What Govt. of India thinks about Entrepreneurship?

24122412a1

India needs to create 1- 1.5 crore (10-15 million) jobs per year for the next decade to provide gainful employment to its young population. Accelerating entrepreneurship and business creation is crucial for such large-scale employment generation. Moreover, entrepreneurship tends to be innovation-driven and will also help generate solutions to India’s myriad social problems including high-quality education, affordable health care, clean energy and waste
management, and financial inclusion. Entrepreneurship-led economic growth is also more inclusive and typically does not involve exploitation of natural resources.

Large Indian businesses – both in the public and private sector – have not generated significant employment in the past few decades and are unlikely to do so in the coming decade or two. Public sector and government employment has declined in the last few years, and is expected to grow very slowly in the coming years. Large private sector firms have also been slow in generating employment, which is unlikely to change due to increasing automation, digitization,
and productivity gains. For example, the banking sector in India has recorded almost no employment growth in the last two decades despite multi fold growth in its revenue and assets.

Agriculture employs nearly a half of India’s workforce but employment is likely to decline in this sector, due to improvements in productivity.

India is an entrepreneurial country, but its entrepreneurs have had to struggle to create and grow their business ventures. There is, however, a growing group of first-generation Indian entrepreneurs – the founders of companies such as HCL, Cognizant, Infosys, Bharti and others -that have generated large scale employment and significant wealth. They and others such as IndiaBulls, Makemytrip and Naukri have also demonstrated value creation through a public listing. These successes have encouraged a new breed of entrepreneurs especially in the Internet and e-commerce space.

India’s entrepreneurial growth can be accelerated by creating more conducive conditions – a catalytic government and regulatory environment, adequate capital flows (both debt and equity), support from businesses and society, and availability of appropriate talent and mentoring. Such an environment could replicate the success demonstrated by the Indian Information Technology (IT) and IT enabled services (ITES) industry over the last two decades. Starting in the early 1990s, the industry now directly employs 28 lakh (2.8 million) and indirectly an additional 89 lakh (8.9 million) people. Its revenues have grown from Rs. 350 crore in 1990 to Rs 4.5 lakh crore ($88 billion) in FY 2012 Several leading companies in this industry started as first-generation entrepreneurial ventures. By 2020, the IT and ITES industry is projected to contribute 9% of GDP with a revenue of over Rs 12 lakh crore ($225 billion) and direct and indirect employment to 30 million people.

India has the potential to build about 2,500 highly scalable businesses in the next 10 years – and given the probability of entrepreneurial success that means 10,000 start-ups will need to be spawned to get to 2,500 large-scale businesses. These businesses could generate revenues of Rs 10 lakh crore ($200 billion) – a contribution to GDP and creation of employment at the same scale as projected for IT and ITES industry. Experience across countries suggests that vibrant entrepreneurial activity significantly improves social harmony, living standards, and quality of
life.

(Taken from Report of The Committee on Angel Investment & Early Stage Venture Capital June 2012)

Be Sociable, Share!


Mohit Bansal(23) is B.Tech in Electronics and Communication Engineering from Indian School of Mines, Dhanbad, India. He has interest in business and entrepreneurship and has published couple of research articles. He is also associated with various NGOs. He is with Techaloo when it was just in concept stage. The Techaloo site was not existing even then. Currently Mohit is working with Mu Sigma as a Business Analyst Profile.

Leave a Comment

Current ye@r *

Close
Please support the site
By clicking any of these buttons you help our site to get better
Social PopUP by Timersys