NC19 – ENTRENEURSHIP

DEVELOPMENT
Module II
• Entrepreneurship & Economic development
• Contribution of Small enterprises to the economy
• Entrepreneurial Development programmes (EDP)
• Entrepreneurship Development Training and Other
Support Organizational Services
• Role of Government in organizing EDPs
• Critical evaluation
• Startup Revolution in India

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 1
ROLE OF ENTREPRENEUR IN
ECONOMIC DEVELOPMENT
 Capitalformation.
 Generation of employment.
 Improvement in per capita income.
 Reduces concentration of wealth.
 Balanced regional development.
 Resource mobilization.
 Improvement in standard of living.
 National self-reliance.
 Harnessing natural resources.
 Backward and forward linkages.
 Sense of purpose. Dr. Sreeya B, Associate Professor, Saveetha
School of Law 2
ROLE OF ENTREPRENEURSHIP IN
ECONOMIC DEVELOPMENT
“Create employment opportunities
Inspire others towards
entrepreneurship
Create knowledge spill over
Augment the number of enterprise
Provide diversity in the firms

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 3
 DEVELOPMENT OF
ENTREPRENEURSHIP
Government and non government
support bodies
Incubation facility
Educational programs
Entrepreneurship networks

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 4
 GOVERNMENT POLICIES AND
SCHEMES
National Small Industries Corporation (NSIC)
National Institute of Small Industry Extension Training
(NISIET) Hyderabad
National Institute for Entrepreneurship (NIE) Guwahati and
National Institute for Entrepreneurship and Small Business
Development (NIESBD), New Delhi.
Mahila udhyam nidhi scheme
Mahila vikas nidhi scheme
Scheme for Market Development Assistance for MSME
Exporters (MSME-MDA)
Rajiv Gandhi Udyami Mitra Yojana (RGUMY)
Assistance to States for Developing Export Infrastructure and
Other Allied Activities (ASIDE). Dr. Sreeya B, Associate Professor, Saveetha
School of Law 5
 Small Business
Small business and
entrepreneurs contribute to the
larger economy in four very distinct
ways:
Job creation,
Innovation,
Opportunities for individuals to achieve
financial success and
Independence.
Dr. Sreeya B, Associate Professor, Saveetha
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 SSI
SSI means small scale industries, which is
an industrial undertaking with the
investment not exceeding Rs.100 lakhs

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 7
WHY WE NEED SSI?
 FOR EMPLOYMENT GENRATION
 FOR BALANCE REGIONAL GROWTH
 FOR MOBILISATION OF LOCAL
RESOURCES
 FOR EXPORT PROMOTION
 FOR CONSUMER SURPLUS
 FOR DEVELOPMENT OF
ENTERPRENEURSHIP
 FOR LARGE SCALE EMPLOYMENT
WITH LOW INVESTMENT
 FOR ATTAINING SELF RELIANCE
AND SELF DEPENDANCE
 FOR ENSURING EQUAL
DISTRIBUTION OF INCOME AND
WEALTH

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SCOPE OF SSI IN DIFFERENT
SCOPE OF SSI UNITS
SECTORS

TRADING INDUSTRIES

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MANUFACTURING industries

THESE ARE CARRIED ON IN

VILLAGE AND HOMES OF WORKER
COTTAGE
(USE LOCAL RESOURSES , USE
INDUSTRIES
LOCAL MARKET ,LOCAL
SKILLS )

THESE INDUSTRIES INCLUDE

HANDLOOMS & ARTISANS, SKILLED CRAFT
HANDICRAFTS MEN SHIP

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 TRADING industries

Person or firm that buys large

 quantity of goods from various
WHOLESALER
 producers or vendors, warehouses 
them, and resells to retailers.

A business or person that sells goods to the 
RETAILER consumer, as opposed to a wholesaler or 
supplier, who normally sell their goods to
another business.

Commission agents thrive in a variety of

COMMISSION AGENT businesses. International agents work in the
export/import arena. Insurance and real estate
agents also often work on a sales-based
commission.

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 SERVICES industries
PROFESSION
(LAW,MEDICI
(FASHION
PERSONAL
COMMISSIO
●
●
(TRANSPORT,
AL DRY
NE,ACCOUNT
SHOPS,
WAREHOUSING,
NSERVICES
SERVICES
REPAIR
ING ) SHOP))
CLEANING
SERVICES

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Institutional support to small entrepreneurs

SIDO (Small Industries Development

Organisation)
NSIC (National Small Industries Corporation
Ltd)
SSIB (Small Scale Industries Board)
SSIDC (State Small Industries Development
Corporations)
SISIs (Small Industries Service Institutes)
DICs (The District Industries Centres)
TCO (Technical Consultancy Organisation)
Dr. Sreeya B, Associate Professor, Saveetha
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Financial Institutions:
Commercial banks, IDBI, IFCI,
ICICI, LIC, UTI, SFCs, SIDBI,
EXIM BANK
Support Institutions
NSIC, SIDO, SSIB, SSIDC,
SISIs, DICS, INDUSTRIAL
ESTATES
Dr. Sreeya B, Associate Professor, Saveetha
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 Contribution of Small Enterprises to the
Economy
 SMEs employ around 40% of India’s workforce, which is an estimated
80 million people, who are given an opportunity for livelihood and
employment via low-skilled jobs. Around 1.3 million SMEs contribute
45% to India’s manufacturing output and 40% of India’s total export.
In a way, they form the backbone of the Indian economy. At 48
million, India has the second largest number of SMEs in the world,
edging close to China which has around 50 million SMEs.
 There are around 6000 products manufactured by 31.7% SMEs while
the remaining 68.2% are engaged in delivering various services. This
sector, if extended the right support, has the potential to spread
industrial growth throughout the country.
 Despite employing 40% of India’s workforce, SMEs are also the bane
of India’s economic problems. Though the volume numbers work in
their favor, they currently contribute to about 17% of India’s GDP.

Dr. Sreeya B, Associate Professor, Saveetha

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 Entrepreneurship Development Programmes
(EDP)
 A well known behavioral scientists David McClelland at Harvard University made an
interesting investigation into why certain societies displayed greed creative power? Is
whether entrepreneurs are born or made?. He found that the 'need for achievement'
was the answer to the question.
 'Motive people to work hard leads to achievement'. According to the scholars, Money
making is incidental whereas the measurement of achievement is valid.
Experimental study (Kakinada). He conducted a 5 year experimental study in one of
the prosperous district of Andhra Pradesh in India in collaboration with small
industry extension and training institute (SIET). His experiment is popularly called as
'Kakinada Experiment'. Under the experiment, young employees/persons are selected
and put through a three month training program and motivated to see fresh goals. One
of the signi cant conclusion of the experiment was that the traditional believes did not
seem to inhibit. An entrepreneurs and that the suitable training can provide the
necessary motivation to the entrepreneurs.
 The achievement motivation had a positive impact on the performance of
entrepreneurs. The Kakinada experiment could be treated as 'Precursor to the present
day EDP' inputs on behavioral aspects. 1971 - First massive program of ED
embarked in India. At present, 686 All India and state level FI and public sector
banks had so far conducted EDPs in hundreds giving training to the candidates in
thousands. Example: Junior Achievement – USA, Young
Dr. SreeyaEnterprises - UKSaveetha
B, Associate Professor,
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 Objectives of EDPs
Develop and strengthen their entrepreneurial quality (i.e.,)
motivation or need for the achievement.
Analyze environmental setup relating to small industry
and small business.
Select product
Formulate project for the product.
Understand the process and procedure involved in setting
up an small enterprise.
Know the sources of help and support available for
starting a small scale industry.
Acquire the necessary managerial skills required to run a
small enterprise.
To know the pros and cons in becoming an entrepreneur.
Appreciate the needed entrepreneurial
Dr. Sreeyadisciplines.
B, Associate Professor, Saveetha
School of Law 17
Entrepreneurship Development Training and
Other Support Oganizational Services

On the whole, the ultimate objective of

Entrepreneurship training program is to make the
trainees prepared to start their own enterprise after
the completion of the training program.
Phases of EDP's
An Entrepreneurship development program consists
of the following three phases:
 Pre-training phase
 Training phase
 Post-training phase Dr. Sreeya B, Associate Professor, Saveetha
School of Law 18
Pre - Training Phase
The activities and preparations required to launch the
training program come together in the phase.
Selection of Entrepreneurs
Arrangement of infrastructure
Tie-up of guest faculty for the training purpose
Arrangement for inauguration of the program
Selection of necessary tools, techniques to select the suitable
Entrepreneurs
Formation of selection committee for selecting trainees
Arrangement for publicity media and campaigning for the
program
Development of application form
Finalization of training syllabus
Pre-potential survey of opportunities available in the given
environmental conditions Dr. Sreeya B, Associate Professor, Saveetha
School of Law 19
Training Phase
 The main objectives of this phase's to bring desirable change in the behavior
of the trainees. In other words, the purpose of training is to develop 'need for
achievement' (i.e.,) motivation among the employees/trainees. Accordingly,
a trainer should see the following changes in the behavior of the trainees.
1. Is he/she attitudinally tuned very much towards his/her proposed project
ideas
2. Is the trainee motivated to plunge in to Entrepreneurial career and bear risk
involved in it.
3. Is there any perceptible change in his Entrepreneurial attitude, outlook, skill,
role etc.
4. How should he/she behave like an Entrepreneur?
5. What kind of Entrepreneurial traits the trainee lacks the most.
6. Whether the trainee possesses the knowledge of technology, resources and
other knowledge related to Entrepreneurship?
7. Does the trainee possess the required skill in selecting the viable projects,
mobilizing the required resources at right time.
Having trained the trainees, the trainees need to ask themselves as to how
much and how far the trainees have moved in their Entrepreneurial pursuits.
Dr. Sreeya B, Associate Professor, Saveetha
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Post- Training phase (Follow up)
The ultimate objective of the Entrepreneurship
development program is to prepare the
participants to start their enterprises. This phase
involvement assessment to judge how far the
objectives of the program had been achieved,
this is called Follow up.
In nutshell, the purpose behind the EDP follow
up is to:
1. Review the pre-training work.
2. Review the process of training program
3. Review post training approach
Dr. Sreeya B, Associate Professor, Saveetha
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Evaluation of EDP
 Evaluation of EDP is necessary to see whether the objective
of EDP's is fulled or not. In simple words, there is a need to
have a look into how many participants have actually
started their own enterprises after completing the training.
This calls for evaluation of EDPs.
 So far 16 evaluation studies have been conducted by
various organizations and individual researchers. The most
recent and nationwide evaluation study on EDPs is carried
out by a ED institute of India Ahmedabad.
 It is observed that one out of every four actually started
his/her enterprise after undergoing Entrepreneurial training.
 Blocked - 10%
 Given up - 29% (idea of launching)
 430 trainees - cannot be contacted
Dr. Sreeya B, Associate Professor, Saveetha
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Problem faced by EDP
1. Trainer - motivations are not found upto the mark in
motivating the trainees to start their own enterprises.
2. ED organization lack in commitment and sincerity
in conducting the EDPs.
3. Non-conductive environment and constraints make
the trainer - motivators role inactive.
4. The antithetic attitude of the supporting agencies
like banks and financial institutions serves as
stumbling block to the success of EDPs.
5. Selection of wrong trainees also leads to low
success role of EDPs. Dr. Sreeya B, Associate Professor, Saveetha
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 Start Up Revolution in India
Startup India is a flagship initiative of the
Government of India, intended to build a strong
eco-system to encourage new ideas and Startups
in the country that will lead to economic growth
and generate large scale employment
opportunities.
Startup India Standup India is a campaign
launched by the government of India to
encourage startups of India means youths
of India towards the entrepreneurship by
supporting them through bank financing for
more jobs creation in India. Dr. Sreeya B, Associate Professor, Saveetha
School of Law 24
 Start Up - Meaning
Startup means an entity, which is registered
in India not over five years and the annual
turnover not exceeding Rs.25 crore in any
financial year. It is an entity which works
towards innovation, development,
deployment or commercialization of new
products and services driven by technology
or intellectual property.

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 25
COMPONENTS OF STARTUP INDIA

Simplification
& Handholding
Funding support & Incentives
Industry - Academia Partnership &
Incubation

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 26
Simplification & Handholding
Compliance regime based on self-
certification
Startup India Hub
Rolling Out of Mobile App and Portal
Legal Support and Fast
Relaxed norms of Public Procurement
for Startups
Faster Exit for Startups

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 27
Funding support & Incentives
Provide funding support to startups
Credit Guarantee for Startups
Tax Exemptions on Capital Gains
Tax Exemption to Startups for Three
Years
Tax Exemption on Investments over
Fair Market Value

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 28
Industry - Academia Partnership &
Incubation
 Organizing Startup Fests for Showcasing Innovation and
Providing a Collaboration Platform
 Launch of Atal Innovation Mission (AIM) With Self
Employment and Talent Utilization (SETU) Program
 Harnessing Private Sector Expertise for Incubator Setup
 Building Innovation Centers at National Institutes
 Setting Up of 7 New Research Parks Modeled on the
Research Park Set Up at IIT Madras
 Promoting Startups in the Biotechnology Sector
 Launching of Innovation Focused Programs for Students
 Annual Incubator Grand Challenge

Dr. Sreeya B, Associate Professor, Saveetha

School of Law 29
Role of Government for Start Up India
 The Ministry of Human Resource Development and
the Department of Science and Technology have agreed
to partner in an initiative to set up over 75 such startup
support hubs in the National Institutes of
Technology (NITs), the Indian Institutes of Information
Technology (IIITs), the Indian Institutes of Science
Education and Research (IISERs) and National Institutes
of Pharmaceutical Education and Research (NIPERs).
 The Reserve Bank of India said it will take steps to help
improve the ‘ease of doing business’ in the country and
contribute to an ecosystem that is conducive for the
growth of start-up businesses.
Dr. Sreeya B, Associate Professor, Saveetha
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 2018 Startup State Ranking 
◦ Best performer: Gujarat
◦ Top performers: Karnataka, Kerala, Odisha,
and Rajasthan
◦ Leader: AndhraPradesh, Bihar, Chhattisgarh, 
Madhya Pradesh, and Telangana
◦ Aspiring leaders: Haryana, Himachal
Pradesh, Jharkhand, Uttar Pradesh, and West Bengal
◦ Emerging states: Assam, Delhi, Goa, Jammu &
Kashmir, Maharashtra, Punjab, Tamil Nadu,
and Uttarakhand
◦ Beginners: Chandigarh, Manipur, Mizoram, Nagala
nd, Puducherry, Sikkim, and Tripura
Dr. Sreeya B, Associate Professor, Saveetha
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 Key points  
10,000 crore startup funding pool.
Reduction in patent registration fees.
Improved Bankruptcy Code, to ensure a 90-day
exit window.
Freedom from mystifying inspections for first 3
years of operation.
Freedom from Capital Gain Tax for first 3 years
of operation.
Freedom from tax for first 3 years of operation.
Self-certification compliance.
Dr. Sreeya B, Associate Professor, Saveetha
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 Key points (contd...)  
Young Entrepreneur of The Year Satyam Kumar,
Founder and CEO at Dataoxy
Created an Innovation hub, under the Atal
Innovation Mission.
To target 5 lakh schools, and involve 10 lakh
children in innovation related programmes.
New schemes to provide IPR protection to startup
firms.
Encourage entrepreneurship within the country.
Promote India across the world as a start-up hub.
Built Startup Oasis as Rajasthan Incubation Center
Dr. Sreeya B, Associate Professor, Saveetha
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 2019 Startup State Ranking 
◦ Best performer: Gujarat
◦ Top performers: Karnataka andKerala
◦ Leader: Bihar, Maharashtra, Odisha,
Rajasthan
◦ Aspiring
leaders: Haryana, Jharkhand, Punjab,
Telangana and Uttarkhand
◦ Emerging states: Andhra Pradesh,
Assam, Chattishgarh, Delhi, Himachal
Pradesh, Madhya Pradesh, Sikkim, Tamil
Nadu and Uttar Pradesh Dr. Sreeya B, Associate Professor, Saveetha
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