A small company is a specific class of company defined under section 2(85) of the Companies Act, 2013. The definition of a small company has evolved through various legislative amendments and notifications. The rationale behind the classification of companies into such a category stems from the need to simplify regulatory compliance for businesses of relatively smaller financial size. The concept is aligned with the Government of India’s broader initiative to improve the ease of doing business in the country, providing small companies with compliance relaxations to encourage entrepreneurship and facilitate growth.
Legal Foundation and Early Definition
Initially, with effect from 1 April 2014, the Companies Act, 2013, introduced the concept of a small company. The term was defined to mean a company other than a public company whose paid-up share capital did not exceed Rs. 50 lakhs or whose turnover as per its last profit and loss account did not exceed Rs. 2 crores. The crucial characteristic of this early definition was that it required only one of these criteria to be satisfied for a company to be categorized as a small company. This means the conditions were non-cumulative. For instance, a company with a paid-up share capital of Rs. 25 lakhs and a turnover exceeding Rs. 2 crores would still qualify as a small company, and similarly, a company with a paid-up capital exceeding Rs. 50 lakh,,s but with turnover under Rs. 2 crores would also qualify. No additional higher thresholds were prescribed in the rules during this period. However, the statutory provision allowed a maximum ceiling of Rs. 5 crores for paid-up capital and Rs. 20 crores for turnover, which the central government could prescribe by way of rules.
Shift in Definition for Better Clarity
Between 13 February 2015 and 8 February 2018, the definition was revised by the Companies (Removal of Difficulties) Order, 2015. The reason for the revision was that many companies, though meeting one criterion, exceeded the second by a small or significant margin, but were still classified as small companies. To address this issue, the revised definition required both criteria to be satisfied cumulatively. This meant that a company could be classified as a small company only if its paid-up share capital did not exceed Rs. 50 lakh,,s and its turnover also did not exceed Rs. 2 crores. This cumulative approach made the classification more stringent. Despite this change, the outer limits as mentioned in the statute continued to remain at Rs. 5 crores for capital and Rs. 20 crores for turnover. The central government still had the authority to prescribe higher thresholds within these statutory maximums, though such prescriptions were not issued during this period.
Companies (Amendment) Act 2017 and Expanded Limits
Effective from 9 February 2018, the Companies (Amendment) Act, 2017, again brought changes to the definition of a small company. Two significant amendments were introduced. Firstly, the outer limit for both criteria was raised, with the maximum prescribed limit for paid-up capital increased to Rs. 10 crores and for turnover to Rs. 100 crores. However, despite these expanded thresholds, the actual limits applicable under the rules continued to remain Rs. 50 lakhs for capital and Rs. 2 crores for turnover since no corresponding rules were prescribed during this period. Secondly, the definition of turnover was updated. Earlier, the turnover was to be determined as per the company’s last profit and loss account. After the amendment, it had to be calculated based on the profit and loss account of the immediately preceding financial year. This clarification aimed at making the assessment more accurate and current in line with the company’s latest financial position. So during this period, although the outer statutory thresholds were enhanced, the effective criteria for small companies did not change due to the absence of updated rules from the government.
Major Reforms in 2021 and their Impact
A significant development occurred with the Companies (Specification of Definitions Details) Amendment Rules, 2021, which took effect from 1 April 2021. Through this amendment, clause (t) was inserted into Rule 2(1) of the Companies (Specification of Definitions Details) Rules, 2014. This marked the first time that the central government exercised its power to prescribe higher thresholds within the statutory outer limits. The limits were raised from Rs. 50 lakhs to Rs. 2 crores for paid-up capital and from Rs. 2 crores to Rs. 20 crores for turnover. As a result, more companies came within the ambit of the ‘small company’ category. This move was consistent with the Hon’ble Finance Minister’s Budget Speech for 2021-2022, which stated that the revised definition would benefit more than two lakh companies by easing their compliance requirements. These compliance relaxations included exemption from the requirement to hold board meetings more than twice a year, non-applicability of cash flow statements in financial reporting, simplified annual return filing, and reduced certification requirements. The impact was significant in terms of lowering the regulatory burden on a vast number of companies and encouraging entrepreneurship.
Further Expansion of Thresholds in 2022
The government’s effort to support small companies did not stop there. In September 2022, another amendment was introduced through the Companies (Specification of Definitions Details) Amendment Rules, 2022, which became effective from 15 September 2022. Under this amendment, the threshold limits for determining a small company were again revised and doubled. The paid-up capital limit was increased from Rs. 2 crores to Rs. 4 crores, and the turnover limit from Rs. 20 crores to Rs. 40 crores. This expansion meant that even more companies could take advantage of the regulatory relaxations applicable to small companies. The revised limits are a reflection of the government’s continued commitment improving the ease of doing business, reducing compliance costs, and supporting the growth of smaller enterprises. It is important to note that the calculation of turnover continues to be based on the profit and loss account of the immediately preceding financial year, ensuring up-to-date financial assessment for classification purposes.
Alignment with Ease of Doing Business Agenda
These changes must be viewed in the broader context of the Government of India’s efforts to promote ease of doing business. The simplification of compliance norms for small companies forms a core part of this strategy. Recognizing that a large portion of Indian businesses are small or medium in size, the government has systematically revised regulatory thresholds to enable more companies to benefit from a lighter compliance regime. The ease of doing business initiative aims at removing procedural hurdles, encouraging transparency, reducing costs, and improving the operational environment for businesses across the country. Small companies are often the first step in entrepreneurial ventures and innovation. By reducing the regulatory burden, the government is effectively lowering entry barriers for new businesses and enabling existing small enterprises to focus on growth and competitiveness rather than procedural compliance. The amendments to the definition of small company are a testimony to this vision.
Scope of Benefits for Small Companies
The benefits enjoyed by small companies under the Companies Act are numerous. These include simplified financial statements thatdo not require the preparation of cash flow statements, reduced board meeting requirements with only two meetings per year needed, exemption from the rotation of auditors, and reduced penalties for non-compliance. Additionally, small companies are allowed to file abridged annual returns and have fewer disclosure requirements under certain provisions. These benefits not only help companies reduce their compliance costs but also free up management bandwidth to focus on core business activities. From a long-term perspective, such relaxations help in building an environment where businesses can flourish with minimum bureaucratic interference. Moreover, they also lead to better ease of access to credit and capital markets, especially when small companies operate with greater formalization and reduced fear of regulatory overreach. With the recent threshold expansions, many medium-scale enterprises now qualify as small companies and can leverage these compliance relaxations to accelerate their operations.
Policy Intent Behind the Small Company Framework
The creation and expansion of the small company category within the Companies Act is not merely a definitional exercise but a deliberate policy initiative designed to promote inclusive economic growth. The rationale behind this categorization stems from a need to balance regulation with ease of operation for smaller entities. The government recognized that subjecting small companies to the same compliance obligations as larger corporations placed an undue burden on their operations. Such regulatory strain could discourage formalization, reduce profitability, and even impede the overall development of micro and small enterprises. By crafting a differentiated compliance framework, the government sought to achieve two core objectives: reduce the cost of compliance and encourage formalization in the business ecosystem.
Evolution of the Government’s Regulatory Approach
The government’s approach has consistently moved from rigid, uniform frameworks toward more tailored regulatory structures. Initially, the Companies Act had a more generalized approach, with most entities being subject to similar sets of obligations. However, over time, the realisation dawned that a one-size-fits-all approach does not support the dynamic needs of a diverse and growing economy like India. The phased expansion of the small company definition is a clear illustration of this evolution. The gradual upward revision of financial thresholds indicates the government’s willingness to respond to changing business environments and market realities. These revisions also align with broader economic developments such as inflation, increased cost of operations, and the growing size of early-stage enterprises, all of which demand a broader definition to remain relevant and effective.
Supporting Entrepreneurship and Startups
Small companies often represent the first corporate step for startups and budding entrepreneurs. The ability to incorporate and operate a company with reduced regulatory oversight encourages more individuals to start ventures with confidence. This support is critical in a country with a large youth population and growing aspirations. Compliance costs and complex regulatory obligations can act as a significant deterrent for new businesses. The small company regime mitigates these challenges by offering a simplified regulatory path. Entrepreneurs can focus more on innovation, customer acquisition, and scaling operations rather than being consumed by administrative burdens. This fosters a culture of entrepreneurship and allows capital and effort to be channeled more productively. Additionally, with fewer compliance obligations, the entry barriers to the corporate form of business have reduced, which leads to increased formalization, more accurate economic data, and a broader tax base.
Compliance Relaxations Available to Small Companies
The Companies Act provides several compliance relaxations exclusively for small companies. Firstly, small companies are exempt from preparing cash flow statements as part of their financial statements, which simplifies annual reporting and reduces the time and resources spent on accounting. Secondly, the number of board meetings that a small company is required to hold annually is only two, as opposed to four for other companies. This provision helps reduce logistical and administrative efforts. Thirdly, small companies are allowed to file abridged annual returns and financial statements, which contain limited disclosure requirements. This again saves time and compliance costs. Fourthly, small companies are exempt from the requirement of mandatory rotation of auditors and from the need to report on internal financial controls. Lastly, penalties for non-compliance with various provisions of the Companies Act are lower for small companies, offering them protection from harsh legal repercussions for minor defaults.
Role of MCA in Implementation and Monitoring
The Ministry of Corporate Affairs plays a central role in the operationalization of the small company concept. It issues rules, notifications, and clarifications that guide companies in determining their eligibility under the small company framework and helpensure smooth implementation of relaxations. The Ministry also updates financial thresholds in light of economic conditions and industry demands. Through its digital platforms, the Ministry has made it easier for small companies to file returns and access compliance-related services. The move to introduce e-adjudication mechanisms and simplified filing procedures has been especially beneficial for small companies with limited legal and financial resources. Additionally, the Ministry often solicits stakeholder feedback through public consultations before implementing major changes, ensuring that the perspectives of smaller firms are adequately considered. This participative regulatory approach fosters trust and compliance.
Addressing Challenges in Classification
Despite the benefits, there have been concerns and confusion around the classification of companies as small. One issue relates to the timing and manner of calculating turnover, particularly when companies are in transition phases such as scaling up or diversifying. The definition requires turnover to be assessed based on the profit and loss account of the immediately preceding financial year, but interpreting this in specific scenarios such as mergers or business model pivots has sometimes led to ambiguity. Similarly, the computation of paid-up share capital must be exact and compliant with accounting standards, and errors here can lead to wrongful inclusion or exclusion from the small company category. The government has addressed some of these concerns through clarifications and FAQs issued from time to time. However, continuous monitoring and feedback mechanisms are necessary to keep the classification process smooth and dispute-free.
Encouraging Voluntary Corporate Compliance
By lowering the compliance burden for small companies, the government has simultaneously encouraged voluntary compliance. A simpler legal framework reduces the incentive for avoidance and promotes greater engagement with the formal economy. The psychological barrier that entrepreneurs often face regarding corporate governance is mitigated when they know the obligations are manageable. In turn, this helps improve transparency and corporate discipline, which has positive knock-on effects for investor confidence, creditworthiness, and market participation. Moreover, voluntary compliance reduces the workload on regulatory bodies and enforcement agencies, allowing them to focus on addressing complex issues involving larger corporations. The entire regulatory ecosystem becomes more efficient and targeted, serving as a virtuous cycle that benefits all stakeholders.
Contribution to Formalization of Economy
The formalization of the economy is one of the central goals of regulatory reform. Bringing businesses into the formal sector enables the government to capture a more accurate picture of economic activity, improve tax collection, and enhance data-driven policymaking. The small company framework contributes significantly to this goal. Many enterprises that would have otherwise remained unregistered or operated as sole proprietorships now find it attractive to incorporate under the Companies Act as a small company. Incorporation brings with it benefits such as limited liability, perpetual succession, and improved access to funding. At the same time, the reduced regulatory burden ensures that the shift to formality does not come at an unmanageable cost. This delicate balance has made the corporate form of business more accessible and appealing to small entrepreneurs.
Complementary Government Initiatives
The expansion of the small company definition is not an isolated reform. It works in tandem with various other government initiatives aimed at supporting small businesses. These include the Startup India campaign, Udyam registration for MSMEs, credit facilitation through MUDRA loans, and various skill development programs. The synergy between these programs ensures that businesses receive end-to-end support from ideation to expansion. For example, a startup recognized under Startup India can simultaneously qualify as a small company and enjoy reduced compliance obligations. Similarly, a micro or small enterprise registered under Udyam may find it easier to incorporate and operate as a small company under the Companies Act. Such interlinkages improve the overall effectiveness of the policy framework and drive meaningful outcomes for businesses.
Reducing Litigation and Disputes
Another indirect benefit of the small company framework is the reduction in legal disputes and litigation. Complex compliance requirements often lead to inadvertent defaults, which in turn result in penalties and legal challenges. By simplifying compliance, the small company regime minimizes the likelihood of such issues. Fewer disputes mean lower legal costs, less time spent on regulatory matters, and reduced exposure to reputational damage. For the regulatory authorities, too, this results in more efficient allocation of resources and faster resolution of genuinely serious cases. The government’s continued emphasis on decriminalizing minor offences and introducing in-house adjudication mechanisms is also aligned with this approach, especially for small companies.
Challenges in Implementation
Despite the progress, challenges in implementation remain. One issue is the awareness gap. Many promoters and professionals are still unaware of the latest threshold limits and eligibility criteria for classification as a small company. This results in underutilization of the available benefits. Another challenge is the transitional nature of thresholds. Companies on the margin of crossing or falling below the limits may face uncertainty regarding their compliance obligations from year to year. Moreover, certain provisions in state-level regulations or sector-specific compliance laws do not distinguish between small and other companies, leading to overlap and inconsistency. Coordination between central and state-level regulatory frameworks is necessary to fully realize the benefits of the small company concept.
Financial Implications of Small Company Classification
The classification of a company as a small company significantly impacts its financial planning, reporting obligations, and cost structure. Reduced regulatory filings and exemption from preparing cash flow statements help minimize accounting and auditing fees. These savings can be reallocated towards core business development activities such as product innovation, marketing, employee training, or technology upgrades. The savings may seem incremental in isolation, but for small businesses operating on limited budgets, they are substantial. Additionally, reduced penalties for defaults make financial risk more manageable. Small companies can better plan their cash flows and ensure smoother operations without the fear of disproportionate penalties derailing their financial stability.
Access to Institutional Funding and Investment
Formal incorporation as a small company improves access to institutional funding. Investors and banks generally prefer dealing with registered companies due to their regulatory transparency and structured management. A company that enjoys the benefits of the small company category can operate with the discipline of a corporate structure while facing fewer compliance burdens. This dual advantage makes it more attractive to investors, venture capitalists, and financial institutions. Further, banks often consider corporate entities as lower-risk borrowers, especially when their compliance history is clean. The simplification in filing and disclosure processes helps maintain an organized financial record, which is crucial during due diligence or while applying for loans. The small company framework, therefore, acts as an enabler of capital access, improving liquidity and financial resilience.
Influence on Corporate Governance Practices
Small companies, despite reduced obligations, must still maintain essential corporate governance practices. However, the regulatory flexibility allows them to implement governance structures in proportion to their scale and complexity. This encourages good business discipline without overregulating. It allows small companies to build sound governance cultures early in their life cycle. Directors and shareholders can focus on strategic oversight, ethical decision-making, and risk management rather than routine compliance formalities. Moreover, the simplified documentation processes ensure better record-keeping and reduce instances of unintentional violations. As small companies mature, the foundational governance practices put in place under a lighter regime can help them smoothly transition into more complex regulatory categories if they outgrow the small company limits in the future.
Stimulating Regional and Rural Entrepreneurship
The small company definition particularly benefits entrepreneurs in tier II and tier III cities, as well as rural areas. In these regions, businesses often face challenges related to legal awareness, professional advisory access, and administrative infrastructure. The simpler compliance framework helps overcome these obstacles. Entrepreneurs who may have hesitated to incorporate a company due to procedural complexities are now more inclined to do so. Additionally, with the increasing digitalization of compliance systems and government support services, entrepreneurs in remote areas can complete regulatory formalities online, further enhancing participation. This geographic expansion of formal enterprises contributes to balanced regional development and economic decentralization, core objectives of inclusive national growth strategies.
Supporting Women and First-Time Entrepreneurs
The small company classification also acts as a support mechanism for women entrepreneurs and first-time business owners. These segments often face additional socio-economic barriers in starting and sustaining a business. Reduced compliance obligations lower entry barriers and give them the confidence to take entrepreneurial risks. Also, since many businesses run by women or first-time founders begin at a modest scale, they are more likely to fall under the small company definition. The opportunity to operate in a regulated corporate form without heavy procedural requirements is empowering. It enables long-term planning, easier access to grants and credit, and visibility in the formal business ecosystem. In this way, the small company framework contributes to broader societal objectives of gender equality and youth empowerment in entrepreneurship.
Technological Integration in Compliance Processes
The use of technology in compliance systems has significantly benefited small companies. Government portals allow for electronic filing of returns, digital issuance of certificates, online payment of fees, and access to helpdesks. For small companies with limited resources and no dedicated compliance departments, this digital infrastructure is invaluable. It simplifies record-keeping, enhances transparency, and minimizes manual errors. The integration of digital signature certificates and online verification tools has made compliance more secure and accessible. The government’s push for automation in regulatory oversight, such as auto-approval of certain filings or algorithm-driven scrutiny, further reduces interaction with authorities and prevents procedural delays. These advances are particularly aligned with the capabilities and needs of small companies and allow them to maintain good standing with minimal administrative burden.
Impact on Professional Service Providers
The regulatory relaxations available to small companies have led to a shift in the role of professional service providers such as company secretaries, chartered accountants, and legal consultants. While compliance needs have reduced, advisory roles have gained importance. Professionals now help small companies with structuring decisions, growth planning, risk management, and digital transformation, instead of merely handling filings and statutory reporting. This shift has allowed professionals to offer more value-driven services and build long-term relationships with growing businesses. At the same time, they play a vital role in ensuring that even under simplified compliance frameworks, companies do not compromise on governance and accuracy. Professionals serve as the critical link between regulatory changes and practical business implementation.
Risk of Misuse and Regulatory Vigilance
While the benefits of the small company regime are significant, there is a risk that some entities may attempt to exploit the relaxed framework to bypass stringent regulations applicable to larger companies. For instance, companies may try to artificially limit their turnover or capital to retain the small company classification and avoid obligations such as mandatory auditor rotation or enhanced disclosures. To address such risks, regulators rely on monitoring mechanisms, data cross-verification, and audit trails. The MCA and other authorities have increasingly adopted analytics-based tools to detect anomalies in filings and identify suspicious patterns. Additionally, the annual review of eligibility criteria based on the latest financial data ensures that only genuinely eligible companies continue to benefit. The balance between ease and accountability remains crucial, and both businesses and regulators must work in tandem to uphold this balance.
Preparing for Transition Beyond Small Company Status
Many businesses begin as small companies but eventually outgrow the prescribed thresholds for paid-up capital and turnover. Transitioning from a small company to a regular private company brings with it a higher compliance burden. Companies must prepare in advance for such a transition by strengthening their internal controls, maintaining more detailed records, and understanding additional statutory requirements. A sudden shift without preparation can lead to compliance gaps and financial strain. Companies that anticipate their growth trajectory often engage consultants to audit their readiness for higher compliance. Such preparation ensures continuity of good governance and reduces the shock of transition. It is also an opportunity to adopt systems and practices that support sustainable growth and operational scalability.
Learning from Global Best Practices
India’s approach to supporting small companies is in line with international practices, where many jurisdictions offer regulatory relief to smaller entities. Countries like the United Kingdom, Singapore, and Australia have adopted similar frameworks where financial thresholds determine the extent of compliance obligations. The global trend is toward risk-based regulation where the intensity of oversight is proportional to the size, sector, and risk profile of a business. India’s framework, while unique in its structure, follows the same spirit. By studying global best practices and adapting them to local realities, the Indian regulatory regime has become more responsive and progressive. The continued benchmarking against international models ensures that Indian businesses remain globally competitive while enjoying domestic policy support.
Role of Industry Associations and Advocacy Groups
Industry bodies and professional associations have played a key role in shaping the small company framework. Through consultations, feedback submissions, and expert discussions, these groups have influenced policy decisions and threshold revisions. They also assist their members in interpreting regulatory changes, filing returns, and complying with statutory obligations. In regions where professional advisory services are scarce, industry bodies conduct training workshops, issue compliance guides, and offer helpline support. Their role in bridging the knowledge gap between regulators and the business community cannot be overstated. Moreover, they act as a feedback loop to the government, ensuring that the on-ground challenges faced by small companies are recognized and addressed in future reforms.
Streamlining Regulatory Approvals and Enhancing Transparency
An important element of the Ease of Doing Business reforms is the streamlining of regulatory approvals, including licensing, registration, and inspections. Complex compliance procedures and multiple regulatory requirements often serve as barriers to entry and growth for small companies. The government has undertaken initiatives to consolidate and simplify these procedures, including the introduction of online portals and single-window clearances. These reforms significantly reduce the cost and time associated with starting and expanding a business, thereby encouraging entrepreneurship and business innovation. Transparency in regulatory procedures has been greatly enhanced with digitisation and automation. The online filing of returns, e-assessments, and digital verification mechanisms ensure accountability and eliminate human interface, thereby reducing corruption and rent-seeking behaviour. This facilitates a more predictable and investor-friendly environment for small enterprises. As a result, businesses can operate with increased confidence in the system, leading to better planning, execution, and long-term sustainability.
Financial Inclusion and Access to Credit
Access to affordable credit remains one of the most critical requirements for small companies seeking to scale operations. The government has recognised this and introduced several measures to enhance financial inclusion and ensure timely credit availability to small businesses. The establishment of institutions like the Micro Units Development and Refinance Agency (MUDRA) and schemes such as Stand-Up India and Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) have helped bridge the credit gap. Moreover, reforms in the banking sector and fintech innovations have enabled greater reach and efficiency in disbursing loans. The emphasis on collateral-free loans and simplified application procedures further encourages aspiring entrepreneurs to formalise their operations and seek financial assistance. Additionally, the development of digital public infrastructure such as UPI, Aadhaar authentication, and eKYC has streamlined the loan disbursement process, allowing lenders to better assess creditworthiness and reduce turnaround time. Enhanced credit access not only supports working capital needs but also enables investment in technology, capacity expansion, and skill development, all of which are essential for scaling up in competitive markets.
Infrastructure Development and Market Access
The expansion of small companies is also heavily influenced by the availability of physical and digital infrastructure. The government’s investment in infrastructure development, including roads, logistics, industrial parks, and broadband connectivity, contributes to reducing operational bottlenecks and transaction costs. For instance, the development of freight corridors, smart cities, and improved rural connectivity has enhanced market access for businesses located in remote and underdeveloped regions. Additionally, the promotion of e-commerce platforms and digital marketing has opened up new avenues for small companies to reach a broader customer base, including international markets. This democratisation of market access allows small businesses to compete with larger firms on a more level playing field. Government-supported trade facilitation initiatives, such as simplified customs procedures and export subsidies for MSMEs, also contribute to greater global integration of small firms. As they gain better access to domestic and global markets, small businesses can build resilience and diversify revenue streams, making them more adaptive to economic fluctuations and disruptions.
Encouraging Startups and Innovation
The government’s support for startups through dedicated policies, incubators, accelerators, and funding mechanisms has created a thriving entrepreneurial ecosystem. Programs like Startup India, Atal Innovation Mission, and funding through SIDBI have encouraged young entrepreneurs to translate innovative ideas into commercially viable products and services. The focus on technology, research and development, and skill enhancement ensures that small companies are equipped to address emerging market needs and compete effectively. Moreover, the push for intellectual property rights (IPR) awareness and faster patent processing has enabled small firms to protect their innovations and attract investment. Innovation-driven enterprises often require an agile regulatory environment, and the reforms under the Ease of Doing Business umbrella have made it easier for them to launch, test, and scale their solutions. Collaboration between academia, industry, and government has further fostered an ecosystem conducive to experimentation and risk-taking. This culture of innovation is critical for driving productivity, generating employment, and building globally competitive enterprises that can contribute significantly to the country’s economic development.
Conclusion
The expansion of small companies is intricately linked to the government’s Ease of Doing Business initiatives. By reducing regulatory burdens, enhancing transparency, improving access to finance, and fostering infrastructure and innovation, these reforms have created a fertile ground for entrepreneurship and small business growth. However, challenges remain, including disparities in implementation across states, bureaucratic inertia, and capacity constraints. To sustain and accelerate the gains achieved, continuous monitoring, stakeholder engagement, and adaptive policy frameworks are essential. Small companies, as engines of job creation and innovation, play a pivotal role in achieving inclusive and sustainable economic development. A supportive business environment, underpinned by government reforms, is key to unleashing their full potential. With persistent efforts and collaborative governance, India can realise its vision of becoming a global hub for entrepreneurship and innovation, driven by the dynamic growth of its small enterprises.