Introduction
Entrepreneurship can be defined as an act or art of using acute business sense in order to transform innovation into economic goods. Till the starting of 21st century the word found itself restricted to the act of starting a new business. However, in the recent times the word has been extended to social and political activity as well. The person who is responsible for the act is known as entrepreneur.
The origin of word reaches back to the work of an Irish-French economist Richard Cantillon who first coined the French verb “entreprendre” which later on became entrepreneur in English. Entrepreneurship was always a hot favourite topic of study for the researchers. From Adam Smith to Peter Drucker, everyone contributed in the field of entrepreneurship but the most notable work came from Schumpter who defines entrepreneurs as “ innovators who use a process of shattering the status quo of the existing products and services, to set up new products, new services.”
But as the world evolved, economy evolved and hence the definition and characteristics of an entrepreneur. Some view the role of an entrepreneur as risk bearer, others as innovators and few others as gap fillers. Finally by combining the entire thoughts one can summarize an entrepreneur as risk-bearers, organizers, leaders, innovators, gap fillers or creative imitators.
The article will talk about the present situation of India on the entrepreneurial ground, challenges faced by entrepreneurs in India, steps taken to encourage entrepreneurship.
Entrepreneurship in India
In India entrepreneurship phase is broadly divided into two major period pre 1991 and post 1991. Pre 1991 success of business is defined primarily on ambition, government contacts, and an understanding of the bureaucratic system. Decision was guided by connections, policies were more inward looking and capital was limited as a result entrepreneurship was subdued. In 1991 Indian government liberalized and the whole economic landscape changed. Family businesses were struggling to stand before the multinationals. Some of the business houses changed their outlook as per changing economic scenario while others failed. Finally a new breed of businesses was born.
Mckinsey & Company-Nasscom report estimates that by 2015, 110-130 million Indian citizens will be searching for jobs, out of which 80-100 million will be looking for their first jobs. Since traditional large employers will find it difficult to sustain this level of employment in future, it is entrepreneurs who will create these new jobs. Today’s knowledge based economy is a perfect ground for entrepreneurs to succeed in India.
A report published by Global Entrepreneurship Monitor (GEM) 2011 states that the number of entrepreneurs is nearing around 400 million. India has also seen a rise in the entrepreneurship but still it is ranked much below than many other economies. As per World Bank group entrepreneurship the business entry density in India is less than 1. However, on the technological front India is ranked 2nd in the global race of entrepreneurship.
Opportunity
As renowned economist, T.N. Srinivasan says, ‘India has been an entrepreneurial society…we had the entrepreneurial skill but suppressed it for too long a time… and now it is thriving.’ But there is a bigger reason behind the surge in entrepreneurship in India in past 5-6 years which is the support from government and other private players. These players have extended a helping hand for new entrepreneurs.
Market regulator SEBI’s decision to allow small and medium enterprises to list their shares without an IPO has boosted response across the country’s start up ecosystem. Odisha’s government has planned out many initiatives which would stress on measures like awareness, promotion, networking and mentoring to encourage the youth to become entrepreneurs.
Future group, Meru cabs and Maruti Suzuki is trying to implement a unique model to create sustainable entrepreneurship. On one side where Future group is setting up around 1,000 retail outlets, Maruti is training around 3000 SC youth to become successful drivers. SIDBI has agreed to
finance small ICT businesses run by Cisco Networking Academy students. The interest payments will be subsidised by Cisco.
Challenges
Everyone recognizes the need of entrepreneurship but still in India it is faced by many roadblocks. Power outage, finance, regulatory frameworks are some of the basic problems an entrepreneur in India has to deal with. Some of them are listed below:-
1. In India it takes around a month to register a company compared to a week in US and 3 days in Singapore.
2. To open a current account, 6-7 set of documents are required most often certified by a Chartered Accountant.
3. To shut down a company an entrepreneur has to file petition in the court, appoint liquidator, meet all the creditors, distribute company assets which takes more than a year.
4. To get the approval on various proposals they have to go through the bribery route because no other way is available.
5. Ban on FDI in retail e commerce sector has led to lay off, closure and acquisition of many e-commerce companies.
6. With coming up of new policy which states that the websites which carry user generated data can be pulled into court has affected the growth of new ventures being launched.
All the above problems are extrinsic and can be eliminated in the coming times but the major hurdle which any entrepreneur in India faces is the society in which we are living. In India entrepreneurship is seen as a last option rather than a choice. Actually the root of the problem lies in the academic system which is designed for jobs. Skills of students are sharpened just in an effort to make them suitable for adopting a corporate environment. India will become superpower only when it will see a plethora of entrepreneurs but the most important question lies ahead is when our society will be ready to accept entrepreneur as an opportunist rather than a black sheep? And as a part of the same society what role we need to play?
