Neiphiu Rio highlighted the steady expansion of the sector and the initiatives undertaken by the government to promote enterprise development.
Rio said that as of 9 March 2026, a total of 48,655 enterprises have been registered on the Udyam portal in the state. Of these, 48,464 are micro enterprises, most of which fall under nano enterprises with an annual turnover below Rs 25 lakh, while 175 are small enterprises and 16 are medium enterprises.
Under the Chief Minister’s Micro Finance Initiative (CMMFI), he said 777 MSME units have been established since the scheme began. These enterprises have generated investments of over Rs 65 crore through government subsidy support and credit linkages.
The Chief Minister said the units are mainly engaged in transport services, retail trade, hospitality and small manufacturing, and are expected to create more than 1,500 direct employment opportunities across the state.
Rio also informed the House that 13 MSME development projects are currently under implementation, while 15 additional projects have been submitted to the Ministry of Micro, Small and Medium Enterprises for approval. These projects aim to strengthen industrial infrastructure and promote cluster-based development to improve productivity and competitiveness.
Under the Prime Minister’s Employment Generation Programme, he said the target for the financial year 2025–26 is 454 projects, of which 66 have already been sanctioned by banks. Over the past five years, 3,715 beneficiaries have been supported through the scheme.
Rio said the state is also implementing programmes such as the Raising and Accelerating MSME Performance (RAMP) initiative to enhance MSME competitiveness through capacity building, registration drives and buyer–seller meets.
He added that the PM Vishwakarma Scheme has received more than 25,000 artisan applications from Nagaland, with training and financial assistance being facilitated.
Efforts are also being made to promote cluster-based development and value addition in sectors such as food processing, handicrafts, handloom and agro-based industries, which have strong potential in the state. The government is also examining provisions to ensure that a certain percentage of government procurement is sourced from indigenous MSME enterprises.
To support traditional weaving communities, Rio said the state government is working on establishing a Yarn Bank in Nagaland to ensure the steady availability of quality yarn at affordable rates. The initiative is expected to reduce production costs and enable local artisans to maintain consistent output while promoting traditional Naga textile designs in wider markets.
On the skilling front, the Chief Minister said the Nagaland Skill and Entrepreneurship Development Mission (NSEDM) has enrolled 3,091 candidates in various training programmes as of February 2026. Of these, 2,365 candidates have completed training, while 495 are currently undergoing training, with further phases planned to meet the target of skilling 5,000 youths.
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Rio also said the government is promoting enterprise development in agriculture and allied sectors. Nagaland ranked third among small states in the Export Preparedness Index 2024. Coffee from the state is currently being exported to the United Arab Emirates, with demand also coming from Bahrain, Europe, South Korea, Singapore and Japan. Pineapple and processed king chilli are also being exported to international markets.
While highlighting these developments, Rio acknowledged that MSMEs still face challenges related to access to credit, bank approvals and market linkages. He said the state government is working with banks, district industries centres and other stakeholders to address these issues and provide timely support to entrepreneurs.
He also urged legislators to encourage young people in their constituencies to take up entrepreneurship.
Rio said the government will continue to focus on improving ease of doing business, strengthening financial support systems and promoting innovation to ensure MSMEs grow into sustainable and competitive enterprises in Nagaland.
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