Unit 5

RURAL INDUSTRIALISATION AND ENTREPRENEURSHIP

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Rural Industrialization

Introduction:
The industrialization acts as stimuli to economic growth by means of increased production, income,
employment through which both economic and social welfare can be met with, but in underdeveloped
countries industrialization alone does not help to achieve momentum on account of lack of various
factors, for instance, capital, skilled labours, and infrastructural bottle necks, etc. In this situation, the
development of small scale and tiny units in the economy is an option to promote
production and income as these units have shorter gestation period. Besides, through the development
of small scale industrial units, the burning problems of the underdeveloped countries like
unemployment and poverty can be diluted as these units are labour intensive in nature. India is a
developing country. The country is facing the acute problems like unemployment, shortage of capital
and other economic and social overheads. If this is the case then large and medium scale units cannot
be attracted. In this situation only small investment can be promoted for industrial activities. The
primary objective of developing small industries in the economy is to extend work opportunities, so
as to raise both per capital income and standard of living, thus to bring out a balanced and integrated
development.

Village and cottage industries have a popular role in the Indian economy due to scarcity of physical
capital, unemployment and under employment, regional imbalances and disparities, inequalities in
the distribution of income and wealth, unutilisation or under utilisation of rural resources. The
government has accorded utmost importance for the growth of these industries through five year
plans and industrial policies because of their high employment intensity. Since employment is a
means to achieve growth with social justice, a number of programmes and schemes have been
designed and implemented for their development since the dawn of the planning era. It will help in
the redistribution of income and wealth. Improving the quality of life for rural people is an enormous
and challenging problem. Solutions to this problem are to be found within the rural areas.

In essence, it comes down to generating employment, increasing income, harnessing and utilising the
primary and secondary resources that the rural areas are endowed with. Diversification of manpower
is required from already saturated agricultural sector to industry and secondary sectors. It has been
recognised that in the long run agriculture and other land based activities, even with a high rate of

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growth, will not be able to provide employment to all the rural workers at adequate levels of income.
Over one fifth of the rural workers are engaged in non agricultural activities. This proportion has
shown a remarkable increase in recent years. Policies are needed to be evolved to further strengthen
this trend. The development of small business especially in rural segments is of a viable remedy. Tiny
units have been found to constitute that segment of small scale industries that is most prone to
sickness or least likely to be viable. At present, rural small scale and cottage industries comprise of
handicrafts and artisan enterprises. The handicraft industry is cottage or small scale industry. Its
products are artistic in nature and require individual skills and craftsmanship in the manufacturing
process. The handicraft industry is a labour intensive industry, its products are of higher value added
ones articles, whereas the village industry produces articles of daily use

Industrialization: Conceptual analysis

Industrialization is the period of social and economic change that transforms a human group from an
agrarian society into an industrial one, involving the extensive re-organisation of an economy for the
purpose of manufacturing.

As industrial workers' incomes rise, markets for consumer goods and services of all kinds tend to
expand and provide a further stimulus to industrial investment and economic growth.

The first transformation to an industrial economy from an agricultural one, known as the Industrial
Revolution, took place from the mid-18th to early 19th century in certain areas in Europe and North
America; starting in Great Britain, followed by Belgium, Germany, and France. Characteristics of
this early industrialization were technological progress, a shift from rural work to industrial labor,
financial investments in new industrial structure, and early developments in class consciousness and
theories related to this. Later commentators have called this the First Industrial Revolution.The
"Second Industrial Revolution" labels the later changes that came about in the mid-19th century after
the refinement of the steam engine, the invention of the internal combustion engine, the
harnessing of electricity and the construction of canals, railways and electric-power lines. The
invention of the assembly line gave this phase a boost. Coal mines, steelworks, and textile factories
replaced homes as the place of work.
By the end of the 20th century, East Asia had become one of the most recently industrialised regions
of the world. The BRICS states (Brazil, Russia, India, China and South Africa) are undergoing the
process of industrialization. There is considerable literature on the factors facilitating industrial
modernisation and enterprise development.

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 Important Policies and Programmes of the State:

The Industrial Policy Resolution of 1956 added some new dimensions to the existing policies in line
with the Mahalanobis model. In this policy resolution while the proposal was made for the
establishment of some basic and heavy industries, the role of cottage and VSI in economic
development was also emphasised. It was stated in the Resolution that "it is essential to ... speed up
industrialisation and in particular, to develop heavy industries and machine making industries, to
expand public sector. The State will progressively assume a predominant and direct responsibility for
setting up new industrial undertakings. The Government of India would stress the role of cottage and
village and small scale industries in the development of the national economy. In relation to some
of the problems that need urgent solutions, they offer some distinct advantages.

They provide immediate large scale employment; they offer a method of ensuring a more equitable
distribution of national income and they facilitate an effective mobilisation of resources of capital and
skill which might otherwise remain unutilised. Some of the problems that unplanned urbanisation
tends to create will be avoided by the establishment of small centres of industrial production all over
the country. The Second Plan gave immediate attention to the development of rural
industries.”The need to promote, modernise and recognise these industries is paramount. The
problem is one of devising the effective policies as well as of making suitable organisational
arrangements. Progressive up gradation of technology without reducing employment, provision of
training facilities for artisans and the supply of credit to petty producers were given special emphasis.
Furthermore, efforts were made to promote cooperation. The Second Plan also stressed on the
promotion of the SSI as ancillaries to large scale units. Small producers were made eligible for tax
concession and subsidies. To provide marketing facilities to them, steps were taken to provide
assistance in conducting exhibitions and setting up show rooms in cities and tourist spots. Improved
spinning wheels (Ambar Charkha) were introduced by KVIB. Intensive marketing schedule and area
schedule were also adopted for KVI. Small Industries Service Institute (SISI) was set up to assist the
VSI with technical advice, procurement of raw materials and marketing research. National Small
Industries Corporation (NSIC) with its branches in the States had undertaken the task of
supplying machinery and equipment to small producers. The corporation assisted them in procuring
orders from the Government and also provided them with financial, marketing and technical
facilities.
The Recommendations of the Karve Committee and the schemes adopted in this Plan primarily
indicated a shift in the emphasis from the Gandhian cottage industries to the modem small scale
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capitalist industries. In the Third Five Year Plan (1961-66), a programme of intensive development of
the VSI was launched through selected project areas, called Rural Industries Project. Operational
areas of the projects were made equal to the average size of the district so as to avoid the
drawbacks of the Pilot Projects. KVIC launched 'Gram Ekais' for Integrated Rural Development.
During the Annual Plans (1966-67, 1967-68 and 1968-89) the question of regional imbalances had
become paramount. The need of discouraging the growth of industries in the metropolitan areas and
of promoting industries in the backward areas was felt. This led to the formation of special location
specific schemes of incentives for setting up units. During the Fourth Plan as well as the Third - and
the Annual Plans, the policy of industrial dispersion was centred on the concept of industrial estates
which were located in the suburbs and small towns. The Government would build up work sheds at
suitable locations having the necessary infrastructure, like, electricity, transport, water, postal and
tele-communication and other facilities, and the sheds would be leased out to the prospective
entrepreneurs at cheap rates to establish manufacturing units.
The Fifth Plan placed special emphasis on the growth of tiny sector and extended the number of
reserved items for VSI sector. It. further, attempted to shift the focal point of development for
cottage and SSI from big cities to district head quarters and stressed the need for providing servicing
facilities and vocational training to the producers in both artisan and modem industries. Similarly,
Integrated Rural Development Programme (IRDP) launched in 1978 to integrate various ongoing
programmes, was intensified in this plan. IRDP attempted to provide self-employment in agriculture,
animal husbandry, manufacturing, trading, etc. through raising asset endowment of the rural poor.
On the average 600 poor households would benefit in each block under this programme. One- sixth
of them would benefit through village and cottage industries employment and another one-sixth
through service sector employment. Decentralisation therefore would extend from district level to the
block level. The Seventh Plan continued with almost all the programmes of the previous plan. It
strengthened the Backward Area Development Programme through special incentives scheme to
disperse modem small and medium scale industries in the rural areas.
Important points to be highlighted are:
 continuing emphasis on the up-gradation of technology of the artisan and small scale
industries,
 gradual dispersion of the focal point of development from the city to the suburban, small
towns, and backward/rural areas, in some cases through setting up industrial estates~
simultaneously, decentralisation of administrative organisations, particularly setting up of
District Industries Corporation (DIC) and Small Industries Corporation (SIC) at district and
regional level to assist the small entrepreneurs,
 organising training to the small entrepreneurs in new technology or entrepreneurship,

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  setting up of Industrial Training Institutes (ITI), Polytechnics and Engineering Collages to
generate skilled technicians, and
 arrangement of finance from commercial banks and financial institutes to the small
entrepreneurs through DIC

Probable Explanations for the Slow Growth of Rural Industries:

 Inadequacy of Financial Assistance in the Plans: Financial assistance provided through Plans may
be considered as one of the important indicators of the seriousness of the State in promoting this
sector. In the First Plan the share of VSI in total Plan expenditure was 2.4% which increased to 4%
during the Second Plan. In the subsequent Plans the share declined and reached 1.33% in the Fifth
Plan. Thereafter it remained below the 2% level. The very low share of the VSI in Central
allocation, as compared to the vast requirements, is indicative of the negligence of the Government.

 Ineffective Common Production Programmes and Assistance to Small Units: The main objective
of these programmes was to protect small units from the competition of the large units. There are a
number of instances, like in the powerloom sector, where the big industrialists set up small units
and reaped the benefits (like tax rebate, assured supply of raw materials), offered by the State to
small units. This further weakened the competitive power of the household enterprises vis-a-vis
large. Even among the small entrepreneurs, the growth of powerlooms adversely affected the
handloom weavers as both produced similar products. These programmes on several occasions
became counterproductive in nature.

Mismatch of Technology Upgradation, Training and Skill Formation: Repeated emphasis

has been made on up-grading technology, training artisans and small entrepreneurs etc for the
development of rural industries in various Plans. So far as technology generation or its up-
gradation for small industries is concerned, the performance of the national/regional R&D
institutes are not satisfactory; only a limited number of new or improved technologies, like,
Jacquard loom, food (particularly fruit) processing machines, ceramics, leaf plate machines,
Jute stick particle and straw boards-machines, etc, have been introduced. These technologies
and some imported ones were supplied to the entrepreneurs through NSIC and for that matter
technical, financial and marketing assistance were provided by SISI through their decentralised bodies,
namely, DICs which were supposed to provide single window clearance.
Problem of technology diffusion arose at two levels. Firstly, unlike what we have seen fn
China where new technology diffused through direct exchanges between the source and
destination (the source organisation directly trained the workers of the user organisation while
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 providing technology), in India, there existed a layer of bureaucracy in between these· two
types of organisations as mediator often obstructing the diffusion of the exact information
regarding technology. This bureaucracy often lacked personnel of the required expertise for
various types of technologies, and therefore, could not transfer the entire technology-
package, including skills, and other information. In other words, this snapped the vertical
technology linkages between the R&D institutes and entrepreneurs. Moreover, unlike in
China where the mass scientific organisations kept the people informed about new
technologies and thereby helped diffuse technologies, in India similar organisations do not
exist; the information was provided by DICs or other organisations which rarely had contacts
with the masses. Secondly, in India, industrial training was provided by the institutes like, ITI,
polytechnics, engineering colleges, etc. which often have no direct contacts with the
enterprises employing the technicians.
The activities of the three types of organisations; those who generate technology, those who
use technology and those who train the workers in operating the technology, were not
coordinated. The technicians (certificate holders) are eligible for bank loans under self-
employment scheme, but they do not have the entrepreneurial ability. But the artisans who
rarely find opportunity to study technical courses acquire their skills as apprenticeship in the
family craft or other's craft. Unlike the certification of the skills of the students of the
technical institutes, the skills of the artisans are not certified by any formal institutes. And
therefore the latter skills are not bankable for the purpose of loans. In general, new or
improved technologies, both artisanal or modem small scale, are highly expensive and
without financial assistance they could hardly be adopted by the poor artisans/ entrepreneurs.
In Japan and China, large enterprises assisted substantially the small enterprises in finance,
arranging raw materials, technology upgradation, marketing, training workers, etc, but such
things are rarely observed in India, excepting in some industries like handloom in West-
Bengal.

 Lack of Effective linkages with Other Sectors: Apart from the direct intervention by the State,
there exist other factors which influence rural industries. Our observation in China indicates that the
rural industries have forward and backward linkages with the agricultural sector. These industries
also provide consumer goods as well as construction materials for housing to the rural people.
Furthermore, they have vertical linkages with the urban factories in terms of technology transfer,
manufacturing, assembling and marketing. In India, there have been a number of studies regarding
rural industry-agriculture linkages. Studies have obtained a positive relation between the growth· of
agricultural production and that of non-farm employment in rural areas for some periods and no

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 such relation for some other.
These studies have noted a strong relationship between the growth of rural industries and that
of agricultural output and the rise in income levels, purchasing power and investible surplus.
They have also traced backward and forward linkages between agriculture and rural
industries (i.e., the rural industries supplying inputs to agriculture, and processing agricultural
products), but the indirect effect (i.e., rising agricultural income led to rising demand for rural
industries' products) seemed to be stronger.
They have also put forward a hypothesis that non-agricultural activities acted as a residual
sector so that rural workers who were not absorbed in agriculture would spill-over into non-
agricultural activities. A similar phenomenon that growing casualisation of labour raised the
participation in non-farm activities, particularly in seasonal activities has also been noted. In
case of West Bengal, it was observed both the phenomena -agricultural growth-led
diversification and the distressed-driven spill-over into non- / farm activities of a labour-force
that was not finding adequate employment in agriculture - at varied extent in different districts
and in different periods. It was then concluded that the aggregate magnitude of off-farm
employment would depend on the combined effect of the agricultural 'pull factor' and 'push
factor'. Finally, the interlinked relations between the rural/small industries with the urban
factory industries are rarely observed.

Impacts of Industrialization in Rural India:

In India there exists a long tradition of artisanal industries. Considerable evidence exist which show
their substantial development in the ancient times and their popularity abroad as the products were
exported. In the medieval times, particularly during the Mughal period, both inland trade and exports
of the manufactured goods flourished to a considerable extent. These manufactured goods were
exported to different parts of Europe and Asia by the European East India Companies and others.
The most important industries were the manufacturing of cotton and silk goods which were produced
in various parts of India. Production was primarily organised by the merchants through the putting-
out system. Apart from these exported items, substantial amount of artisanal production was carried
on by the artisans in the villages under customary exchange system called the jajmani system. The
artisanal industries continued to grow till the early decades of the 19 th century. Thereafter, with the
establishment of the British rule these industries substantially declined in the face of competition
from the British factory-made goods together with discriminatory colonial policies against these
industries. It was since 1921, with the launching of nationalist movement that some of the artisanal
industries, notably weaving and spinning received some protection and started reviving to an extent,
particularly in the rural areas. After independence the State recognised their importance and made
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planned efforts to develop them in the villages and small towns. Several organisations like the Khadi
and Village Industries Commission and Handloom Board were set up to promote these industries.
However, the rural industries in India achieved a moderate growth after independence. State policies
to promote these industries are found to be often ineffective and sometimes counterproductive.
Several contradictions are also noted in the policies, notably, in technology upgradation, diffusion,
training workers and technicians, and the use of technology and skills. As such there is no effective
coordination among the agencies involved in technology generation, training workers in the
technology and using them. Further, demand for rural industries' products has not been growing fast
enough due to slow growth in agriculture which in turn was primarily due to non-implementation of
land reforms. The inherited power structure of a coalition of landlords, rich peasants and big
capitalists effectively barred radical land reforms.
Furthermore, there is a conflict between the artisanal industries and the small scale industries - the
growth of the latter substantially competed out the former. Moreover, a substantial part of the rural
industries products was being substituted by urban factory made goods. This is not only true for
consumer goods but also for agricultural tools and implement, fertilizers, and even processing some
agricultural products. Lastly, as seen in Japan and China, the large enterprises helped the small
enterprises through up-grading technology, providing raw materials or intermediate products,
improved machinery, financial assistance, various information, and marketing products; such
phenomena are occasionally seen among the enterprises in India, for instance, in some weaving
clusters in West Bengal. The latter region has made significant progress in rural industrialisation. The
region has also fulfilled certain preconditions, like implementation of land reforms and rural
development measures attainment of a sizeable growth in agriculture. Moreover, the entrepreneurs
also developed some flexibility in their organisational structure, like the Japanese-type symbiotic
relations, though to a lesser extent, between artisans and the big enterprises promoting rural
industries.

Positive Impact of Industrialization:

 Low cost of production: The introduction of industries has led to the decrease in the cost of
production of many essential items. The decrease in cost is the result of economy of large
scale production. It allows to save time and labour. Industrial goods have become more
affordable for common people.

 Self-sufficient: Before independence, we used to spend hundreds of millions of rupees over

import of cloth only, as we had no heavy industries in the real sense of the term. With the
advancement of textile industry in our country, we are able to manufacture clothes at a much
lower cost. In this way, we made ourselves self-sufficient in providing our basic needs.
 Employment: Large industries need thousands of skilled and semi-skilled workers. It provides
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 massive employment opportunity for a large chunk of people.
 Improved Agriculture: In the modern age efficient agricultural system is that, which is done
with the help of machine and mechanical devices. For this purpose, we have to adopt the
latest Industrial system.
 Defense and security: But we must keep pace with the march of time. We have to defend our
country against foreign aggression. We must manufacture latest weapons, for it is most
unwise to depend upon foreign aid for defense of one’s country.
Negative Impact of Industrialization:

Mechanized, heavy and large-scale industries have negative impact which adversely affects the
environment, society and economy of this country.
 Decline of cottage industry: Throughout, India has been proud of her rural cottage
industries. The silk produced by the village-weavers had been a source of attraction all over
the world. With the advent of heavy mechanical industries began the chapter of the decline of
our village cottage industries.
 Mass migration from rural areas: Another attack is that with the creation of heavy
mechanized industries in the urban areas, the rural population would start mass-migration into
town and cities, thereby making the unemployment problem more acute and complex.
 Depletion of natural resources: Due to industrialization, there is constant depletion of
natural resources. Many industries are powered by thermal power plants that consume coal.
Since, large industries are spread over many acres of land, agricultural lands and forests are
often cleared to make available the required land.

 Pollution: Large industries emit many harmful gases into the environment. The introduction
of harmful chemicals into air leads to air- pollution. The noises that it produces leads to noise-
pollution.
 Increase of war-like situation: Out of the degenerating effects of heavy industries is born
contention. In developed nations, most of these Heavy industries are engaged in the
production of war materials. With a lot of war weapons in hands, there has been an increase
in war-like situation among countries.

Gandhian Approach to Rural Industrialization:

Gandhian approach has always said about the voluntary wants, the need for self- sufficient village
communities and the issues relating to better balance between man and nature. Gandhi wanted to
have an ideal society of his own imagination and his economic ideas are a part and parcel of his
philosophical and sociological ideas. Gandhi was interested in the growth of human beings and more
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significantly the growth of the deprived and underprivileged group of people.

'Rural Industrialization' was never the term used by Gandhi. However, two basic components of
Gandhian development, self-sufficient villages and decentralization of economic and political
powers, gave a very important place to development of Khadi and Village Industries. According to a
recent study the Khadi movement was not only a mass mobilization movement against anti-
imperialist struggle, it was also a social movement of recognizing women's capacity as economically
and politically active beings without whose support the goal of freedom or Swaraj would be
unattainable and meaningless. In fact, Gandhi's well known concept of 'Living Wage for Spinners'
originated in his realizing the danger of women being paid low wages even by constructive workers.
The World of Appropriate Technology, in which it defined appropriate technology as characterized
by "low investment cost per work-place, low capital investment per unit of output, Organizational
simplicity, high adaptability to a particular social or cultural environment, sparing use of natural
resources, low cost of final product or high potential for employment.

Review of Practice based Gandhian Ideology:

There are three basic evidences of accepting Gandhian rural industrial approach in India. First, right
from the industrial policy of 1948 till the New Small Enterprise Policy of 1991, we have placed
Khadi and Village Industries as the prime instrument of promotion of rural employment and rural
economy. As early as 1953 we established an exclusive institution of Khadi and Village Industries
Board and later established a Khadi and Village Industries Commission in 1957. To assume
responsibility for initiating, assisting and financing Khadi programmes on a much wider basis, make
it a part of the whole development programme of the country and an essential constituent of a
planned economy in the making. Such as below: The first Five Year plan had adopted a complete
'Gandhian' perspective in development of KVIC as it was decided to be developed 'with processing of
local raw material for the local market with simple techniques (1951). As an appropriate method of
protection a “Common Minimum Programme” was formulated, which was mainly related to
reservation of production, restriction on capacity expansion and continuation of research. A multi-
institutional approach was developed by establishing a separate institution like the KVIC Board,
Hand- loom Board, Handicraft Board and Small Scale Industries Board for their development. The
Second Five Year Plan gave a very strategic place to village industries to generate marketable surplus
as consumer goods to support heavy industry development without inflation and also gave a task to
liquidate unemployment as quickly as possible. The basic approach for the KVIC was worked out by
the panel of economists appropriate to the development of these sectors. The production through the
traditional charkha to provide relief to distressed persons should be separated from the economic

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problem for Khadi production as an employment generation activity.

Gandhian View of Self–Sufficient Village Economy:

Gandhi holds the view of the maximization of social welfare and for this he gives prime importance
to the welfare of the individuals by reducing inequalities in income and wealth. Gandhi is in favour of
the self-sufficient village economy where the villages will be the independent economic units. India
lives in villages.
Naturally the development of the country depends on the development of villages. All the goods and
services necessary for the village members should be grown within the village. Agricultural sector
alone cannot solve the problem of rural poverty and unemployment. That's why Gandhi gives stress
on the growth of the rural industries like khadi, handlooms, sericulture and handicrafts. He opines
that large-scale industries make people lazy and help concentration of wealth in the hands of few.
Therefore there is no problem of production and market. Large scale production creates conflicts
between labour and capital. On the contrary, rural industries are based on family labour and required
less amount of capital. The raw materials are also collected from local markets and the goods thus
produced are sold in the local markets. Gandhi is not in favour of large-scale industries in the sense
that these industries are not related to a vast population living in rural areas. Thus industrialization,
according to Gandhi, does not help the growth of the personality; contrarily it helps only the material
progress of a few.

Strategies for Improving Rural Industrialization:

Formulation of Rural Industrial Policy:

Rural Industrialisation means encouraging location of large and small scale units away from urban
areas or planned shifting of units from urban areas to rural areas. But it is not likely that the existing
urban industrial structure can be disturbed. Therefore under rural industrialisation concept, the state
should encourage industrialisation in rural areas on a massive scale. It is immaterial whether it is
small, village industries or large scale industries. A comprehensive policy should be so evolved that
industries are encouraged in rural areas hereafter. A vast reservoir of rural resources should be
harnessed. Govt. should create full fledged infrastructural facilities in rural areas before initiating
efforts in this direction. Rural industrialization aims at all-round development of an area as well as
people living in such areas. This can be realized only through systematic adoption of improved
technology. There should be a harmony among primary sector, secondary sector and tertiary sector in
rural industrialization. The focus of rural industrialization should be alleviation of rural poverty by

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creating wide employment opportunities in rural sphere.
At present, there is no policy directive on rural industrialization. A number of Government sponsored
programmes like Khadi and village industries, hand loom, sericulture, coir, IRDP, DPAP, PMRY,
DRIP, DAAP, Artisan employment guarantee programme are in vogue. These programmes have
different set of objectives, pattern of organization, and system of assistance. The focus of these
schemes is either to develop industries or to develop target group but not to promote rural
industrialization. Lack of coordination among the various poverty alleviation programmes
contributed least to the fight against poverty and unemployment in rural horizon.
There is no coordination among these programmes. This has affected concerted action in the
implementation of rural industrialization programme. In other words, Central Govt plays a leading
role in certain programmes and State Govt act as an implementing agency of Central Govt. In certain
schemes, State Govt. plays a leading role while institutional financing agencies dominate in some
states. Therefore, confusion arises as to who is accountable to whom. Too many schemes, too many
agencies, high leakage of financial assistance and role ambiguity made little impact on abject rural
poverty and growing rural unemployment. A clear cut policy for rural industrialization is to be
evolved which should address the likely pitfalls in the road to rural industrialisation.

Reversal of the Trend - Towards Decentralization:

Rural industrialization is indubitably a noble idea. While the economic development has gone so far
towards capital intensive industrialization, centralization and high degree of unplanned urbanization,
very exercise of evolving policies and undertaking efforts towards decentralization and rural
industrialization seem to be irrelevant in today’s context of liberalization. In other words, open
economy presupposes non-invention of Govt. while successful rural industrialization warrants state
intervention. Therefore, the issue is how to reconcile these two diametrically opposite view points.

Multiplicity of Technologies and Reservation of Industries:

Existence of plurality of technologies in every field is threatening rural industrialization. For
example, we have hands spinning, as well as power-spinning and hand loom and power loom,
weaving. This diversity is found in food processing, building materials, leather goods, soap making,
carpentry, blacksmith, paper making, food preservation and processing and so on. Large units that
use state-of-the art technology produce goods on a mass scale. This sector is producing goods of
necessity to meet the demands of growing population and for satisfying the urge to improve standard
of living and quality of life while small scale industries not only produces but also provide
employment to a significantly large number of people and create purchasing power in the economy.
Small scale units in Cuddalore districts proved to be a boon to rural and village artisans in Cuddalore
district and it has created 8978 jobs in 1428 units and contributed rupees 10,282 crores worth export
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during 2005 and 2006. This shows the potential of rural and village industries in fighting poverty and
unemployment. There is no question of accepting one and rejecting the other. Both have to be
supported and conditions are to be created for their sustained development. While small scale
industries as well as large scale industries engage in the production of similar items, a conflict arises
as to which industry needs to be supported. The large scale industries contribute to massive
production, decrease employment opportunity due to automation and finally lead to unplanned
urbanization, ecological and environmental degradation while rural industrialisation generates more
employment opportunities for the rural masses and brings all its attendant advantages to the rural
scenario. So far as India is concerned, rural industrialization cannot be ignored as something
irrelevant in today’s context. Thus choice of technology is crucial issue. The following approach is
recommended for deciding as to which industry is to be encouraged where. Large scale industries
which use state-of-art technologies may be encouraged in certain productive activities that call for
sophisticated technology, eg. construction, infrastructure industries, shipbuilding, railways, power
sector telecom and the like. Rural industries that use local technology may be encouraged in certain
areas where human skill plays a predominant role. Eg. handicrafts, coir, embroidery, carpentry,
blacksmith, pottery, etc.

Ancillary type of industries may be encouraged in certain sectors like automobiles, healthcare,
electronics, drugs, chemicals, etc. Both small as well as large scale industries may be allowed in
certain areas where both can co exist. The areas of production are to be clearly demarcated in term of
demand feasibility employment generation, production capacity. This exercise would solve the twin
problems of employment generation as well as larger production. Reservation of certain areas
exclusively for SSIs would be effective if areas are properly identified. On reserving the areas
exclusively for SSIs, certain issues such as quality standards, production capacities, price subsidy and
so on, need to be addressed in a clear-cut terms.

Nature of Employment:
As for nature of employment, it is to be decided as to the type of employment suited for promoting
rural industrialization. There are several patterns of generating employment in rural areas. They
include self-employment, wage employment in industrial units, wage cum self employment and
establishment of rural industrial estates. Each of the above method has its own merits and
drawback. Therefore the pattern of employment generation is to be decided after weighing the
relevant factors dominant in each pattern of employment generation.

Organizational Difficulties:
Rural population being highly scattered and unorganized, organizing and institutionalizing the

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activities of rural population and proving work on a regular basis are really challenging task. Either
work is to be provided by the units to them to be done at their residence or industries are to be
started in the rural areas in order to bring them into an organized entity. Some of the efforts
undertaken by the Govt. in the past have not made any perceivable impact on the employment
generation in rural India. Industrial co-operatives were started with the mission of rural
industrialization for different crafts in pursuance of the recommendation of Karve committee 1955.
These societies mobilized the scattered rural skill to a certain extent. But it failed in its re-mission. As
these societies could not ensure regular employment and provide fair wages, members were
withdrawing from the societies. As a result most of the societies remain currently defunct. Another
experiment done was formation of multipurpose block level co-operatives by Govt. of Maharastra.
These societies ended up becoming mere credit societies. Mere provision of credit could not promote
rural industrialization. Third experiment was formation of institutions under societies Registration
Act 1860. This type of institution was started by Khadi. This entity is currently thriving due to Govt.
patronage. Management and workers assume significance in these institutions.

Since the societies cannot afford to pay good pay scales, it cannot get a team of talented, experienced
and capable administrative staff. Therefore, it suffers on administrative front. Paying higher pay scale
would result in increasing the final cost of the product and the consequently, the State would have to
come forward to support them. Besides there is a need to evolve a separate labour code for
unorganized rural labour since the present labour laws are oriented towards organized sector. Studies
have suggested evolution of labour code for unorganized rural workers for improving the living
standard of working masses in rural areas. In this background, it is suggested that the unorganized
rural work force may be converted into organized force through self - help group. These groups may
be financed either directly by banks and institutions or through voluntary agencies or through NGOs.
The State has to put in place a marketing structure for marketing the product of self help group on a
massive scale. Thus organization of unorganised work force through self help group mechanism
appears to be a viable solution.

Technology Gap:
While organized industry is fast upgrading its technology, there is no technology up gradation in rural
industries. Around 60 per cent of artisans are still carrying on their traditional occupation in a
primitive way. National Research and technical institutes have done little for the village industries.
Infect there is more urgent need for R & D in rural industrial sector. Otherwise, it is likely to be
irrelevant and obsolete. The fact that still large number of artisans carry on the work in most
antiquated methods highlight the failure of transfer of technology. This discourages new persons
entering into this occupation cutting across the caste barrier. Therefore mechanical and engineering

Page 15
talents have to develop suitable technology which would be modern and efficient and which would
absorb greater number of people in work. Planning commission ought to earmark adequate funds for
promoting research endeavours in rural industrialization. A mechanism ought to be put in place to
fund directly the research endeavours directed towards technical up-gradation of rural and village
industries.
Promoting Managerial and Entrepreneurial Skills in Rural Entrepreneurs:
Managerial inadequacies are one of the reasons for the failures in decentralized industrial sector.
There is a need to equip village artisans and their institutions with new except of entrepreneurship
and managerial skills. Proper training is to be arranged for village artisans to develop their
managerial and entrepreneurship skills. Banks and development institutions should conduct
entrepreneurship courses for students from the rural colleges and for the rural artisans. They need to
be enlightened on various skills of management. In other words these groups need to be enlightened
on rudiments of entrepreneurship and management of the units. Studies emphasized the role of higher
educational institutions functioning in rural areas in spreading entrepreneurial awareness through
establishment of entrepreneurial cell.
New Definition for Small and Village Industries:

Several attempts have been made to define village industry. Khadi Village Industries Commission
proposed a definition in terms of per capita investment. Still identity crisis persists. The definition
given for tiny industry during 1979 could not suit for institutional village industries since the total
investments in such units were more but per capita investment were less. A clear definition for village
industry is to be evolved in the context of globalisation. The factors such as per capital investment,
eco-friendliness, degree of manual effort involved in making the product, non-conventional energy
used, ability to provide work at residence, value-addition, conversion of waste into wealth, level of
energy required, high nutrition, purity, flavour, suitability to Indian context, women participation,
absence of child labour, etc. may be some of factors which should be considered on defining ‘village
and small scale industries’. Since these industries enjoy a lot of financial and fiscal privileges, a clear
definition is warranted so that privileges go directly to deserving ones.

Role Clarity:
The Central Govt. took up certain industries like coir, sericulture, handloom, Khadi and handicrafts
as central schemes, the implementation of which was left to State Govt. In other words, Central Govt.
provided funds, fiscal concession and policy support to these industries. The State had to take care of
implementation and to ensure infrastructure support like water, electricity, road work shed and
communication to units located in rural areas. The State Govt. being passive partners did not evince
any interest in promoting these centrally sponsored schemes. It is suggested that the Union Govt.

Page 16
should take up both funding as well as implementation of the projects for centrally sponsored
schemes. Similar should be case for state sponsored schemes. Further the role of various facilitating
agencies like banks voluntary organization, KVI board, Govt. Departments Central and State Govt.
development organizations should be clearly spelt out in no unambiguous terms in promoting the
rural industrialisation.

Credit Gap:
It is observed that most of the rural industries are starved of financial resources. Studies proved the
apathy of commercial banks towards rural credits ever since our country followed globalization
path. He further stated that the loan waiver is the price paid by the Govt for the neglect of the rural
sectors. The public sector outlays are hardly one per cent and institutional credit is negligible.
Therefore, it is necessary to continue to provide concessional credit to encourage rural
industrialisation. As suggested earlier, Govt. has to redefine small scale and village industries for
concessional financing and other privileges from financing agencies.

Marketing Infrastructure:
Rural industrialization would be a total fiasco if sound rural marketing infrastructure is not at place.
As long as rural products do not enter the normal supply chain, their products cannot enjoy a good
market. Some sort of network should be created for marketing the products of village industries.
Where Govt. departments buy their requirements from the rural marketing mechanism, half of the
marketing problems of rural industries would be solved. At present, rural bazaars have been set up at
District Head Quarters for marketing the output of self-help group entities. Besides, Govt. may set up
some sort of permanent marketing structure at each district which may collect rural products from
various units and supply to final consumers through various fair price shops, consumer co-operative
societies. Efforts should be made to have a permanent retail stall in local markets and pilgrim centres
and participate at festival gathering to market rural products.

Govt. may think of establishing rural departmental stores or rural malls in districts. The rural
products may be branded by the Govt. and certified for its quality and franchises may be given for
marketing the products of rural enterprises like the KVI organizations do. It may offer credit
facilities to salaried class against the post dated cheques or through pay deduction. It may accept
credit cards and debit cards to boost sales from stable income segment. Govt. has to propagate and
publicize the products of rural industries in their own media like AIR and DD and News channels.

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Rural Entrepreneurship

Introduction
The entrepreneurial orientation to rural development accepts entrepreneurship as the central force of
economic growth and development, without it other factors of development will be wasted or
frittered away. However, the acceptance of entrepreneurship as a central development force by itself
will not lead to rural development and the advancement of rural enterprises. What is needed in
addition is an environment enabling entrepreneurship in rural areas. The existence of such an
environment largely depends on policies promoting rural entrepreneurship. The effectiveness of such
policies in turn depends on a conceptual framework about entrepreneurship, i.e., what it is and where
it comes from.

Rural development is more than ever before linked to entrepreneurship. Institutions and individuals
promoting rural development now see entrepreneurship as a strategic development intervention that
could accelerate the rural development process. Furthermore, institutions and individuals seem to
agree on the urgent need to promote rural enterprises: development agencies see rural
entrepreneurship as an enormous employment potential; politicians see it as the key strategy to
prevent rural unrest; farmers see it as an instrument for improving farm earnings; and women see it as
an employment possibility near their homes which provides autonomy, independence and a reduced
need for social support. To all these groups, however, entrepreneurship stands as a vehicle to
improve the quality of life for individuals, families and communities and to sustain a healthy
economy and environment.

Definition

Entrepreneurship emerging in rural areas is called rural entrepreneurship. Establishing

industries in rural areas refers to rural entrepreneurship. Rural entrepreneurship is synonymous
of rural industrialization.

According to the KVIC:-

Rural industry means any industry located in rural areas, population of which does not exceed 10,000
or such other figure which produces any goods or renders any services with or without use of power
and in which the fixed capital investment per head of an artisan or a worker does not exceed a
thousand Rupees.´

Page 18
According to Government of India:-

Any industry located in rural area, village or town with a population of

20,000 and below and an investment of Rs. 3 crores in plant and machinery.´

The problem is essentially lopsided development which is a development of one area at the cost of
development of some other place, with concomitant associated problems of underdevelopment. For
instance, we have seen unemployment or underemployment in the villages that has led to influx of
rural population to the cities. What is needed is to create a situation so that the migration from rural
areas to urban areas comes down. Migration per se is not always undesirable but it should be the
minimum as far as employment is concerned. Rather the situation should be such that people should
find it worthwhile to shift themselves from towns and cities to rural areas because of realization of
better opportunities there.

Rural Entrepreneurship in India

Since national economies are more and more globalized and competition is intensifying at an
unprecedented pace, affecting not only industry but any economic activity including agriculture, it is
not surprising that rural entrepreneurship is gaining in its importance as a force of economic change
that must take place if many rural communities are to survive. However, entrepreneurship demands
an enabling environment in order to flourish. Some individuals who happen to be local leaders and
NGOs and who are committed to the cause of the rural people have been catalytic agents for
development. Though their efforts need to be recognized yet much more needs to be done to reverse
the direction of movement of people, i.e. to attract people in the rural areas. It means not only
stopping the outflow of rural people but also attracting them back from the towns and cities where
they had migrated. This is possible when young people consider rural areas as places of opportunities.

Despite all the inadequacies in rural areas one should assess their strengths and build on them to
make rural areas places of opportunities. This is much to do with the way one sees the reality of the
rural areas. The way a survivor or job seeker would see things would certainly be different from those
who would like to do something worthwhile and are ready to go through a difficult path to achieve
their goals. It isn't that there is a dearth of people with such a mindset. But with time they change
their minds and join the bandwagon of job seekers due to various compilations. Enabling them to
think positively, creatively and Entrepreneurship purposefully is most of the development of rural
areas. Young people with such perspective and with the help of rightly channelized efforts would
usher in an era of rural entrepreneurship.

The basic principles of entrepreneur which applied the rural development are:
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 Optimum utilization of local resources in an entrepreneurial venture by rural population -
Better distributions of the farm produce results in the rural prosperity.
 Entrepreneurial occupation rural population to reduce discrimination and providing alternative
occupations as against the rural migration.
 To activate such system to provide basic '6 m'- manpower, money , material, machinery,
management and market to the rural population.

Rural Entrepreneurship in changing Environment:

The changing global environment raises questions about the ability of traditional, small-scale
businesses in rural areas to share the potential benefits offered by the changing environment. The
rapid (though declining) population growth, coupled with even faster urbanization, creates increasing
demands. In India, urban populations in general grow about twice as fast as the overall total, and by
2020 they may exceed the size of rural populations. Such a major demographic trend challenges the
capacities of some traditional small-scale businesses to cope with the increasing demands.

Rural Industry

"Rural Industry" means any premises used for handling, treating, processing, packing or
distributing primary products and includes the servicing in a workshop of plant and equipment
used or intended for use for rural uses in the locality.

Highlights:

 Rural industrialisation has been given prominence in the current decade and enterprises under
SIDO, KVIC and PMRY have received more attention.
 Employment under KVIC has shown remarkable progress and it may exceed 100 lakh persons
in the near future.
 The high economic growth, perhaps, caused spurt in the demand for cloth and more so for
garments. However, the production of cloth declined in 2009-10 more so in Handloom sector
and in decentralized sector. The silk industry has been witnessing phenomenal improvement.

 The numbers of rural enterprises have been increasing over time. Six states viz., West Bengal,
Andhra Pradesh, Uttar Pradesh, Tamil Nadu, Maharashtra and Kerala account for about 58
per cent of the rural enterprises in the country and 57 per cent of the total employment in this
sector.
 Percentage of agricultural enterprises in rural areas is higher in Gujarat, Andhra Pradesh,
Kerala and Tamil Nadu.
 Share of female workers in rural enterprises is high in Andhra Pradesh, Gujarat, Karnataka,
Page 20
 Kerala, Manipur, Mizoram, Nagaland, Sikkim and Tamil Nadu.
 Impressive growth rates of enterprises in rural areas of Haryana, Jammu & Kashmir, Kerala,
Mizoram, Punjab, Tamil Nadu, Uttar Pradesh and Uttarakhand during 1998-2005 are
observed. Very high growth of employment in rural enterprises is witnessed in Haryana,
Jammu & Kashmir and Uttarakhand.

The Ministry of Agro and Rural Industries (MoARI) in India was established in September, 2001
with the aim to develop the Rural Industries in the Indian Economy. The main objectives of this
initiative were to ameliorate the supply chain management, upgrade skills, introduce innovative
technologies and expand markets of the entrepreneurs and artisans. A wide range of programs,
schemes, projects and policies have been formulated to carry out various activities in the rural sector
in India. Also, the Government of India has also ensured employment generation program in the rural
regions under Rural Employment Generation Program (REGP) and the Prime Minister's Rozgar
Yojana (PMRY) in association with of State Governments, Reserve Bank of India (RBI) and other
banks.

Some of the major sectors in rural economy of India have been listed below: Rubber Business

in India-

Rubber is one of the significant commercial crops in India. Rubber Industry in India has accounted
for a production of 6.49 lakh tons for the year 2006. Places in India where rubber is cultivated include
areas of southwest Konkan and Malabar Coast in Kerala and in some areas of Tamil Nadu.

Fisheries in Rural India-

The fish production rate in India has witnessed a remarkable growth since 1995-
96. The National Program of Developing Fish Seeds, Fish Farmers' Development Agencies and
Brackish Water Fish Farmers' Development Agencies have been the major contributors to the growth
in fisheries in rural India. A diversified range of fishing methods along with processed fish products
have been introduced in the Indian rural market through an Integrated Fisheries
Project.

Poultry Business in India-

Poultry Business is one of the major contributors to the growing economy of rural and semi-urban
India. India has witnessed a remarkable growth in the egg and poultry meat industry in the recent
period. States of Andhra Pradesh, Karnataka, Kerala and Tamil Nadu contribute to around 45 percent
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of the total egg production in India whereas the eastern and central parts of India contribute to around
20 percent of the same. India is the seven largest poultry producer all over the world.

Tobacco Business in India-

India is one of the most predominant producers as well as consumers of tobacco in India. It ranks
third in terms of tobacco production around the world. Tobacco leaves are highly exported in the
overseas countries which has accounted for a 99 percent increase in the revenue
from exports.

Jute Business in India-

Jute is one of the most prime products in terms of exporting to the overseas nations and it brings in
maximum foreign exchange earnings. The delta of the river Ganges in West Bengal is perfect for
jute cultivation. A wide range of gunny bags, shopping bags, handicrafts, carpets, and many more
other items are made from Jute.
Horticulture Business in India-

India has a diverse soil and climate which provides a promising opportunity for horticulture. Some of
the crops cultivated in the horticultural sector comprise of fruits, vegetables, root and tuber crops,
flowers, ornamental plants, medicinal and aromatic plants, spices, condiments, plantation crops and
mushrooms.

Sericulture Business in India-

Sericulture is one of the rural based agro industries in India. Silk production activity has accounted
for a total income from export production of more than USD 600 million. Sericulture offers agro
based, ecologically and economically sustainable activity for the poor, small and marginal farmers
which also include women. 60 percent of the pre-cocoon and post-cocoon sector activities are carried
out by women.
Tea Business in India-
The tea business has been ruling Indian economy for the past 170 years. The chief areas of tea
production in India include rural hills and backward areas of North eastern and southern states like
Assam, West Bengal, Tamil Nadu and Kerala. India mainly manufactures tea variants such as CTC,
Orthodox tea and green tea.

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Rural Industries under Make in India

The Government is implementing the following schemes for bringing the rural industries under the
ambit of the 'Make in India' programme:

(i) Prime Minister’s Employment Generation Programme (PMEGP) is a credit

linked subsidy scheme, for setting up of new micro-enterprises and to generate employment
opportunities in rural as well as urban areas of the country through Khadi & Village Industries
Commission (KVIC), State Khadi & Village Industries Board (KVIB) and District Industries
Centre (DIC). Since inception and up to January 2016, 3.50 lakh micro enterprises have been
set up by utilizing margin money amounting to Rs.7004.40 crore and 29.82 lakh jobs have
been created from these units.
(ii) Scheme of Fund for Regeneration of Traditional Industries (SFURTI) was
launched in 2005-06 for making Traditional Industries more productive and competitive by
organizing the Traditional Industries and artisans into clusters. 26 clusters have been granted
final approval with a total project cost of Rs.72 crore benefiting around 25000 artisans.
(iii) A Scheme for Promoting Innovation, Rural Industry and Entrepreneurship
(ASPIRE) was launched on 18.3.2015 to promote Innovation & Rural Entrepreneurship
through rural Livelihood Business Incubator (LBI), Technology Business Incubator (TBI) and
Fund of Funds for start-up creation in the agro-based industry. During the year 2015-16, 22
LBIs & 2 TBIs have been approved and two LBI Centres have been operationalized at Deoria
(U.P.) and Rajkot (Gujarat).
Products of rural industries are already covered under extant laws & rules relating to trade &
commerce including consumer protection. Stand Up India scheme is meant to provide composite
loans between Rs. 10 lakh to Rs. 100 lakhs for setting up Greenfield enterprises in non-farm sector by
SC/ST and women entrepreneurs.
Classification of Rural Industries
Rural industries have been classified into the following six categories:-
1. Mineral-based industries.
2. Forest-based industries.
3. Agro-based industries.
4. Engineering and non-conventional industries.
5. Textile industry (including Khadi), and
6. Service industry.

Globalization in Rural Industry

Since globalization is a macro-concept and rural entrepreneurship is a micro- concept, occurring in a

very limited area, it is very difficult to establish causal linkages, or to quantify the specific effects of
Page 23
globalization on rural entrepreneurship. However, it is possible to identify a range of different
channels through which various aspects of globalization can be expected to change the welfare of
rural entrepreneurship in India.

1) Productivity and efficiency effect

Globalization is often said to result in higher productivity, due to the access to global markets,
abilities to specialize, and to take advantages of economies of scale and scope. Exposure to the
global competition can result in high levels of productivity and efficiency. However, it is less crucial
for large economies like India. Again, the potential gains to rural entrepreneur are also large, because
globalization enhances countries’ abilities to exploit comparative advantages arising from differing
natural and ecological conditions. At the level of national policy, these arguments seem to favour
globalization. Still, it is very easy to see how the rural entrepreneur could still lose out. In short,
globalization presents real dangers to the rural entrepreneur, to set against the possible advantages for
the wider economy.
2) Economic growth effect
The argument in favour of globalization is the positive link between globalization and rural
entrepreneurship in India. Because the potential benefits include improved access to foreign
technology and managerial expertise. Emergence of the WTO and the series of deliberations under
the Uruguay round have changed the world economic order. Indian Government has shelved the
earlier protectionist policies and opened up the economy to the world market. Undoubtedly, this has
helped the Indian economy to recoup its strength with the flow of international capital and technology
resulting in a robust economic position. The economy is moving steadily with more than 6 per
cent DGP growth rate for the last two decades or so. However, the new economic order has posed
severe challenges to the agricultural and rural sectors of the economy.
Overall, it indicates that openness promotes faster growth. Still, the question remains as to what this
might do for the rural enterprises, particularly as little FDI flows into agriculture, least of all small-
scale agriculture. The effect of globalization on rural enterprises depends upon the changes in GDP
and changes in income distribution. The evidence suggests that the rural entrepreneur overall are
substantially included as beneficiaries from economic growth. However, the extent of inclusion
varies from country to country.
3) Technological effect
Transfer of technology is one of the prominent features of globalization and one of the major reasons
for predicting improved growth. Many formerly small rural entrepreneurs saw major improvements
in their businesses, but the improvements were in a very limited area and to a very limited number of
entrepreneurs. The focus today is on the potentials and dangers of biotechnology. In principle, the
Page 24
benefits here too may be large. The benefits may be from raising productivity, reduced risks of
drought and pests, as well as lower food prices. Biotechnology research has been more relevant to the
problems of high-income countries. The benefits tend to be specific to particular environments,
conditions or markets. As mall number of multinational corporations is also carrying out much of the
research. There has been a general focus upon the problems of rural entrepreneurs in rich countries,
with little attention being paid to developing countries’ like India’s basic food crops and the problems
of their small farmers.

4) Distributional Effect
It is not possible to gauge the overall effect of globalization on the level of inequality; the effect on
women entrepreneur in rural area is less ambiguous. Many rural women entrepreneurs are hampered
from benefiting from the changes arising from globalization. They have less access than men to
education and training, less time to devote to productive activities, less command over important
resources such as land, credit and capital. Income developing countries, the sexual division of labor
precludes women from income derived from cash crops. In addition, they also have less
incentive to respond to economic signals, since they are likely to have less control over any income.
5) Policy
Government of India has, in a sense, discriminated against agriculture and those enterprises that
depend upon it. This ‘discrimination’ has typically taken the form of overvalued exchange rates, state
trading monopolies for domestic and external marketing of agricultural commodities. Additionally,
the revenues from commodity exports have been used for the growth of civil services and urban
development, rather than reinvestment in agriculture.

Challenges faced by Rural Entrepreneurship in India

Family Challenges: Convincing to opt for business over job is easy is not an easy task for an
individual. The first thing compared is – Will you make more money in the business of your choice
or as a successor of family business. This is where it becomes almost impossible to convince that
you can generate more cash with your passion than doing what your Dad is doing.

Social Challenges: Family challenges are always at the top because that is what matter the most but
at times social challenges also are very important. Let us say you and your friend graduated at the
same time. You opted for entrepreneurship and your friend opted for a job. He now has a flat, car and
what not because he could easily get those with a bank loan but you still have nothing to show off
and this is where the challenge comes.

Technological Challenges: Indian education system lags too much from the Job industry as a whole
Page 25
but then it lags even more when it comes to online entrepreneurship. What technology would be ideal
and how to use that technology effectively?

Financial Challenges: (Difficulty in borrowing fund): Financial challenges are a lot different in
India especially for online entrepreneurs. When you are starting out as an entrepreneur you don’t opt
for venture funding but try to go to funding for small to medium business people. Many such non-
technical business people don’t understand the online business models as a whole and so getting an
initial business funding from them becomes challenging. The other option you can think of is a loan
but bank loan is not at all an option in India for new online entrepreneurs.

Policy Challenges: Now and then there is lots of changes in the policies to change in the
government. Problems of TRIPS and TRIMS. Problems of raising equity capital, Problems of
availing raw-materials, Problems of obsolescence of indigenous technology Increased pollutions
Ecological imbalanced. Exploitation of small and poor countries etc.

A. Opportunities
 Free entry into world trade.
 Improved risk taking ability.
 Governments of nations withdrawn some restrictions
 Technology and inventions spread into the world.
 Encouragement to innovations and inventions.
 Promotion of healthy completions among nations
 Consideration increase in government assistance for international trade.
 The establishment of other national and international institutes to support business among the
nations of the world.
 Benefits of specialization.
 Social and cultural development

B. Challenges for Rural Entrepreneurs

 Growth of Mall Culture
 Poor Assistance
 Power Failure
 Lack of Technical know how
 Capacity Utilization
 Infrastructure Sickness

C. Opportunities for Rural Entrepreneurs

Page 26
 Crashed Scheme for Rural Development
 Food for Work Program
 National Rural Employment Program
 Regional Rural Development Centers
 Entrepreneurship Development Institute of India
 Bank of Technology
 Rural Innovation Funding
 Social Rural Entrepreneurship.

Problems of Rural Entrepreneurship

Entrepreneurs are playing very important role in the development of economy. They face various
problems in day to day work. As the thorns are part of roses, similarly every flourishing business has
its own kind of problems. Some of the major problems faced by rural entrepreneurs are as under:

Financial Problems

• Paucity of Funds

Most of the rural entrepreneurs fail to get external funds due to absence of tangible security and
credit in the market. The procedure to avail the loan facility is too time-consuming that its delay
often disappoints the rural entrepreneurs. Lack of finance available to rural entrepreneurs is one of
the biggest problems which rural entrepreneur is born now days especially due to global recession.
Major difficulties faced by rural entrepreneurs include low level of purchasing power of rural
consumer so sales volume is insufficient, lack of finance to start business, reduced profits due to
competition, pricing of goods and services, Financial statements are difficult to be maintained by
rural entrepreneur, stringent tax laws, lack of guarantees for raising up of loans, difficulty in raising
capital through equity, dependence on small money lenders for loans for which they charge
discriminating interest rates and huge rent and property cost. These all problems create a difficulty in
raising money through loans. Landlords in Punjab proved to be a major source of finance for rural
entrepreneurs but the rates of land are reduced due to global recession so they also lack hard cash
nowadays.
Some banks have not ventured out to serve rural customers because banks are expensive to be
reached by rural customers and, once reached, are often too poor to afford bank products. Poor
people often have insufficient established forms of collateral (such as physical assets) to offer, so
they are often excluded from traditional financial market. The government is providing subsidies to

Page 27
rural areas but due to the high cost of finance, these subsidies are not giving fruitful results. Major
sources of finance in rural areas are loans from regional rural banks or from zamindars but their rate
of interest is usually very high. The government has various institutions for this purpose but the
results are not up to the level expected. Industrial Finance Corporation of India (IFCI), Industrial
development bank of India, Industrial Credit and Investment Corporation of India (ICICI), Small
Scale Industry development bank of India (SIDBI) are some of the national level (SFC) institutions
that are helping out rural entrepreneurs. Some state level institutions are also working like a State
Financial Corporation and State Industrial Development Corporation (SIDC). These institutions
provide assistance for setting up of new ventures and side by side for modernization and expansion
of existing ones but their terms and conditions are very strict to be handled.
Various schemes like composite loan scheme, tiny unit scheme, scheme for technical entrepreneurs
etc. had started but they are unable to meet the expectation of rural entrepreneur. Raising funds
through equity is little bit difficult for rural entrepreneurs because of lack of financial knowledge and
also their financial corpus is also low, so loans are the primary source of finance for them which
proved to be a great obstacle in developing rural entrepreneurship. Various policies of RBI regarding
priority sector lending failed to achieve its objectives. Micro financing movements started in India
worked well. Self-help groups from the basic constituent unit of micro finance movement in India.
Self-help groups are a group of a few individuals who pool their savings into a fund from which they
can borrow as and when necessary. Such a group is linked with banks but joining an existing SHG is
often a costly affair for an aspiring villager as in order to maintain parity among the members, a new
member has to join by depositing the total accumulated individual savings and interest of groups. So
starting new SHG is an easy as compared to join existing one. NGO’s also played important role in
rural development. These NGO’s are usually registered as societies and trust. They have less capital
resources as they cannot raise equity capital.
Lack of Infrastructural Facilities
 The growth of rural entrepreneurs is not very healthy in spite of efforts made by government due to
lack of proper and adequate infrastructural facilities.
Risk Element
Rural entrepreneurs have less risk bearing capacity due to lack of financial resources and external
support.
Marketing Problems
• Competition
Rural entrepreneurs face severe completion of large sized organizations and urban entrepreneurs.
They incur the high cost of production due to high input cost. Major problems faced by marketers
are the problem of standardization and competition from large scale units. They face the problem in
fixing the standards and sticking to them. Competition from large scale units also creates difficulty
for the survival of new ventures. New ventures have limited financial resources and hence cannot
Page 28
afford to spend more on sales promotion. These units are not having any standard brand name under
which they can sell their products. New ventures have to come up with new advertisement strategies
which the rural people can easily understand. The literacy rate among the Problems Faced by Rural
Entrepreneurs and Remedies to Solve It rural consumer is very low. Printed media have limited scope
in the rural context. The traditionally bounded nature, cultural backwardness and cultural barriers add
to the difficulty of communication. People in rural areas mostly communicate in their local dialects
and English and Hindi are not understood by many people. It has been seen in the recent past that in
spite of enough food stocks with government warehouses, people are dying of starvation. This
indicates a problem with the public distribution system. The producers are not collective in their
approach for marketing their products because they are too widely scattered and uneducated.

• Middlemen
Middlemen exploit rural entrepreneurs. The rural entrepreneurs are heavily dependent on middlemen
for marketing of their products who pocket large amount of profit. Storage facilities and poor mean
of transport are other marketing problems in rural areas. In most of the villages, farmers store the
produce in open space, in bags or earthier vessels etc. So these indigenous methods of storage are not
capable of protecting the produce from dampness, weevils etc. The agricultural goods are not
standardized and graded.

Management Problems

• Lake of Knowledge of Information Technology

Information technology is not very common in rural areas. Entrepreneurs rely on internal linkages
that encourage the flow of goods, services, information and ideas. The intensity of family and
personal relationships in rural communities can sometimes be helpful but they may also present
obstacles to effective business relationships. Business deals may receive less than rigorous objectivity
and intercommunity rivalries may reduce the scope for regional cooperation. Decision making
process and lines of authority are mostly blurred by local politics in rural areas.

• Legal formalities

Rural entrepreneurs find it extremely difficult in complying with various legal formalities in
obtaining licenses due to illiteracy and ignorance.

• Procurement of Raw Materials

Procurement of raw materials is really a tough task for rural entrepreneurs. They may end up with
poor quality raw materials, may also face the problem of storage and warehousing.
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• Lack of Technical Knowledge

Rural entrepreneurs suffer a severe problem of lack of technical knowledge. Lack of training facilities
and extensive services crate a hurdle for the development of rural entrepreneurship.
• Poor Quality of Products

Another important problem is growth of rural entrepreneurship is the inferior quality of products
produced due to lack of availability of standard tools and equipment and poor quality of raw
materials.

Human Resources Problems

• Low Skill Level of Workers

Most of the entrepreneurs of rural areas are unable to find workers with high skills. Turnover
rates are also high in this case. They have to be provided with on the job training and their training is
generally a serious problem for the entrepreneur as they are mostly uneducated and they have to be
taught in the local language which they understand easily. The industries in rural areas are not only
established just to take advantage of cheap labor but also to bring about an integrated rural
development. So rural entrepreneurs should not look at rural area as their market, they should also see
the challenges existing in urban areas and be prepared for them. Rural entrepreneurs are generally
less innovative in their thinking. Youths in rural areas have little options “this is what they are given
to believe”. This is the reason that many of them either work as farm or migrate to urban land.

• Negative Attitude

The environment in the family, society and support system is not conducive to encourage rural people
to take up entrepreneurship as a career. It may be due to lack of awareness and knowledge of
entrepreneurial opportunities. The young and well educated mostly tend to leave. As per
circumstances, rural people by force may be more self-sufficient than their urban counterparts, but
the culture of entrepreneurship tends to be weak. Continuous motivation is needed in case of rural
employee which is sometime difficult for an entrepreneur to Problems In Rural Entrepreneurship
Entrepreneurs are playing very important role in the development of economy. They face various
problems in day to day work. As the thorns are part of roses, similarly every flourishing business has
its own kind of problems. Some of the major problems faced by rural entrepreneurs are as under.

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 Role of Rural Entrepreneurs in Economic Development:

The entrepreneurs with their ability to scan, analyze and identify opportunities in the environment
transform them into business proposition through creation of economic entities. They by channelizing
the resources from less productive to move productive use crate wealth. Through efficient and
effective utilization of national resources, they act as catalysts for economic development and agents
of social transformation and change. According to Joseph Schumpeter, the rate of economic progress
of a nation depends upon its rate of innovation which is turn depends on rate of increase in the
entrepreneurial talent in the population. According to Meir and Baldwin, development does not occur
spontaneously as a natural consequence when economic conditions in some sense are right. A catalyst
is needed which results in entrepreneurial activity to a considerable extent. The diversity of activities
that characterizes rich countries can be attributed to the supply of entrepreneurs. They play a vital
role for the economic development of a country in the following ways.

Formation of Capital: Entrepreneurs by placing profitable business proposition attract investment

to ensure private participation in the industrialization process. The otherwise idle savings are
channelized for investment in business ventures which in turn provides return. Again the savings are
invested giving a multiplier effect to the process of capital formation.

Balanced Regional Development: The entrepreneurs always look for opportunities in the
environment. They capitalize on the opportunities of governmental concessions, subsidies and
facilities to set up their enterprises in undeveloped areas. The setting up of still plant at Tata Nagar,
Reliance Petrochemicals at Jamnagar (Gujarat) have resulted in the development of Good Township
and peripheral regional development. Thus entrepreneurs reduce the imbalances and disparities in
development among regions.

General Employment: This is the real charm of being an entrepreneur. They are not the job
seekers but job creators and job providers. With the globalization process the government jobs are
shrinking leaving many unemployed. In the circumstances, the entrepreneurs and their enterprises
are the only hope and source of direct and indirect employment generation. Employment is generated
directly by the requirement of the large enterprises and indirectly by ancilliariation and consequential
development activities.

Improvement in Standard of Living: Entrepreneurial initiative through employment generation

leads to increase in income and purchasing power which is spent on consumption expenditure.
Increased demand for goods and services boost up industrial activity. Large scale production will
result in economies of scale and low cost of production. Modern concept of marketing involves

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creating a demand and then filling it. New innovative and varying quality products at most
competitive prices making common man’s life smoother, easier and comfortable are the contribution
of entrepreneurial initiative.

Increase in per Capita Income: Entrepreneurs convert the latent and idle resources like land, labour
and capital into goods and services resulting in increase in the national income and wealth of a
nation. The increase in national income is the indication of increase in net national product and per
capita income of the country.

National Self-reliance: Entrepreneurs are the corner stores of national self- reliance. They help to
manufacture indigenous substitutes to imported products which reduce the dependence on foreign
countries. There is also a possibility of exporting goods and services to earn foreign exchange for the
country. Hence, the import substitution and export promotion ensure economic independence and the
country becomes self-reliance.

Planned Production: Entrepreneurs are considered as economic agents since they unite all means of
production. All the factors of production i.e., land, labour, Capital and enterprise are brought together
to get the desired production. This will help to make use all the factors of production with proper
judgment, perseverance and knowledge of the world of business. The least combination of factors is
possible avoiding unnecessary wastages of resources.

Equitable Distribution Economic Power: The modern world is dominated by economic power.
Economic power is the natural outcome of industrial and business activity. Industrial development
may lead to concentration of economic power in few hands which results in the growth of
monopolies. The increasing number of entrepreneurs helps in dispersal of economic power into the
hands of many efficient managers of new enterprises. Hence setting up of a large number of
enterprises helps in weakening the evil effects of monopolies. Thus, the entrepreneurs are key to the
creation of new enterprises that energies the economy and rejuvenate the established enterprises that
make up the economic structure.

Benefits from Rural Entrepreneurship:

Provide employment opportunities: Rural entrepreneurship is labor intensive and provides a clear
solution to the growing problem of unemployment. Development of industrial units in rural areas
through rural entrepreneurship has high potential for employment generation and income creation.

Check on migration of rural population: Rural entrepreneurship can fill the big gap and disparities
in income rural and urban people. Rural entrepreneurship will bring in or develop infrastructural
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facilities like power, roads, bridges etc. It can help to check the migration of people from rural to
urban areas in search of jobs.

Balanced regional growth: Rural entrepreneurship can dispel the concentration of industrial units in
urban areas and promote regional development in a balanced way.

Promotion of artistic activities: The age-old rich heritage of rural India is preserved by protecting
and promoting art and handicrafts through rural entrepreneurship.

Check on social evils: The growth of rural entrepreneurship can reduce the social evils like poverty,
growth of slums, pollution in cities etc.

Awaken the rural youth: Rural entrepreneurship can awaken the rural youth and expose them to
various avenues to adopt entrepreneurship and promote it as a career.

Improved standard of living: Rural entrepreneurship will also increase the literacy rate of rural
population. Their education and self-employment will prosper the community, thus increasing their
standard of living.

Women Entrepreneurship

Women entrepreneur may be defined as a woman or group of women who initiate, organize, and run
a business enterprise. In terms of Schumpeterian concept of innovative entrepreneurs, women who
innovate, imitate or adopt a business activity are called “women entrepreneurs”.

Kamal Singh who is a woman entrepreneur from Rajasthan, has defined woman entrepreneur as “a
confident, innovative and creative woman capable of achieving self-economic independence
individually or in collaboration, generates employment opportunities for others through initiating,
establishing and running the enterprise by keeping pace with her personal, family and social life.”

The Government of India has defined women entrepreneurs based on women participation in equity
and employment of a business enterprise. Accordingly, the Government of India (GOI2006) has
defined women entrepreneur as “an enterprise owned and controlled by a women having a minimum
financial interest of 51 per cent of the capital and giving at least 51 per cent of the employment
generated in the enterprise to women.” However, this definition is subject to criticism mainly on the
condition of employing more than 50 per cent women workers in the enterprises owned and run by
the women.

In nutshell, women entrepreneurs are those women who think of a business enterprise, initiate it,
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organize and combine the factors of production, operate the enterprise and undertake risks and handle
economic uncertainty involved in running a business enterprise.

Women Entrepreneurship in India

Women entrepreneurship in India represents a group of women who have broken away from the
beaten track and are exploring new vistas of economic participation. Women in India entered
business due to pull and push factors. Their task has been full of challenges. In spite of the family
opposition, many women have proved themselves independent and successful entrepreneurs. The
emergence of women entrepreneurs and women-owned firms and their significant contributions to
the economy are visible in India and these businesses are ready for continued growth in the future. In
India, women constitute half of the total population (495.74 million), but their participation in the
economic activity is very low.

In India, women are relatively powerless with little or no control over resources and little decision
making power. Women in the informal sector are found to be home-based workers, engaged in the
petty manufacture of goods, either on piece rate basis or on own account, petty traders and petty
shopkeepers or service specialists. Studies reveal that 89 per cent of India’s women workers toil in
the informal sectors in sub-human conditions. Over 2/3 of the enterprises are self owned and have a
fixed capital of less than Rs.50/- . Over 4/5 of the women workers in this sector earn less than
Rs.500/-p.m. The income earned by women in this sector is said to be about ¼ of that of a woman in
the organised sector”.

Nowadays women are well-educated with technical and professional qualifications. Many of them
have medical, management and similar degrees and diplomas. Many entered their family business as
equal partners. Women set up their own clinics or nursing homes, small boutiques, small
manufacturing enterprises and entered garment exports. They have their own personal choices and
the courage to undertake new ventures. However, many have to face family antipathy and do not get
adequate support from their family.

Organisations’ Promoting Women Entrepreneurship in India

i. National Resource Centre for Women (NRCW) An autonomous body set up under
the National Commission for Women Act, 1990 to orient and sensitise policy planners
towards women’s issues, facilitating leadership training and creating a national database in the
field of women’s development.

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ii. Women’s India Trust (WIT) WIT is a charitable organisation established in 1968 to
develop skills of women and to earn a regular income by providing training and employment
opportunities to the needy and unskilled women of all communities in and around Mumbai.
iii. Women Development Corporation (WDC) WDCs were set up in 1986 to create
sustained income generating activities for women to provide better employment avenues for
women so as to make them economically independent and self- reliant.
iv. Development of Women and Children in Urban Area (DWCUA) DWCUA was
introduced in 1997 to organise the urban poor among women in socio-economic self-
employment activity groups with the dual objective of providing self-employment
opportunities and social strength to them.
v. Association of Women Entrepreneurs of Karnataka (AWAKE) AWAKE was
constituted by a team of women entrepreneurs in Bangalore with a view to helping other
women in different ways –to prepare project report, to secure finance, to choose and use a
product, to deal with bureaucratic hassles, to tackle labour problems, etc.
vi. Working Women’s Forum (WWF) WWF was founded in Chennai for the
development of poor working women to rescue petty traders from the clutches of middlemen
and to make them confident entrepreneurs in their own right. The beneficiaries are fisher
women, lace makers, beedi making women, landless women, labourers and agarbathi
workers.
vii. Association of Women Entrepreneurs of Small Scale Industries (AWESSI) It
was founded in Ambattur in Chennai in 1984 to promote, protect and encourage women
entrepreneurs and their interests in South India to seek work and co-operate with the Central
and State Government services and other Government agencies and to promote measures for
the furtherance and protection of small-scale industries.
viii. Women’s Occupational Training Directorate: It organises regular skill training
courses at basic, advanced and post advanced levels. There are 10 Regional Vocational
Training Institutes (RVTIs) in different parts of the country, besides a National Vocational
Training Institute (NVTI) at NOIDA.
ix. Aid The Weaker Trust (ATWT) ATWT was constituted in Bangalore by a group of
activists to impart training to women in printing. It is the only one in Asia. Its benefits are
available to women all over Karnataka. It provides economic assistance and equips girls with
expertise in various aspects of printing and building up self- confidence.
x. Self- Employed Women’s Association (SEWA) SEWA is a trade union registered
in 1972. It is an organisation of poor self- employed women workers. SEWA’s main goals are
to organise women workers to obtain full employment and self- reliance.

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 xi. Women Entrepreneurship of Maharashtra (WIMA) It was set up in 1985 with its
head office in Pune to provide a forum for members and to help them sell their products.
It also provides training to its members. It has established industrial estates in New Mumbai
and Hadapsar.
xii. Self- Help Group (SHG) An association of women, constituted mainly for the
purpose of uplifting the women belonging to the Below Poverty Line (BPL) categories to the
Above Poverty Line (APL) category. The major activities of the group are income generation
programmes, informal banking, credit, unions, health, nutritional programmes, etc.
xiii. The National Resource Centre for Women (NRCW) An autonomous body set up
to orient and sensitize policy planners towards women’s issues, facilitating leadership training
and creating a national data base in the field of women’s development.
xiv. Women Development Cells (WDC) In order to streamline gender development in
banking and to have focused attention on coverage of women by banks, NABARD has been
supporting setting up of Women Development Cells (WDCs) in Regional Rural Banks and
Cooperative Banks.

Problems and Prospects of Women Entrepreneurship in India

Women Entrepreneurs may be defined as the women or a group of women who initiate, organize and
operate a business enterprise. The Government of India has defined women entrepreneurs as ―an
enterprise owned and controlled by women having a minimum financial interest of 51 per cent of the
capital and giving at least 51 per cent of the employment generated in the enterprise to women‖.
Women entrepreneurs engaged in business due to push and pull factors which encourage women to
have an independent occupation and stands on their on legs. A sense towards independent decision-
making on their life and career is the motivational factor behind this urge. Saddled with household
chores and domestic responsibilities women want to get independence. Under the influence of these
factors the women entrepreneurs choose a profession as a challenge and as an urge to do something
new. Such a situation is described as pull factors. While in push factors women engaged in business
activities due to family compulsion and the responsibility is thrust upon them.

REASONS FOR SLOW PROGRESS OF WOMEN ENTREPRENEURS IN INDIA

The problems and constraints experienced by women entrepreneurs have resulted in restricting the
expansion of women entrepreneurship. The major barriers encountered by women entrepreneurs are:

The greatest deterrent to women entrepreneurs is that they are women. A kind of patriarchal- male
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dominant social order is the building block to them in their way towards business success. Male
members think it a big risk financing the ventures run by women

Women entrepreneurs have to face a stiff competition with the men entrepreneurs who easily involve
in the promotion and development area and carry out easy marketing of their products with both the
organized sector and their male counterparts. Such a competition ultimately results in the liquidation
of women entrepreneurs.

Lack of self-confidence, will-power, strong mental outlook and optimistic attitude amongst women
creates a fear from committing mistakes while doing their piece of work. The family members and
the society are reluctant to stand beside their entrepreneurial growth.

Women in India lead a protected life. They are even less educated, economically not stable nor self-
dependent which reduce their ability to bear risks and uncertainties involved in a business unit.
The old and outdated social outlook to stop women from entering in the field of entrepreneurship is
one of the reasons for their failure. They are under a social pressure which restrains them to prosper
and achieve success in the field of entrepreneurship

Unlike men, women mobility in India is highly limited due to many reasons. A single women asking
for room is still looked with suspicion. Cumbersome exercise involved in starting with an enterprise
coupled with officials humiliating attitude towards women compels them to give up their spirit of
surviving in enterprise altogether.

Women's family obligations also bar them from becoming successful entrepreneurs in both
developed and developing nations. The financial institutions discourage women entrepreneurs on the
belief that they can at any time leave their business and become housewives again.

Indian women give more emphasis to family ties and relationships. Married women have to make a
fine balance between business and family. The business success also depends on the support the
family members extended to women in the business process and management.

Women‘s family and personal obligations are sometimes a great barrier for succeeding in business
career. Only few women are able to manage both home and business efficiently, devoting enough
time to perform all their responsibilities in priority.

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The educational level and family background of husbands also influences women participation in the
field of enterprise.

Absence of proper support, cooperation and back-up for women by their own family members and
the outside world people force them to drop the idea of excelling in the enterprise field. They are
always making many pessimistic feelings to be aroused in their minds and making them feel that
family and not business is a place meant for them.
Many women take the training by attending the Entrepreneurial Development programme without an
entrepreneurial bent of mind. Women who are imparted training by various institutes must be verified
on account of aptitude through the tests, interviews, etc.

High production cost of some business operations adversely affects the development of women
entrepreneurs. The installations of new machineries during expansion of the productive capacity and
like similar factors discourage the women entrepreneurs from venturing into new areas.

Women controlled business are often small and it is not always easy for women to access the
information they need regarding technology, training, innovative schemes, concessions, alternative
markets, etc. Just a small percentage of women entrepreneurs avail the assistance of technology and
they too remain confined to word processing software in the computer. They hardly make use of
advanced software available like statistical software SAP, Accounting Package like TALLY,
Animation software 3D MAX, internet, etc

Lack of awareness about the financial assistance in the form of incentives, loans, schemes etc. by the
institutions in the financial sector. So the sincere efforts taken towards women entrepreneurs may not
reach the entrepreneurs in rural and backward areas.

Achievement motivation of the women folk found less compared to male members. The low level of
education and confidence leads to low level achievement and advancement motivation among
women folk to engage in business operations and running a business concern.

Apart from the above problems there may occur other series of serious problems faced by women
entrepreneurs as improper infrastructural facilities, high cost of production, attitude of people of
society towards the women modern business outlook, low needs of enterprise. Women also tend
to start business about ten years later than men, on average. Motherhood, lack of management
experience, and traditional socialization has all been cited as reasons for delayed entry into

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entrepreneurial careers.

STEPS TAKEN BY THE GOVERNMENT

At present, the Government of India has over 27 schemes for women operated by different
departments and ministries. Some of these are:
 Integrated Rural Development Programme (IRDP)
 Khadi And Village Industries Commission (KVIC)
 Training of Rural Youth for Self-Employment (TRYSEM)
 Prime Minister‘s Rojgar Yojana (PMRY)
 Entrepreneurial Development programme (EDPs)
 Management Development progammes
 Women‘s Development Corporations (WDCs)
 Marketing of Non-Farm Products of Rural Women (MAHIMA)
 Assistance to Rural Women in Non-Farm Development (ARWIND)
 Trade Related Entrepreneurship Assistance and Development (TREAD)
 Working Women‘s Forum
 Indira Mahila Yojana
 Indira Mahila Kendra
 Mahila Samiti Yojana
 Mahila Vikas Nidhi
 Micro Credit Scheme
 Rashtriya Mahila Kosh
 SIDBI‘s Mahila Udyam Nidhi
 Mahila Vikas Nidhi
 SBI‘s Stree Shakti Scheme
 NGO‘s Credit Schemes
 Micro & Small Enterprises Cluster Development Programmes (MSE- CDP).
 National Banks for Agriculture and Rural Development‘s Schemes
 Rajiv Gandhi Mahila Vikas Pariyojana (RGMVP)
 Priyadarshini Project- A programme for ‗Rural Women Empowerment and Livelihood in Mid
Gangetic Plains‘
 NABARD- KFW-SEWA Bank project
 Exhibitions for women, under promotional package for Micro & Small enterprises approved by
CCEA under marketing support.

The efforts of government and its different agencies are ably supplemented by NGOs that are playing
an equally important role in facilitating women empowerment. Despite concerted efforts of
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governments and NGOs there are certain gaps. Of course we have come a long way in empowering
women yet the future journey is difficult and demanding.

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