Shiv Sena (Uddhav Balasaheb Thackeray) on Wednesday, 29 July cited Central government data tabled in the Lok Sabha to claim that 1,21,805 Micro, Small, and Medium Enterprise (MSME) units shut down between 2024 and 2026, leaving hundreds of thousands of young workers jobless. The party made the assertion through an editorial in its mouthpiece, 'Saamana', arguing the closures directly contradict official claims of large-scale foreign investment and job creation.

Scale of the Closures

According to the Saamana editorial, the MSME sector — widely regarded as the backbone of the Indian economy and its second-largest employer after agriculture — has seen a continuous upward trajectory in unit closures over the past decade. The 1,21,805 figure covers a two-year window from 2024 to 2026 and spans industries and factories across the country.

State-wise, the damage has been concentrated in major industrial hubs. Maharashtra recorded the highest number of closures at 28,764 units. Tamil Nadu followed with 14,176 closures, Gujarat reported 11,150 shuttered units, and Rajasthan saw 9,881 MSME units permanently cease operations.

Root Causes: Credit, Payments, and Bureaucracy

The Thackeray camp pointed to three structural fault lines driving closures: inadequate or delayed access to bank credit at reasonable interest rates; prolonged payment delays from large corporations for goods supplied by smaller units; and bureaucratic delays in releasing payments owed by government departments. Rising operational costs compounded these pressures, the editorial argued.

This comes against the backdrop of more than ₹35 lakh crore in loans extended to the MSME sector over the past 10 years — a figure the party noted has not translated into sector stability, given the persistent procedural bottlenecks business owners continue to face.

The Maharashtra Contradiction

The editorial highlighted a sharp contradiction in Maharashtra's own numbers: while the state registered over 75 lakh new enterprises in the last three years, it simultaneously lost more than 28,000 existing MSME units. Critics argue this points to a structural gap — new registrations are not offsetting the collapse of established units with embedded workforces and supply-chain linkages.

Notably, the absence of targeted rehabilitation programmes for sick industrial units has, according to the editorial, contributed to rising Non-Performing Assets (NPAs) for banks and abrupt job losses for young workers.

Political Charge and Government Response

The Uddhav Thackeray-led party argued that global outreach efforts — including participation in forums such as the World Economic Forum in Davos — have prioritised attracting new industrial setups over reviving ailing existing ones. The editorial characterised the government's approach as a 'fend for yourself' policy that leaves struggling small industries without institutional support.

The party said that without concrete measures to support, rebuild, or revive sick industries, the cycle of loan defaults and sudden livelihood loss will continue. The Centre has not yet issued a formal response to the claims made in the editorial.

What Comes Next

With MSME closures reportedly accelerating and NPA risks mounting for lenders, pressure is likely to grow on both the Centre and state governments to introduce sector-specific revival frameworks. Industry bodies and opposition parties are expected to demand a dedicated rehabilitation policy in the upcoming parliamentary session.