Both developed and developing nations owe a great deal to the success of their small and medium-sized businesses (SMEs). These economic spheres are essential to Indias progress. The expansion of these companies has helped boost the economy. Manufacturing contributes around forty-five percent of GDP and over forty percent of export income. The term economic development is often used to describe the process of improving a regions quality of living and economic health via means of both quantitative and qualitative improvements to the economy. The importance of the cottage industry to national economic growth is the subject of this essay.