India’s micro, small and medium enterprises (MSMEs) reported firmer conditions in July–September 2026, lifting the Small Industries Development Bank of India’s (SIDBI) MSME Business Confidence Index (M-BCI) to 60.4 as margins stayed strained.
The index stood at 59.3 in April–June 2026, a 1.1-point quarterly gain. SIDBI’s eighth-round survey said the increase followed four quarters in which confidence had cooled.
Services had the highest current reading, at 61.3, compared with 61.0 for manufacturing and 57.5 for trading. Manufacturing recorded the largest quarterly rise, from 59.5; services advanced from 60.4 and trading from 56.5. All three sector readings were above 50.
Of those surveyed, 49% said business conditions improved during the quarter, while 33% reported no change and 18% saw a deterioration. Positive views on sales growth came from 45% of services respondents, 43% in manufacturing and 38% in trading. The sales-growth share was below half in each sector.
Improved confidence did not remove pressure on profitability. Depending on the sector, 20% to 30% of MSMEs reported lower net profit margins, while 48% to 58% said their margins were broadly unchanged. In trading, 31% reported that access to working-capital finance had declined.
SIDBI uses the M-BCI to measure current conditions and its Business Expectations Index (M-BEI) to capture respondents’ outlook. The survey’s composite readings draw on six business parameters and use a 0-to-100 scale, with scores above 50 indicating expansion.
The composite M-BEI stood at 61.7 for October–December 2026 and 62.2 for July–September 2027. Manufacturing’s expectations readings were 63.3 and 64.8 for those periods. These values describe anticipated conditions, rather than results already recorded; October–December 2026 is the nearest outlook period in the survey.
