Pratap Rawal

Impediments in
Developing
Entrepreneurshi
p in Nepal
It is important to create a culture conducive to the entrepreneurial
development, in which people can have a positive attitude towards Assignment
entrepreneurship and while celebrating the success can gracefully accept 1
failures as part of the game.
 Impediments in Developing Entrepreneurship in Nepal

An entrepreneur play’s an important role in economic development of a nation and the

enterprise is an effective means to combat unemployment. Additionally, entrepreneurship
of the people in the nation enhances productivity by increasing and maintaining
competitive pressure in the market which in turn forces the market players to increase
their respective efficiencies. Therefore, it could then perhaps said to be a driving force
behind growth of smaller economies.

Entrepreneurship is a mindset that covers an individual’s motivation and capability,

independently or within the context of an organization to spot the opportunities and to
pursue it in order to create wealth or economic success. It is not about the business itself
but about the people, their choices and actions in starting, running and growing a business
or their involvement in a firm’s strategic decision making. (EU-2003)

Richard Cantillon a French economist in 1700, used the term “entrepreneur” to refer to a
person who took an active risk; while, Coutler in 2003 referred to entrepreneurship as
creative destruction, that means a process in which existing products, processes, business
ideas and methodologies are replaced by the new and better ones Peter Drucker proposed
that entrepreneur was some one who recognized and acted upon the opportunities.

Ask a child in Nepal, what would one want be when s/he grows up; in the early stages of
life, invariably the answer is a doctor or an engineer a pilot or even a teacher; however, as
one grows up with the difficulties associated in attaining this ambition, it gets modified to
work as a bureaucrat or say in the defense services but never does the answer turns out to
become an entrepreneur or to establish and own a business or even work for a business. It
is much latter that one decides or goes for this option.

The atmosphere provided by our parents, neighbors, the schools & colleges and even the
friend circle is same and the child as grows to adulthood develops a mindset to serve the
existing not to create a new. This is where one finds security, seeks and finds the
opportunities and prides in recognition of being there. Even while working in an
organization there is inertia to change and a liking to live with the conventional.

While most people do not even consider business to be a respectable occupation in our
societies, many who would want to be an entrepreneur lack the confidence and skills to
turn their dream come true. It is therefore important to create a culture conducive to the
entrepreneurial development, in which people can have a positive attitude towards
entrepreneurship and while celebrating the success, can gracefully accept failures as part
of the game.

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In order to address the challenges in promoting an entrepreneurial culture, it is imperative
to know and understand the impediment’s, and as is well said by Soren Kierkgaard; “the
direction of life is forward but the understanding of life comes from looking back”. Looking
back we can innumerate following as the impediments in developing entrepreneurship in
Nepal.

 Financial security and access to finance: Poor financial capacities of families a need
to fulfill the basic needs, access of limited few to the financial institutions.
 Lack of exposure and basic skills due to an education system that does not promote
entrepreneurship: having trained manpower and large knowledge base of workers
is essential for growth of any economy. As is, we have a very small and poor quality
work force. Since; entrepreneurship is an activity characterized by the originality of
thoughts, innovation and risk taking in order to create a new business or even grow
an existing one; education, training and exposure to skills could provide an answer.
 Access to information and markets therefore ventures can not work to its full
potential. While some who recognize the rewards and challenges of involving in
starting and running a business remain unsure of their abilities to execute plans
successfully.
 Political instability: inhibits rational calculated risk taking process.
 Short term thinking over longer range: is result of mindset formed due to political
instability, people want quick results for they do not trust the environment to
remain as conducive over longer range of time.
 High inflation rate. If the start ups do not grow at a faster pace than the inflation
itself then the chances are they will soon become unprofitable.
 Social Norms: where most people do not even consider business to be a respectful
occupation.

Entrepreneurship development is more than having a support system in place; it is

strategic transformation of societies and about changing the mindset of people. It is a
culture that promotes and recognizes those who consistently seeks opportunities and acts
on them, maintains a positive outlook even in the face of adversity, promotes calculated
risk taking and celebrates the success while accepts failures as part of the game. Therefore
education with Training and exposure to various skills from the very beginning of the
middle school education spanning up to even the post graduation is perhaps the most
important of all and is perhaps an answer to the challenge of developing entrepreneurship
in Nepal.

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