India's Small Businesses Lead Asia-Pacific in Growth and Innovation

India's small business sector has emerged as one of the most vibrant in the Asia-Pacific region, according to the latest findings from the 16th Asia-Pacific Small Business Survey by CPA Australia. The survey reveals that 78% of Indian small businesses grew last year, showcasing a robust post-pandemic recovery.

Prafulla Chhajed, an experienced Certified Practicing Accountant with CPA Australia, attributes this momentum to a dynamic business environment fueled by rapid digital transformation and a strong focus on innovation. Business confidence is high, with an impressive 86% of respondents anticipating growth in the current year.

Another notable trend is the increasing export focus of Indian small businesses, with 64% expecting a rise in overseas sales, outperforming many surveyed markets. Chhajed highlights the sector's adaptability and readiness to embrace technology and explore new opportunities as key drivers of growth in a rapidly evolving economy.

Domestically, technological advancements, improved infrastructure, and supportive government policies have created a favorable climate for MSMEs to thrive. On a global scale, rising demand for Indian products and services, alongside government incentives, are encouraging more businesses to expand their international reach, despite challenges like rising costs.

Last year, 40% of respondents cited increasing expenses as their major challenge, leading 34% of those seeking external funds in 2024 to do so mainly to manage costs. However, access to finance remains favorable, with 43% of businesses finding it easy to secure funding, a trend expected to persist this year.

The survey also reveals a strong hiring trend, with 46% of Indian small businesses expanding their workforce in 2024, making them leading job creators in the region. The outlook is even more optimistic for this year, with 64% planning to hire, outpacing the regional average significantly.

Younger entrepreneurs under 40 play a critical role in job creation, often running rapidly growing businesses. These enterprises are increasingly focusing on innovation, with 78% planning to introduce new products or services by 2025. A sharp rise in investments in artificial intelligence (AI) is also noted, signaling a tech-driven future.

The annual survey collected insights from over 4,236 small businesses across 11 Asia-Pacific markets, with 507 respondents from India, conducted in November and December 2024. (ANI)

(With inputs from agencies.)