5 - UNIT 5 - Rural Industrialization and Entrepreneurship - BY MANISH KUMAR SHARMA

Rural Development: Administration and Planning (KHU-701) Unit-5
Manish Kumar Sharma

AP, Department of CSE
Rural Industrialization and Entrepreneurship: Concept of Rural Industrialization,

Gandhian approach to Rural Industrialization, Appropriate Technology for Rural
Industries, Entrepreneurship and Rural Industrialization Problems and diagnosis of
Rural Entrepreneurship in India, with special reference to Women Entrepreneurship;
Development of Small Entrepreneurs in India, need for and scope of entrepreneurship
in Rural area.
_____________________________________________________________________
Introduction Of Rural Industrialization
Swami Vivekananda
once said; “The real India lives in the villages. Unless we are able to uplift the tribals
and the backward classes, India faces a dark future.”
Basically rural society is an agrarian society and almost 70% of the population of India
lives in villages and their major source of employment are agriculture and related
industries. Still Indian economy is based on the primary sector i.e. agriculture.
After green revolution brought the revolution in the way Indian agriculture was done.
It has changed the Indian agriculture scenario. But still agriculture production is highly
dependent on the monsoon rain and if in a particular year there is no
or less than expected rain it ultimately affects the economy of the country.
There is intense need of industrialization in rural areas with proper attention by

exploring opportunities. In various five year plans introduced by Indian government
had given proper attention to the industrialization but the concentration was on heavy
and large scale industries.
A famous slogan during promotion of heavy industries was “Industrialize

or perish” but in case of rural industrialization it is not justifiable.
Rural areas required promotion of small scale industries which are more related with
the expertise of rural people,available resources and expansion of existing traditional
businesses. There is a need of the establishment of the industries in rural areas which
must not affect the rural eco-system alongwith local businesses. It must promote local
expertise, employment generation, income generation and utilization of available
resources
The basic purpose of rural industrialization is to create alternate model for overall
development of rural society to avoid over dependency on farming by utilizing
available opportunities to establish small and medium industries. Rural industrialization
must not link with establishments of heavy industries or machinery but to promote rural
entrepreneurship at local level in a professional manner by enhancing skills and
knowledge of local people. There are various opportunities present in the rural based
industry segment the only need is to explore, establish and sustain the business. The
three ways approaches which may help inexploring the rural industrialization are:
1. Agriculture diversification by exploring the opportunities by farming completely a

new range of grains, fruits or vegetables.
2. Establish agro food processing unit or related units like wine production, juice
production and many others.
3. Non-farm product business establishment by promoting local rural artisan work.
Rural industrialization means focus on promoting the rural based industries by

involving local people, resources and expertise or exploring the new business
opportunity related with available resources in that particular rural area or cluster in a
professional way.
Primary beneficiary must be local farmer, artisan and labour in small or medium enter
prise establishment in the rural areas and also support the local eco-system and
economy.
Types of Rural Industry
There are various types of rural industries possibilities present in the rural areas are:
1. Agro based industries: This industry is related with the processing of agro products
like jiggery and sugar production from sugarcane, wine production from grapes,
khadi production from cotton, fruit juice production, oil from oil
seeds and other related processing from raw agro products.
2. Forest based industries: There are possibilities to establish industries related to

wood products, bamboo products, honey, preparing manure from plant leaves, herbal
medicines production and others.
3. Mineral based industries: After exploring for the minerals in rural areas proper
utilization is required by establishment of its processing unit nearby the concerned rural
area. It also helps to minimize the initial cost of transportation to other processing units.
4. Traditional industry: Traditional industries like hand loom, handicraft and other
local artisan product manufacturing are having immense potential to become
professionally managed small and medium industries. There is a considerable high
demand in the market for traditional hand loom and handicraft products and a tie-up in
between local artisan and private SMEs can create a scope for small or medium scale
industry in the rural areas for better growth.
5. Dairy Industry: Production of milk and milk products on large scale can create a
space for organized milk industry in rural areas where milk production is high.AMUL
brand of GCMMF (Gujarat Cooperative Milk Marketing Federation) is one the best
example in this matter.
6. Renewable Energy Industry: Rural areas can be converted into industry hub
for producing renewable energy by setting up solar cell units, bio-
gas plants, gobar gas plants and other use of alternative energy commercially.
Significance of Rural Industrialization
In the country like India where population of rural areas is exploding and due to lack
of infrastructure facilities, under employment and lack of education; population is
migrating to urban areas is a matter of concern. Agriculture business is also shrinking
due to unprofitability, lack of skilled labour, irrigation facilities and over dependency
on rainfall.Due to unfavourable economic condition in rural areas some of the emerging
problems are:
1. Decrease in employment
2. Migration of rural population to urban areas.
3. Increase in poverty.
4. Underutilization of resources
5. Shut down of traditional businesses
Lack of government policy to regulate the rural business To address all these problems
rural industrialization is the solution. Rural industrialization will help talented local
youth to get the employment, utilization of available resources,creating new business
dimensions and to support the rural economy as a whole.
In simple terms “entrepreneurship” is the act of being an entrepreneur, which can be

defined as “one who undertakes innovations, finance and business acumen in an effort
to transform innovations into economic goods”. 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 underemployment or unemployment in the villages that has led to major
influx of rural population to the cities. At present what is needed is to create a situation
wherein the migration from rural areas to urban areas comes down. Migration per se is
not always undesirable but it should be minimum as far as employment is concerned.
Indeed 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
amenities and opportunities there.
The Gandhian Approach to Rural Development
In the Indian context rural development may be defined as maximising production in

agriculture and allied activities in the rural areas including development of rural
industries with emphasis on village and cottage industries.
It attaches importance to the generation of maximum possible employment

opportunities in rural areas, especially for the weaker sections of the community so as
to enable them to improve their standard of living.
Provision of certain basic amenities like drinking water, electricity, especially for the
productive purpose, link roads connecting villages to market centres and facilities for
health and education etc. figure prominently in the scheme of rural development.
Theoretically, Gandhian approach to rural development may be labelled as ‘idealist’. It

attaches supreme importance to moral values and gives primacy to moral values over
material conditions. The Gandhians believe that the source of moral values in general
lies in religion and Hindu scriptures like the Upanishads and the Gita, in particular.
The concept of ‘Rama Rajya’ is the basis of Gandhiji’s idea of an ideal social order.
Gandhi defined Rama Rajya as “sovereignty of the people based on moral authority”.
He did not view Rama as a king, and people as his subjects. In the Gandhian scheme,
‘Rama’ stood for God or one’s own ‘inner voice’ Gandhi believed in a democratic
social order in which people are supreme. Their supremacy is, however, not absolute.
It is subject to moral values.
Ideal Village:
The village is the basic unit of the Gandhian ideal social order. Gandhi succinctly
pointed out, “If the village perishes India will perish too…. We have to make a choice
between India of the villages that is as ancient as herself and India of the cities which
are a creation of foreign domination”. Gandhi’s ideal village belongs to the Pre-British
period, when Indian villages were supposed to constitute the federation of self-
governing autonomous republics
According to Gandhiji, this federation will be brought about not by coercion or
compulsion but by the voluntary offer of every village republic to join such a federation.
The work of the central authority will only be to coordinate the work of different village
republics and to supervise and manage things of common interest, as education, basic
industries, health, currency, banking etc.
The central authority will have no power to enforce its decisions on village republics
except the moral pressure or power of persuasion. The economic system and transport
system introduced by the British have destroyed the “republican’ character of the
villages.
Gandhi, however, admitted that in olden times tyranny and oppression were in fact
practised by feudal chiefs. But, “odds were even”. Today the odds are heavy. It is most
demoralising.” In this way in the Gandhian scheme of things the ancient ‘republic’, an
Indian village without tyranny and exploitation serves as a model unit.
Decentralisation:
Gandhi firmly believes that village republics can be built only through decentralisation
of social and political power. In such a system decision-making power will be vested
in the Village Panchayat rather than in the State and the national capital. The
representatives would be elected by all adults for a fixed period of five years. The
elected representatives would constitute a council, called the Panchayat.
The Panchayat exercises legislative, executive and judicial functions. It would look
after education, health and sanitation of the village. It would be the Panchayats
responsibility to protect and uplift ‘untouchables’ and other poor people. Resources for
Gandhian Approach to managing village affairs would be raised from the villages.
All the conflicts and disputes would be resolved within the village. And as far as
possible not a single case is to be referred to courts outside the village. The Panchayat
would play its role in propagating the importance of moral and spiritual values among
the ruralites for bringing about rural reconstruction.
Apart from managing its own affairs the village would also be capable of defending
itself against any invasion. A non-violent peace brigade of volunteers would be
organised to defend the village. This corps would be different from the usual military
formation. They would repose the utmost faith in non-violence and God.
Self-sufficiency:
Such a decentralised polity implies a decentralised economy. It can be attained only

through self-sufficiency at the village level. The village should be self-sufficient as far
as its basic needs – food, clothing, and other necessities – are concerned. The village
has to import certain things which it cannot produce in the village. “We shall have to
produce more of what we can, in order thereby to obtain in exchange, what we are
unable to produce”.
The village should produce food-crops and cotton in order to meet its requirements.
Some lands should also be earmarked for cattle and for a playground for adults and
children. If some land is still available, it should be used for growing useful cash crops
like tobacco, opium, etc. to enable the village to get in exchange things which it does
not produce.
Village economy should be planned with a view to providing full employment to all the
adults of the village. Each man should be guaranteed employment to enable him to meet
his basic needs in the village itself so that he is not forced to migrate to towns. In the
ultimate analysis full employment should be linked with equality.
Physical labour occupies a central place in the Gandhian concept of the self-sufficient
village. In this respect he was highly influenced by Rus-kin and Tolstoy. According to
Gandhi, each man must do physical labour to earn his bread. Physical labour is
necessary for moral discipline and for the sound development of the mind. Intellectual
labour is only for one’s own satisfaction and one should not demand payment for it.
The needs of the body must be supplied by the body. Gandhi said, “If all laboured for
their bread then there would be enough food and enough leisure for all.” Shriman
Narayan rightly observes, “Gandhiji recognised toil to be not a curse but the joyful
business of life as it has the power to make man healthier, merrier, fitter and kindlier”.
Industrialization:
Gandhiji maintained that industrialization would help only a few and will lead to
concentration of economic power. Industrialization leads to passive or active
exploitation of the villages. It encourages competition. Large scale production requires
marketing. Marketing means profit-seeking through an exploitative mechanism.
Moreover, industrialization replaces manpower and hence it adds to unemployment. In
a country like India, where millions of labourers in the villages do not get work for even
six months in a year, industrialization will not only increase unemployment but force
labourers to migrate to urban areas. This will ruin villages.
In order to avoid such a catastrophe, village and cottage industries should be revived.
They provide employment to meet the needs of the villagers and facilitate village self-
sufficiency. Gandhians are not against machine per se if it meets two aims: self-
sufficiency and full employment. According to Gandhi, there would be no objection to
villagers using even the modern machines and tools that they could make and could
afford to use. Only they should not be used as a means of exploitation of others.
Trusteeship:
Gandhiji was not against the institution of private property. But he wanted to restrict
the right of private property to what was necessary to yield an honourable livelihood.
For the excess he prescribed the principle of trusteeship.
Gandhiji firmly believed that land should not be owned by any individual. Land belongs
to God. Hence, individual ownership of land should be shunned. For that a landowner
should be persuaded to become a trustee of his land. He should be convinced that the
land he owns does not belong to him. Land belongs to the community and must be used
for the welfare of the community. They are merely trustees. By persuasion the heart of
landowners should be changed and they should be induced to donate their land
voluntarily.
Gandhiji’s concept of development is oriented to the uplift of the common man. He

preferred village habitats to megalopolises and Swadeshi craft to imported technology
for the economic well being of the common man. He stressed the need for cottage
industries in place of gigantic industries and advocated for a decentralised economy
instead of a centralised one.
He realised the need for integrated rural development and believed that education,
health and vocation should be properly integrated. He emphasised the need for
education and training which he called ‘Naitalim’ (New training) for rural
reconstruction.
In fine, Gandhian approach to rural development strives to reconstruct village republics

which would be non-violent, self- governed and self-sufficient so far as the basic
necessities of ruralites are concerned. Apart from creating a new socio-economic order,
it Endeavour’s to transform man; otherwise the changes in the socio-economic order
will be short-lived.
Entrepreneurship and Rural Industrialization
Rural entrepreneurship refers to the development of a new enterprise which

pioneers new products and services, creates a new market for its offerings
or uses advanced technology, in the rural area.
The word entrepreneur originates from the French word, entrepreneur, which
means “to undertake”. In a business context, it means to start a business. The
Merriam-Webster Dictionary presents the definition of an entrepreneur as
one who organizes, manages, and assumes the risk of a business or enterprise.
Rural entrepreneurship is now a days a major opportunity for the people who
migrate from rural areas or semi - urban areas to Urban areas. It is also a
fact on the contrary that the majority of rural entrepreneurs are facing many
problems due to non-availability of primary amenities in rural areas like
India. Financial problems, Lack of education, insufficient technical and
conceptual ability at present it is too difficult for the rural entrepreneurs to
establish industries in rural areas. Certainly the economic development of our
country largely depends on the development of rural areas and also the
standard of living in its rural mass. The paper also makes an attempt to find
out the challenges and problems for the potentiality of rural entrepreneurship.
It also tries to focus on the major problems faced by entrepreneurs especially
in the field of marketing of products, other primary amenities like water
supply, availability of electricity, transport facilities, required energy and
financial amenities. In the light of this research paper focuses on the major
challenges and problems available in the Indian market by en-cashing the
possibilities and prospects of the same to be an able and successful
entrepreneur.
Scope for rural Entrepreneurs:
India is the land of diversity and known for its variety of resources available in
abundance. Keeping in mind of rural resources the budding entrepreneurs have vast
opportunities to start an enterprise and produce products and services at lower cost in
compare to urban industries and contribute to strengthen the national economy.Gone
are the days when potential and talented peoples have desire to become an entrepreneurs
and start enterprises but due to limited access to information, funds, technology,
connectivity and required inputs to start the business dreams did not take shape and
turned into reality which discourage the persons. But now the things have changed a lot
and government and other financial institutions have initiate to promote rural
development and encouraging youth and entrepreneurs to start there enterprises 141
Journal Global Values, Vol. X, No. II 2019, ISSN: (P) 0976-9447, (e) 2454-8391,
Impact Factor 6.861 (SJIF) and create much needed employment opportunities as every
year 12 million people join the workforce. Rural entrepreneurs has a vast scope in
agriculture and non-agriculture sectors and with latest trends and new technology rope
in the sectors as modern farming techniques with high yielding variety of seeds,
irrigation and increased use of fertilizers are encouraging the would be entrepreneurs
as business risks has been mitigated with growing times and yields have been improved.
Below are few areas to consider in agriculture and non-agriculture sector where scope
is abundant and have been proven with great output and have promising careers —
Multiple cropping – Growing two or more crops on same piece of land in same season
in a year. The yield is higher, input cost is lower as compared to single crop growing
cost, sustained soil fertility and better returns. Collective farming – Sharing of land and
resources to achieve greater economy of scale and increase crop yields. Information
sharing – Set up of business centre for sharing of ideas, technology, resources available,
government aids is an opportunity for field experts and technocrats to gather
information and counsel the rural peoples for their betterment. Storage/warehouses –
Land is available at low cost in rural and introduction of e-commerce largely required
big warehouse for product storage and workforce too abundantly and economically
available in rural for running these warehouses. Cottage industries – Abundant
workforce available in rural for running labour intensive cottage industry and a big
source to increase foreign exchange by way of exports as handicrafts have higher
demand in foreign land. — Rural finance – Owing to infrastructure gaps and non-
availability of industries there is a dearth of financial institutions in rural and this is an
opportunity for budding entrepreneurs for set-up to meet small loan demands from
farmers. Rural energy generation – Electricity has not reached 45 million rural
households, yet. Major thrust has been put up by government to develop this sector and
is an opportunity for entrepreneurs to tap this area. Development of agro food industries
– Need of the hour is to innovate and revolutionize entire food chain to achieve
economies. Increase of crop yields, sustainable farming practices, improving market
access have made this sector lucrative. 142 Rural Entrepreneurship - Scope And
Challenges Dr. Upasana Major outcome of rural entrepreneurship:As known that

industrialization is closely related to urbanization and development of industries in rural
areas create scope for regional uplift and fosters economic development of rural areas.
This brings the need to establish rural industries through promotion of rural
entrepreneurship in order to maximize utilization of locally available raw materials and
labour.Rural industries helps in proper utilization of local resources human and non-
human and effectively tackled basic problem of unemployment in rural area.Rural
industries have helped to reduce ruralurban imbalance by providing job opportunities
at local level to non and semi skilled workforce and prevent migration of rural people
to urban and also reduce disparities in income.Rural industries have promote regional
development and reduces pressure from urban towns facing issues by rural migration
as population increase, environmental pollution, etc. — Rural industries helps in
earning of foreign exchange through export of their products as hand-made products
are in demand at global level.
Needs/Importance of rural Entrepreneurship
A significant role has been playing by the rural entrepreneurship in the overall
economic development of a nation. Various opportunities comes with the growth as
well as development of rural industries as it facilitates self-employment which may lead
to the wider distribution of things in different economic and industrial activities which
will be helpful in the maximum and proper utilization of resources such as raw material
and labour which is available within the boundaries of the rural areas.
Here, we have jotted down some of the aspects that are related to the importance of
rural entrepreneurship which results in the enhancement of socio-economic conditions
of a nation and especially in remote areas. So, let us have a brief look at all these realms.
1. As the rural industries are labour-intensive, they tend to have a high possibility of
generating employment, which acts as a corrective measure to a number of
problems causing due to unemployment stemming in the rural areas.
2. Rural industries have a comparatively high potential of generating income,

which reduces the disparities amidst income earned by people living in urban
and rural areas.
3. Rural entrepreneurship stimulates the dissemination of economic activities in

the village areas, which ultimately results in balanced regional development.
4. It does not just protect but also promotes the art, culture and creativity, i.e. the
varied heritage of that particular region.
5. When industries are set up in rural areas, it advances economic

development which reduces migration of the villagers to urban areas.
6. Curtails unequal growth in the urban areas, decreases the development of slums,
environment pollution etc.
Proper Utilization of resources
All the resources related to the business are available in the remote areas and the rural
entrepreneurship is associated with the proper and complete usage of all the materials
to maximize the profit. Directly and indirectly, this will be helpful for making
improvements in the economic and financial conditions of the rural areas. If the rural
entrepreneurship does not exist, then it may lead to proper wattage of all the available
resources and this might be not in favour of any nation.
When there is the proper utilization of all the resources by the rural entrepreneurs, then
this may lead to increase productivity. On the other side, when the labour available in
the rural areas gets some work through these types of entrepreneurship, then it will also
be helpful to eliminate unemployment. Unemployed people get employed due to rural
entrepreneurship.
Generation of employment opportunities
A huge number of employment opportunities generated because of the rural

entrepreneurship for the people who are living in these areas. A basic problem of any
nation in today’s era is unemployment and underemployment. This type of
entrepreneurship gives ample new opportunities to people and effectively tackle the
problem in a very positive way.
Rural industrialization is labour intensive and provides great dealings to all rural people.
People from rural areas migrate to the urban areas in search of a job and it helps to
decrease the migration by offering similar opportunities for growth in their remote areas.
Plug the gap
There is always a huge gap between the remote areas and urban areas in terms of better
education as well as job opportunities for all. Rural Entrepreneurship helps to fill the
gap by providing a similar level of growth and development opportunities for people in
rural areas and compete with the urban areas too. It maintains a gap between the income
in remote and the urban areas.
Enhance traditional culture

All type of historic and ancient artistic activities was originated from rural areas and it
is obvious that people have immense talent in terms of tradition and culture. Rural
entrepreneurship plays a vital role in the promotion of artistic activities and helps them
to create some brilliant handicraft pieces and earn their bread and butter easily. In
addition to this, the old-age artistic heritage is also conserved by protecting as well as
promoting the rural entrepreneurship.
Foster economic development
The economic development of remote areas fosters with the help of rural
entrepreneurship. On the one hand, it keeps control over the migration from rural areas
to the urban areas and secondly, increases the level of growth in all the areas equally.
Differentiation between the areas such as slum, towns and cities, etc, eliminates to a
great extent. Apart from this, there is a proportion of social tension and environmental
pollution too.
Getting foreign exchanges
The products manufactured in rural areas is exported to the other nations across the
world and in this way, they will earn foreign exchanges. It also enhances the rural
entrepreneurship and gives a great push to the way of success.
Consider the taste of consumers

All the products manufactured by the rural entrepreneurship are according to the taste
of the customers and fulfil all the expectations what they want. Choice of each
individual taken into consideration and so, they produce jewellery, sarees, artistic
materials that are produced serve all the requirements of the customers.
Entrepreneurial development
In the remote areas, the development of entrepreneurship is enhancing by the rural

entrepreneurship. At the same token, it encourages the young generation and talented
people to come up with something new and carry out the entrepreneurial tasks in the
rural sector. Hence, it develops the rural areas also.
Problems in Rural Entrepreneurship
Entrepreneurs certainly play very important role in the development of economy thus
contributing to overall Gross Domestic Product of the nation. They face various
problems in day to day life and work. As thorns are part of roses, in the same way
flourishing business has its own kind of problems. Some of the major problems faced
by rural entrepreneurs are as under:
• Paucity of Funds
• Lack of technical know-how
• Lack of training and development
• Non-availability of skilled labours
• Risk Element
• Legal Formalities
• Lack of technical knowledge
• Lack of Quality Control
• Lack of communication and market insights
• Lack of storage and transportation facilities

• Old and obsolete technology, machinery and equipment
• Lack of promotional strategy
• Lack of infrastructural facilities
• Poor quality standards
1. Financial Problems: Some of the major financial problems faced by rural

entrepreneurs as follows: a. Paucity of funds: Due to absence of tangible security and
credit in the market most of the rural entrepreneurs fail to get external funds. Also the
procedure to avail the loan facility from the banks is too time consuming that its delay
often disappoints the rural entrepreneurs. Lack of finance available to rural
entrepreneurs is by far one of the biggest problems faced by rural entrepreneurs
nowadays especially due to b. Lack of Infrastructural facilities: In spite of efforts made
by government the growth of rural entrepreneurs is not very healthy due to lack of
proper and adequate infrastructural facilities. c. Rise Element: Rural Entrepreneurs
have very less risk bearing capacity due to lack of financial resources and external
support.
2. Marketing Problems: Some of the major marketing problems faced by rural

entrepreneurs are as follows:
a. Competition: Rural entrepreneurs face stiff and severe competition from large sized
organizations and urban entrepreneurs. They incur high cost of production due to high
input cost. Problem of standardization and competition from large scale units are some
of the major problems faced by marketers. New ventures have limited financial
resources and hence cannot afford to spend more on sales promotion and advertising.
b. Middlemen: Middlemen exploit rural entrepreneurs. Rural entrepreneurs are heavily
dependent on middlemen for marketing of their products who necessarily pocket large
amount of profit. Poor means of transportation facilities and storage facilities are also
other marketing problems in rural areas.
3. Management Problems: Some of the major management problems are as follows:

a. Lack of Knowledge of I.T: Information technology as such is not very common in
rural areas. Entrepreneurs rely on internal linkages that which encourage the flow of
services, goods, ideas and information.
b. Legal formalities: In complying with various legal formalities and in obtaining
licenses rural entrepreneurs find it extremely difficult due to ignorance and illiteracy.
Also procurement of raw materials is really a tough task for many rural entrepreneurs.
They may also end up with poor quality raw materials, which may also face the problem
of storage and warehousing.
c. Lack of technical knowledge: Rural entrepreneurs to a major extent suffer a severe
problem of lack of technical knowledge. Lack of training facilities and other extensive
services create a hurdle for the development of rural entrepreneurship.
d. Poor quality 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 other equipments as well as poor quality of raw materials.
4. Human resource Problems: Some of the major human resource problems found in
organization are as follows:
a. Low skill level of workers: Most of the entrepreneurs working in rural areas are
unable to find workers with high skills. They have to be provided with on the job
training and their training too generally is a serious problem for entrepreneur as they
are mostly uneducated and the training should be imparted in local language which they
can understand easily.
b. Negative attitude: Sometimes environment in the family, society and support system
is not much conducive enough to encourage rural people to take up entrepreneurship as
a career. It may be certainly due to lack of awareness and knowledge of entrepreneurial
opportunities. Young and mostly well educated youths mostly tend to leave.
Remedial measures to solve the problems faced by rural entrepreneurs
Different organizations like IFCI, SIDBI, ICICI, NABARD etc are trying to sort the
major problems faced by rural entrepreneurs. Marketing problems are mainly related
with pricing, distribution channels, product promotion etc. In order to make the rural
entrepreneurs to state the business venture, following measures may be adopted:
a. Creation of finance cells: Banks and financial institutions which provide finances
to entrepreneurs must create special cells for providing easy finance to rural
entrepreneurs
b. Concessional rates of Interest: On easy repayment basis and at concessional rates

of interest the rural entrepreneurs should be provided finances. The cumbersome
formalities should necessarily be avoided in sanctioning the loans to rural entrepreneurs.
c. Offering training facilities: Training is essential for the overall development of

entrepreneurships. It also enables the rural entrepreneurs to undertake the venture
successfully as it certainly imparts required skills to run the enterprise. At present the
economically weaker entrepreneurs of the society are necessarily offered such training
facility by government of India regarding skill development of the existing
entrepreneurs so that rural entrepreneurs can indeed generate income as well as
employment opportunities in rural area.
d. Power supply of raw materials: Rural entrepreneurs should be surely ensured of

proper supply of scare raw materials on a priority basis. Subsidy may also be offered at
times to make the products manufactured by rural entrepreneurs reasonable and cost
competitive.
e. Setting up marketing co-operatives: Proper assistance and encouragement should

be provided to rural entrepreneurs for setting up marketing co-operatives. These co-
operatives shall help in getting various inputs at reasonable rate and they are helpful in
selling their products at remuneration prices. Thus comprehensive training, proper
education, setting up of separate financial Institutions, development of marketing co-
operatives to a large extent help to flourish the rural entrepreneurs in India.
Women Entrepreneurship – Problems

The greatest problem faced by women entrepreneurs is that they are women. We are
living in a male dominated society where women are treated as ‘abalas’. They have to
face several economic and social problems. Usually they will not get any support or co-
operation from various financial institutions, male entrepreneurs or even from their
families.
They have to face resistance not only from men but also from elderly women who are
ingrained with this attitude of inequality.
Women entrepreneurs have to face two types of problems viz., general problems of
entrepreneurs and problems specific to women entrepreneurs.
The following are the important problems faced by women entrepreneurs:
1. Financial Constraints:
Finance is the life blood of every business. Both long term and short term funds are
required for business. For obtaining loans and advances from financial institutions, they
have to provide collateral securities. But, usually women do not have property in their
names and this hinders them from obtaining external sources of funds.
The banks also consider women as less credit worthy and discourage women borrowers
on the belief that they can at any time leave their business and become housewives
again. Under these circumstances, women entrepreneurs are bound to rely on their
savings and loans from friends and relatives. The quantity of such funds are often
negligible leading to the failure of women enterprises.
2. Over Dependence on Intermediaries:
Women entrepreneurs have to depend largely on intermediaries for the distribution of

their products. These intermediaries take a major portion of their profits. It may be
possible for the women entrepreneurs to eliminate the middlemen, but it requires
additional investment of capital and a lot of travel. Women entrepreneurs find it
difficult to capture market and popularise their products.
3. Stiff Competition:
Women entrepreneurs have to face stiff competition for the products from the organised
industries and male entrepreneurs. They do not have organisational set up to spend a
lot of money for canvassing and advertisement. The society has a feeling that the
products manufactured by women are inferior in quality on account of the fact that they
are manufactured by women themselves. These factors will lead to the liquidation of
women enterprises.
4. Scarcity of Raw Materials:
Scarcity of raw materials is yet another important problem faced by the women
entrepreneurs. The price of raw materials is very high and women entrepreneurs usually
get the raw materials at minimum discount. The failure of many women co-operatives
engaged in basket making in 1971 is an example of how the scarcity of raw materials
affects entrepreneurship.
5. High Cost of Production:
Another problem faced by women entrepreneurs is the high cost of production. The
government grants and subsidies help them tide over this difficulty, but these grants
and subsidies are available only at the initial stages of its setting up. For expansion and
diversification activities these assistances will be negligible.
6. Limited Mobility:
Unlike men, women mobility in India is highly limited due to various reasons.
Physically they are not fit enough to travel a lot. A woman running an enterprise
independently and alone is often looked upon with suspicion. The humiliating attitude
of officials towards women compels them to give up the idea of starting an enterprise.
7. Family Ties:
The family responsibilities also hinder the development of women entrepreneurship. In

India, it is mainly a woman’s duty to look after the children and other members of the
family. Man plays a secondary role in these matters. In the case of married women, they
have to make a fine balance between their business and family.
Their success greatly depends on the support given by the family. Occupational
backgrounds of families and educational level of husbands have a direct bearing on the
development of women entrepreneurship.
8. Lack of Education:
In India around 60% of women are still illiterate. Illiteracy is the root cause of socio-
economic problems. Due to lack of education, women are ignorant of business
technology and market. It also reduces the achievement motivation among women.
Thus, lack of education creates problems for women in the setting up and running of
business enterprises.
9. Social Attitudes:
This is one of the most important stumbling block in the path of women
entrepreneurship. The constitution provides equality for both men and women, but there
is widespread discrimination against women. In a male dominated society, women are
not treated as equals to men. Women have the potential but they lack adequate training.
There is a common belief that skill imparted to a girl is lost when she gets married.
Therefore, girls continue to be helpers in agriculture and handicrafts and the rigid social
attitudes prevent them from becoming successful and independent entrepreneurs.
10. Male Dominated Society:
Male chauvinism is still the order of the day in India. The constitution of India speaks
of equality between sexes. But, in practice women are treated as ‘abalas’. Women suffer
from male reservations about their roles, abilities and capacities. In short, women are
not treated as equal to men. This is the main barrier to women’s entry into business.
11. Low Need for Achievement:
The pre-requisites for success in entrepreneurship are the need for achievement,
independence and autonomy. But in India the common Indian woman is happy to bask
in the glory of their parents, husband, children etc. They have preconceived notions
about their role in life. This inhibits them from achievements and independence.
In addition to the above difficulties, lack of infrastructural facilities, shortage of power,

difficulty in obtaining licenses from various control boards and a number of other socio-
economic problems stand as hurdles to the women entrepreneurs.
Conclusion
Rural entrepreneurs are certainly act as a key figure in economic progress of India. They
play a vital role in converting developing country into developed nation. In today’s
global market a country’s economic policy environment must always be favourable for
an organization to achieve efficiency. Economic policy of a country should also enable
entrepreneurs to provide magical touch to anorganization irrespective of public, private
or joint sector in achieving innovativeness, speed, flexibility and also strong sense of
self determination. Rural entrepreneurship however is the best answer for removal of
rural poverty in India. Hence government should stress and emphasize more on
integrated rural development programs. Also majority of the rural youths do not think
of entrepreneurship as a career option. Hence organizations and government should
come with training and sustaining support systems providing all necessary assistance
so that rural youth can be motivated to take up entrepreneurship as a career. Besides
there should also be efficient regulated markets and governments should also lend its
helping hand in this context. Standardization and grading should be promoted and also
promotional activities should be enhanced to encourage rural entrepreneurs. NGO’s
should also be provided full support by the government. In the present context study of
entrepreneurship helps entrepreneurs not only to fulfill their personal needs but also
help in economic contribution of new ventures. More than increasing the national
income by creating new jobs, rural entrepreneurship also acts a force in economic
growth by serving as a major bridge between innovation and marketplace. To conclude
to bring change institutions need to focus on synergies between education, innovation
and entrepreneurship.
Development of Small Entrepreneurs in India

A self-made individual who takes financial risks in setting up a business for profit is
called an entrepreneur. Today, amidst a struggling economy, India has witnessed many
start-up success stories including Flipkart, OYO, Ola Cabs, Book My Show, Nykaa,
Big Basket, and Swiggy to name a few. However, all self-employed people cannot call
themselves entrepreneurs. The potential for growth and economic impact is what truly
defines an entrepreneurial business.
“Startups have emerged as engines of growth for our economy. Entrepreneurship has
always been the strength of India. Even today, young men and women have given up
greener pastures elsewhere to contribute to India’s growth. They are risk-taking and
come up with disruptive solutions to festering challenges…We recognise the
knowledge, skills and risk-taking capabilities of our youth. He is no longer the job
seeker. He is (a) creator of jobs. Now we wish to create more opportunities and remove
road-blocks from his path.”
• Nirmala Sitharaman, Finance Minister of India
In recent years, entrepreneurs have faced countless obstacles in the business

environment. Extreme harassment from tax officers was an issue that was addressed in
the budget. “Our government would like to reassure taxpayers that we remain
committed to taking measures so that our citizens are free from harassment of any kind,”
– Nirmala Sitharaman
The government is now determined to empower Indian society, digitally. Introducing

investments, technology, employment and seed funding for ideation and development
progress. Crucial moves were also made to defer tax payment on employee stock option
plan (ESOP) by five years. This is the best way to entice young start-ups to retain their
talented employees during the initial years of business.
1. Declaration of Progressive Industrial Policies
The central government declared industrial policies in 1948, 1956, 1980, 1986, and
1991 and revisions therein were also made from time to time.
Plan expenditure on development of small entrepreneurs has successively increased.

The government has established various institutions, Like SIDO, national small
industries corporation ltd., Small Industries Extension Training Institution, National
Entrepreneurship, and Small Business Development Institute, Entrepreneurship
Development Institute of India (EDII), etc. for achieving policy goals.
As a result of all these, the old entrepreneurs have not only started working quite freely,
but the entrepreneurs have also started getting a certain and healthy industrial
environment.
2. Simplification of Licensing Procedure
Now, only six industries are required to obtain licenses from the government. All other
industries have been exempted from it.
License obtaining procedures and various related formalities have been simplified.
Besides, the time taken in obtaining licenses has been substantially reduced.
3. Liberal Economic Policies
The central government has made its economic policies, like export-import policy,
taxation policy, fiscal policy, and monetary policy, etc. excessively liberal, which has
resulted in entrepreneurship development in the country.
4. Establishment of Development Institutions
Government of India has established various development institutions for encouraging

entrepreneurial development.
Institutions like National Industrial Entrepreneurship Development Centre, National

Entrepreneurial and Small Business Development Institue, Entrepreneurship advisory
Organisation, State Small Industries Development Corporation, and Small Industries
Service Institute, etc. to provide guidance, training, and facilities to the entrepreneurs.
5. Development of Industrial Estates/Areas
The Government has developed various industrial areas/estates in various states,

wherein private entrepreneurs have established their industries.
The government has attracted the entrepreneurs to establish new industries in these
industrial areas by providing facilities of land, transportation, banks, warehouses, water,
and electricity, etc.
6. Development of Training Facilities
The various training institutions have been established by the government of India,
banks, financial institutions and management institutions to organize training
programmes to develop the capabilities of the entrepreneurs.
For example, in 1960, maccllell and winter made important tests on entrepreneurial
development through motivation, organized by small industries extension training
institute.
In addition to it, small industries development organization (SIDO), small industries

service institute, district industries centers also provide information to the entrepreneurs
about project development, enterprise management, and new production techniques, etc.
7. Development of Technical and Vocational Education
The central government, as well as the state gorvenment, have also established technical
and vocational education centers where vocational education has been provided.
The technical and vocational education at the level of schools, colleges and universities
have been introduced, where education is being provided relating to entrepreneurial
development, entrepreneurial feelings and facilities and procedures for establishment
of small industries, etc.
In the present education policy, the government of India aims at vocational and
technical education by dispensing with the essentiality of degree and for that open
universities have also been established.
Vocational and technical education in India

Besides, management institutions also provide vocational education and training for
business and industries management.
8. Establishment of Science and Technology Parks
Science and technology parks have also been established in India for the development
of entrepreneurs.
Industrial development bank of india is making efforts for these parks.
Bank has established an entrepreneurial park and industrial parks.
Related: Top 5 Basics of Successful Entrepreneurship (Must Know).
9. Organization of Seminars and Workshops
Seminars and workshops are organized in India and other countries for entrepreneurial
development.
Indian industrial entrepreneurial development institute and other popular institutions.
10. Creation of Literature
Seventeenth technical advisory organizations working in the country have created and
published useful literature for entrepreneurial development.
entrepreneurship development in India

During 1984-85, 1019 feasibility studies and project reports were prepared and 261
reports relating to feasibility surveys, market surveys and development surveys were
published.
11. National Awards
National awards scheme has been started to provide encouragement to small

entrepenerurs.
Find out all National Entrepreneurship Awards of INDIA.
12. Declaration of Product Wise Polices
Governemnt has declared product wise policies for developing new and existing
entrepreneurs.
These include textile policy, electronic policy, drug policy, etc.
As a result, the entrepreneurs will be encouraged and benefited in respect of

innovations in the field of industries, use of new commodities, use of new methods for
production of new commodities, the search of new markets and their development.
13. Establishment of Entrepreneur Assistance Unit
Government of India had established an Entrepreneur Unit in the industries

development department, in the year 1966.
Its functions are as follows:
1. This unit help in implementation of industries (development and regulation) Act,

1951, foreign cooperation, import of capital goods, providing information
about foreigners of indian orign.
2. This unit also informs the entrepreneurs about action taken on their applications.
3. This unit makes efforts for getting the problems of entreprenurs resolved
through various governmental institutions.
This unit, thus, tries to provide substantial cooperayion in entrepreneurial development,

which provieds opportunities to the entrepreneurs to develop.
14. Special Schemes
Besides, self-employment scheme, various other schemes, like a guarantee scheme for
small industries, margin money scheme, rehabilitation of sick unit scheme, government
purchase scheme, the scheme for the availability of machinery to entrepreneurs on
higher purchase are being implemented by the government, for entrepreneurial
development.
“Proposed Scheme on Entrepreneurship Development“
The government, as well as various organisations and financial institutions, are

contributing to these schemes.
15. Development of Women Entrepreneur
In the modern age, entrepreneurial tendencies are developing in women folk also, due
to co-education and women education.
Women are also getting attracted to technical and management education.
Various types of organizations, therefore, are providing cooperation to women

entrepreneurs in India for entrepreneurial activities.
16. Preparation of Industrial Maps
Directorate of industries and each district industries center are working to search the
industrial potential of each district and also prepare maps of future industrial potential
in the district.
It facilitates the selection of a profitable enterprise. These maps also provide

information about the availability of raw materials and labour.
17. Establishment of Financial Institutions
Government of india has established various specific financial instutions. These

institutions prepare projects of the new entrepreneurs and also helps them
in implementing the projects.
These institutions provide fixed capital, seed capital and working capital.
In addition, several companies in the private sector are, presently establishing venture
capital fund also, to encourage new entrepreneurs to establish industries, by providing
capital to new entrepreneurs.
18. Availability of Subsidies
The central government and the state governments are providing various types of
subsidies, like:
1. Interest subsidy, transport subsidy and raw material subsidy to the new
entrepreneurs.
2. Cash subsidy is being made availabe. Amount of this subsidy is based on
the level of expansion of the industrial area. Higher subsidies are provided
to the entrepreneurs who are working in backward areas.
3. Government of many states has exempted for the industries of new
entrepreneurs from sales tax during the first few years, since the start of
the industry.
4. Best Government Subsidy For Small Business In India
The subsidies provided by the government have not only helped in the establishment of
various new industries, but the industries are being established even in such areas where
entrepreneurs did not have an interest because they being backward areas.
19. Export Promotion Programmes
The central government has taken various measures for export promotion, as the
organization of international rebates in taxes to export-oriented units, organization of
international seminars and workshops and encouragement to the entrepreneurs to enter

into the international market making export contracts with several countries.
‘Export Promotion Schemes INDIA’
The small industries develoment insitute (SIDO) has been established in india to
provide advisory services to the entrepreneurs in technical, managerial and economic
fields.
20. Self Employment Scheme
Government has started self emplyoment scheme for educated unemployed persons,
wherin loans are provided at concessional rates.
Subsidies are also providded, to a limited extent.
“Self-Employment Schemes India”
21. Special Incentive Schemes for Small Entrepreneurs
Various schemes have been introduced and implemented in the country for the
development of entrepreneurs.
Government has provided significant cooperationin development of small

entrepreneurs by raising the limits of capital investment, from time to time.
Thus, for developing small entrepreneurs, not only the investment limit has been raised,
but relaxations have also been provided to the small entrepreneurs in various industrial
acts.
22. Increase in Research and Development Expenditure
Industries established by the government and private entrepreneurs are now laying
emphasis on research and development, which has resulted in the emergence of
innovations.
Due to hike in expenditure on research and development, there have been significant
changes in the production process and techniques.
23. Quick Approval of Project Reports
The project reports submitted by the entrepreneurs to district industries center

established by the government are quickly approved, as a result, the entrepreneur is able
o quickly obtain loan from the bank or financial institution.
24. Capital Market and Capital Issue System
Government of India provides incentives in respect of the development of the capital

market and liberalizing capital issue system to encourage the entrepreneurs of small
industries.
Thus, on the one side, the pace of development of entrepreneurs in the country has
increased, due to development of capital markets, and on another side, the establishment
of enterprises has now become easier for the entrepreneurs, due to liberalization in the
capital issue.
25. Startup India
Startup India is a flagship initiative of the Government of India, intended to build a

strong ecosystem that is conducive for the growth of startup businesses, to drive
sustainable economic growth and generate large scale employment opportunities.
The Government through this initiative aims to empower startups to grow through
innovation and design.
Young Indians today have the conviction to venture out on their own and a conducive
ecosystem lets them watch their ideas come to life. In today’s environment, we have
more Startups and entrepreneurs than ever before and the movement is at the cusp of a
revolution.
However, many Startups do not reach their full potential due to limited guidance and
access.
The Government of India has taken various measures to improve the ease of doing
business and is also building an exciting and enabling environment for these Startups,
with the launch of the “Startup India” movement.
Complete Guide about Start-Up INDIA
26. Make In INDIA
The Make in India initiative was launched by Prime Minister in September 2014 as part
of a wider set of nation-building initiatives.
Devised to transform India into a global design and manufacturing hub, Make in India
was a timely response to a critical situation: by 2013, the much-hyped emerging
markets bubble had burst, and India’s growth rate had fallen to its lowest level in a
decade.
The promise of the BRICS Nations (Brazil, Russia, India, China, and South Africa) had
faded, and India was tagged as one of the so-called ‘Fragile Five’.
Global investors debated whether the world’s largest democracy was a risk or an
opportunity. India’s 1.2 billion citizens questioned whether India was too big to succeed
or too big to fail. India was on the brink of severe economic failure.
To start a movement, you need a strategy that inspires, empowers and enables in equal
measure.
Make in India needed a different kind of campaign: instead of the typical statistics-
laden newspaper advertisements, this exercise required messaging that was informative,
well-packaged and most importantly, credible.
It had to (a) inspire confidence in India’s capabilities amongst potential partners abroad,
the Indian business community and citizens at large; (b) provide a framework for a vast
amount of technical information on 25 industry sectors; and (c) reach out to a vast local
and global audience via social media and constantly keep them updated about
opportunities, reforms, etc.
Appropriate Technology for Rural Industries
There are two alternative views on the definition of an appropriate technology: the
social welfare approach and the technology specifications approach. In the social
welfare view, a mix of technologies should be chosen that maximizes achievement of
the objectives of a society. Although this concept has appeal, it is difficult to
operationalize because social objectives are not clearly specified and are often in
conflict, and it can be difficult to quantify the expected effects of a technology B priori.
Under the technology specifications approach, the expected outcomes of a technology
are compared to a list of characteristics generally associated with ‘(appropriateness.”
These characteristics are defined in terms of the expected socio-economic impacts on
the poor in rural and/or urban areas, and the environmental impacts. Technology
specifications lists are also subjective and often confuse short-term and long-term
impacts. A technology may satisfy a particular criterion to varying degrees and few
technologies are likely to meet all of the specifications of appropriateness. However,
the technology specifications view does offer “signposts for action
The appropriateness of a technology depends on how it is used, what it is used to
produce, and who gains and loses as a result of the production and consumption
decisions. Appropriate technology projects typically differ from conventional
technology projects in their reliance on small-scale equipment and processes (often
locally made), and different amounts, kinds, and sources of raw materials. Compared
to conventional technologies, appropriate technologies typically are less capital
intensive; more labor intensive; less dependent on scarce foreign exchange for imported
goods; and easier to operate, maintain, and repair. Yet, appropriate technologies are
labor saving in comparison to traditional methods of production.
Appropriate technology projects can be most cost-effective and will have the fewest
unintended, negative impacts when low-income people own and operate profitable
enterprises that match their skills and resources. These projects may be designed to
increase their access to goods and services, raw materials, financing, technical
information, and/or markets. This strategy also increases the participation of the poor
in the development decisions that affect them. Such opportunities are neglected by
commercial sources of capital because they are relatively risky, smallscale, and non-
urban. The following classification of technologies is useful in testing assumptions
about technology transfer: 0 Traditional technologies are those that have been used in
production or consumption for at least 25 years. In some cases, they have been
introduced from another less developed country (LDC) rather than being of indigenous
origin. Traditional technologies usually rely on human or animal power, or renewable
energy sources. 0 Upgraded traditional technologies incorporate key elements of
traditional technologies, but have been improved to take advantage of the potential for
higher inherent efficiencies (e.g. thermodynamic properties or extraction rates) or
economies of scale. 0 Off-the-shelf modern technologies have been in use for a rela-
Identification of Appropriate Technologies 37 tively short time, generally less than 25
years. They are often larger in scale than traditional technologies. 0 Down-scaled
modern technologies are versions of modern technologies that have been adapted for a
smaller scale of production or consumption, or to match the available resources.
Innovative replacement technologies are generated by application of new scientific and
engineering knowledge.
Key Factors in the Appropriateness of a Technology
1. Scale of equipment and processes
2. Cost savings
(a) Capital
(b) Operating, maintenance and replacement
(c) Foreign exchange
3. Generation of profits
(a) Increased production
(b) Higher prices for products
(c) Value added locally through processing
4. Socioeconomic impacts and distribution of benefits

(a) Directly increases employment for rural and low-income people i. Creation of new
jobs ii. Higher wages due to better labor productivity or skills iii. Reduced labor
displacement
(b) Increases net incomes of other enterprises i. Greater demand for locally produced
raw materials ii. Higher profits in subsequent use or processing of the prodiii. Reduced
share for middlemen ucts
(c) Provides benefits to rural or low-income consumers i. Reduced prices ii. Improved
quality of products iii. Greater availability of products
5. Environmental Impacts
(a) Natural resources consumption
(b) Amenities
(c) Health
COST SAVINGS Capital Costs: Many technologies are appropriate because they
require less capital than alternatives of comparable productivity. Edible oil extraction
is a basic industry in rural areas and diesel-powered expellers are expensive to purchase
and operate. Consequently, AT1 provided technical assistance and financing to a
medium-scale, private workshop in Tanzania (the Themi Farm Implements and
Engineering Co.) for production of two types of manually operated oil presses for
sunflower seeds to fill different market segments.
THE GENERATION OF PROFITS: Appropriate technologies can increase revenues by

increasing the quantity or value of production on farms and in rural industries. This can
take place through the expansion or intensification of existing activities or the
establishment of new ones. For example, the Themi Farm Implements and Engineering
Co. mentioned earlier was started in 1982 with loans and technical assistance from AID.
SOCIOECONOMIC IMPACTS Provision of Employment: Some of the pioneers

of appropriate technology urged more support of traditional technologies such as the
simple Identification of Appropriate Technologies 45 spinning wheels Gandhi spoke
about in India. In this view, labor intensity and being small-scale was inherently good
(Schumacher 1973). Although partly a reaction to the money spent on largescale,
modern technologies that did not trickle down to the rural masses, this view was also
motivated by the need to provide income to large numbers of unskilled workers through
simple, productive employment opportunities.
ENVIRONMENTAL IMPACTS: Many of the technologies discussed above have

favorable impacts on environmental quality or natural resource consumption or less
negative impacts than those associated with other alternatives. For example, an
improved lime kiln decreases fuelwood use and more efficient charcoal stoves reduce
charcoal consumption. Unlike commercial fertilizers, rhizcbium inoculant does not
contaminate rivers with nonpoint source runoff. Hand-operated pumps, oil extraction
equipment, and grain mills do not release air pollutants from combustion of diesel oil.
Animal-drawn agricultural machinery is less likely to compact the soils. Similarly,
small-scale wells are less likely to drawn down the water tables than large wells and
are not associated with increases in disease rates for malaria or schistcsomiasis as are
large dams. In comparing the environmental impacts of a small-scale technology and a
large-scale one, the assessment has to be based on the same total level of production. A
variety of techniques are available for assessing environmental impacts (Hyman, Stiftel,
Moreau, and Nichols 1987).

5 - UNIT 5 - Rural Industrialization and Entrepreneurship - BY MANISH KUMAR SHARMA

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

5 - UNIT 5 - Rural Industrialization and Entrepreneurship - BY MANISH KUMAR SHARMA

Uploaded by

Copyright:

Available Formats

Rural Development: Administration and Planning (KHU-701) Unit-5

Manish Kumar Sharma

Rural Industrialization and Entrepreneurship: Concept of Rural Industrialization,

Introduction Of Rural Industrialization

There is intense need of industrialization in rural areas with proper attention by

A famous slogan during promotion of heavy industries was “Industrialize

1. Agriculture diversification by exploring the opportunities by farming completely a

Rural industrialization means focus on promoting the rural based industries by

Types of Rural Industry

2. Forest based industries: There are possibilities to establish industries related to

Significance of Rural Industrialization

In simple terms “entrepreneurship” is the act of being an entrepreneur, which can be

The Gandhian Approach to Rural Development

In the Indian context rural development may be defined as maximising production in

It attaches importance to the generation of maximum possible employment

Theoretically, Gandhian approach to rural development may be labelled as ‘idealist’. It

Such a decentralised polity implies a decentralised economy. It can be attained only

Gandhiji’s concept of development is oriented to the uplift of the common man. He

In fine, Gandhian approach to rural development strives to reconstruct village republics

Entrepreneurship and Rural Industrialization

Rural entrepreneurship refers to the development of a new enterprise which

Scope for rural Entrepreneurs:

Challenges Dr. Upasana Major outcome of rural entrepreneurship:As known that

Needs/Importance of rural Entrepreneurship

2. Rural industries have a comparatively high potential of generating income,

3. Rural entrepreneurship stimulates the dissemination of economic activities in

5. When industries are set up in rural areas, it advances economic

Proper Utilization of resources

Generation of employment opportunities

A huge number of employment opportunities generated because of the rural

Plug the gap

Enhance traditional culture

Foster economic development

Consider the taste of consumers

In the remote areas, the development of entrepreneurship is enhancing by the rural

Problems in Rural Entrepreneurship

• Lack of technical know-how

• Lack of training and development

• Non-availability of skilled labours

• Lack of technical knowledge

• Lack of Quality Control

• Lack of communication and market insights

• Lack of storage and transportation facilities

• Old and obsolete technology, machinery and equipment

• Lack of promotional strategy

• Lack of infrastructural facilities

• Poor quality standards

1. Financial Problems: Some of the major financial problems faced by rural

2. Marketing Problems: Some of the major marketing problems faced by rural

3. Management Problems: Some of the major management problems are as follows:

Remedial measures to solve the problems faced by rural entrepreneurs

b. Concessional rates of Interest: On easy repayment basis and at concessional rates

c. Offering training facilities: Training is essential for the overall development of

d. Power supply of raw materials: Rural entrepreneurs should be surely ensured of

e. Setting up marketing co-operatives: Proper assistance and encouragement should

Women Entrepreneurship – Problems

The following are the important problems faced by women entrepreneurs:

2. Over Dependence on Intermediaries:

Women entrepreneurs have to depend largely on intermediaries for the distribution of

4. Scarcity of Raw Materials:

5. High Cost of Production:

The family responsibilities also hinder the development of women entrepreneurship. In

10. Male Dominated Society: