Module –III ENTREPRENEURSHIP

INTRODUCTION: Concept and importance of entrepreneurship

“An entrepreneur is a person who functions as an innovator, manger and co-coordinator.”

The term “entrepreneur „was applied to business initially by the French economist‟s can till on,
in the 18th century to designate a dealer who purchases the means production tor combining
them into marketable products. The emergence of the entrepreneurial society may be major
turning point in history. Only the entrepreneurs create capital, wealth and resources in a country
there inventive and risk-taking behavior.

According to Schumpeter, The entrepreneur in an advanced economy, is an individual who

introduces something new in the economy-o production of method not yet tested by experience in
the branch of manufacture concerned, a product with which consumers are not yet familiar, a
new source of raw material or of new markets and the like”
According to Marshall, “Entrepreneur is an individual who adventures or underrates risks, who
brings together the capital and labor required for he work, who arranges its general plan and
who superintends its minor details.”

ROLE AND SIGNIFICANCE OF AN ENTREPRENEUR

(1) Contribution in Economic Development:
Economic development refers a press of upward change, whereas the precipitate income of a
country actually increases after a long time. Entrepreneurs create jobs, wealth and capital in the
country. They promote investment, increase production and bring competitiveness in business,
reduce costs of products and raise the standard of Livonian society. Entrepreneurs encourage
effective resource mobilization of capital and skill which might otherwise remain unutilized and
idle. They establish new business enterprises, make possible use of resources and increase the
national income. Thus they play significant role in the economic development of a country.
(2) Promotion of Innovation:
Entrepreneur recognizes the need to change and introduce something new in the existing
economic field. Innovations may be in the form of new product,
Instituting of new production technology, searching or opening of a new market, discovery of
new source of supply of a raw material and developing a better form of industrial organization.
The innovations of new product may imply the employment of productive means in a modified
form.
(3) Increase in Employment Opportunities:
Entrepreneurs promote he idle savings of the public. They provide immediate large scale
employment. They integrate resources and technologies into profitable business ventures and
help to reduce the unemployment problem in the country.
(4) Pillar of Modern Production System:
Entrepreneur has become balancing wheel „of modern global economy. Marshall called him as
the „captain of industry‟. George Gilder in “The Spirit of Enterprise‟ said that:”Entrepreneurs are
innovators who evoke demand. They are makers of markets, creators of capital, and developers
of opportunity and producers of new technology. They seek the unique product, the marketing
break through, the startling new feature of the novel design.”
(5) Increase in Productivity:
Entrepreneurs play an important role in raising the productivity. They have the ability to produce
more goods and services with fewer inputs. They increase
Productivity with the help of research and development and investment in new plant and
machinery.
(6) Expansion of Existing Units:
Entrepreneurs not only establish the new enterprises but also make the expansion of the existing
units.
(7) Encouragement to Research and Development:
Entrepreneurs make the task of innovation along with the promotion of a new enterprise. It
encourages research and Development and help to reform and revolutionize the pattern of
production by exploiting an invention and provide better godless to the consumers.
(8) Establishment of Nerd industrial Organization:
A business does not get started by itself. It is the entrepreneur who takes the risks and is willing
to face devastating failure. He braves uncertainty, strikes out on his own, and through h native
wit, devotion to duty, and singleness of purpose, somehow creates business and industrial
activity where none existed before. His values and activates have become integral to corporate
culture.
(9) Employment Generation :
Unemployment is the major problem of our country. The available employment opportunities
can cater only 5% to 10% of the unemployed. Entrepreneurs generate employment both directly
and indirectly. Directly create employment through self employment as an entrepreneur and
indirectly by starting many industrial units they offer jobs to millions. Thus entrepreneurship is
the best way to fight the evil of unemployment.
(10) Capital Formation :
Entrepreneurs facilitate capital formation in the country. The entrepreneur provide employment
to people. The employees save a part of their income. The entrepreneurs also save a part of their
profits. These savings lead to investment. Investment in term facilitates capital formation, i.e.
production of capital goods, which can be used for further production of consumer goods and
services.
(11) National Income :
National Income consist of the goods and services produced in the country and imported. The
goods an services produced are for consumption within the country as well as to meet the
demand of exports. The domestic demand increases with increase in population and increase in
standard of living. The export demand also increases to meet the needs of growing imports due
to various reasons. An increasing number of entrepreneurs are required to meet this increasing
demand for goods and services. Thus entrepreneurs increase the national income.
(12) Revenue to the Government :
The entrepreneurs provide revenue to the government. They provide revenue in the form of
direct and indirect taxes. The direct revenue comes in the form of personal income tax and
corporate tax paid by entrepreneurs. The indirect revenue comes in the form of excise duty,
custom duty, service tax etc., paid by the entrepreneurs. The entrepreneurs paid revenue to the
government in the various forms of taxes.
FACTORS CONTRIBUTING TO GROWTH OF ENTREPRENEURSHIP
The emergence of entrepreneur in a society depends upon closely interlinked economic, social,
cultural, psychological, political and personality factors. The factors contributing to the growth
of entrepreneurship are as follows:
1) Economic Policies :
The economic policies of the government and other financial institutions and the opportunities
available in a society as a result of such policies play a crucial role in exerting direct influence on
entrepreneurship in view of the haphazard development of economic zones.
2) Government Incentives :
Government is encouraging the entrepreneurs to establish their business in backward and tribal
areas. This is primarily to arrest the migration of people from the villages to cities and to create
employment opportunities locally. Government is promoting such development by giving
incentives like tax holidays, subsidized power tariff, raw materials, transportation cost etc.
3) Social Factors :
A society that is rational in decision making would be favourable to entrepreneurship growth.
Several less developed countries characterized by the presence of a social set up which is
generally hostile to entrepreneurship. Education research and training are given very little
importance. The process of division of labour comes to be decided upon by the hereditary
principle rather than by aptitudes, skills and attainments of individuals.
4) Cultural factors :
If the culture is economically or monetarily oriented, entrepreneurship would be applauded and
praised. In the less developed countries, people are not economically motivated. Monetary
incentives have relatively less attraction. People have ample opportunities of attaining social
distinction by non-economic pursuits. Men with organizational abilities are therefore not dragged
into business.
5) Psychological Factors :
The psychological factors like high need for achievement, determination of unique
accomplishment, self confidence, creativity, vision, leadership etc. promote entrepreneurship
among individuals. On the other hand psychological factors like security, conformity and
compliance, need for affiliation etc. restrict promotion of entrepreneurship.
6) Political Factors :
The political scenario and also the political stability of country influence the growth of
entrepreneurship. The political system, which promotes free market, individual freedom and
private enterprise, will promote entrepreneurship. It means entrepreneurship growth is depends
upon the political factors.
7) Personality Factors :
In our country the entrepreneurship is looked upon with suspicion. The result is the personality
of the entrepreneur has got greatly affected. Public opinion in the developing nations sees in the
entrepreneur only a profit maker and exploiter. Many of the developing nations were exploited
by foreigners for centuries. The people and their leaders therefore tend to see in the entrepreneur
a suspect personality.
ENTREPRENEUR AND MANAGER, ENTREPRENEUR AND INTRAPRENEUR
Generally, the two terms, entrepreneur and manager are used interchangeably but they differ in
their meaning in the following sense:
Basic of Entrepreneur Manger
distinction

1. Status An entrepreneur is the owner of his A manager is just an employee in the

enterprise. enterprise.

2. Reward The reward of the entrepreneur is A manager gets his monthly salary as
the profit earned by him. a reward for the services rendered by
him.

3. Qualification An entrepreneur doesn‟t need to A manger must possess professional

have professional qualification. qualification.
Qualities such as risk-bearing, hard
work, creative thinking, fore
slightness etc. are more important.

4. Risk An entrepreneur bears all risks and A manger does not bear any risk.
uncertainties of his business.

5. Innovation An entrepreneur acts as an Manger is not relates with

innovator and brings changes. innovation. He simply implements
the plans prepared by the
entrepreneur and gives them practical
shape.

6. Function Main function of an entrepreneur is Manger‟s function is to manage the

to establish a new enterprise. affairs of the enterprise.

7.Decision All of the policies and strategic Managerial and operational decisions
making designs are taken by the are taken by the manager.
entrepreneur.

8. Freedom Being the owner of the enterprise, Manger is an employee and hence
entrepreneur has full freedom to run lacks freedom.
the enterprise.

9. Management Entrepreneur manages the business Manger manages the business

outside. enterprise from inside.
ENTREPRENEUR AND INTRAPRENEUR
As both entrepreneur and intrapreneur share similar qualities like conviction, creativity, zeal and
insight, the two are used interchangeably. However, the two are different, as an entrepreneur is
a person who takes a considerable amount of risk to own and operate the business, with an aim
of earning returns and rewards, from that business. He is the most important person who
envisions new opportunities, products, techniques and business lines and coordinates all the
activities to make them real. On the contrary, an intrapreneur is an employee of the
organization who is paid remuneration according to the success of the business unit, for which
he/she is hired or responsible.
The primary difference between an entrepreneur and intrapreneur is that the former refers to a
person who starts his own business with a new idea or concept, the latter represents an employee
who promotes innovation within the limits of the organization.

BASIS FOR
ENTREPRENEUR INTRAPRENEUR
COMPARISON

Meaning Entrepreneur refers to a Intrapreneur refers to an employee of

person who set up his own the organization who is in charge of
business with a new idea or undertaking innovations in product,
concept. service, process etc.

Approach Intuitive Restorative

Resources Uses own resources. Use resources provided by the

company.

Capital Raised by him. Financed by the company.

Enterprise Newly established An existing one

Dependency Independent Dependent

Risk Borne by the entrepreneur Taken by the company.

himself.

Works for Creating a leading position in Change and renew the existing
the market. organizational system and culture.
TYPES OF ENTREPRENEURS

On the basis of nature Clarence Danhof classified entrepreneurs into four categories. These are:

1) Innovative entrepreneurs: An innovative entrepreneur in one, who introduces new goods,

inaugurates new method of production, discovers new market and recognizes the enterprise. It is
important to note that such entrepreneurs can work only when a certain level of development is
already achieved and people look forward to change and improvement.

2) Imitative entrepreneurs: These types of entrepreneurs creatively imitate the innovative

technical achievement made by another firm. Imitative entrepreneurs are suitable for
underdeveloped countries as it is hard for them to bear the high cost of innovation.

3) Fabian entrepreneurs: Fabian entrepreneurs are characterized by very great caution and
skepticism to experiment any change in their enterprises. They usually do not take any new
challenge. They imitate only when it becomes perfectly clear that failure to do not so would
result in a loss of the relative position in the enterprise.

4) Drone entrepreneurs: They are characterized by a refusal to adopt any change even at cost of
severely reduction of profit.

Some other types of entrepreneurs:

A) Solo operators: These are the entrepreneurs who essentially work alone and if needed at all
employ a few employees. In the beginning most of the entrepreneurs start their enterprises like
them.

B) Active partners: Active partners are those entrepreneurs who start or carry on an enterprise
as a joint venture. It is important that all of them actively participate in the operations of the
business.

C) Innovators: Such entrepreneurs with their competence and creativity innovate new products.
Their basic interest lies in research and innovative activities.

D) Buyers’ entrepreneurs: These are the entrepreneurs who do not like to bear much risk. They
do not take the risk of production but take the risk of marketing a product i.e. wholesaler and
retailer.

E) Life timers: These entrepreneurs believe business as an integral part of their life. These
entrepreneurs actually inherit their family business i.e. goldsmith, potter etc.

F) Challengers: These are the entrepreneurs who initiate business because of the challenges it
presents. They believe that „No risk, No gain‟. When one challenge seems to be met, they begin
to look for new challenges.

Beside these, there are Govt. and Non-govt. entrepreneurs.

COMPETENCIES OF AN ENTREPRENEUR
The main characteristics of an entrepreneur are as follows:
(1) Risk takers : Entrepreneur has the risk bearing capacity. He bears the risks of change and
uncertainties Entrepreneurs are not high risk-takers-they are not gamblers. They are moderate
risk-takers who believe in taking calculated risks where the chances of achievement are
consistent are match with the level of performance efforts and resources. In other words, they
prefer such risks as provide resemble changes of success and seem to be with in proper control of
available resources and capacities. They believe in “moderate risk. Reasonable rewords.”
(2 ) Innovators : Another important characteristics of an entrepreneur is that he is an innovator
by nature. He is always in search of new ideas and new opportunities; He tries to outshine others
by taking initiative in doing new things i.e., exploring new products, new markets, new raw
materials, new methods of production, etc. material, equipment
(3) Provider of Resources: An entrepreneur is the economic agent who brings together
manpower, land, material, equipment and arranges necessary capital needed for business.
(4) High Achievers: An entrepreneur believes n high achievements. As a high achiever, he
competes with his rivals in the venture fields as well as with his own previous performance. He
desires to excel in his venturing performance and to achieve a goal that possesses are as on able
challenge to his ability and competence.
(5) Motivator: An entrepreneur is a motivator. He builds a team, keep it motivated and provide
an environment for individual growth and career development.
(6) Opportunist: Entrepreneurs have the ability to see and evaluate business opportunities. They
take advantage of opportunities by taking appropriate actions.
(7) Individual organization or Groups: Entrepreneurs may be an individual, an organization or
a group of individuals.
(8) Dynamic Agent: An entrepreneur has the ability to visualize new ventures and new pl He
breaks old traditions and develops new ones. He creates a new business venture through the
utilization of his knowledge, passion, dreams and desires.
(9) More than a manager: In real sense, an entrepreneur is more than a manager. Entrepreneur
takes risks and bear uncertainties but a manager does not do so. An entrepreneur by nature is a
visionary leader. He inspires loyally and hard work to raise productivity and efficiency.
(10) High Level Energy: A success full entrepreneur exhibits a higher level of energy, hard
work, and perseverance than an average person. He is fully determined to erush the hurdles,
solve the problems, face the tough times, and get over the misfortunes in order to ultimately
achieve his present goals. He spends most of his times in energetic activities. He has
commendable stamina for enduring the frustrations and hardships.
11) Desire for Independence: Entrepreneurs often seek independence from others. As a result,
they generally are not motivated to perform well in large, bureaucratic organizations. They have
internal drive. They are confident of their own abilities and possess a great deal of self-respect.
(12) Organizing capacity: An entrepreneur is a good organizer of a new vernture‟s activities.
He possesses special skills for identifying and grouping of work, creating and filling the
administrative positions, delegating authority and responsibility, creating coordinated
relationships among various positions, distribution of resources among them, and supervising the
events to happen in the desired ways so as to accomplish the pre-determined goals of the new
venture. He is an extraordinary organization build reorganizer of work and people.
(13) Prefers Achievement over Money: Entrepreneurs are not driven wholly by the desire to
make money. To the contrary, achievement seems to be entrepreneurs‟ primary motivating force.
Simmered says, Money is simply a way of keeping score” of accomplishments-a symbol of
achievement.
(14) Different from Capitalist and Investors: He is distin-gushed from investors and
capitalists. Peter Ducker writes, “Nor are entrepreneurs capitalists, although of course they need
capital. They are not investors either. The entrepreneur is also not an employer, but can be, and
often, is, an employee or someone who works alone entirely by himself.”
(15) Human relations ability: An entrepreneur possesses sound human relations ability to deal
with his employees, cus-tomers, suppliers, creditors etc.
(16) Decision makers: Prof. A.H. Cole regarded an entrepreneur as a decision maker. He has to
take several decisions to put his business idea into a reality. For example, he has to decide what
is to be produced, how is to be produced, when and where to be produced etc.
(17) Self-confidence: An entrepreneur does not believe in luck or fate. He has high class self
confidence in achieving his goals, He believes in his own firm decisions and actions.

TRAINING AND DEVELOPMENT CENTRES IN INDIA.

In order to accelerate the speed of self employment and entrepreneurship development, the
government has established various centres or institutes to impart training and development to
entrepreneurs. Some of these are as follows :
1) District Industries Centres (DICs) : The focus of attention for industrial development was
mainly as large cities and state capital. Therefore, it was felt necessary to provide all the services
and facilities to village and small industries under one roof. Accordingly, the DICs were
established in 8th May, 1978 in order to cater to the needs of small units in rural areas. The head
of the DICs are general managers who are assisted by managers working under them. For every
Taluka in the District, industries inspectors are appointed by the government who visit the office
of the Panchayat Samiti once in a week. To guide the entrepreneur in order to solve their
problems. Functions of DIC :  Identification and development of new entrepreneurs. 
Conducts training programmes.  Offer technical advice to new entrepreneurs.  Conducts
industrial potential surveys.  Evaluates the proposals received from entrepreneurs.  Assists
entrepreneurs in marketing their products.  Assists export promotion of products.  Undertakes
product development for small industries.
2) Small Industries Development Organization (SIDO) : Small Industries Development
Organization (SIDO) was established in 1954. It provides training for entrepreneurship. It
undertakes entrepreneurship development programmes through 138 small industries service
centers. It also provides support in the areas of credit, marketing technology and infrastructure to
small industries. It provides number of facilities to small industries these are as follows : 
Quality control and testing.  Training for entrepreneurship development.  Preparation of
project and product profiles.  Technical and managerial consultancy.  Assistance for exports.
 Pollution and energy audits.  Economic and market survey.
3) Entrepreneurship Development Institute of India (EDIT) : Entrepreneurship Development
Institute of India (EDIT) was established in 1983 at Ahmedabad in order to create the
institutional infrastructure for entrepreneurship development. It is sponsored by apex financial
institutions, namely the industrial Development Bank of India, the Industrial Finance
Corporation of India, the industrial credit and Investment Corporation of India, and State Bank of
India. It is committed to entrepreneurship education, training and research. It strives to provide
innovative training techniques, competent faculty support, consultancy services, Quality teaching
and training material.
4) National Small Industries Corporation (NSIC) : National small Industries Corporation
(NSIC) was established in February 1955. NSIC is an ISO 9001 : 2000 certified company. It has
been working to promote the growth of small scale industries and industry - related small scale
services in the country. The main functions of the corporation are -  Higher purchase of
machinery  Marketing.  Industrial Estates.  Exhibitions.  Production cum training.
5) Small Industries Service Institutions (SISIs) : The SISIs are the field offices of SIDO. Set
up in the early 1950s. These institutes give on the spot technical assistance and guidance to
small-scale units to solve their technical problems. 139 They also advice small units on new and
improved techniques of production and in the use of modern machinery and equipment. There is
a network of 28 SISIC in all the states to carry out its functions. The following are the services
provides by SISIs.  Technical advisory services.  Management consultancy services. 
Economic advisory services.  Managerial services.  Marketing  Entrepreneurial
Development Programme.
6) National Institute for Entrepreneurship and Small Business Development (NIESBUD) :
The National Institute for Entrepreneurship and small Business Development (NIESBUD),
located at Ahmedabad was set up in 1983. Indian Central Government started an organization
called NIESUD with the main motto of co-ordinating activities related to entrepreneurship and
small business development. The following are the major activities of the NIESBUD. 
Developing model syllabus for training.  Facilitating and supporting central and state
governments.  Conducting programmes.  Helps other entrepreneurs development.
7) Centre for Entrepreneurship Education and Development (CEED) : Centre for
Entrepreneurship Education and Development (CEED) ws launched in December, 1995, as an
innovation centre that assist governments. Organizations and communities in helping people to
achieve their potential through entrepreneurship. The following are the services of CEED. 
Technical assistance.  Entrepreneurship consulting.  Entrepreneurship training courses. 
Micro-finance systems.  Resources publications.  National Institute of Small Industry
Extension Training (NISIET).  Federation of Indian chamber of commerce and industry
(FICCI).  Rural Entrepreneurship Development Institute (REDI).

INCENTIVES TO ENTREPRENEURS IN INDIA (GOVT)

Entrepreneurs in the present globalized market economies are the engine of economic
development. Due to their private ownership for majority of cases, entrepreneurial spirit, their
flexibility and adaptability and also their capability to react to challenges and changing
environments, enterprises lead to sustainable growth and employment generation in a significant
manner. Enterprises, specially small and medium enterprises are considered to have strategic
importance in national economy for many reasons. Therefore government helps enterprises
including small and medium ones by supporting entrepreneurs. By doing so, it is possible to
create new job positions, increase gross domestic product (GDP) and rising living standard of
population. Government provides support to entrepreneurs in the following ways.
Training:
Basic training varies from product to product but will necessarily emphasise on sharpening of
entrepreneurial skills. In this regard central and state government‟s technical institutions provide
need based technical training. Entrepreneurship development programmes are conducted by
many government organizations and non government institutions.
Marketing assistance:
Government and non government agencies provide marketing assistance to entrepreneurs.
Government promotes MSME products through exhibitions. NSIC directly markets the MSME
product in the national and international market, NSIC manages single point registration scheme
for manufacturers for government purchases. Enterprises registered under this scheme obtain the
benefit of free tender documents and exemption from earnest money deposit and performance
guarantee.
Promotional schemes:
Government provides highest preference for development of MSME by formulating and
implementing conducive policies and government schemes. Government provides development
land and sheds on actual cost basis with appropriate infrastructure. The government has designed
the special schemes for specific purposes such as quality upgradation, common facilities,
entrepreneurship development and consultancy services at minimal charges. The government
provides financial support to entrepreneurs to obtain ISO 9000 certificate by providing up to
75% of actual cost with maximum ceiling of Rs 75000/-.
Concession of Excise duty:
Government provides exemption to MSME units for a particular level of annual turnover from
paying excise duty. The limit of turnover is variable.
Credit facility:
Credit to micro, medium and small scale sector is covered under priority sector lending by banks.
Small industries development bank of India (SIDBI) is mainly responsible for implementing
various schemes of providing financial support to small entrepreneurs. Loans are also provided
to small entrepreneurs by scheduled banks without collateral security. This limit is variable.

Incentives in Operation :
 Interest free loans.  Exemption from property tax.  Incentives to NRIs.  Special
incentives to women entrepreneurs.  Exemption from income tax.  Interest free sales tax
loans.  Sales tax exemptions.  Land and building at concessional rates.  Price preference to
SSI units.  Exemption from stamp duty.  Provision of seed capital.  Allotment of developed
/ constructed shed.  Allotment of controlled or subsidized raw materials.  Concessional water.
 Special facilities for import of raw materials.  Taxation benefits.  Excise concessions.

Subsidies in Operation :
 Export / import subsidies and bounties.  Subsidy for research and development works. 
Capital investment subsidy.  Transport subsidy.  Interest subsidy.  Subsidy for power
generations.  Subsidies to artisans and traditional industries including handlooms.
8. Start up space in India: Importance, Challenges and Solutions available in the changing
scenario.

WOMEN ENTREPRENEURS: PROBLEMS AND PROMOTION.

Women entrepreneurs are becoming alarming force to consider within the business world and
they are not only involved in business for survival, but to satisfy their inner urge of creativity and
to prove their capabilities. Educated women is contributing to a great extent to the social
transformation and in the future, it will be seen that more women venturing into areas
traditionally dominated by men. In India, concept of women entrepreneurship is of recent origin.
Women have become aware about their rights and entered in different fields of business. They
have established their own successful business empires. They are contributing towards the
growth of economy and improvement of their socio-economic conditions. Women workforce
ratio in the country is increasing due to increase in the women literacy rate in India. Government
of India has also given appropriate importance to women entrepreneurship in the country and
several schemes have been introduced for the development of women entrepreneurs.
Various problems associated with the women entrepreneurship are discussed below:
1. Financial Problems
Finance is regarded as “life blood” for any enterprise, be it big or small. However,
women entrepreneurs suffer from shortage of finance on two counts. Firstly, women do
not generally have property on their names to use them as collateral for obtaining funds
from external sources. Thus, their access to the external sources of funds is limited.
Secondly, the banks also consider women less credit-worthy and discourage women
borrowers on the belief that they can at any time leave their business. As a result, women
entrepreneurs are bound to rely on their own savings only. Thus, women enterprises fail
due to the shortage of finance.
2. Scarcity of Raw Material
Most of the women enterprises are plagued by the scarcity of raw material and necessary
inputs. The failure of many women co-operatives in 1971 engaged in basket making is an
example how the scarcity of raw material sounds the dearth-knell of enterprises run by
women.
3. Stiff Competition
Women entrepreneurs do not have organization set-up to pump in a lot of money for
canvassing and advertisement. Thus, they have to face a stiff competition for marketing
their products with both organized sector and their male counterparts. Such a competition
ultimately results in the liquidation of women enterprises.
4. Production Problems
Coordinating factors of production are really challenging to women entrepreneurs.
Women entrepreneurs cannot easily co-ordinate the production process particularly with
the ever changing technology. Very few women can endure such production instants.
Women who aspire to become entrepreneurs cannot keep pace with technology
progressions. This puts down their initiative to become entrepreneurs.
5. Family Ties
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 only. In case of married woman, she has to strike a
fine balance between her business and family. Her total involvement in family leaves
little or no energy and time to devote for business. Support and approval of husbands
seem necessary condition for women‟s entry into business. Accordingly, the educational
level and family background of husbands positively influence women‟s entry into
business activities.
6. Lack of Education
In India, around three-fifth (60%) of women are still illiterate and illiteracy is the root
cause of socio-economic problems. Due to the lack of education and that too qualitative
education, women are not aware of business, technology and market knowledge. Also,
lack of education cases low achievement motivation among women. Thus, lack of
 education creates problems for women in the setting up and running of business
enterprises.
7. Male Dominated Society
Male chauvinism is still prevailing in India. The constitution of India speaks of equality
between sexes. But, in practice women are looked upon as able, i.e. weak in all respects.
Women suffer from male reservations about a women‟s role, ability and capacity and are
treated accordingly. In nutshell, in the male-dominated Indian society, women are not
treated equal to men. This in turn, serves as a barrier to women entry into business.
8. Low Risk-Bearing Ability
Women in India lead a protected life. They are less educated and economically not
selfdependent. All these reduce their ability to bear risk involved in running an enterprise.
Risk bearing is an essential requisite of a successful entrepreneur. In addition to above
problems, inadequate infrastructural facilities, shortage of power, high cost of production,
social attitude, low need for achievement and socio-economic constraints also hold the
women back from entering into business.

PROSPECTIVE SCHEMES FOR THE DEVELOPMENT OF WOMEN

ENTREPRENEURS
According to the Third All India Census of Small Scale Industries conducted in 2001-02 and
subsequent estimates made, only 10.11% of the Micro and Small Enterprises in India are owned
by women while 9.46% of the MSE enterprises are managed by women. In order to promote
progressively women enterprises in the MSE sector, various schemes have been formulated by
this Ministry and some more are in the process of being finalized, aims only at the development
of women enterprises in India. Significant schemes in India those specifically introduced for
women for providing special benefits to women

Trade related entrepreneurship assistance and development scheme for women (TREAD)
With the objective of encouraging women in starting their own ventures, government launched a
Scheme, namely, (TREAD) Trade Related Entrepreneurship Assistance and Development during
the 11th Plan. The scheme envisaged economic empowerment of 297 women through the
development of their entrepreneurial skills in non-farm activities. There are three major parts of
the scheme; Govt. of India has grant up to 30% of the total project cost to the NonGovernment
Organizations (NGOs) for promoting entrepreneurship among women. The remaining 70% of
the total project cost is financed by the lending agency as loan for undertaking activities as
envisaged in the project. Up to Rs.1 lakh per program can be granted by govt. of India to training
institutions / NGOs for providing training to the women entrepreneurs.

Micro & Small Enterprises Cluster Development Programme (MSE-CDP):

Cluster is described as a group of enterprises, normally 20 or more producing same/similar
products/services. The Cluster Development Programme being implemented envisages
diagnostic study of identified clusters of traditional skill-based MSEs to identify suitable
technologies and their providers and to facilitate adoption of available technology meeting the
specific needs of the end users. The Cluster Development goals at improved competitiveness,
technology improvement, adoption of best manufacturing practices, marketing of products,
employment generation etc.
Credit guarantee fund scheme
In May, 2000 The Government had introduced the Credit Guarantee Fund Scheme for Small
Industries with the objective of providing credit to SSI units, particularly small units, for loans
up to Rs. 25 lakh with no collateral/ third party guarantees. The Scheme is being operated by the
Credit Guarantee Fund Trust for Small Industries (CGTSI) set up jointly by the Government of
India and SIDBI.

Help for Entrepreneurial and Managerial Development

MSME DIs regularly conducts EDPs/MDPs for existing and potential entrepreneurs and charge
fee for such courses. To encourage more entrepreneurs from among the SC/ST, women and
physically challenged groups, it is proposed that such beneficiaries will not be charged any fees
but, instead paid a stipend of Rs.500/- per capita per month. 50,000 entrepreneurs will be trained
in IT, Fashion Technology, Agro & Food Processing, Catering, biotechnology Pharmaceutical,
etc. through specialized courses run by MSME DIs. 20% of courses conducted by these
Institutions shall be exclusively for women

Scheme for Women Entrepreneurs to Encourage Small & Micro Manufacturing Units DC
(MSME) has formulated a scheme for women entrepreneurs to support Small & Micro
manufacturing units owned by women in their efforts at developing overseas markets, to enhance
participation of representatives of small/micro manufacturing enterprises under SIDO stall at
International Trade Fairs/Exhibitions, to enhance export from such units. Under this scheme
participation of women entrepreneurs in 25 international exhibitions is envisaged during the 11th
Plan.

Dena Bank to support India’s women entrepreneur.

Dena Bank will help Government of India‟s initiative to promote women entrepreneurs for
selfemployment ventures in any kind of non-farm activity. At present, the Government of India
has over 27 schemes for women. Some of these are: • Assistance to Rural Women in Non-Farm
Development (ARWIND) schemes • Entrepreneurial Development programme (EDPs) • Indira
MahilaYojana • Indira Mahila Kendra • Integrated Rural Development Programme (IRDP) •
Khadi And Village Industries Commission (KVIC) • Management Development programmes •
Women‟s Development Corporations (WDCs) • Marketing of Non-Farm Products of Rural
Women (MAHIMA) • MahilaVikasNidhi • Mahila SamitiYojana • MahilaVikas Nidhi • Micro
Credit Scheme • Micro & Small Enterprises Cluster Development Programmes (MSE-CDP). •
NGO‟s Credit Schemes • NABARD- -SEWA Bank project • National Banks for Agriculture and
Rural Development‟s Schemes • Priyadarshini Project- A programme for Rural Women
Empowerment and Livelihood in Mid Gangetic Plains‟ • Prime Minister‟s RojgarYojana
(PMRY)