Doing

heRigss

Ethics

Valu
As per CBCS Syllabus

Entrepreneurial
Development
and Business Ethics
Rudra Saibaba
KALYANI
 7
PROJECT
CLASSIFICATION
ANDIDENTIFICATION
Learning Objectives
7.1 Concept of Project
7.2 Definition of Project
7.3 Characteristics of a Project
7.4 Classification of Projects
7.5 Project ldentification Introduction
7.6 Defintion
7.7 Process of Project ldentification
7.8 Constraints in Project ldentification

7.9 Project Objectives

7.10 Techniques of Project ldentification

7.1 cONCEPT OF PROJECT

Once the entrepreneur becomes aware of the concept and role of new venture,
he could make up his mind and proceed toward taking concrete actions to establish
ue unit. The entrepreneur draws a plan ot action to suit his requirement to setup

a new project. In the precise sense, a project can be considered to be any series of

acuvities and tasks that have a specific objective to be completed within certain
 E N T R E P R E N E U R I A L DEVELOP

erfotmed wit
pwr
to be
tasks

to
cemmitment

supposes
budgets
p r o j e c t s ,
nl refirery p
oil

wrifications
I and prrwer

the
Tm project
tern
hedues
s p r o e cts,
djer tives, but
while

et
p r o j e c t is for tte
th phars
Tited

mnally
hear
of
e m e n t

steel
p r o j e c t s
etc,

of
the
cases, the
d e e m e d
to be com plar
We each is
ta,
inm
and
not
In project project for mstructrn
rtilizer pr ev plants
are the i n s t a n c e
a
C o n s t r u c t i z

the
o p e r a t i o n a l ,

For when
t h e m
is
plant project
4l c o m p i e t e

ctive, nor n
N M t h e

with a n y
other
The
project
1s

a
physical
objectiv

between,
w
it t
in the caw

G n d a v a r i
is
not in
ilar
project merel
hod
h a p p e n i n g s

river
a or
d a m
oner
T h e r e f o r e , the plant
with
do
s
vn
ahieved

something
to
technologY
process

name
a n d to be termed
result
it has a high common

nd we
build deserve
a
whether
to
Mme

gram
panchayat,

there
is à
need to sth
to study a6
wfhto
of project o r privas e secto
the public
concept in
the Therof
efore, the
w h e t h e r

u n d e r s t a n d

survival.

onder to business
setting of its
In sake
In a
for the re
require
if is
concerved

at
least ideas
which may
But
growh
must grow
w business

o r g a n i s a t i o n

looks torgood
diversified
areas.
idea
in other suitable, legali.
ganisation
continuously

lives of
business
or

viable,
politically lly and
on
the existing economically tests, an inves
investr an
ther feasible, these
preliminary
comme
the project comme
ust be technically
Once the
ideas pass
is approved, ed, project
cially acceptable. investment
proposal
When the
made.
oposalis
its operation.

OF PROJECT
DEFINITION
Proet
.2 the definitions of different experts on
the concept

Now, let us
examine
project is a A
one shot, tine
Institute, USA:
Management the commitment of
i) The Project undertaking, requiring
directed, major combination of
limited, goal as a
It also described a project
resources.
varied skills and in temporar a
non-human resources pooled together
human and activites
The objectives and set of
organisatiorn toachieve a specific purpose.

differ from one

another
project to project.
to encyclopedia of management
(ii) Encyclopedia of Management: According
unit dedicated to the attainment of a goal- the
a project is an organised
within budge
successfulcompletion of a development project on time,
in conformance with pre-determined programme specifications.
(ii) Harrison: According to Harzison, a project management scholar
project can be defined as a noR-routine, non-repetitive, one ot
chnica
undertaking normally with discrete time, financial and te
performance goals.
M O I E C T
CLA
LASS

Mirrlees
CATION
CATIONN
Little and
and
tle
faa scheme, for investing
scheme,
Mirlees iewed
part
of
resources which can
a
pr oject 1.s
a n d

waluated
e v a l u a t e d
an as
important unit an as
a wherne
Economic reasonably be analyed
Nlation
Manual
on

ompilation .of data which

will
Development
enableProjectscts: It
advantages and all defined
ecoomic

'resources to the disadvantagesof attendant

appraisal made project
to be as a
cuntry'

production the upon the of

i)
20th
Webster's
Century Dictionary:specific goods and services.
New alloxcation o
he eme, design, proposal of something Webster viewed
sc
a
a
intended
Directory of devised.project
as
(viThe It Management: regards
or

carried out
plan in order project
according to
to
a as an
investment project
within a certain time and which will cease whenachieve a
definite objective
the
On the
On the basis of above definitions.
project can be
objective is achieved.
lan dev.
work plan devised to achieve a defined as a
e v o l e d

specific objective within a scientifically

ime.
o tt m e .
The speci objective may be to create, expand or specified period
in order to increase the production ot
goods and services develop certain facilities
required
to the
society.
CHARACTERISTICS OF A PROJECT
A project has or consists of a variety of characteristics. The
evails in the project despite diversities of work. The whole
concept of wholeness
work has to be
completed in one shot one for all. It is not a
process that
special features of a project are as follows;
can
perpetuate. The

(a) Objectives: A project has a fixed set of objectives and once these objectives
are adhered, the project ceases to exist.
(b) Life span: A project cannot have a perpetual succession. It has to come
to an end once the desired work is completed. When the project comes
an end is normally spelled out clearly in its objectives.
C) Single entity: A project is considered as a single entity and it is entrusted
to one responsible centre or authority. Participants in the project may be
more in number.
e a m Work: Successful completion of project work requires the team
phrit. This team constitutes members belonging to different disciplines,
organisations and even countries.
L i f e cycle: A proiect is initiated to achieve a mission and it is Compiete
these wo cut off
lives between
ad mission is fulfilled. One project
e
called projectlire cye
two phases is
Sand the gap between these and decay.
Ccycle is reflected by growth, maturity
 AND BUSINEse
ENTREPRENEURIAL
DEVELOPMENT
s ETHICS
7.6 ( Uniqueness: No two projects are exactly similar even if the
infrast

duplicated.
The location, are
identical or are merely
exactly unique.
make each project
agencies and the people
its life.
ut its
many
changes throughout ome of
(g) Change: A project undergoes but some cha

these changes may not

have any major impact,
of the project undertaken
ay hanges may
character or course
change the entire the life
the life cycle
cycle
will prevail during
uncertainties of a
(h) Uncertainty: What The details get finalised succec
known at any stage.
project is not fully
with the passage of time.
undertaken on
the requirement.
Made to order: A project
is always
(1) various requirements and
The c u s t o m e r stipulates
puts
Customers. executed.
must be
Constraints within which the project
is considered
as unity diversity IeIt is in
A project
) Unity in diversity: machinery, material
because it is a complex set
of technology, equipnment,
are inter-related
these aspects d
ethics etc. But all
culture,
men, work
allow the project to complete smoothly.
ot project work Is executed throuph
(k) Sub-contracting: A high percentage and complex in nahiro
more technical ure,
contractors. If the project work is
work would also be very hiok
the extent of contracting the project
done through
sub-contractors which will
Normally, the. project work is
be around 80%.
involves the element of risk and uncertaintu
(k) lement of risk: Every project
of risk depends on how a project passed through
has different
The degree are not well defined, the
phases of its life cycle. If the project objectives
be very high. The good entrepreneurs
risk and uncertainty is expected to
in the execution
always works, hard to minimise this risk and uncertainty
of his project work.

7.4 CLASSIFICATION OF PROJECTS

Projects have been classified by project experts and managers in different
ways. Acording to Little and Mirrlees, the projects can be classified into two
categories ie, quantifiable projects and non-quantifiable projects. We also find the
project classification of Planning Commission of India, All India financial institutions
etc., which is based on sectoral criteria and techno-economic criteria.
The project classification details are discussed below;
i) Quantification Basis: According to Little and Mirrlees,
be classified
. the
projects ca
on the basis of
quantification into two broad categories L
 a r e t h o s e l l l

O Den
netits can be
are thon-quantifiable projects are those where
de. Non-quantifia

a No rojects related to industrial such an aven

DO5s1D apment etc., come under developrnent, power gmeration,
n o tp o s s i b l

the
mineral categories of quantifiable
projects, oreas
wh health, education, defence etc., come
ntifiable projects.
under non-
Sectoral asis: Indian Planning Commission has been following the sectoral
(ii) assification of projects. It is quite useful for allocation of resources
basis f o r classifi

basis T the plan periods. The various projects which are

during classified on the
dur of ectors
are agriculture and allied sector,
basis irrigation and power
sector, industry and mining sector, transport and communication sector,
sector, indus

services sector and other sectors.

social

Techno-Econo: Basis: The projects can also be classified on the basis

(ii) echnological and economic tactors prevailing in the country. Techno
economic projects classification includes factors such as intensity oriented,
causation oriented and magnitude oriented classifications. The details of
these sub-classifications are given below;

Project Classification

Quantification Sectoral Techno-Economic Age, experience

Basis Basis Basis and purpose Basis

A. Agricultural A. Factor oriented A. New projects

and allied sector projects
Quantifiable Non- B. B. Causation
Projects quantifiable Irrigation
and B.Expansion
power sector oriented Projects
projects projects
C. Industry and C. Magnitude C. Modernisation
mining sector oriented Projects
projects
D. Transport and D. Diversification
Communication projects
sector
E. Welfare
E. Social services
projects
sector
F. Service projects
F. Miscellaneous G. Research and
sectors Development
projects
H. Educational
projects
 SINESS EE.
ENTREPRENEURIAL D E V E L O P M E N T A

claSsification is related to capital

relat.

ojects, huge i
westm
i n t e n s i v e

oriented

ther latest
tnvesechnoltmergts
capital

In and
i n t e n s i t y

machinery
7.8 tor i e Pand
f a c t o r
p r o j e c t s .

large
large scale
e
and p r o j e c t s ,

The

Pronted projects, the proi

i n t e n s i v e

intensive
l a b o u r plant pro

in o r i e n t e d

and made
causation

raw
l a b o u r

be based or
to In ln d e m a n d

material
demand tor bay
are units.
resources.
d e v e l o p e d

causes
i.e, consequent
c o
h u m a n and
of or
her inputs is
s e r v i c e s

on basis
made
and
skills
the m a t e r i a l s

on
classitied

Non-availability
of
goods

of
c e r t a i n
raw

project.
In
m a g n i t u d e

of
oriented classiassffiiccatai
orios

of iinvestments.
nve
the
size
o f size
sence,
a v a i l a b i l i t y

starting basis
the for
or
c a u s e

c l a s s i t i e d
on
the
scale proj
scale
projects,
medi jum scale and
important

are
as
ge
large
projects c l a s s i f i e d

the be
projects
may
classiication
of p r o j e c t s
i
highly USeTdl n
activiyu
scale projects economic activitie
based
have bek
economic

Techno-economic All the ve

standara
The feasibility
appraisal.
Internatio ational standa
I n t e r n a t i o n a l
industa
the the
by grouped ped under this
und

Categn
preparing
1
ten
g
grro
ouup
pss which are
into activities
classified

and fishi
and
ishing; mining and
sanitaryquarryin
economic
The
classification.

forestry,
hunting
gas
water d san
and servicks
agriculture, electricity
are construction;
tions; services and
servie

othet
c o m m u n i c a t i o n s ;

manufacturing; and
storage
transport,
c o m m e r c e ,

activities. lndia and state financial. nancial institution

basis: All

experienceand
purpose experience and purpose for
(iv) Age, of age,
the Dros
basis
on the criterion
projects to this
classify the undertaken.
According
they have
been
new projects,
expansion projects, modemiu
projects, modernisat
classified as
projects are Financial institutions classification a
institutions classification
projects.
which are classified as weld
diversification

projects and oriented projects welfar

service
envisages the research and development projects and
service projects,
projects,
educational projects.
techno- economic classifications
discussed above the
Of all the classifications The Unitee
the process of feasibility appraisal.
widely used which facilitates
very use the
International Standard Industia
Nations and its specialised agencies
economic activities in collecting
and analysing the economia
Classification of all
data.

INTRODUCTION
7.5 PROJECT IDENTIFICATION
ldentification of a suitable project is a very crucial decision as the ulma
success of the venture greatly depends upon the selection of the right y
product. There are no set of rules and regulations for identification of the p jerts
It is observed that most of the prospective entrepreneu follow the herdi
mentali

ple hae
inidentification and selection of a
project. If in particular area,
a
sou
 cLASSIFICATION AND IDENTIFICATION
PROJECTCLASSIFICATION 7.9

line of manutacture, others also

This is tollow suit
into a
sNitic tield
specitic
or

entured
red attitude s i e one's success in a particular project does not necessarily
need to understand the concept
thers. Theretore, there is a
n ta h e a l t

success tor othe

guaranter by the prospective entrepreneurs.
i d e n t i t i c a t i o n

proevt

7 . 6D E F I N I T I O N

concerned with
the collection, compilation and analysis
dentitication is for
P'roject
the eventual purpose ot locating possible opportunities
T data
o fe c o n o m i c
for
has located three opportunities
viz., additive,
Peter
eter Drucker
Dru
tment.
Additive opportunities enable
the decision
break through.
invest.

and bre the character of

lementary
mentary resources without aftecting
ompler
utilise
effectively
maker to ettectively
the existing
to

ideas which
the business.

reter to the introduction

of new

Complementary opportunities involve

structure. Breakthrough opportunities
in the existing
lead to change
lead to both the structure
and character of business. The
in
iamental changes when compared with
would be less in additive opportunities
element of risk involve
It is because additive opportunities
two opportunities.
the remaining state of affairs of business. If the
disturbance to the existing
of
the least
amount there arises a need to define
business opportunities,
high in
element of risk is alternative solutions for
project idea, to develop
nature of the
and approach in
the scope
objectives and to select the best possible
achieving the project and risk and to optimise the
return
the resource consumption
order to minimise
on the investment.

IDENTIFICATIOON
7.7 PROCESS OF PROJECT
involves
identification and selection is not an easy task. It
The process of project which are
number of characteristics of project
the assessment and evaluation of a

discussed below;
a suitable project, it is necessary
to make
(a) Inputs: Infact, while identifying
use of the SWOT analysis (strengths,
weaknesses, opportunities and threats)
at the disposal of the entrepreneur.
in respect of the resources available
The various input resources reters to raw materials, energy, man power,

and magnitude of each of

finance and organisational setup. The nature
these inputs must be determined in order to make
the input characteristics
explicit.

(b) Outputs: The study of output characteristics in determining as to helps

what the project will generate in the form of goods and services,
employment, revenue etc. The quantity and quality of all these outputs
should be clearly analysed before the proposed project is undertaken.
 ENTREPRENEURIALDEVELU

necessary tto
necessary
o study the
s

is
also

stu
of project work
benefits:
I1
proposed
nd supply in the ine,neia
riety if theTequi
and s
demand
and The

hich the
10
S o c i a l
c o s t s

the
equilhbriums
s o c i e t y
ot
sacritice
s a c r i f i c e
which
whic
society
c) on
lly
tthe
he
to
the
ciety it the
propos
c a r e f t u l l y

p o j e c t
c u r n n t
accrue

the evahuate will

a t t e v t s

that
to
b e n e t i t s

tentative
e s s e n t i a l

the
Is
projects
make
d
the
a nare undertaken.
into
account

has choice
to
take

is
be
to be been obse
setup.
setup

pre-determine

Itis
necessary
p r o p o s e d

the locatior
mally pre-determin.

the project suitable

Location:
project n o r m a l l y

the suitab for that suitabla

(d)
location
where

scale
entrepreneur

entify
identity
tne
project

projects, the
the location
that llocas
ocata
to projects,

theTOmalh
small
scale
that a selers
lection of
n e c e s s a r y

it is and large The

requirements.

background an inci pro

t h e r e t o r e ,
m e d i u m

case
of project
background

In the the
basis of of
p r o m o t e r s

on basis
decided
on
the
project
different
ditferent
Sources
nt Centressuch
made project
should ld beben..For For
aa
selecting
Developmen
(ED
(e)
Counseling
services:

agencies
i.e, sreneursn Technical Consultan
E n t r e p r e n e u r s h i p

Institute
(SISI),
altano
Technical

govermment

Industries
Service

and
nstitutions; no
financial non-gover
verrment
institutions:
i n t e r - i n s t i t h e m e

Small
(TCO),
credit lustry, inter-institutional
and industry, groun
Organisation
collaho
collaborations att
c o m m e r c e

chamber of international
and
agencies i.e., organisations
consultancy entrepreneurs.
technical
services to the
useful
rendering of he entrep
project, the entrepreneur
selection
a may
that for ultimate decision
denen
It may be
mentioned
but decision depends
on te
the oventut
persons/organisations,

consult any
number of
ot the proposed
project. Once the
and
weaknesses
have to he see
Creened
analysing strengths
alternatives
the
entrepreneurs
ideas have been developed
by before the nro

of internal and
external constraints propose
and evaluated on the basis identification comes to an end
end
The project
project is put to tests of pre-feasibility. formulated to convey t
are clearly and concisely
when specific project objectives
concerned persons.
uniform meaning to all the

IDENTIFICATION
7.8 CONSTRAINTS IN PROJECT
entrepreneurs have to be screened and evaluated
n
The venture ideas of the
te
a preliminary fashion on the basis of internal and external constraints before
project is put to additional tests of pre-feasibility. The internal and external consta
which are to be examined for the implementation of the proposed project wot
explained below;
(A) Internal Constraints
Internal constraints arise gement

on account of the limitations of the

system. The internal oconstraints nta orop
of the entrepreneurs in
projects are discussed here under; venturing u
 c I C A T I O NA N D 1 D E N T I F I C A T I O N
I D E N T I F I C A T I O N

7.11
s I F I C A T I O NA N

tside consultants: In implenenting their projects,

s f o r er e l i a n c e o n
ad more on the outside consultants for preparinyg
More
relian yneurs depend

not have
not have in-bu
in-built project
project serviCes in
Since they do
pre undue delay may take place in the
t h e e
b i
n l i t yr e p o r t s

sibility
f e a s i b i
reports,
he of the proposed projects.
implementation
u l a t i o n a n d

schedule: For early implementation of projects

rmut time
a n d
a n

schedule, all the enterprises may not

budget

costs and time

Limited eted
t h eb u d g e t e d

systems, organisation structure,

i lwithin i n d e p e n d e n
project managem
and other elements.
and
otH
develop

objectives: Normally, project management

a r n a l y s i s

n e t w o r k

) Formulation of
i o n o f

unrealistic
u n r e a l i s t i c

objectives.
with the determination of project
involved

lay down the main purpose for

much

is
not
goals and objectives
team

project formulated by top

exists. The unrealistic objectives
H e n c e
h i c h

anisation
a n

constraint for the project team to

o r g a n i s a t i o n

internal
becomes an
management
thus,
achieve those objectives.

The.availability of necessary internal project

resources:
of The physical
Non-availabi
non-physical resources.
as physical and
are classified
resources are classif infrastructural
inventories and
finances, personnel,
rrps include
resources inclu
are patents; unique experience and
sical resources
non-physical
r
facilities.
The r e s o u r c e s are the important
physical and non-physical
These at a the time when
skills. to make available
the entrepreneurs
constraints for is in progress.
implementation
of project
process
) External c o n s t r a i n t s

who venture into project

also restrict the entrepreneurs
constraints
The external constraints are the project
environment
external
mplementation. The important project. Further, the size,
situations outside a
and
rhich comprises things, people environment of the project.
The
also constitute the
ature and extent of the project are
in implementing the projects by the entrepreneurS
anous external constraints

aipiained below; external

socio-economic objectives: The
Non-conformity to the of projects
location and the extent
environmental factors like nature, size, to the
when the project does not conform
mit the entrepreneurs
SOcio-economic objectives of soCiety.
ana
i) Government po Government policies
policies and regulations: while
ent the entrepreneurs
gulations have become major hurdles for to
in getting
delay is taking place
menting the projects. Abnormal
issues
clearance,

approvalfor license, foreign collaboration, control of capital

Cnse,
7.12 ENTREPRENEURIAL
DEVELOPMENT AND
environmental clearance, foreign exchange permit, ca
and import goods clearance. On account of these
BUSIUSINNESSESS ETmE
tal goods
sons, the
implementation is delayed, as a result the project coste, th
with the estimated costs. are
not matchiap tse
(ii) Cumbersome procedure of financers: Financial instits:
are the important external financial source for the 0ns,
ns and
he
financing their projects. These financial institutionPrene entrerepreneursDarly
cumbersome procedures and documentati system
maki nd
delay in getting financial sanctions for the projects.ingHer bar
inordinay
inor
entrepreneurs are not able to get the required funds ence
on time for
implementation of the projects.
th
7 PROJECT OBJECTIVES
Formulating project is an important element in the project nlam..
Project objectives are concerned with defining in a precise manner as ng cyde
y
project is expected to achieve, if it is implemented.
provide a hat the
It also
performance for the project as a whole. Objectives are very essential e o
, to :
enterprise, as they are the foundations on which the entire edifice of #dy
design is built. of the projet

Essentials: While formulating the project objectives, it is

mind the following essential
necessary to kes
keep i
requirements;
(a) The project objectives must be specific and not general to have a clers
understanding.
(b. They should not be complex in nature.
(c) They must be measurable, tangible and verifiable from time to time.
(d) They must be realistic and attainable.
(e) They must be prepared keeping in view the available resources.
() They must be in consistence with available resources or anticipated
resources.

(8) They must be consistent with organisational plans, policies anu

procedures. Keeping in view the above essentials in formulating
objectives of the project, the entrepreneurs will have to complerc the
project on time; within the contemplated costs and at a profit the

company.
e n e u r s in different
Classification: Project objectives may be setup by the entrepreneurs
ways which are discussed below with the help of a chart;
 IDENTIFICATION
SSIFICATION 7.13

Project Objectives

Economical Social Specified General

Acquisitive

Objectives Objectives Objectives Objectives

Relentive Objectives

Dectves

hiectives: Retentive objectives are those objectives which are

Retentive objectives: Retentive

he retention and preservation of resources ike money,

oncerned with

and skills.
equipment
energy,
time,
obiectives:
ves: Acquisitive objectives are those objectives which
(b) Acqu
uisiti
of esource or
attaining a position or status that an
(b)Acacguisition
could not attain so far.
or its managers
enterprise

Economical objectives: Economical objectives are those objectives which

(c concerned with financial and benefits of the project.
costs
rimarily
are
the resources which the project will consume in
obiectives quantify
e objectives
These
and revenue expenditure. Thus, the
ofcapital expenditure
the shape
omicalobjectives are in the form of profit oriented.
The social objectives service oriented but not profit
are
Social objectives:
are inconformity with social cost
oriented. The social project objectives
individual projects. The social project objective enables
benefit aspects of
from the point of view of the total impact which the
to evaluate a project
is to have on the economy of the country.
going
project
of the
te) Specified objectives: Specified objectives refer to those objectives
project which it aims to achieve the specified results and within the specified
time limit.
(0 General objectives: General objectives refer to those objectives of the
in nature and intent to achieve number
project which are not specific a

of other goals. Normally, time limit may be prescribed for attainment ot

these general objectives.

he project formulation team will have to keep in mind all the above objectves
n determining the objectives of the project. They have to locate as many
nse ot the
s project activities as possible and undertake the exercise
ot re-
Co
and re-defining the project objectives in unambiguous, precise and
quantitative terms. The success of the project formulation team depends on
its
perTSIstence
a5
sist and alertness on the one hand and on its strong desire to be as objective
possible on the other hand.
 NT AND BUSINESS

7.10 TECHNIQUES OF PROJECT IDENTIFICATION 3HESS EH

Before the actual implementation ot any project, we
project and a detailed information about the project is beine we need toto
select a suitable project, there is a need to identify a plInan ordeffor .
few taken up.plan
background and resources of the entrepreneur. For this
this purpose
purpose, th Suj jects suit
prima-facie will have to assess the market potential of the it e
ent
only when entrepreneurs get a detailed intormation
The information needs of an entrepreneur can be
ems. This is
about the Deentreprene
the proposedis possi,
divided :.d pr proie
categories viz, general, technical and Support agency. Data onded into three
collected through Desk research and Techno-economic thethree
e areas
important techniques to the useful intormation
survey
survey whi
which Teas
provide for the proie
project identifica
the
(a) Desk Research
Desk research implies the collection and use of
ication
sources like journals, magazines,
information f
m publishe,
reports etc. Various
publications
tions such as'Guidelin
such ublis
for Industries' published by the Ministry of Industry,
Book of Industrial Statistics' published by Government of In
Ministry of Industries. H,Ha
Statistics' published by the Confederation of Indian
Industry etc., mav DOok
workout the gap between demand and supply. Institutions ay be
Service Institute (SISI), Technical consultancy
like Small: usefl t
organisatiorns, (TCO), Sino
contact
organisations (SPCO), District industrial centres (DIC) etc., offer
in these In addition,
areas.
Development Commissioner of small scale ind
has also published project profiles on all reserved items for the small scale inde
sector. Special directories listing manufacturers of both
material such as all India Manufacturers Organisation
machinery as well as
Directory, Indian Indtust
Directory, Chemical Weekly Buyer's Guide etc., are also available in the marke
Directorate General of Technical Development also
publishes, from time to time
a of
directory manufactures of engineering stores and chemical stores. With t
help of these publications, the entrepreneur would be able to collect basic information
about the project.
Data and product identification may also be obtained from the sources viz
Industrial potential surveys, Lead bank survey reports, new process/product
development in research laboratories, literature on industries within the count
and abroad, import, export statistics, profitability studies on selected industries and
studies on price and shortage of certain commodities.

(b) Techno-Economic Survey

irs mar
Based on the market intelligence on several
products, the
identify the most suitable project keeping in mind their own backgrounu
and entrepreneu
resources available. After having identified the project and to make it a
 ASSIFICATIONAND ON AND DENTIFICATION
T CIASIFIC 7.15
will have to collect. a lot of information
the
entepr
reneur bout various
project.

highly
the

of
ey is useful
investigation conducted by team
nx
tsh n oe c o n o m i c

o ri d e n t i f y i n g
he
industrial
development potential of area. Normally
an
ernment agencies often
ncies ofte commission such surveys. These
surveys
e f u l intormation which is explained below;
which

Intormation on the infrastructure

alIntrastructur
tructure
facilities:
facilities such
area, power, water etc; nature of the facilities
built up proposed
s l a n d

cluding sources of reliable supply of plant and

prothereof; information elating to the reliable supply of rawmachinery
including

hebe
provided
materials
o
a n de o s
ices thereot etc.; is required in order to establish the techno-economic
nroject. The intormation relating to infrastructure faciities
feasibility

ilability of land, power, water, facilities for disposal of effluents

such as a v a

etc,
lahle with the offices of istrict Industries Centres or Directorate
a v a i l a b l e

o r the
I n d u s t r i e s
Industrial Infrastructh Development Agencies in the
of
states c o n c e r n e d .

The entrepreneur should also know the nature of incentives

Incentives

bl c o n c e s s i o n s
available at the location selected by him. This information

the office of the District Industries Centre of the district in

or

is
provided
by
is proposed to be located or the State Directorate of
which the project
Industries shall provide such useful information to the entrepreneurs.
In order to accelerate the industrialisation in the
Tax concessions:
areas of the country, the
central and state governments are
developing
tax concessions to the entrepreneurs. The state govern ts
offering several
form of sales tax incentives such
normally offer the concessions in the
as

for a specific period of

exemption or determent upto specific quantum
a

time. The central government generally

offers concession in the form of
income tax exemption under various sections
such as section 10B for
section 35 tor
00% export oriented units, section 32 for depreciation,
35 AB for expenditure
expenditure incurred on scientific research, section
in
on know how, section 80 HHA for small scale industrial undertakings
Certain rural areas, section 80 HHC for profits retained from export business
Information
Section 80 HHE for from export of computer software etc.
profit
from the concerned
garding all these tax concessions is available
Income Tax Act or Excise Manuals.
partments' publications such as

d) various government
There is a necessity to know the
gal formalities: These formalities primarily
e s tor the implementation of the project. clearance, undertaking
include obtaining registratiorn, pollution
control
formalities for availing of the infrastructural facilities, incentives, financiadl
Information on such
assistance by way of term loan, working capital etc.
 ENTREPRENEURIAL DEVELOPMENT AND
7.16
formalities can be
had from District Industrial c
entres or DirectorBUSINNESSES ETa
Point Contact Organisations of
Industries or a Single he
ie,, Desk
identification states con
techniques of project
research and Te
.

Thus, the two

useful to the entrepreneurs in getting
economic survey are highly usetul
concrete proposal,
for formulating the project idea into a
intorm,
QuESTI0NS

I. SHORT ANSWER QUESTIONS

1. Define the concept project?

2. What is meant by quantifiable project?
3. Define non-quantifiable project?
4. What is capital intensive project?
5. What is labour intensive project?
6. What is project identification?
7. What are the essentials of formulating project objectives?
8. What is meant by retentive objectives of a project?
9. What do you mean by acquisitive objectives of a project?

10. What is desk research?

11. What is techno-economic survey?
12. What is meant by project life cycle?

1. LONG ANSWER QUESTIONS

1. Explain the concept 'project' with the help of definitions given by number t
experts and academicians.
2. How do you classify the projects? Give a rational and acceptable crterion w

classifying the projects.

3. Explain the characteristics of a
project
4. Discuss Desk research and Techno-economic survey as the techniques otpo

identification.
in the
5. What is project identification? Explain the internal and external consirains
project identification.
6. Explain the process of project identification?
7. Describe the nature and significance of project objectives.
 CLASSIFICATION AND IDENTIFICATION
PROJECT 7.17
How do you Classiiy tne project objectives? Explain.
AA/hat is the need tor tormulating project objectives? Explain the essential
9.
requirements to formulate the objectives of the project
10. Explain the diferent techniques of project identification.
Explain the internal constraints for project identification.
Do you offer any
11.
suggestions to Overcome those constraints.

I11. FILL IN THE BLANKS

i s a scheme, design a proposal of something intended or devised.