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‘The solution to rural prosperity is entrepreneurship at scale’

Ease of doing business for MSMEs: The lever to create jobs lies in mass entrepreneurship or widespread entrepreneurship. It means the growth of the millions of mundane businesses started by millions of ordinary people across the country in villages and towns which employ at least five people.

Ease of doing business for MSMEs: “If you want to go quickly, go alone. If you want to go far, go together.” This proverb mirrors the sentiment that can help us tackle one of the biggest challenges the country, especially rural India, is facing today – unemployment. We are set to have one of the youngest populations in the world till 2030 while experiencing a demographic window of opportunity that will last till 2025. But with unemployment rates at an all-time high, we need to reflect on the kind of future we can give to the youth.

With bleak workforce participation rates, the challenge of unemployment is particularly daunting for women and the youth living in smaller towns and rural India. With the headwinds posed by climate change and artificial intelligence, this challenge is not going to get any easier.

But we have a solution to rural prosperity – entrepreneurship, at scale. Do not think of the tech startups in Bangalore or Gurgaon with astounding valuations or the valiant self-employed chaiwallah and pakorawallahs, because neither of them creates enough jobs to tackle the unemployment crisis.

Who are the drivers of prosperity?

The lever to create jobs lies in mass entrepreneurship or widespread entrepreneurship. It means the growth of the millions of mundane businesses started by millions of ordinary people across the country in villages and towns which employ at least five people. Therein lies the core of the PM’s call to convert job seekers to job creators, which is currently a vital, unappreciated and underinvested lever for generating meaningful employment.

To create a self-sustaining ecosystem in every community, the first call to action becomes creating an entrepreneurial hub in every district of our country. Entrepreneurship is the natural result of a healthy local ecosystem. So if we want to see a flourishing of enterprises, the responsibility falls unto us to ensure that seed-soil-climate is healthy. And here are five ways in which we can:

Mindset shift: Figuring out the beliefs and mindset of the youth is imperative to bring about a shift towards entrepreneurial thinking. Their aspirations, goals and belief systems should reflect entrepreneurship as a viable option. So celebrating the success of local entrepreneurs and presenting the idea of starting a business to the youth is as important as giving them the tools to succeed. And just like cricket or chess, as more and more young people inspired by Tendulkar and Kumble and Dravid start playing on small dusty fields, we start producing more world-class cricketers like Kohli Bumrah and Shubman Gill.

Templatised businesses: Franchising and replicating successful business models is another pillar that can support the building of job creation. For example, one of our partners has developed templates for 175 solar-driven livelihood businesses including small cold storage units, and various types of food processing machines. Another partner has a successful program for agri-entrepreneurs who are able to consolidate procurement to save costs and provide market linkages for better price realisation. These models can be intentionally replicated and scaled up as avenues of employment in many districts, exactly as a Cafe Coffee Day or McDonald’s creates new outlets through franchising.

Access to finance: A major issue for all first-time entrepreneurs, especially rural entrepreneurs, is access to affordable loans and micro-equity. Despite many schemes, this remains a challenge. The solution is to one, change the method of credit evaluation of small entrepreneurs and two, unlock credit through small NBFCs and build capacity for the same, as they are critical for reaching small businesses. While this comes with a host of challenges in itself, this is absolutely achievable if we work together in mission mode.

Support through incubators: Effective incubators and accelerators are extremely essential due to the support they bring. Our efforts with incubators for first-time women entrepreneurs and existing small businesses with a turnover of 1 cr – 5 cr have shown us that interventions can make an impact. The biggest value add for businesses, in such a system, surprisingly, is not the technical training or upskilling. It is rather the peer-to-peer learning and a spike in self-confidence that comes from being part of a group, along with the emergence of a growth mindset from seeing the success of a peer. We cannot dismiss the on-ground support that market or financial linkages bring but our takeaway should be how community and support have a ripple effect on direct ground-level impact.

Integration is the solution: For all efforts to bring about actual change, we need synergy which comes as the by-product of integration. This would entail bringing together key stakeholders, government machinery, the private sector, financial institutions and implementation organizations in mission mode. We are currently on the pathway to creating a district entrepreneurship model that, if replicated successfully, will allow us to reach 800 districts in just a decade.
We cannot deny the necessity of creating and empowering job creators, not when the health of our economy rests on it. What we can do is instead face the music, because today, we have the tools to start and to succeed.