home Advertise
With Us

Dalit entrepreneurs fight prejudices to build business Jul 21, 2013 BANGALORE: Raja Nayak's teenage life was played out on the streets of Wilson Garden selling surplus export garments from Tirupur

BANGALORE: Raja Nayak's teenage life was played out on the streets of Wilson Garden selling surplus export garments from Tirupur at half the price. Today, Nayak, 52, runs a diversified business of over Rs 50 crore and drives a Merc to work.

He first worked his way up to start Akshay Enterprises, a company dealing with corrugated fibre board boxes used in packaging. Since then, he has got into the education business, built a logistics company called MCS, and made inroads into the packaged drinking water market with the brand Jala Drops.

He has no qualms in calling himself a dalit entrepreneur, having confronted 
prejudices that run deep in society. "I am close to signing a Rs 1-crore deal with the Tatas. In fact, the Tata Group has invested Rs 1 crore for a 33% stake in a dalit enterprise. We had discussions with Tata Global Beverages recently, and they are looking at more investments in such enterprises in Karnataka ," says Nayak, who heads the Karnataka chapter of the Dalit Indian Chamber of Commerce and Industry (DICCI). Launched last year, the state chapter has 150 members.

Lingesh HS, promoter of Bangalore-based Sidnag Cables that makes electrical and power cables, found it extremely hard to convince a nationalized bank manager to give him a Rs 2 lakh overdraft facility when he started his business in the early 2000s.

"Banks were wary of lending to SC/SCT entrepreneurs fearing that the debts would go bad. We didn't have access to seed capital and relied on
friends for angel money. But I was reluctant to ask friends, so forced this bank manager to visit my factory in Bidadi. Today, I have an overdraft facility of up to Rs 20 lakh," says the mechanical engineer.

Lingesh makes PVC-coated nylon bindings for Ingersoll Rand and specialized cables for Aeronautical Development Establishment in Bangalore. He does a business of Rs 4 crore annually.

Stumbling block 

Lack of access to capital has been a stumbling block for many aspiring 
dalit entrepreneurs.

"When I applied to the Prime Minister's Rozgar Yojana to set up a cyber cafe some time ago, they offered a loan to set up a cobbler shop, and that too by cancelling the sanction given to another dalit entrepreneur. I was fed up with the bureaucracy and started an event management firm, pooling money from my friends," says Satish Chandra, who runs the event management firm Indus Events.

DICCI SME Fund (DSF), a VC fund initiated by DICCI, has received Sebi's approval to raise Rs 500 crore in the next 10 years.

Milind Kamble, chairman of DICCI, says: "Banks ask for collateral, but dalits have nothing to offer. We encourage people to be job-givers , not job-seekers . The SME fund will empower dalit entrepreneurs. "

Varhad Capital, the 
investment banking arm of Varhad Financial Consultancy Services, manages funds for DSF. Recently, the government mandated that 20% of all government procurements must be made from the MSME sector and 4% of all purchases must be made from firms run by SC/STs.