UNIT 3

Role of Central and State Governments in promoting Entrepreneurship

The success of an enterprise also depends on the support provided by its State. By its
regulations it can create an attractive and easier climate for business enterprises on the one
hand, while on the other hand the state can be a major limiting factor for the establishment
and development of enterprises. In the entrepreneurial economy the state is not an
entrepreneur, it is rather supposed to protect, with all its legal force, every business venture.
The State, its institutions and officials do not act as executive authorities, but are seen as a
necessary administrative service for successful business. Their responsibilities are to provide
a stimulating business environment and development support to SMEs, by stimulating
legislation, improving institutional capacities, rendering adequate measures of economic
policy, and establishing the necessary infrastructure.

Developed countries have long-standing experience and good strategies to support

entrepreneurship, while the underdeveloped and developing countries make beginner's steps
in the development of strategies which are of great importance for the development of this
sector. Therefore, the development of enterprises depends largely on institutional, physical
and financial infrastructure that a country has. The higher level of infrastructure development,
the easier factor it represents in the development of entrepreneurship in the country and vice
versa.

Role of Government in Promoting Entrepreneurship

Following inferences were driven from the Focused Group Discussions with aspiring
entrepreneurs

1. Provide a fair legal system: The Government should provide a fair legal system with strong
property rights and contract law, and an orderly bankruptcy system that reassures lenders and
enables failed entrepreneurs to get back on their feet.

2. Streamline business registration: The average time it takes to open a small business varies
dramatically around the globe. New Zealand wins, with an average half-day and one official
procedure to register a business. In Venezuela, it takes 114 days and seventeen procedures—
seventeen opportunities for delay and corruption. The U.S. ranks twentieth, averaging five
days and six procedures. However, in India, it takes years to register a business as corruption
is rampant in India in every department and same is the case with Kashmir Valley as one
faces many hurdles in seeking permission to register a business.

3. Encourage a diverse funding universe: Entrepreneurship experts say it’s more important to
have multiple money streams than one giant pipeline. Government can encourage
development of new capital sources—such as equity crowd funding and peer-to-peer lending.
The 2012 JOBS Act, for example, provided new exemptions that enabled small businesses to
use crowd funding to raise money.
4. Enforce strong intellectual property laws: Intellectual property is a category of property
that includes intangible creations of the human intellect. There are many types of intellectual
property, and some countries recognize more than others. The best-known types are
copyrights, patents, trademarks, and trade secrets. Government as well as private
organizations need to enforce strong intellectual property laws for paving a way for
entrepreneurs to start up their ventures.

For example: Microsoft might never have succeeded if IBM hadn’t licensed the fledgling
company’s operating system—a deal made possible by intellectual property law.

5. De- Stigmatize business failure: Countries that do so experience higher rates of business
formation. The European Commission Competitiveness Council reports: ―Failed
entrepreneurs are a precious resource. Due to experience, failure rates of second start-ups are
lower. We should support entrepreneurs and give them a second chance.

6. Invest in education: Development experts agree that government investment gets the
biggest bang for the buck in education. Over a third of America’s universities are now
partnering with smallbusiness incubators to generate new businesses. In addition, we should
provide entrepreneurship education to our high-school students.

7. Simplify tax laws: Countries that offer favourable tax rates, simplify procedures, and
provide entrepreneurial support will enjoy high numbers of start-ups. Therefore, it is need of
the hour to simplify tax laws to enable individuals to start their own ventures.

8. Reform immigration and open borders.

Government Initiatives for Entrepreneurship Development

India is gradually on its mission to build a robust startup ecosystem. In order to promote and
support entrepreneurs, the government has created a ministry (department) dedicated to
helping new businesses. Furthermore, the Central Government of India has also introduced
many schemes to bolster entrepreneurship in India and to assist emerging startups financially.

The government is not only promoting the schemes to help the present group of startups
benefit from them but also motivating the budding entrepreneurs, startups, and students from
all domains, who tend to be independent and lead the vision of Atmanirbhar Bharat forward.
These initiatives have been introduced for the development of the Indian startup ecosystem.
The country now seems to be heading towards the golden era of entrepreneurship, where if
things go as planned, India may host as many successful startups as the USA or any other
leading nation by 2030.

SAMRIDH Scheme

Ashwini Vaishnaw, who was then a newly appointed Minister of Electronics Information and
Technology (MeitY) launched the SAMRIDH scheme, which stands for Startup Accelerators
of MeitY for pRoduct Innovation, Development, and growtH, on August 25, 2021, after a
little over a week of his announcement that the government will support the startups in the
initial stages.

The SAMRIDH initiative is designed to provide funding support to startups along with
helping them bring skill sets together which will help them grow successful. The newly
launched SAMRIDH program aims to focus on the acceleration of around 300 start-ups by
extending them with customer connect, investor connect, and other opportunities for
international expansion in the upcoming three years that will follow.

Startup India Seed Fund

On 16 January 2021, Prime Minister Narendra Modi announced the launch of the 'Startup
India Seed Fund' — worth INR 1,000 crores — to help startups and support ideas from
aspiring entrepreneurs. PM Modi said that the government is taking important measures to
ensure that startups in India do not face any capital shortage.

The reserved fund for the Startup India Seed Fund initiative, as per the Union Budget of 2022
is Rs 283.5 crore, which is higher than the revised estimate of around Rs 100 crore for the
year 2021-22.

Startup India Initiative

The Prime Minister of India launched the Startup India Initiative in the year 2016 on 16th
January. The idea is to increase wealth and employability by giving wings to entrepreneurial
spirits. The government gives tax benefits to startups under this scheme and around 50,000
startups have been recognized via this scheme in a period of a little more than five years, as
of June 3, 2021. The Department of Industrial Policy and Promotion is maintaining this
initiative and is treating it as a long term project. Moreover, the overall age limit for startups
has been increased from two years to seven years. Plus, for the biotechnology firms, the age
limit is ten years from the date of incorporation. It is one of the best government-sponsored
startup schemes for entrepreneurs as it is provides several concessions.

ASPIRE

The government has made continuous efforts to improve the social and economic aspects of
life in rural areas of India and one of the most popular schemes that the Indian government
has sanctioned in this regard is ASPIRE. A Scheme for Promotion of Innovation, Rural
Industries and Entrepreneurship (ASPIRE) is a Government of India initiative and promoted
by the Ministry of Micro, Small and Medium Enterprises (MSME).

The mentioned scheme was launched in 2015 to offer proper knowledge to the entrepreneurs
to start with their business and emerge as employers. Since 56% of the Indian population
lives in rural areas, the government has promoted entrepreneurship and innovation in the rural
sector with this scheme. The ASPIRE scheme aims at increasing employment, reducing
poverty, and encouraging innovation in rural India. However, the main idea is to promote the
agro-business industry. The Ministry of Medium and Small Enterprises has tried to boost
economic development at the grassroots level. The total budget of the scheme initially was
INR 62.5 crores for the period of 2014-2016.
Pradhan Mantri Mudra Yojana (PMMY)

Micro Units Development Refinance Agency (MUDRA) banks has been created to enhance
credit facility and boost the growth of small business in rural areas. The government has
introduced this scheme to support small businesses in India. In 2015, the government
allocated INR 10,000 crores to promote startup culture in the country. The MUDRA banks
provide startup loans of up to INR 10 lakhs to small enterprises, business, which are non-
corporate, and non-farm small/micro-enterprises. MUDRA comes under Pradhan Mantri
Mudra Yojana (PMMY) which was launched on 8 April 2015. The loans have been
categorized as Tarun, Kishore, and Shishu. The assets are created through the bank’s finance
and there is no collateral security.

ATAL Innovation Mission

In the budget session of 2015, the Indian government announced the Atal Innovation Mission
(AIM); with the name coming from Atal Bihari Vajpayee, the Former Prime Minister of
India. Atal Innovation Mission was established to create a promotional platform involving
academicians and draw upon national and international experiences to foster a culture of
innovation, research, and development. The government allocated AIM around INR 150
crores in the year 2015.

eBiz Portal

eBiz was the first electronic government-to-business(G2B) portal, which was founded in
January 2013. The main purpose of the portal was to transform and develop a conducive
business environment in the country. eBiz Portal was developed by Infosys in a public-
private partnership model. It was designed as a communication center for investors and
business communities in India. The portal had launched 29+ services in over 5 states of India,
viz., Andhra Pradesh, Delhi, Haryana, Maharashtra, and Tamil Nadu. The government also
announced that it will add more services to the scheme with time. However, after rounds of
talks about the shutting down of the eBiz initiative since July 2018, it was finally shut down
on account of low service integration. The government is again planning to revive eBiz-like
portals, according to the 2020 updates.

Dairy Processing and Infrastructure Development Fund (DIDF)

National Bank for Agriculture and Rural Development (NABARD) is an apex development
bank in India. The Government of India announced the creation of the Dairy Processing and
Infrastructure Development Fund under NABARD in the Union Budget of 2017-18 for the
sustained benefit of farmers. The total corpus for this fund is INR 8000 crores over a period
of 3 years (i.e. 2017-18 to 2019-20)

Milk Unions, multi-state milk cooperatives, state dairy federations, milk-producing

companies, and NDDB subsidiaries meeting the eligibility criteria under the project can
borrow loans from NABARD. The loan component would be 80% (maximum rate) with the
end borrower's contribution at 20 % (minimum rate). Borrowers shall get the loan at an
interest rate of 6.5% per annum. The period of repayment will be 10 years. The respective
state government will be the guarantor of loan repayment. Moreover, if the borrower is not
able to contribute his or her share in the scheme, the state government shall step in.

The departments that come under the agriculture ministry were allocated a total of Rs 1.31
lakh crore in 2021 Budget, which has been increased to Rs 1.32 lakh crore in the Union
Budget of 2022. A fund consisting of blended capital that will be raised under the co-
investment model will be facilitated via NABARD, which will finance the agritech startups
and rural enterprises that are relevant to farming. The Finance Minister of India, Nirmala
Sitharaman further added that the use of ‘kisan drones’ will see a new encouragement to
facilitate effective crop assessment, digitization of land records, and the spraying of
insecticides and nutrients.

Support for International Patent Protection in Electronics & Information Technology

(SIP-EIT)

The Department of Electronics and Information Technology (DeiTY) has launched a scheme
entitled “Support for International Patent Protection in E&IT (SIP-EIT)”. This scheme
provides financial support to MSMEs and Technology Startups for international patent filing.

Features and benefits of the SIP-EIT scheme are:

Financial support is provided for international filing in Information Communication

Technologies and Electronics sector.

The Reimbursement limit has been set at a maximum of INR 15 lakhs per invention or 50%
of the total charges incurred in filing and processing of a patent application, whichever is
lesser.

The SEP-EIT scheme can be applied at any stage of international patent filing by the
applicant.

Multiplier Grants Scheme (MGS)

Department of Electronics and Information Technology (DeitY) started the Multiplier Grants
Scheme (MGS). This scheme aims to encourage collaborative Research & Development
(R&D) between industry and academics/institutions for the development of products and
packages. Under the scheme, if the industry supports the R&D of products that can be
commercialized at the institutional level, the government shall provide financial support
which will be up to twice the amount provided by industry. MGS promotes and expedites the
development of aboriginal products and packages. The government grants would be limited
to a maximum amount of INR 2 crores per project and the duration of each project could
considerably be less than 2 years. It would be INR 4 crores and 3 years for industry
associations.

Credit Guarantee Fund Trust for Micro and Small Entreprises (CGTMSE)
The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE ) was set up by
the government of India and had been put to effect from 1st January 2000 onwards to provide
business loans to micro-level businesses, small-scale industries, and startups with zero
collateral. It allows businesses to avail loans at highly subsidized interest rates without
requiring security. By working along with SIDBI (Small Industries Development Bank of
India), the government provides a maximum amount of up to INR 100 lakhs under this
scheme for boosting new enterprises as well as rehabilitating the existing ones. Primarily
meant for manufacturing units, this loan can be availed in the form of working capital or a
term loan.

Software Technology Park (STP)

The Software Technology Park (STP) scheme is a totally export-oriented scheme for the

development and export of computer software. This includes the export of professional
services using communication links or media.

The scheme is unique in its nature as it focuses on only one sector, i.e., computer software.
The scheme integrates the government concept of "100% Export Oriented Units" (EOU),
"Export Processing Zones" (EPZ), and the concept of Science Parks or Technology Parks as
operating elsewhere in the world. The sales in the Domestic Tariff Area (DTA) shall be
permissible up to 50% of the export in value terms. STP gives total depreciation on capital
goods over a period of five years.

The Venture Capital Assistance Scheme (VCA)

Small Farmer’s Agri-Business Consortium (SFAC) has launched the Venture Capital
Assistance (VCA) scheme for the welfare of farmer-entrepreneurs and to develop their agri-
business. The scheme is approved by the banks and financial institutions regulated by the
RBI. It intends to provide assistance in the form of term loans to farmers so that the latter can
meet the capital requirements for their project's implementation. VCA promotes the training
and nurturing of agri-entrepreneurs.

The quantum of the loan will be 26% (40% for hilly regions) of the promoter’s equity. The
maximum amount of loan provided under this scheme will be INR 50 lakhs.

Loan For Rooftop Solar Pv Power Projects

To build reliance on non-conventional sources of power, the government of India has decided
to set up 40,000 MWp of Grid-Interactive Rooftop Solar PV Plants in the next five years.
These rooftop solar PV plants will be set up in residential, commercial, industrial, and
institutional sectors in the country and shall range from 1 kWp to 500 kWp in terms of
capacity. Such rooftop plants are economically viable since they can produce electricity using
solar energy at about INR 7 per kWh without any subsidy. The government also provides a
subsidy of 15% on these plants to the associations or individual companies, making the
scheme even more lucrative.

NewGen Innovation and Entrepreneurship Development Centre (NewGen IEDC)

NewGen IEDC is an initiative launched by the National Science and Technology
Entrepreneurship Development Board under the Department of Science and Technology,
Government of India. The initiative aims to inculcate the spirit of innovation and
entrepreneurship among the Indian youth. It also endeavors to support and encourage
entrepreneurship through guidance, mentorship, and support.

NewGen IEDC is a five-year programme that would be implemented in educational

institutions. It will support up to 20 new projects.

Single Point Registration Scheme (SPRS)

The Single Point Registration Scheme (SPRS) was launched in 2003. It is managed by the
National Small Industries Corporation (NSIC). NSIC registers all Micro & Small Enterprises
(MSEs) in India under the Single Point Registration Scheme to enable them to participate in
government purchases.

Enterprises are classified as Micro, Small, or Medium based on the limit of investment.
Eligible MSME units are provided with Udyog Aadhar registration certificate. All central
ministries, departments, and PSUs shall set an annual goal of minimum 20% of the total
annual purchases of products produced or rendered by MSMEs. About 358 items are reserved
for exclusive purchase from MSMEs .

Modified Special Incentive Package Scheme (M-SIPS)

The government of India has approved a special incentive package to promote large-scale
manufacturing in the Electronic System Design and Manufacturing (ESDM) sector. The
scheme is called the Modified Special Incentive Package Scheme (M-SIPS).

Under M-SIPS, the Indian government will provide a subsidy of 20% on capital investments
in special economic zones (SEZs) and 25% on capital investments in non-SEZs for individual
companies. It also provides the re-imbursement of CVD/excise on capital equipment for non-
SEZ units. Re-imbursement of central taxes and duties is also provided for high technology
and high capital investment units.

Stand Up India Scheme

Stand-Up India for Financing SC/ST and/or Women Entrepreneurs

Stand-Up India is a notable government of India scheme for financing SC/ST and/or women
entrepreneurs. According to the scheme, bank loans between 10 lakhs to 1 crore can be
borrowed by at least one Scheduled Cast (SC) or Scheduled Tribe (ST) borrower and at least
one woman per bank brand to set up a greenfield enterprise. The greenfield enterprise may be
based out of manufacturing, services or the trading sector. In case of non-individual
enterprises, it is mandatory that an SC/ST or a woman entrepreneur holds at least 51% of the
shareholding and controlling stakes.

ExtraMural Research Funding Scheme

ExtraMural Research or Core Research Grant

The government of India launched the famous Extramural Research (EMR) funding scheme
via SERB to help academic institutions, research laboratories, and other R&D organizations
carry out their basic research in all frontier areas of Science and Engineering. Founded just
after the establishment of the Science and Engineering Research Council (SERC), this
scheme is one of the oldest on the list and still quite a relevant one even after more than four
decades of its existence.

This scheme encourages emerging and eminent scientists in the field of science and
engineering for an individual-centric competitive mode of research funding. Only the name
Extramural Research (EMR) has now been renamed to Core Research Grant (CRG) because
the scheme provides core research support to active researchers.

High Risk - High Reward Research

The High Risk and High Reward Research is a scheme launched by the Indian government to
support and invite new proposals and ideas that have the potential to usher a paradigm
shifting influence on the Science and Technology domains. This funding focuses on the new
proposals, which might be conceptually new and risky but are expected to have a paradigm
shifting influence on the S&T, in terms of formulating new hypotheses or scientific
breakthroughs, which might help in the emergence of new technologies.

IREDA-NCEF Refinance Scheme

The revival of the operations of existing biomass power and other small hydro power
projects, which were affected due to unforeseen circumstances, is essential, which is why the
government of India decided upon the Refinance Scheme in collaboration with the Indian
Renewable Energy Development Agency Ltd. (IREDA) and The National Clean Energy
Fund (NCEF).

The scheme aims to revive the operations of the existing biomass power and small hydro
power projects by cutting down the cost of funds for these projects and providing refinance at
concessional rates of interest, with funds sourced from the National Clean Energy Fund
(NCEF).

Dairy Entrepreneurship Development Scheme

The Dairy Entrepreneurship Development Scheme (DEDS) is a scheme implemented by the

Department of Animal Husbandry, dairying, and fisheries to generate self-employment
opportunities in the dairy sector. These opportunities in the mentioned sector will comprise
activities like the enhancement of milk production, procurement, preservation, transportation,
processing, and marketing of milk by providing back-ended capital subsidies for bankable
projects.

The scheme has been implemented by the National Bank for Agriculture and Rural
Development (NABARD).

Drone Shakti

The government of India launched Drone Shakti, as voiced by the Union Finance Minister
Nirmala Sitharaman on February 1, 2022. This new initiative is designed to motivate the
startups to introduce diverse applications for drones, including drones-as-a-service (DaaS).
Furthermore, the finance minister also stated that the government would encourage the use of
drones by farmers. Sitharaman focused on the farmers' use of these drones to survey the lands
and spray insecticides along with digitising land records. Besides, the government also
asserted to stand in full support of the drone technology startup in India. It recently flagged
off 100 Kisan Drones in diverse parts of the country to spray pesticides and more. In order to
promote the made-in-India drones, the government of India banned the import of drones with
immediate effect. This however exempts the import of drones for research and development,
defence, and security purposes, as per the Ministry of Civil Aviation (MoCA).

The drone manufacturing industry, as estimated by MoCA, is expected to receive an

investment of over Rs 5,000 crore over the next 3 years, which will include drones and drone
components. The annual turnover of the sales of the drone manufacturing industry, which
was valued at Rs 60 crore during FY 2020-21, will shoot over to Rs 900 crore during FY
2023-24.

Zero Defect Zero Effect (ZED) Certification Scheme

The Zero Defect Zero Effect (ZED) scheme has been launched by the government of India
with a vision of creating proper awareness about ZED manufacturing among the MSMEs and
motivating them for the assessment of their enterprise for ZED and supporting them. ZED
can be summed up as an integrated and holistic certification and handholding scheme that
extends an opportunity to the Micro, Small and Medium Enterprises (MSMEs) to strive to
continuously improve their processes and move up the ZED maturity assessment model.

Credit Linked Capital Subsidy for Technology Upgradation (CLCSS)

Credit Linked Capital Subsidy for Technology Upgradation, which is popularly acronymed as
CLCSS, is a government of India scheme to upgrade technology. Under CLCSS the Indian
government provides cash for the Indian companies upfront to upgrade/modernize their
equipment or techniques. This scheme mainly empowers Micro and Small Scale Enterprises
(MSMEs).        

Design Clinic Scheme for Design Expertise

The Design Clinic Scheme for Design Expertise is a scheme declared by the Indian
government to support the MSME manufacturing sector of India. As the government deems
that design and innovation are critical to the growth of a brand and feels that the MSMEs
should develop a design-centric approach to fuel their startups, it aims to infuse design
expertise in them. Under this scheme, the government of India announced to extend around
Rs 60,000 for attending design seminars and up to Rs 3.75 lakhs or 75% of the cost that
would be needed in conducting the seminar, where the entrepreneurs and their teams can
learn about design theories, interact with design veterans, build a network, and put them into
practice. 

Women Entrepreneurs

Women Entrepreneurs may be defined as the women or a group of women who initiate,
organize and operate a business enterprise. The Government of India has defined women
entrepreneurs as ―an enterprise owned and controlled by women having a minimum
financial interest of 51 per cent of the capital and giving at least 51 per cent of the
employment generated in the enterprise to women. Women entrepreneurs engaged in
business due to push and pull factors which encourage women to have an independent
occupation and stands on their own legs. A sense towards independent decision-making on
their life and career is the motivational factor behind this urge. Saddled with household
chores and domestic responsibilities women want to get independence. Under the
influence of these factors the women entrepreneurs choose a profession as a challenge and
as an urge to do something new. Such a situation is described as pull factors. While the
push factors for women engaged in business activities are family compulsion and the
responsibility.

Women Entrepreneurship in India

It is estimated that presently women entrepreneurs comprise about 10% of the total
entrepreneurs in India. The term “Women Entrepreneurship” means, an act of business
owner -ship and business creation that empowers women economically, increases their
economic strength as well as position in society. Hence women-entrepreneurs have been
making a considerable impact in all most all the segments of the economy which is more
than 25 percent of all kinds of business .In India “Entrepreneurship” is very limited
amongst women especially in the formal sector, which is less than 5 percent of all the
business. Indian women business owners are changing the face of businesses of today, both
literally and figuratively. The dynamic growth and expansion of women-owned businesses
is one of the defining tends of the past decade, and all indications are that it will continue
undoubtedly. For more than a decade, the number of women-owned businesses has grown
at one-and-a-half to two times the rate of all businesses. Even more important, the
expansion in revenues and employment has far exceeded the growth in numbers.

Factors influencing the growth of women entrepreneurs

i) Internal and External Factors:
Internal Factors: Among the internal factors which have been attributed to successful
women entrepreneurs are self-efficacy and risk taking. Self-efficacy refers to the “beliefs in
one‟s capabilities to organize and execute the courses of action required producing given
attainments. Risk taking is recognized as another internal factor contributes to successful
entrepreneurs . Majority of research on risk perceptions has shown that women are more
concerned about risks of starting a business than men. Since risk taking is an important
quality of successful entrepreneurs, risk averseness of women entrepreneurs may be viewed
as a barrier to their growth.
External Factors:Self-sphere system: it defines how an individual gathers knowledge, skill
and motivation to become entrepreneur.
b. Socio-sphere system: it relates to family expectations, value orientation to independence,
work initiative or innovations etc., which ultimately affect the self-sphere system
c. Resource system: Technology and Technical Manpower, existing industries and
enterprises, transport and communication facilities, power, raw materials, market etc.,
d. Support system: the support, including banks and financial institutions, their policies and
programs and the organizational climate to help or hinder in the growth of entrepreneurship
in a society
(ii) Pull and Push Factors
Pull factors women entrepreneurs choose a profession as a challenge as adventure with an
urge to do something new and to have independent occupation. Autonomy is one of the
„pull‟ factors, which influence a woman to be entrepreneur.
Push factors, women take up business enterprises to get over financial difficulties when
responsibility is thrust on them due to family circumstances. Frustration and Boredom in their
past jobs are the „push‟ factors, which make women undertake entrepreneurship as their
career.
(iii)Opportunity Entrepreneurship Vs. Necessity Entrepreneurship
Entrepreneurial opportunities exist; the sources of those opportunities and the forms that they
take; the processes of opportunity discovery and evaluation; the acquisition of resources for
the exploitation of these opportunities; the act of opportunity exploitation; why, when, and
how some individuals and not others discover, evaluate, gather resources for, and exploit
opportunities; the strategies used to pursue opportunities; and the organizing efforts to exploit
them.
Necessity entrepreneurs are individuals in developing countries who start small enterprises
out of necessity. While they range from street sellers to educated hopefuls with little access to
formal employment, the one thing that unites them is the need to survive. An estimated one
billion individuals in both developed and developing nations can be defined as necessity
entrepreneurs; individuals who have no other viable option for licit income than to start a
small, income-generating activity. However, unless these „necessity entrepreneurs‟ have
access to meaningful education, they will never realize the powerful, economic potential to
impact the economic development of their respective nations. This volume is the foundation
upon which the budding discipline of necessity entrepreneurship can be built.
Qualities of women entrepreneurs
Successful entrepreneurs are always successful leaders, innovators and motivators , whether
they lead a few employees or many . Due to the very nature of their career, entrepreneurs are
leaders as they seek opportunities ,initiate projects, gather the required material resources
needed , set goals for themselves , and direct , guide and control others to accomplish goals.
Following are some of the important qualities necessary for entrepreneurs in general and
women entrepreneurs in particular.

 Mental ability ;Mental ability mainly consists of intelligence and creative thinking .
Women entrepreneurs must have reasonable intelligence, creative thinking and also
must be able to engage in the critical analysis o f various problems and processes in
order to deal with them.
 Clear objectives : Women entrepreneurs should be set clear objective regarding the
exact nature of the goods to be produced and subsidiary activities to be performed .
 Business secrecy: Women entrepreneurs must be equipped to guard business
secrecy. Leakages of business secrets may impose greater toll on the level of success
of women entrepreneurs .
 Social and Interpersonal skills : The important personality traits contributing to the
success o f women entrepreneurs are emotional intelligence and stability, ability to
maintain sound interpersonal relations, consideration and tactfulness.
 Communication skills : It is the ability to communicate effectively with the
environment. Good communication also means that both the sender and the receiver
understand each other and are being understood. Women entrepreneurs must have this
ability to communicate effectively.
 Technical Know-how: Women entrepreneurs must posses a reasonable level o f
technical knowledge and also ready to adapt themselves with scope of changing
technology.
 Motivator : Women entrepreneurs are team builders who motivate people as and
when it is necessary and provide an environment for individual growth as well as
career development.
 Self confidence: Women entrepreneurs must have belief in themselves and their
ability to achieve their goals.
 Initiative :Women entrepreneurs must take initiative in accepting personal
responsibility for actions and above all make optimum use of available resources.
 Moderate risk takers :Women entrepreneurs must be a moderate risk taker and learn
lessons from success and failures.
 Educated : Women entrepreneurs must be well educated so that she can better
understand her rights and role in the society and can make better use of opportunities.
 Desire to excel and Hard-work : Women entrepreneurs must be hard workers.
 Accept challenges: Women entrepreneurs must able to accept the direct and indirect
challenges created by her competitors and the business environment.

TYPES OF WOMEN ENTREPRENEURS

By the words of J.A. Schumpeter a women entrepreneur is a,” Woman who innovate, imitate
or adopts a business activity is called woman entrepreneur”. Women entrepreneurs in India
are broadly classifieds as:

 Affluent entrepreneurs – These are women entrepreneurs who hail from rich and
esteemed families and are the daughters, daughter-in-laws, sisters etc of affluent
 business people in the community. The family strongly supports these entrepreneurs
in carrying out their entrepreneurial roles.
 Pull factors – Women in both rural and urban areas take-up entrepreneurship career
as a challenge to do something new and to be economically independent and self-
reliant. These entrepreneurs are coming under the category of pull factors and
basically undertake small and medium industries where is comparatively low.
 Push factors – These are women entrepreneurs who accept entrepreneurial activities
to overcome financial difficulties . The family difficulties and pressure from the same
forces them either to start a new business or to restructure existing family business to
improve economic condition as well as standard of living.
 Self-employed entrepreneurs – Poor and unprivileged women especially in rural
areas highly depend on their own efforts for existence. They start tiny, micro or
sometimes small enterprises and such women are called self-employed entrepreneurs.
 Rural entrepreneurs – Women in villages and other rural areas start enterprises
which needs only least organizing skills and risk. These category of women is known
as rural entrepreneurs.
The concept of women entrepreneurs has many facets and the term has been used in a
different context with different perspective. The existing women entrepreneurs in India can
be classified into three main categories,

 Forced entrepreneurs : women entrepreneurs who are compelled by circumstance or

family business responsibilities to take up a career in business .
 Chance entrepreneurs : women entrepreneurs who went into business by luck or
accident without any preparation.
 Created entrepreneurs : Women entrepreneurs who are specifically identified,
motivated, trained, equipped and developed as entrepreneurs in recent years. This is
an immediate response from women entrepreneurship development training which
is increasing the band of women entrepreneurs in India.

Problems of Women Entrepreneurs

1.1 Gender Inequality

India is a male dominated traditional society where women are not supposed to be equal to
men folk. They are treated as subordinate to husbands and men, physically weak and lesser
confident to be able to shoulder the responsibility of entrepreneur.

1.2 Lack of Education

Women in India are lagging far behind in the field of education. Most of the women
(around sixty per cent of total women) are illiterate. Those who are educated are provided
either less or inadequate education than their male counterpart partly due to early marriage,
partly due to son's higher education and partly due to poverty. Due to lack of proper
education, women entrepreneurs remain in dark about the development of new technology,
new methods of production, marketing and other governmental support which will
encourage them to flourish.

1.3 Problem of Finance

 Women entrepreneurs suffer a lot in raising and meeting the financial needs of the
business. Bankers, creditors and financial institutions are not coming forward to provide
financial assistance to women borrowers on the ground of their less creditworthiness and
more chances of failure.
1.4 Skepticism of Financial Institution

Financial Institutions and bankers are skeptical about the entrepreneurial abilities of
women. These institutions consider women loanies as higher risk than men.

1.5 Obsolescence of technology & resulting increase in cost of production

Women entrepreneurs face technology obsolescence due to non-adoption or slow

adoption to changing technology which is a major factor of high cost of production.

1.6 Low risk-bearing capacity

Women in India are by nature weak, shy and mild. They cannot bear the amount of risk
which is essential for running an enterprise. Lack of education, training and financial
support from outsides also reduce their ability to bear the risk involved in an enterprises.

1.7 Lack of entrepreneurial aptitude

Lack of entrepreneurial aptitude is a matter of concern for women entrepreneurs. They

have no entrepreneurial bent of mind. Even after attending various training programs on
entrepreneurship they fail to tide over the risks and troubles that may come up in an
organizational working.

1.8 Limited managerial ability

Women entrepreneurs are not efficient in managerial functions like planning, organizing,
controlling, coordinating, motivating etc. of an enterprise. Therefore, less and limited
managerial ability of women has become a problem for them to run the enterprise
successfully.

1.9 Legal formalities

Fulfilling the legal formalities required for running an enterprise becomes an uphill task
on the part of an women entrepreneur because of the prevalence of corrupt practices in
government offices and procedural delays for various licenses, electricity, water and shed
allotments. In such situations women entrepreneurs find it hard to concentrate on the
smooth working of the enterprise.

1.10 Lack of self confidence

Women entrepreneurs because of their inherent nature, lack self-confidence which is

essentially a motivating factor in running an enterprise successfully. They have to strive
hard to strike a balance between managing a family and managing an enterprise.

Future Prospects for the Development of Women Entrepreneurs

 Throughout the world, it is observed that the ratio of Women entrepreneurs is increasing
tremendously. The emergence as well as development of Women entrepreneurs is quite
visible in India and their over- all contribution to Indian economy is also very significant.
Today the role of Women entrepreneurs in economic development is inevitable because
women are entering not only in selected fields but also in fields like Trade, Industry and
Engineering.

The industrial structure and the enterprises are undergoing a radical change. Information
Technology has transformed the very technique of doing business individually. Business
ownership provides women with the independence they crave and with the economic and
social success they need. Nationally, business ownership has great importance for future
economic prosperity. Globally, women are enhancing, directing and changing the face of
how business is done today. Ultimately, female business owners must be recognized for
who they are, what they do, and how significantly they impact the World’ Global
Economy.

Training on professional competence and leadership skills should be extended to Women

entrepreneurs. Activities in which women are trained should focus on their marketability
and profitability. State Finance Corporations and financing institutions should permit by
statue to extend purely trade related finance to Women entrepreneurs. And lastly women
Development Corporation has to gain access to open-ended financing.

How to Develop Women Entrepreneurs?

Right efforts from all areas are required in the development of women entrepreneurs and
their greater participation in the entrepreneurial activities. Following efforts can be taken
for effective development of women entrepreneurs.

 Considering women as specific target group for all developmental programmers.

 Better educational facilities and schemes should be extended to women folk from
government part.
 Adequate training programmed on management skills to be provided to women
community.
 Encourage women's participation in decision-making.
 Vocational training to be extended to women community that enables them to understand
the production process and production management.
 Skill development to be done in women's polytechnics and industrial training institutes.
Training on professional competence and leadership skill to be extended to women
entrepreneurs.
 Training and counseling on a large scale of existing women entrepreneurs to remove
psychological causes like lack of self-confidence and fear of success.
 Counseling through the aid of committed NGOs, psychologists, managerial experts and
technical personnel should be provided to existing and emerging women entrepreneurs.
 Continuous monitoring and improvement of training programmers.
 Activities in which women are trained should focus on their marketability and
profitability.
 Making provision of marketing and sales assistance from government part.

Steps taken by the Government

 Women, being almost 50% population of India, have a pivotal role to play as far as
economic development of country is concerned. The Government has increased the
importance of women by adopting various schemes and programs for the development of
women entrepreneurship. At present, the Government of India has over 27 schemes for
women empowerment operated by different departments and ministries. Some of these
are:

 Integrated Rural Development Programme (IRDP)

 Khadi And Village Industries Commission (KVIC)
 Training of Rural Youth for Self-Employment (TRYSEM)
 Prime Minister‘s Rojgar Yojana (PMRY)
 Entrepreneurial Development programme (EDPs)
 Management Development progammes
 Women‘s Development Corporations (WDCs)
 Marketing of Non-Farm Products of Rural Women (MAHIMA)
 Assistance to Rural Women in Non-Farm Development (ARWIND) schemes
 Trade Related Entrepreneurship Assistance and Development (TREAD)
 Working Women‘s Forum
 Indira Mahila Yojana
 Indira Mahila Kendra
 Mahila Samiti Yojana
 Mahila Vikas Nidhi
 Micro Credit Scheme
 Rashtriya Mahila Kosh
 SIDBI‘s Mahila Udyam Nidhi
 Mahila Vikas Nidhi
 SBI‘s Stree Shakti Scheme
 NGO‘s Credit Schemes
 Micro & Small Enterprises Cluster Development Programmes (MSE-CDP).
 National Banks for Agriculture and Rural Development‘s Schemes
 Rajiv Gandhi Mahila Vikas Pariyojana (RGMVP)
 Priyadarshini Project- A programme for Rural Women Empowerment and Livelihood in
Mid Gangetic Plains‘
 NABARD- KFW-SEWA Bank project

Corporate Entrepreneurship

In simple language, corporate entrepreneurship is a procedure utilized for creating new

business, solutions or services inside a present company for giving values and creating new
sort of revenues using the thoughts and actions of an entrepreneur. This process creates the
foundation for boosting revenue and innovation in the company. There is an exact idea about
the resources and environment required for support and motivation is provided by corporate
entrepreneurship.
It can motivate the entrepreneurs to take the necessary action and take the company to the
required goals. The main motive of this process is creating ideas with having disruptive
nature instead of making little bit changes. Additionally, it creates an environment where
innovations are led by company employees instead of being applied by management.
Why is corporate entrepreneurship necessary?
If we talk about the present world, innovation work as the bloodline of a company as the
business will run out for sure if it lacks there. However, bigger organizations face lots of
difficulties in making innovative environments because of culture and structures. However,
applying corporate entrepreneurship techniques give them a systematic method for making
the innovation capabilities better.
 It can turn out to be a great blessing in the long run for all types of organizations. Let’s look
at the major reasons on why corporate entrepreneurship is necessary for companies.

 Revenue Growth
The time has become very competitive, and it is essential to follow the path of corporate
entrepreneurship to have a consistent trend of innovations in their portfolio. Moreover, it will
result in giving a huge boost to the revenue and growth of the company. After all, every
company wants to stay on top in terms of revenue and following this sort of program will be
helpful for sure.
 Boosting Productivity
Following corporate entrepreneurship techniques lets the employees deal with new
opportunities in style and work to complete those tasks. Productivity becomes well when the
contributions of clients get valued by the organization. Additionally, their morale gets up
once they start following these entrepreneurship programs.
 Give highly competitive advantage
It is a well-proven fact that employees are the most useful asset of a company if we think
about the opportunities and dangers available in the market. It gives available insights and is
considered a very useful source for getting an edge over the others.

Major Types of corporate entrepreneurship

It is important to understand the different forms of corporate entrepreneurship. Many people
won’t care about them as entrepreneurs, but it shouldn’t be missed. Allow us to tell us about
the major categories of corporate entrepreneurship in detail below:
1. Corporate Venturing
The biggest part of this entrepreneurship type is corporate venturing, which begins a new
company inside an existing organization. For example, Reliance Company begins as a textile
business, but they begin the jewellery business after a few years. In that case, it is considered
as corporate venturing where they utilized their present resources. Therefore, we can say it is
simply about reaching a new market or developing new products in the existed market.
2. Intrapreneuring
It is considered an activity that entrepreneurs use for developing a company for adding
innovation. Intrapreneurship is created to set the employees’ minds and behaviour to create a
culture of creativity. If you met an entrepreneur before, we are pretty assured you must have
realized how proactive and self-motivated they are. They take action for pursuing an
innovative service that can be very useful for sure.
3. Organizational Transformation
An organizational transformation can be defined as an expanded version of full business that
alters the main pattern for better economic performance. The major motive of this
transformation is boosting the performance of the company. A few top examples of this
category are downsizing, minimizing cost, and de-layering. It is strongly suggested never to
change an organisation’s organisational system, but few businesses should be revitalizing for
effective transformation.
4. Changing Industry Rules
There are very few organizations trying to develop new opportunities by making few
modifications in the industry. This form is known as the Industry Rule Bending that target
modification of rules in the working environment. The name also knows of Frame-Breaking
Change because using this standard affects the entire industry. There are a tremendous set of
opportunities regarding growth and innovation is created by this form of standard. An
organization can achieve huge success by following the rules adequately.
Advantages of corporate entrepreneurship
There are two sides of every coin that everyone needs to take into consideration before
moving further. The same goes for corporate entrepreneurship that comes with both pros and
cons. We will discuss the advantages of corporate entrepreneurship first:
 Resources Availability
The most incredible advantage of corporate entrepreneurship is it gives a solid set of
resources at the disposal. Start-ups mostly have a common issue, i.e. lack of money or capital.
However, a corporate entrepreneur stays ahead of the others and has an abundance of
resources.
 Minimal Set-up
A very difficulty that entrepreneurs have to face is setting up the business as it asks for lots of
effort and time. On the other hand, a great advantage that most corporate entrepreneurs get is
knowing the business’s technical aspects and having information about the setup process.
 Recognizing Brand
Recognition is one of the most critical aspects in an industry that every entrepreneur needs to
perform for the success of a business. As a starter, it needs to be passed down for correct
utilization. There is a need for years of hard work to reach this height that corporate
entrepreneurship can give to entrepreneurs.
 SalesForce
If we talk about corporate entrepreneurs, they will probably have a support or development
team to boost sales on a different level. The main reason behind them is most of them are
already equipped with potential contacts to target the potential companies or clients.

Disadvantages of corporate entrepreneurship

We can’t complete the article without mentioning the cons of this entrepreneurship. Go
through the disadvantages of corporate entrepreneurship in detail below:
 Long Approval Cycles
The biggest obstacle that corporate entrepreneurs face is its long approval cycles. It needs to
understand that they can’t decide on their own, and there is a need for having approval from
the company first. So it wastes lots of time that might not be a suitable choice for many
people.
 Limited Financial Rewards
There is a limit on what corporate entrepreneurs can receive regarding rewards from the
company’s side. It might affect the morale of company’s morale that no one wants at all.
 Communicating the Idea
The corporate entrepreneur has to work really hard to come up with a solid plan and convince
the top management to allocate resources towards their idea. They have to show extreme
creativity and possess active soft skills to convince the management.
 
 Job Security
There is always an element of risk involved when starting something new. If their plan fails to
execute as expected, then it can backfire on the corporate entrepreneur who has to take the
blame. There are chances that they might also lose their job and be asked to leave. If this
happens it can be difficult for the entrepreneur to find a new job and explain the reasons as to
why their plan did not meet success.

Comparison between Corporate Entrepreneur and Intrapreneur

These two concepts are very close and sometimes are used to designate the same reality.
However, there is a significant difference between them.

intrapreneur: is an employee who proposes and manages a project within the company in
which he works. He bears a moral risk but non a financial risk.

Corporate entrepreneur: is an entrepreneurial organization that innovates and develops a new

business idea that does not yet exist. It creates a new venture as a strategy of its growth.
corporate entrepreneur bears financial risk.

Comparison Corporate Entrepreneur Intrapreneur

Definition Creates and facilitates a new An employee of the organization takes charge of
business model—builds a innovations in product, service, process, etc., and improves
new organization. the existing business model.

Approach Instinctive Restorative

Resources Uses own resources Uses resources within the organization

Enterprise Newly established Pre-existing

Dependency Independent Dependent

Risk Takes on all responsibilities Organization takes responsibility

Objective Become a market leader Innovate and reinvent existing culture and systems