The Micro Small and Medium Enterprises (MSMEs) sector plays a crucial role in economic development of the nation. Growth cannot be inclusive unless and until the fruits of the growth is percolated to the bottom of pyramid. Specifically in a developing nation like India where inequality in distribution of wealth and income is significantly high, sustained increase in per capita income cannot be translated automatically to sustained increase in standard of living. In order to alleviate the curse of poverty, inequity, unemployment and underemployment, adequate employment opportunities should be created for the poor mass which will facilitate them to meet their subsistence level of consumption demand. The MSMEs players can discharge the responsibility of adequate employment creation provided major impetus is provided by the Government to boost the sector through appropriate policy prescriptions. The objective of the proposed research paper is to analyze the current status of MSMEs in India, to determine the extent of funding the sector receives from different sources, to identify various risks and challenges that the sector is facing across the nation and to develop the strategies for the MSMEs players so that they will be able to provide maximum benefit to the maximum number of stakeholders of the nation. The methodology of the proposed work consist survey of existing literatures from different scholarly research articles available in several reputed national and international journals and analysis of secondary data. The paper will focus on an alternative economic model where adequate impetus will be given to the small scale entrepreneurs instead of providing excessive leverage towards large corporate players. The paper will add a new dimension in the sphere of distributive justice.