Sunday, January 12, 2025

Inspiring New Gen entrepreneurs with an inclusive approach

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Dr. Chukka Kondaiah

India has a unique social structure in the world. It is a highly stratified society with its caste system, which is one of the world’s oldest social organisations and is believed to have originated thousands of years ago. It was found to be thriving in its pristine form in 634 CE at the time of Hiuen Tsang, a Chinese traveller, who had visited India around that time. Since then, although it has been changing and evolving, its main features continue to reflect the segmental division of society, social hierarchy, endogamy, hereditary occupations, restricted food and drink habits, social interaction, practices of purity and pollution, caste panchayats, and so on. Many studies have demonstrated that the caste system, with all its rigidities, also provided space for social mobility through the process of Sanskritization (M.N.Srinivas, 1972). Traditionally, certain occupational groups like Parsee, Marwari, Chettiyar, Bania, and others are more entrepreneurial and avid risk-takers and manage many family-owned businesses. Even today, they own and control a major chunk of India’s market capitalization.

Indian entrepreneurship is also influenced by certain social aspects, other than caste, like family, kin group, peer group, culture, religion, and value systems. Indian family system as a social institution impacts the person’s behaviour, which ultimately facilitates entrepreneurial or non-entrepreneurial career choices of individuals and groups.

Indian entrepreneurship was born with the path-breaking experiments of Prof. David C. Mc Clelland of Harvard University who spent some time during the 1960s at the then Small Industries Extension and Training Institute (SIET), later re-named by the Government of India as the National Institute of Micro, Small and Medium Enterprises (NI-MSME). Through what came to be popularly known as the ‘Kakinada Experiment’, Mc Clelland unveiled that, “Entrepreneurs are not necessarily born, but can be made/developed through systematic training interventions”, which resulted in the birth of several entrepreneurship training institutions with various training packages in both public and private sectors from 1970 onwards. This trend-setting experiment ignited the minds of youth belonging to even non-business communities, which resulted in the growth of millions of MSMEs across the country.

The Global Entrepreneurship Monitor, India (2020-21) estimates around 62% of youth are aware of business activities and some 20% of Indians (aged between 18 and 64 years) intend to start ventures in the next three years as against the global average of 12.6%.

The best entrepreneurial talent from premier institutes like IITs, IIMs, IIITs, and others is not adequately attracted to start-ups as they are lured by big corporate companies with attractive salary packages. India-born talent is successfully managing the world’s top companies. India’s entrepreneurial resources and innovative talent are drifting away to western countries.

Another unique demographic feature of India is that it is one of the youngest countries in the world. In the current year, India’s median age will be 28 years, in contrast to 37 in China and 45 in western countries. According to the National Science Foundation Report (USA), India produces 25% of the world’s science and engineering graduates. In addition, around 10 lakh youth of ITIs and polytechnics are joining the job market every year. No country in the world has this magnitude of youth power.

Out of India’s estimated 1.42 billion population, the volume of the vulnerable population is over 70% who are mostly from groups of Other Backward Classes, Scheduled Castes, and Scheduled Tribe. A good majority of the current entrepreneurial population are from ‘Forward communities’ including traditional business communities that have a long association with commerce and industry. The huge population at the bottom of the pyramid is still to be ignited with the spirit of entrepreneurship. India’s post-liberalization economic and trade reforms should have facilitated the emergence of a good number of entrepreneurs from the economically vulnerable sections to create a more heterogeneous entrepreneurial ecosystem, but it has not happened due to the lack of integrated entrepreneurship programmes. There is immense hidden entrepreneurial potential to be transformed into viable business activities that can contribute to achieving the economic and social goals of the country. In the case of women, their participation in the business is just 13.76%, which is not commensurate with the size of their population in the country. In recent times, weaker sections and women entrepreneurs are entering business activities through training interventions, and yet not adequate to their share of the population. Entrepreneurship development action plans with successful models must be implemented to tap these entrepreneurial resources.

India has enormous indigenous knowledge, skills, and technology in the artisanal clusters, which are a symbol of local culture and ethos, and some are becoming extinct due to a lack of modernization and identification of suitable markets. With the entrepreneurship-cluster strategy, these clusters need to evaluate and develop innovative models to bring holistic development, providing employment and income generation.

To tap the youth vigour, entrepreneurship can be introduced as a subject in the curriculums of education, both schools, and colleges. The New Education Policy (NEP) also emphasizes a multi-disciplinary approach so that students have the freedom to choose their career paths.

To achieve the goals of Aatmanirbhar Bharat and its vibrant demography as one of its pillars, developing Indian entrepreneurship can be a viable strategy. Besides reaping the demographic dividend, this will also help to find solutions to the social and economic maladies of the country. The participation of more promising entrepreneurs from the traditional non-business sections of society calls for a new approach to inclusive entrepreneurship development that can move us closer to the ambitious economic goals of nation-building.

(The author is former Director General, National Institute for MSME)

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