Rich in natural resources and abundant in labor, India is a beautiful place that allows entrepreneurs. When we look at how a large business develops, it is usually enlarged into a small unified space.

However, money and social media are often the keys to the growth of many small businesses. While many businesses start out with high expectations, funding serves as a major barrier to success.

What is meant by small-scale industries?

A small-scale industry is where the provision, structure, and production of services are made on a small scale. Millions of people are a part of small businesses in India and businesses that import their products into the country.

The Small, Medium, and Medium Business Development Act of 2006 defines and categorizes sub-sectors such as MSMEs. These sectors are based on investments in plant and equipment in the manufacturing sector and on investment in resources in the service sector industries.

Today, the government encourages most of these small industries through grants, MSME loans, and finances. 

Small-scale industries play an important role in India, as they have taken India to a higher level in the industrial world. The  MSME registration online has made registration steps easy for industrialists.

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Top 9 Most Profitable Small Scale Industries in India 2021

Here are some of the most profitable small-scale industries in India:


The industries that produce Papads and Fritters are the most profitable options for those who want to own a business in South Asia, especially in India.

The shelf life of papad is 2.5 to 3 months, and you can produce a variety of products. The biggest customers are usually hostels, hotels, and restaurants. The value of the papad market in India is estimated at around 1000 crores.

Incense sticks

India is globally the largest producer of incense sticks and exports products to several countries. The agarbatti or incense market is expected to grow by more than 8% CAGR depending on volume over the next few years.

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Due to the growth in the number of people performing self-medication, there has been a growth in the demand for pharma grade camphor among Indians.

However, 98% of the camphor used in India is for religious purposes. Agarbatti making is an evergreen profitable business that one can easily set up with little investment.

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Indian cuisine is highly dependent on a variety of spices. Therefore, the demand for spices will always be high. However, the spice market in India is so large that it caters to international needs.

In the 2020 financial year, spices worth US $ 3.65 billion were exported from India. The profitable industry is growing at a rate of 40000 crores every year.

Phenyl or Floor Cleaner

Phenyl is a moderate cleaning agent that is widely used in homes, hospitals, restaurants, and factories. Although the market has seen the introduction of many products as alternatives, phenyl continues to be the most widely used.

It is one of the best small manufacturing businesses that can help you make lots of money with little investment.

Chips and snacks

Potato chips and banana chips are some of India’s most widely consumed snacks. Currently, small towns have also become a strong market for the production of chips.

The size of the overall food market is estimated to be close to Rs. 45 to 50 billion easily. The market is reported to be growing at 7 to 8% per annum. India produces two types of snacks, traditional such as chanachur or bhujia and international like chips.

Dairy Products

India has various dairy products ranging from milk and curd to processed products such as paneer. With the growing awareness of the health benefits of high-quality dairy products, there is a great need for low-fat dairy products.

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Cottage Cheese, better known as paneer, is one of the most widely used dairy products in dishes, especially in North India.

Handloom Industry

The handicraft or handloom industry is one of the largest small-scale industrial enterprises. Small industries face many difficulties but continue to thrive due to the availability and quality of products. With encouraging programs like Make in India, we can hope to see the industry thrive.

Sanitary Napkins

Sanitary Napkins is one of the most popular options among small businesses run by the NGO. It provides a dual-use service in many rural areas by providing employment for women as well as raising awareness of the use of safe and hygienic clothing.

These industries are also gaining attention on the silver screen with the release of movies like Padman. The set-up of these industries will require approximately 3- 35 lakhs depending on the unit size, equipment, and the number of employees. In fact, it is the best small business idea that isn’t going anywhere soon.

Coconut Oil

Coconut oil is used by different people to cook food. It is not only used in kitchens. In fact, it is also used in the production of oil, hair tonics, soaps, cosmetics, etc.

This can be a very practical business investment as you can start it for as little as 1 Lakh. If the right standards and quality are maintained, you can sell not only in the local market but also in the international market and earn decent money.  

Due to the growing awareness of naturally prepared fats among humans, its demand has grown exponentially. You can start it in your own home if you have a vacant lot or rent a small place to start a business. 

Final Words!

Now, it has become very simple to own a small-scale industry and be an entrepreneur in India. Just by some simple steps, you can do MSME registration online for an MSME loan or for a machinery loan.  

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Since the P.M has appealed to be self-dependent and self-employed by the policy, Aatmanirbhar Bharat Rojgar Yojana (ABRY), entrepreneurship has reached new heights, and since then, it can be seen going in almost every part of the country.

Hence, financial organizations and institutes are also coming forward in order to help such entrepreneurs and small-scale industrialists grow by offering them MSME loans at a very low rate of interest and with the ease of registration period.

Yes, now you can get your registration done for MSME loans in just three days, without any formalities, at a very reasonable interest rate, with ZipLoan. To know more about us or MSME loans contact us today.

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Frequently Asked Questions

Which small scale industry is profitable?

The answer is not easy but the consumption of ice cream has grossly increased over the few years. Icecream cone manufacturing business is amongst the most profitable small scale business in India. An ice cream cone manufacturing unit can be set up in a small space with a meager investment of 1 to 1.5 lakh rupees.

Which manufacturing business is most profitable?

Here are some most profitable businesses in India:
1) Plastic Bottle Manufacturing
2) Jams/Jellies/Marmalades Making
3) Candle Making
4) Sports Items Manufacturing
5) Biscuits Manufacturing
6) Hair Oil Manufacturing
7) Detergent and soap Manufacturing
8) Manufacturing of Paper

How can I start a small industry?

Here are some smart tips to start a small scale industry in India
1) Product Selection
2) Location of the Enterprise
3) The pattern of the Organisation
4) Project Appraisal
5) Registration with Authorities

What small scale business can I start?

There are a variety of best small-scale industries for those interested in starting their businesses.
1) Cake Baking Business
2) Candle Making Manufacturing Business
3) Pickles
4) Incense Sticks or Agarbattis and Camphors
5) Handmade Chocolates
6) Papad and Other Roasted/Fried Snacks
7) Jute Bags
8) Organic Soaps

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