existing support system and...

CHAPTER V

EXISTING SUPPORT SYSTEM AND CONSTRAINTS

Every development endeavour requires certain conditions to engender desired impact

on individual as well as in society. Entrepreneurship development is not an exception. The

emergence, sustenance and success of entrepreneurial process depend upon certain pre

requisites and conditions i.e. achievement motivation, entrepreneurial training,

management of venture, efficacy of support system, efficient marketing and follow-up system.

These are the essential components of entrepreneurial environment where enterprises flourish.

The magnitude of thrust of each pre-requisite varies according to the level and the

requirement of the target groups and their cultural settings. For example, entrepreneurial

motivation and support system play significant role for the enhancement of entrepreneurial

activities in developing economy like the Indian economy in general and rural or tribal economy

in particular. A large number of drop-outs and sick units speak volumes for the poor

attention to these pre-requisites and conditions. Therefore, to make entrepreneurial effort

productive, these pre-requisites are essential.

For the emergence of entrepreneurial spirit, two factors i.e., availability of capital and

management of enterprise play significant role. It has been found that these two factors of

entrepreneurial culture have been confined to small segments of people in traditional social

structure of a developing society. Developing economies require more local entrepreneurs for

balance growth of economy and generally local entrepreneurs are deprived of capital and

managerial skills. Therefore, government and some non-governmental organisations of the

developing countries, as a rnatter of policy deliberately initiate measures to promote

entrepreneurship through ensuring availability of capital and other infrastructural facilities for

the improvement of skills to wider section of people who could be considered as potential

entrepreneurs. Legal, institutional, structural and organisational measures initiated from time to

time, aim at creating support system which can attract more and more people to entrepreneurial

ranks, irrespective of their class, caste and creed; thereby helping to diJfuse the entrepreneurial

161

culture to wider segments and section ofthe society. In this, government sees a promise of not

only accelerated economic growth and industrial development but prospects of more equitable

distribution of wealth.

Role of support system has a great relevance for the emergence and development of

entrepreneurship particularly in a developing society. Government and business development

organisations can organise programs in order to develop societal awareness towards

entrepreneurship and make people recognise the importance of being entrepreneurs. The US

small Business Administration, for example, recognises outstanding entrepreneurs through

several awards (SBA, 1993). The Czechoslovak Management Centre has created a country-wide

Entrepreneur-of-the-year award, one of the first in the region (Fogel, 1993). The Australian

government has eased immigration procedures for foreigners with a business idea, capital and

experience (Dana, 1988). Similar examples can be found in many other countries, suggesting

that positive societal factors help attract potential entrepreneurs to start a business. The need for

such motivational factors is generally higher in countries where entrepreneurial awareness is

low than in countries where such awareness is high. Tax and other start-up incentive have a

greater motivation to go into business (Davidson, 1991).

This chapter attempts to (a) examine and compare the role of organisational and • institutional support system promoting entrepreneurship in both tribal regions under study and (b)

identifY, analyse and compare various constraints perceived by the support system, business

incubators as well as the respondent entrepreneurs.

The support system for the purpose of this study refers to different government and

non-government agencies, training institutes, financial agencies and community support which

facilitate and promote entrepreneurship among the tribals of both the regions under study.

Contact with these agencies are helpful to get acquainted with the current situation, scope,

opportunities, resources and constraints for the development of entrepreneurship in Meghalaya

hill districts and Chotanagpur.

162

EXISTING SUPPORT SYSTEM IN MEGHALAYA

The government of Meghalaya has fonnulated an industrial policy in 1988 to promote

entrepreneurship in the state. The main thrust of this policy is (i) to bring about an industrial

culture amongst the people of the state, (ii) to develop local tribal entrepreneurship so as to

channelize investment not only to traditional activities like construction, trading, etc. but also

into industrial activities (iii) to generate employment avenues for local unemployed youths, and,

(iv) to promote training facilities in order to develop skills and expertise amongst local people.

It is expected that the setting up of industries in accordance with the policy of the government

will promote the employment opportunity and income among the youth as also the rural

masses.

The various agencies covered under support system in Meghalaya are Small

Industries Service Institute, Tura, District Industries Centre, Jowai, Vijay Bank, Shillong, State

Bank of India, Tura, various co-operative societies (Service Handloorn, Tea Growers and

processing) Tura and Tribal Integrated Progressive Multi Pw-pose Co-operative Society,

Shillong

SmalI Industries Service Institute

The Small Industries Service Institute (SIS!) has been set up at Tura, the district

Headquarters of West Garo Hills on 31st October, 1983. The main services provided by this

Institute include technical, economica~ managerial, marketing and consultancy services to

promote entrepreneurship and to assist entrepreneurs to run their small scale units successfully.

These services are generally free except for some activities for which some nominal charges are

levied. The consultancy services include technical, managerial and economic components. The

srsr conducts Entrepreneurship Development Programme (EDPs) in Garo Hill districts. EDP

covers entrepreneurship course for the weaker section of society, women as well as for

educated unemployed, rural youth. Other functions of SISI are economic and statistical

infonnation services, marketing assistance in terms of central government stores, purchase

163

programme, ancillary development and sub-contracting exchange, preparation of technical

literature, co-operation and co-ordination with other organisations and modernisation of small

scale industries. The Small Industries Service Institute (SISI) is conducting Tribal

Entrepreneurship Development Programme since 1986 which is sponsored by smo (Small

Industries Development Organisation). According to this organisation, the success rate among

tribal entrepreneurs has been found between the range of 50 to 60 percent in Garo hill districts.

District Industries Centre, Jowai

The District Industries Centre(DIC), Jowai since its inception, is running tribal

entrepreneurship development programme. The main sponsors are Megha1aya Industrial

Development Corporation (MIDC), SISI and National Institute of Small Industry, Extension

and Training (NISIET). The major work being done by DIC, lowai for the enhancement of

tribal entrepreneurship are training inside-outside, Master craftsman training scheme, exhibition,

achievement motivation training etc.

(i) Training Programme

The following departmental training programmes are available for the local youths of

Jowai.

Name of Centres

I. Tailoring, Knitting and Embroidery Training Centre, Khliehriat

2. Knitting Training cumEmployment Centre, Jowai

3. Knitting Training cumEmployment Centre, Mualsei

4. Rural Industrial Development Centre, Jowai

164

Name of Trade

Tailoring, Knitting and Embroidery

Knitting

a) Knitting b) Tailoring a) Mechanical Service

Section b) Electrical Service Section c) Tractor & Automobile Service

d) Carpentry

Duration

I (one) year

I (one) year

I (one) year I (one) year

2 (two) years

2 (twolyears

2 (two) years

2 (two) years

Training Inside and Outside

The scheme aims at providing training facilities to local youth by sending them for

training either in reputable institutions or impart training in the registered units so as to enable

them to start industrial units or get employed. The District Industries Centre is expected to

send youth for training under the scheme. Each trainee is paid a stipend of Rs.ISO /- per

month.

(ii) Exhibition

As part of promotional programme, the District Industries Centre conducts an

exhibition each year at the District Headquarters. It also takes part in exhibitions conducted by

the department ofInformation and Public Relations at Block and Sub-Divisional levels.

(iii) Seminar-cum-Workshops

The objective of the scheme is to create an industrial awareness among the people,

promote industrial growth and allow prospective entrepreneurs into the field of industrial

activities. The District Industries Centre has launched three such programmes with 70

participants in each programme. During the year (1995-96), around 28 tribals got

entrepreneurial training, but the success rate was only around 10 per cent.

Co-operative Societies:

The role of co-operative societies has been significant for the development of tribal

entrepreneurship in the hill districts of Meghalaya. The Tribal Integrated Progressive Multi

purpose Co-operative Society Ltd. (TIMCOS.) Shillong is involved in project consultancy

and legal formalities since 1993 to help tribal entrepreneurs in the preparation of business plan.

During the year of 1995-96, fourteen tribal entrepreneurs were benefited by TIMCOS Ltd.

There are other co-operative societies like Service Co-operative Societies, Handloom Co

operative Societies, Tea growers and Processing Co-operative Societies and Fishery Co-

165

operative Societies which have an active role to play for the enhancement of entrepreneurship

among the local people. These co-operative societies are extending their help in economic

activities like horticulture, sericulture, bee-keeping, lac, food processing, potteries, handloom,

tea growing, bettlenut growing and processing etc.

Financial Institutions:

The financial institutions like State Bank of India, Tura and Vijaya Bank, Shillong are

providing financial support to the potential entrepreneurs through proper identification and

selection techniques. There is co-ordination between these banks and training institutes which

helps in the selection of the entrepreneurs. The banks also provide follow-up during the inception

of the enterprises.

Ram Krishna Mission:

It has been observed that there are few non-governmental organisations working for

the development of entrepreneurship in Meghalaya hilI districts. The Ram Krishna Mission's

activities at ShilIong, in this context, have twin objectives: (a) to bring out hidden talent for

particular vocations and (b) to develop and make these talents for financial returns in order to

the gifted ones, to enable them to be self-reliant. The trades taught include agriculture,

horticulture, furm, machinery work, bee-keeping, tailoring, carpentry, weaving, welding,

bakery etc. Basco Pnar, Jowai also conducts training progrannne for the youth in Jaintia hill

district.

EXISTING SUPPORT SYSTEM IN CHOTANAGPUR:

Assistance generally to the cottage and small industries is provided by the government

either directly or more often through the industries department. A part of the assistance is under

the Bihar State Aid to Industries Act, 1956 and takes the form of: (a) a loan; (b) guarantee of

credit, overdraft or fixed advance with a bank; (c) taking of share or debenture, (d) guarantee of

\66

minimum returns on the whole or part of the capital of a joint stock company, (e) grant of

favourable terms of land, raw materials or other property vested in the state, (f) payment of

subsidy for the establishment or expansion of small scale industry and research, (g) supply of

machines on hire-purchase system, and (h) supply of electrical energy at concessional rates.

Generally, loans are granted to the cottage and the small-scale industries. Subsidies are granted

upto 50 per cent of the cost of establishment, running, expansion or development in the case of

the small-scale industries and upto 50 per cent of the cost of research or purchase of machinery in

the case of any other industry.

The agencies covered under support system in Chotanagpur are Small Industries

Service Institute (SISI), Ranchi, District Industry Centre, Ranchi, Ranchi Industrial Area

Development Agency (RIADA), SIRTDO, Mesra and Bank of India, Ranchi, Ramakrishna

Mission, ShiIlong, Xavier Institute of Social Services (XJSS), Ranchi, Society of Rural

Industrialisation, Ranchi, Vikas Maitri, Animation Rural Outreach Service, GumJa and Rural

Entrepreneurship Development Institute, Ranchi.

Rural Entrepreneurship Development Institute (RED I):

Rural Entrepreneurship Development Institute and Xavier Institute of Social Service,

Ranchi have been conducting tribal entrepreneurship development progranunes since 1974. These

progranunes have been financed by many government departments, corporations, banks,

international organizations like MISEREOR (Germany), State Industrial Department,

Department of Science and Technology, Government ofIndia, Industrial Development Bank of

India (IDBI), Industrial Finance Corporation of India (IFCI). Industrial Credit and

Investment Corporation ofIndia (ICICI) National Bank for Agriculture and Rural Development,

Small Industry Development Bank oflndia, District Rural Development Agency, etc.

Different dimensions of activities provided by these organizations for enhancement

of tribal entrepreneurship are awareness building, skills training like managerial skills, social

skills, planning skills and technical skills, co-ordination with other support agencies,

167

monitoring and follow-up. About 150 tribals are getting entrepreneurial training per year and

according to officials of REDI, their success rate among tribal entrepreneurs has been found

approximately 40 per cent.

Small Industries Services Institute, Ranchi

Small Industries Service Institute, Ranchi has been running entrepreneurship

development programme since 1978. It is being sponsored by Development Commissioner,

Small Scale Industries, Govermnent of India. There are different dimension of activities to

develop entrepreneurship among the tribals like management development programme, skill

development programme, Buyer-seller meet, lnterfare meet, techno managerial assistance and

guidance, post-training support etc. In the year of 1992-93 and 1993-94 total thirty and thirty

four tribals got entrepreneurial training respectively. The annual reports of this organization

show that success rate varies from IO to 30 per cent among the tribals. Since 1978, District

Industry Centres are providing technical training to tribal youth. The main objective of this

organization is to look after various entrepreneurial requirements of grassroot level

entrepreneurs. Tribals are getting loan and special subsidies in terms of sale

tax, income tax, production tax etc.

Society of Rural Industrialisation, Ranchi

Society of Rural Industrialization, Ranchi, has mentioned in its annual report that during

1992-93, total 516 rural people completed their training in trade activities like pump-machine,

motor-cycle, cycle-cum-fitting, electronics, weaving, horticulture, aquaculture, land and water

management, mushroom and food processing, etc. Since 1969, training institute of Ramkrishna

Mission named 'Divyayan' has been imparting skill oriented training in poultry, animal husbandry,

bee-keeping, horticulture among the tribal people of Chotanagpur (Vinayak, 1980). Besides

these 19 tribal boys and girls started six months course on bamboo craft in March, 1993.

This organization has been conducting tribal entrepreneurship development programme since

1974 and residential training programme is going on since 1984. Till now, 5,200 tribals received

168

entrepreneurial training. According to SRI, success rate has been 72.3 per cent among rural

people ofChotanagpur.

Ranchi Industrial Area Development Authority

In the year 1994, Ranchi Industrial Area Development Authority (RIADA) conducted

training programme with the help of institutions like XISS, Institute of entrepreneurship

development, BITCD and centre for entrepreneurship development. This programme was

sponsored by Tribal Welfare Commissioner, Ranchi. Training took place in the tribal areas of

Khunti, Lohardaga and Gurnla. RIADA provided infrastructural facilities and financial support

to tribal entrepreneurs and gave them shed, machinery and infrastructural facilities like road,

drainage, electricity and water supply. Each trainee received Rs. 50001- to set up small

enterprise. Moreover, RIADA has liaison with banks and financial institution like Bihar State

Financial Corporation for financial assistance.

Vikas Maitri

A non-govermnental organization, named Vikas Maitri, conducted training programmes

for potential tribal entrepreneurs from 1974 to 1979 which was sponsored by Indo-German

Social Service Society, New Delhi. It had close co-ordination with banks for securing loan.

According to Vikas Maitri, the success rate of tribal entrepreneur varied from 35 per cent to 50

per cent.

Similarly, SIRTDD, Ranchi has entrepreneurship development programmes exclusively

for the tribals. This organization has been getting fund from Industrial Development Bank of

India (IDBI), Industrial Finance Corporation ofIndia and Department of Science and Technology.

According to officials of this organization success rate among tribals were less in comparison to

non-tribals because of traditional and social background which was not conducive to

entrepreneurship.

169

An effort has been made to collect the information from government and non

governmental officials who are concerned with entrepreneurship development among the tribal

communities of both the regions under study and according to them, entrepreneurship can be

developed among the tribals, but it needs financial support and constant follow-up from

developing agencies. Opportunities based on natural resources are suitable for the tribal

entrepreneurship like sericulture, lac processing, Mahua trade, bee-keeping, bettlenut and tea

growing, processing of fruits, mushroom cultivation etc. According to the officials and trainers

of both regions, the tribal entrepreneurs have no active participation during training

programme and some of the tribals lack commitment and confidence at the implementation stage

of the project which shows their hesitancy to take-up new ventures.

Hence, the foregoing study of existing support system shows that there are more

number of government agencies involved in promoting entrepreneurship in Meghalaya where as

in Chotanagpur, there are more non governmental organizations.

Role of support system as perceived by the respondents

It has been mentioned earlier that support system encompasses the facilitating efforts of

different governmental, non-governmental agencies, training institutes, banks, financial

corporations and co-operatives to initiate and to encourage entrepreneurship among the tribals.

The main aim of the support system is to provide raw material, machinery, finance, technical

know-how, electricity, shed, training, marketing and infrastructural facilities.

An attempt has been made to examine the significance and effectiveness of the existing

support system from the beneficiaries of the two selected regions. They are asked to express

their opinion on the importance of support system and it has been found that the majority of the

respondents, 89.7 per cent (n=58) in Meghalaya and 92.3 per cent (n=52) in Chotanagpur

perceive support system as an essential input for the development of entrepreneurship

(Table 5.1).

170

Table 5.1

Distribution of respondents by perception on importance of

support system and regions

Perception on importance of support system

Can't Say

Positive

Negative

Column Total

Meghalayan Chotanagpur Row Total Entrepreneurs Entrepreneurs

5 (S.6%)

52 (89.7%)

(1.7%)

58

2 (3.S%)

48 (92.3%)

2 (3.8%)

52

7

100

3

110

The major reasons for attributing the importance to support systems are found to be

financial support, training programmes, marketing facilities, infrastructural facilities and

technical services. The reasons for negative perception are reported to be ineffective training

programmes, corruption in banking process, lack of electricity and transport facilities.

It can be concluded from the data that the role of support system seems to be

significant for the development of entrepreneurship in both regions.

ENTREPRENEURIAL TRAINING

Training IS an important ingredient of entrepreneurial success among potential

entrepreneurs. The main objective of entrepreneurial training is to impart knowledge, inculcate

skills and bring about attitudinal and behavioural change among the prospective entrepreneurs.

The success of entrepreneurship depends upon effective inputs in the training as well as constant

follow up. The design, period and inputs of training programmes vary according to level ,

requirements of target group, place and cultural settings. Training helps potential

171

entrepreneurs to analyse environment conducive to small business, to select and fonnulate

projects, to acquire basic managerial skills and to understand the process & procedure of setting

of small enterprises. It has been assumed that the tribal regions having large number of

entrepreneurial training programmes will have more entrepreneurs.

Perception on importance of entrepreneurial training

Table(5.2) reveals that the majority of the respondents in both the regions Meghalayan

(72.5 per cent) and Chotanagpur (63.5 per cent) perceive training as an important factor for

the inception of entrepreneurial process. Around l\lOth of the respondents of both the

regions, 8.6 per cent in Meghalaya and 9.6 per cent in Chotanagpur, find entrepreneurial

training not important.

Table 5.2

Distribution of respondents by perception on importance of training and regions

Importance of training

Not Important

1m portant to some extent

Important

Column Total


5 (8.6%)

11 (19.0%)

42 (72.5%)

58

5 (9.6%)

14 (26.8%)

33 (63.5%)

52

10

25

75

110

x2 (chi square) = 7.77, df= 2, p=.lO (not significant at .05)

The statistical analysis shows that there is no significant difference (p>.05) between

Meghalayan and Chotanagpur respondents, with regard to perception about the importance of

training. It appears that the respondents engaged in non-traditional entrepreneurial activities have

172

supported formal training because it provides technical know-how and other skills whereas the

respondents who are engaged in traditional entrepreneurial activities do not give much

importance to training. Other reasons for the support of entrepreneurial training are reported to

be impact of industrialisation, exposure, awareness and education.

Incidence of Entrepreneurial Training

Data indicate that the sizeable percentage of the respondents in both the regions (67.2

per cent in Meghalaya and 53.8 per cent in Chotanagpur) have no formal entrepreneurial training.

It has been found that there are more trained respondents in Chotanagpur (43.2per cent) than

Meghalaya (32.8per cent) (Table 5.3).

Table 5.3

Distribution of respondents by entrepreneurial training and regions

Attained entrepreneurial training

Yes

No

Column Total


19 (32.8%)

39 (67.2%)

58

24 (46.2%)

28 (53.8%)

52

43

67

110

x2 (chi square) = 2.06, df= I, p=.I5 (not significant at .05 level)

Cramer's v = .13

The application of statistical technique, x2 shows that there is no significant difference

(p>.OS) between Meghalayan and Chotanagpur respondents in terms of training experience. On

the basis of above findings, it can be concluded that entrepreneurial training is not the

decisive factor to show the difference between these two regions.

173

Reasons for not attending training programmes

Data show that the sizeable percentage of the respondents in both the regions (67.2 per

cent in Meghalaya and 53.8 per cent in Chotanagpur) did not attend the entrepreneurial training.

It is found that in the category of respondents (n=39) who did not attend training in

Meghalaya, around 2\3rd (64.1 per cent) of them mention that training progranunes are not

available in their regions as against around 2\Sth of the respondents(n=28) from Chotanagpur.

Other reasons for not attending training progranunes are found to be lack of information and

physical inaccessibility in both regions (Table 5.4).

Table 5.4 Distribution of respondents by reasons for not attending the

training programmes and regions

Reasons for not attending training


(n=39) (n=28)

No training programme 25 available (64.1 %)

Lack of information

Inaccessible

Not required

column Total

6 (15.3%)

4 (10.2%)

4 (10.2%)

39

6 (21.4%)

8 (28.5%)

8 (28.5%)

6 (21.4%)

28

31

14

12

10

67

Participation of various support organisation in training programme

The majority (73.6 per cent) of the respondents (n=19) in Meghalaya receive training by

government agencies like DIC, SISI, TCO's, MIDC etc. The role of government agencies in

174

training programmes has been found significantly low in Chotanagpur (8.3 per cent). However,

it has been found that the majority of the respondents (n=24) in Chotanagpur have attended

training programmes conducted by non-governmental organizations like Xavier Institute of

Social Services, Society of Rural Industrialisation, Rural Entrepreneurship Development

Institute, R.K. Mission, AROUSE (Animation Rural Outreach Service) etc. (Table 5.5).

Table 5.5

Distribution of respondents by various organisations involved in


Various Meghalayan Chotanagpur Row Total organisations Entrepreneurs Entrepreneurs

Government agencies 14

NGOs

Bank

Educational Res. Institute

Private Trainin Institute

Column Total

(73.6%)

(5.2%)

2 (10.5%)

2 (10.5%)

19

2 (8.3%)

17 (70.8%)

2 (8.3%)

3 (12.5%)

24

16

18

2

2

5

43

It can be concluded from the above findings that the role of government agencies are

more significant in conducting training programmes in MeghaJaya whereas in Chotanagpur the

role of non-governmental organizations. The role of private training institutes are more or less

similar in both regions.

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According to the majority of the respondents in both the regions (89.5 per cent in

MeghaJaya and 75.0 per cent in Chotanagpur), the training programmes are institutionalised

(Table 5.6). Again, it has been observed that the majority of the respondents in Meghalaya

(78.9 per cent) and in Chotanagpur (66.6 per cent) state that training programmes are non

residential (Table 5.7).

Table 5.6

Distribution of respondents by types of training attended and regions

Types of training Meghalayan Chotanagpur Row Total Entrepreneurs Entrepreneurs

Non-institutional

Institutionalised

Column Total

(n=19) (n=24)

2 (10.5%)

17 (89.5%)

19

Table 5.7

6 (25.0%)

18 (75.0%)

24

8

35

43

Distribution ofrespondents by natu re oftraining and region

Nature of training Meghalayan Chotanagpur Row Total

Non-residential

Residential

Column Total

Entrepreneurs Entrepreneurs (n=19) (n=24)

15 (78.9%)

4 (21.0%)

19

176

16 (66.6%)

8 (33.3%)

24

31

12

43

On the basis of these data, it can be concluded that in both regions, most of the training

programmes are institutionalised and non-residential. But, it has been found from the discussion

with tribal entrepreneurs that there should be more residential and non-institutional training

programmes to inculcate entrepreneurial spirit among tribal entrepreneurs.

Financial Assistance during training programme

Data reveal that around half of the respondents from Chotanagpur got financial

assistance during entrepreneurial training programmes as against only 5.2 per cent of the

respondents from Meghalaya (Table 5.8).

Table 5.8

Distribution of respondents by financial assistance in

training and region

Received Financial Meghalayan Chotanagpur Row Total assistance Entrepreneurs Entrepreneurs

Yes

No

Column Total

1 (5.2%)

18 (94.7%)

19

11 (45.8%)

13 (54.4%)

24

12

31

43

It has been observed that the range of financial assistance varies between Rs. 100 to Rs.

300 per programme. Although this amount is meagre, but quite helpful for the prospective

entrepreneurs from backward areas.

177

Major Inputs acquired during training

The major inputs acquired by the respondents of both regions are reported as planning

skills, financial skills, managerial skills, technical skills, achievement motivation, marketing

skills and social skills. The majority of the respondents in both the regions (84.2 per cent in

Meghalaya and 87.5 per cent in Chotanagpur) find that the technical 'know how' is the major

input among all the inputs acquired during training followed by planning skills, (68.4 per cent),

motivation (68.4 per cent), financial skills (57.8 per cent) & marketing skills (52.6 per cent) in

Meghalaya and marketing skills (62.5 per cent), planning skills (58.3 per cent), financial skills

(54.1 per cent) and motivation (54.1 per cent) in Chotanagpur (Table 5.9).

Table 5.9

Distribution of respondents by major inputs acquired during the

training and regions

Major inputs acquired

Planning skills

Financial skills

Managerial skills

Technical know-how

Motivation

Marketing skills

Follow-up

Meghalayan Entrepreneurs

(F 19)

178

13 (68.4%)

II (57.8%)

9 (47.3%)

16 (80%)

13 (68.4%)

10 (52.6%)

(5.2%)

Chotanagpur Entrepreneurs

(n ~ 24)

14 (58.3%)

13 (54.1%)

7 (29.1%)

21 (87.5%)

13 (54.1%)

IS (62.5%)

4 (16.6%)

The application of x2 shows that there is no significant difference (p>.05) between

respondents of Meghalayan and Chotanagpur regions with regard to the inputs acquired during

entrepreneurial training programmes. It can be concluded that both regions do not differ

significantly with regard to the inputs acquired during training programmes.

It is evident that training has developed different skills necessary for entrepreneurship

development. It is clear from the table (5.9) that the technical know-how is the most iruportant

among all inputs. Motivation which is the contributing factor for entrepreneurial emergence

has special relevance for the tribal entrepreneurship training programmes. Moreover, plarming

skills, financial skills and marketing skills are integral part of the training programme to fucilitate

entrepreneurship among prospective entrepreneurs.

Satisfaction witb Training Programmes

It is observed that the majority of the respondents in both the regions; 78.9 per cent in

Meghalaya (n=19) and 70.8 per cent in Chotanagpur (n=24), are satisfied with the training

programmes attended. Conversely, 115th (21.1 per cent) of respondents from Meghalaya and

around 113rd (29.2 per cent) of respondents from Chotanagpur are not satisfied with

entrepreneurial training programmes(Table 5.10).

179

Table 5.10

Distribution of respondents by satisfaction with


Satisfuction with Meghalayan Chotanagpur Row Total training programmes Entrepreneurs Entrepreneurs

Yes

No

Column Total

15 (78.9%)

4 (21.1%)

19

17 (70.8%)

7 (29.2%)

24

32

11

43

x2 (chi square) = 2.4, df= I, p=.29 (not significant at .05)

Cramer's v = .14

The statistical analysis shows that there is no significant difference between

Meghalayan and Chotanagpur entrepreneurs in terms of satisfaction with training programmes

attended. It can be inferred that the training programmes are satisfactory in both regions. It

seems the main reasons for satisfaction in both regions are found to be technical know-how,

business skills, motivation and financial skills. At the same time, the probable reasons for

dissatisfaction are short duration of training programme, no residential facilities, less finance

during training and lack of constant follow-up.

Suggestions for Improving Training Programmes

The respondents of both the regions under study have following suggestions for

improving the training programmes:

i) There should be different types of technical training progtamrt1es for the initiation of

different types of entrepreneurial activities

ii) Duration of training programmes should be longer

180

iii) Trainers should be well-qualified and experienced

iv) Training progranunes should be residential

v) After training, constant follow-up is required by the training institutes.

Family and Community Support

The local communities can play an important role in developing an entrepreneurial

environment. Entrepreneurship may not develop if members of the community view it with

suspicion. A fuvourable attitude of the family and community towards entrepreneurship is

needed to motivate people to start a new business. For example, family members or relatives

can help entrepreneurs seek out solutions, locate resources, and assemble a team of willing

people to address the entrepreneurs problems.

It is found from the table( 5.11) that little more than I \ 10th of the respondents in both the

regions (13.8 per cent in Meghalaya and 13.5 per cent in Chotanagpur) get only financial support

from family and community. Data show that 20.7 per cent of Meghalayan and 13.5 per cent

of Chotanagpur respondents get only moral support from their families and communities for

entrepreneurial activities. But, around 2/3rd (63.8 per cent) of the respondents from

Meghalaya get moral as well as financial support from their fumilies and communities as against

only around 1\4th (23.1 per cent) of the respondents from Chotanagpur.

181

Table 5.11

Distribution of respondents by family and

community support and region

Type of family and Meghalayan Chotanagpur Row Total community support Entrepreneurs Entrepreneurs

Financial

Moral

Financial and Moral

Not much support

Column Total

8 (13.8%)

12 (20.7%)

37 (63.8%)

(1.7%)

58

7 (13.5%)

7 (13.5%)

12 (23.1%)

26 (50.0%)

52

15

19

49

27

lID

i (chi square) = 37.07, df= 3, p=.OO (significant at .05)

Cramer's v = .58

The statistical analysis x2 indicates that there is a significant difference (p<.05) between

Meghalayan and Chotanagpur regions in tenns of family and community support for

entrepreneurial activities.

In Meghalaya, comparatively higher percentage of respondents get both

financial and moral support from their fumilies and communities in comparison with the

Chotanagpur region. It has been mentioned earlier (in Chapter III) that the Chotanagpur tribals

are more conservative in their outlook on entrepreneurial activities. They feel that business is

the means of exploitation which is practised by the dikus (outsiders). Business men are looked

down in their communities. This could be the cause for less support from family and community

for entrepreneurial activities in Chotanagpur region.

182

Sources of Capital for Entrepreneurial Activity

Data reveal that the sizeable percentage (36.2 per cent) of respondents in Meghalaya

and 1\5th (19 per cent) of respondents in Chotanagpur have used their own capital for the

inception of business activities. Around 1\5th (21.2 per cent) of the respondents in

Chotanagpur mention banks as the only source of capital for business ventures as against

1\IOth (8.6 per cent) of the respondents from Meghalaya. A sizeable percentage (32.7 per cent

from Chotanagpur and 27.6 per cent from Meghalaya) of respondents use their own money

together with bank loan as source of capital for business. It has been found that 5.2 per cent of

respondents in Meghalaya and 9.6 per cent of respondents in Chotanagpur receive credit from

money lenders (Table 5.12).

Table 5.12

Distribution of respondents by source of capital and regio¥

Source of Capital Meghalayan Chotanagpur Row Total Entrepreneurs Entrepreneurs

Own

Partner

Moneylenders

Bank

Own + Bank

Own + Moneylender

Financial Corporation

Column Total

21 (36.2%)

4 (6.9%)

3 (5.2%)

5 (8.6%)

16 (27.6%)

6 (10.3%)

3 (5.1%)

58

183

10 (19.2%)

I (1.9%)

5 (9.6%)

II (21.2%)

17 (32.7%)

6 (11.5%)

2 (3.8%)

52

31

5

8

16

33

12

5

110

Own money as the source of capital shows that the investment capacity among

Meghalayan entrepreneurs is higher than Chotanagpur entrepreneurs. The dependency on

bank for seed capital is more among Chotanagpur entrepreneurs than their counterparts. It,

clearly, indicates that the econonnc status of Meghalaya entrepreneurs is higher than

Chotanagpur entrepreneurs.

Contact with Various Supporting Institutions

Association of entrepreneurs with various supporting institutions shows

participation of these institutions for the development of entrepreneurship in their respective

regions. It helps to assess the relative importance of various components of support system to

develop entrepreneurship in Meghalaya and Chotanagpur.

Table(5.13) reveals that around 1I3rd (36.2 per cent) of the respondents in Meghalaya

and little more than half (53.8 per cent) of the respondents in Chotanagpur have association

with banks for their entrepreneurial activities. Around 3/20th (15.5 per cent) of the respondents

in Meghalaya and 1/5th (21.1 per cent) of the respondents in Chotanagpur receive credit

from money lenders for their business activities. A little less than 114th (24.1 per cent) of the

respondents in Meghalaya and little more than IIlOth of the respondents (13.5 per cent) in

Chotanagpur have association with government agencies like DIC's SISI, TCO's for training and

consultancy support. It is found that the contact of entrepreneurs with non-governmental

organization in Chotanagpur (42.3 per cent) is significantly higher than Meghalaya regions (6.9

per cent). The association of respondents with financial corporations, co-operative societies

and marketing associations are 5.1 per cent, 8.6 per cent and 8.6 per cent respectively in

Meghalaya and 3.8 per cent, 5.8 per cent and 9.6 per cent respectively in Chotanagpur .

184

Table 5.13

Distribution of respondents by contact with various

institutions and regions

Contact with Institutions

Bank

Money Lenders


(n = 58)

21 (36.2%)

9 (15.5%)

Government agencies 14

NGO's

(24.2%)

4 (6.9%)

Financial Corporations 3 (5.1%)

Co-operative Societies 5 (8.6%)

Marketing Association 5 (8.6%)


(n = 52)

28 (53.8%)

11 (21.1%)

7 (13.5%)

22 (42.3%)

2 (3.8%)

3 (5.8%)

5 (9.6%)

The application of x shows that there is no difference between the regions, I.e.

Meghalaya and Chotanagpur with regard to contact of respondents with various supporting

institutions except non-governmental organizations. These supporting institutions are banks,

government agencies, financial corporations, co-operative societies, moneylenders and

marketing associations. It can be further concluded that the non-governmental organizations play

significant role in imparting training among the respondents of Chotanagpur than Meghalaya.

185

Experience towards Institutional borrowing

Experience towards institutional borrowing reveals the strength and weaknesses of

banking process so that the constraints perceived by the entrepreneurs can be overcome to

enhance the entrepreneurial process.

Data indicate that among the respondents who borrowed, approximately 3/4 (75.0 per

cent) of the respondents in Meghalaya (n=24) and half (50.0 per cent) of the respondents in

Chotanagpur (n=30) have favourable attitude towards institutional borrowing. Conversely,

1/4th (25 per cent) of the respondents in Meghalaya and half (50.4 per cent) in Chotanagpur

have unfavourable attitude towards institutional borrowing (Table 5.14).

Table 5.14

Distribution of respondents by attitude towards Institutional

borrowing and regions

Experience towards Institutional Borrowing

Favourable

Unfavourable

Column Total


(n = 24) (n = 30)

18 (75.0%)

6 (25.0%)

24

15 (50.0%)

15 (50.0%)

30

33

21

54

x2 (chi square) = 6.1, df= 1, p=.04 (significant at.05)

Cramer's v = .23

The application of x2 shows that there is a significant difference (p < .05) between

Meghalayan and Chotanagpur respondents with regard to experience towards institutional

borrowing. The Meghalaya entrepreneurs have comparatively higher favourable attitude

towards institutional borrowing than their Chotanagpur counterparts. The reasons for favourable

attitude are found to be 'less time' taking and less complicated process in institutional

186

borrowing. At the same time, the main reasons for unfavourable attitude towards iostitutional

borrowing are found to be lengthy process, high interest rate, and corruption.

Facilities offered by the Support System

The success of any entrepreneurial activity would greatly depend on the types of

facilities offered by the support system. The stable iostitutional framework accelerates the

momentum of process of entrepreneurship. The inputs provided by support mechanism finance,

machinery, building, raw-materials, technical know-how, effective communication ,marketing

facilities, infrastructural facilities etc. are always required by the entrepreneurs The

supporting process starts from the selection of entrepreneurs and moves towards setting up

enterprise and bringing it up to the point of break-even in production.

The study reveals that facilities such as availability of raw-material, machinery, finance,

technical services, electricity, training programmes, tax reduction, marketing and

infrastructural facilities have been availed by 10.3 per cent, 15.5 per cent, 41.4 per cent, 32.7 per

cent, 89.7 per cent, 32.7 per cent, 20.7 per cent, 3.4 per cent and 55.2 per cent of the

respondents respectively in Meghalaya as against 11.5 percent, 15.4 per cent, 57.6 per cent, 50.0

per cent, 57.7 per cent, 46.2 per cent, 13.5 per cent, 9.6 per cent and 46.2 per cent of the

respondents respectively in Chotanagpur (Table 5.15).

The study reveals that only 1I10th of the respondents in both the regIOns (10.3 per cent

in Meghalaya and 11.5 per cent in Chotanagpur) get raw material from the support system,

only 15 per cent of the respondents in both the regions get machinery for their industrial units,

approximately 2/5th (41.4 per cent) of the respondents in Meghalaya and more than half (50.0

per cent) of the respondents in Chotanagpur receive financial assistance from banks and

financial corporations to start their business units. The technical know-how has been provided

to 1I3rd (32.8 per cent) of the respondents in Meghalaya and 50.0 per cent of the respondents

in Chotanagpur by the training iostitutes. The majority (89.7 per cent) of the respondents in

Meghalaya and around little more than half (57.7 per cent) of the respondents in Chotanagpur

187

have been provided electricity for their business units. It has been found that 36.2 per cent of

the respondents in Meghalaya and 46.2 per cent of the respondents in Chotanagpur avail

training facilities in their regions. The facility of sale tax reduction has been given to 20.7 per

cent of the respondents in Meghalaya and 13.5 per cent of the respondents in Chotanagpur.

Data show that only 3.4 per cent of the respondents in Meghalaya and 9.6 per cent of the

respondents in Chotanagpur have been provided marketing facility by the support agencies.

With regard to infrastructural facilities, (55.2 per cent of the respondents in Meghalaya and 46.2

per cent of the respondents in Chotanagpur mention that they have been provided this facility

(Table 5.15).

Table S.lS

Distribution of respondents by facilities provided and regions

Facilities provided by support system

Raw material

Machinery

Finance

Technical Services

Electricity


(n ~ 58)

6 (10.3%)

9 (15.5%)

24 (41.4%)

19 (32.7%)

52 (89.7%)

Training Programme 19 (32.7%)

Sales Tax

Marketing Facility

12 (20.7%)

2 (3.4%)

lnfrastructural Facility 32 (55.2%)

188


(n ~ 52)

6 (11.5%)

8 (15.4%)

30 (57.6%)

26 (50.0%)

30 (57.7%)

24 (46.2%)

7 (13.5%)

5 (9.6%)

24 (46.2%)

•

•

•

•

The application of x' shows that there is no significant difference (p > .05) between

Meghalaya and Chotanagpur with regard to facilities provided by various support system such

as raw material, machinery, finance, technical services, training progranune, sales tax subsidy,

marketing facility and infrastructural facilities. But the electricity for business units is

significantly higher in Meghalaya than Chotanagpur.

The research findings of Maulik, Basu and Patel (1971) and Seti (1980) have shown

that infrastructural facilities played important role for the enhancement of rural and tribal

entrepreneurship .

MARKETING

Marketing is an essential component of entrepreneurship. Marketing delivers a

standard of living to the people by satisfYing multitude of needs and desires of the consumers.

Marketing helps to enhance employment opportunities to the member of any society both in

production and marketing activities. Marketing is the important process through which

entrepreneurs get remunerative price and adequate profit to run their enterprises successfully.

Place of procurement of raw material

Table(5.l6) indicates that the majority (7\10th) of the respondents in both the regions

(72.4 per cent in Meghalaya and 69.2 per cent in Chotanagpur) procure raw materials from

town market for the business purposes and around 1 \5th (20.7 per cent) of the respondents in

Meghalaya and 1\20th (5.7 per cent) of the respondents in Chotanagpur procure their raw

materials from big cities.

189

Table 5.16

Distribution of respondents by place of procurement of

raw materials and regions

Place of procurement

Forest

Village market

Block market

Town Market

Big cities

Column T olal


(1.7%)

3 (4.1%)

42 (72.4%)

12 (20.7%)

58


2 (3.8%)

5 (9.6%)

6 (11.4%)

36 (69.2%)

3 (5.7%)

52

It has been observed from data that significantly higher number of respondents from

Chotanagpur procure raw materials from block market, village market and forest, but the

respondents from Meghalaya procure raw material from town market and big cities. It seems

that the main reason for the high incidence of procurement of raw materials from town market

in both the regions, Meghalaya and Chotanagpur, is the involvement of respondents in non

traditional entrepreneurial activities such as repair works and general services.

Demand for the products or services

Demand means marketing of the products or services. If the marketability of the product

is normal or if the entrepreneur is able to sell his product, then such type of demand is called

normal demand. If the marketability of the product is less, then demand is called low and

similarly, if the marketability of the product is more than normal, then it is called high.

190

The study shows that the sizeable percentage (60.3 per cent) of the respondents from

Meghalaya have normal demand for their products and services as against 67.3 per cent of the

respondents from Chotanagpur and it has been noted that around only 1\4th (23.1 per cent) of

the respondents from Chotanagpur have normal demand for their products and services (Table

5.17).

Table 5.17

Distribution of respondents by demand for products & services /inLregions

Opinion on demand Meghal.yon Chotan.gpur Row Tot.1 Entrepreneurs Entrepreneurs

Low demand

Nonna]

High Demand

Column Total

18 (3\.0%)

35 (60.3%)

5 (8.6%)

58

35 (67.3%)

]2 (23.1%)

5 (9.6%)

52

53

47

10

110

x2 (chi square) = 19.04, df-= 2, p=.OO (significant at .05 level)

Cramer's v = .41

The statistical analysis -J! reveals that there is a significant difference (p<.05) between the

regions, Meghalaya and Chotanagpur in tenns of demand of the products or services. In

Chotanagpur, there is comparatively low demand of products or services than Meghalaya. The

normal demand of products or services is significantly higher in Meghalaya than Chotanagpur.

The reasons reported for low demand for products in both the regions are lack of marketing

facilities, seasonal variation in demand, lack of transport facility and competition with non-tribal

entrepreneurs. On the other hand, the availability of better quality of raw material & products

and infrastructural facilities are reported to be the contributing factors for high demand for

products or services.

191

Difference in Price Received

The study shows that the majority (74.1 per cent) of the respondents in Meghalaya find

no difference in the price received and price prevailing in the market. But in Chotanagpur, only

46.1 per cent of the respondents receive normal price of their products. Around 114th (25.8

per cent) and a little more than half (53.9 per cent) of the respondents from Meghalaya and

Chotanagpur respectively get less price than prevailing in the market for their products and

services (Table 5.18).

Table 5.18

Distribution of respondents by difference in price

received and regions

Difference in price received

Same

Less

Column Total


43 (74.1%)

15 (25.8%)

58

24 (46.1%)

28 (53.9%)

52

67

43

110

x' (chi square) = 9.08, df= I, p=.02 (significant at .05)

Phi ( ) = .28

The application of x' reveals that there is a significant difference (p<.05) between

Meghalaya and Chotanagpur entrepreneurs with respect to difference in price received and price

prevailing in the market. The majority of the respondents in Meghalaya who have received

same pnce as prevailing ill the market are significantly higher in Meghalaya than

Chotanagpur. The common reasons accounted for the price difference in both the regions are

lack of marketing facilities, transport problems, quality of the products, buying capacity of the

consmners and the existing competition in the market.

192

Fluctuation in Sale

Sale fluctuation studies the consistency in the marketing process. It helps to

understand the causes of this fluctuation and its implications on the entrepreneurs.

It is evident from the table (5.19) that the majority (63.8 per cent and 80.7 per cent in

Meghalaya and Chotanagpur respectively) of the respondents find fluctuation in sale of the their

products. Conversely, around I \3rd (36.2 per cent) of the respondents from Meghalaya and

1\5th (19.2 per cent) of the respondents from Chotanagpur do not find fluctuation in the sale.

Table 5.19

Distribution of respondents by fluctuation in the

sale and regions

Fluctuation in the sale support system

Yes

No

Column Total


37 (63.8%)

21 (36.2%)

58

42 (80.7%)

10 (19.2%)

42

79

31

110

X2 (chi square) =14.89, dt= I, p=.OO (significant at .05)

Cramer's v = .36

The application of Xl shows that there IS a significant difference (p<.05) between

Meghalaya and Chotanagpur respondents with respect to fluctuation in the sale of their

products. The main reasons for fluctuations are reported to be seasonality of demand and

festivals. In rainy season, people are generally engaged in agricultural and allied activities in

rural and tribal areas. Their savings are invested in agricultural & allied activities, whereas, in

winter season due to festivals and marriage, the demand for the products or services increases.

193

Maximum Sale in the Season

According to the majority (86.4 per cent in Meghalaya and 78.5 per cent ill

Chotanagpur) of the respondents, maximum sale occurs in the winter season. Conversely, only

5.4 per cent of the respondents in Meghalaya and 5.7 per cent of the respondents in

Chotanagpur find minimum sale in rainy season. Around 1\1 Oth (13.5 per cent in Meghalaya and

14.2 per cent in Chotanagpur) of the respondents find maximum sale in summer season.

Intensity of competition in Market

It is found that the sizeable percentage (65.5 per cent) of the respondents in Meghalaya

and 42.3 per cent of the respondents in Chotanagpur find normal competition in the marketing of

their products and services. Conversely, around 1\3rd (33.5 per cent) of the respondents in

Meghalaya and 3\5th (57.7 per cent) of the respondents in Chotanagpur find high competition in

the marketing process(Table 5.20).

Table 5.20

Distribution of respondents by intensity of

com petition and regions

Intensity of competition


Normal competition 38

High competition

Column Total

(65.6%)

20 (33.5%)

58

22 (42.3%)

30 (57.7%)

52

60

50

110

x2 (chi square) = 8.5, dF I, p=.03 (significant at .05)

Phi ( ) = .27

194

The application of x2 shows that there is a significant difference (p<.OS) between

Meghalayan and Chotanagpur entrepreneurs with regard to competition in the marketability of

the products. High level of competition is perceived by more respondents from Chotanagpur

than Meghalaya.

Suggestion to start the entrepreneurial activities

The starting of entrepreneurial activity is very crucial in tribal societies. It requires lot

of effort and mental preparedness, particularly, if they want to get involved in non-traditional

entrepreneurial activities. It is found that the sizeable percentage (41.1 per cent) of the

respondents from Meghalaya suggest motivation, finance, proper place and infrastructural

facilities as important factors for the inception of entrepreneurship, whereas around half (51.2

per cent) of the respondents suggest finance and motivation as important factors initiate the

entrepreneurial process. The managerial skills, marketing skills and transport facilities are

important suggestions for continuation and expansion of business units in both tribal regions.

Suggestions for various components of support system

According to the 9/10th of the respondents (91.4 per cent in Meghalaya and 96.2 per

cent in Chotanagpur) from both regions, the role of bank can be major contributing factor

for the development of entrepreneurship. More than 3/4th of the respondents from both the

regions (75.9 per cent in Meghalaya and 82.7 per cent in Chotanagpur) feel that the government

agencies like DICs, SISI, TCO's can be useful for providing training, technical support,

motivation, financial skills as well as follow-up. The need for non-governmental organizations

has been felt comparatively more in Chotanagpur (57.7 per cent) than Meghalaya (20.6 per

cent). Around lISth (17.2 per cent) of the respondents from Meghalaya and 1I3rd (34.6 per

cent) of the respondents from Chotanagpur suggest that the co-operative societies can play

active role for the procurement of raw materials and marketing of the products. Similarly, other

suggestions are found to be formation of marketing association and active participation of

financial corporations (Table 5.21).

195

Table 5.21

Distribution of respondents by suggestions on

various support system and regions

Various support System

Banks

Financial Corp.

Marketing Association

Meghalayan Chotanagpur Entrepreneurs Entrepreneurs (n~58) (n=52)

53 (91.4%)

11 (19.0%)

5 (8.6%)

50 (96.2%)

2 (3.8%)

4 (7.7%)

Government Agencies 44 (75.9%)

43 (82.7%)

Co-operati ve Societies

NGOs

10 07.2%)

12 (20.6%)

18 (34.67%)

30 (57.4%)

It can be concluded from the analysis that the banks as the sources of finance could be

extremely useful for the development of enterprises in both regions. Even the role of

government agencies could be of great importance for providing training, technical skills,

motivation, follow-up, subsidies, tax reduction and infrastructural facilities in order to enhance the

entrepreneurial process. The importance of non-governmental organizations has been found

comparatively more effective in Chotanagpur than Meghalaya. The requirement of other

components of support system such as financial corporation, and marketing association have

been perceived similar in both the tribal regions, Meghalaya and Chotanagpur.

196

Constraints perceived by the Respondents

Constraints faced by the entrepreneurs in executing decisions and activities are often

associated with the extent of success achieved by them. These constraints can be attributed to

socio-economic, political and institutional factors of the regions. These constraints vary in

nature & uniformity. Constraints faced by one entrepreneur may not be the same constraint

faced by others.

The present study reports varlOUS constraints perceived by the respondents of

Meghalaya and Chotanagpur. These constraints are found to be lack of finance, non-availability

of raw material, marketing problem, infrastructural problem, lack of electricity, lack of proper

place and shed, transport problem, lack of motivation, lack of technical know-how, lack of

managerial skills, ineffective follow-up, lack of skilled labour etc. The constraints are

perceived at various levels of entrepreneurship development such as inception, sustenance and

diversification of enterprises.

The table (5.22) provides the major constraints perceived by the respondents of both the

regions, Meghalaya and Chotanagpur.

Table 5.22

Distribution of respondents by constraints perceived and regions

Constraints perceived

Lack of finance


(n= 58)

42 (72.4%)

Lack ofraw material 24

Lack of marketing

Lack of transport

(41.4%)

40 (69.0%)

45 (77.6%)

197

Chotanagpur Entrepreneurs (n= 52)

46 (88.5%)

22 (42.3%)

32 (61.5%)

13 (25.0%)

a) Lack of Finance

Lack of support system 43 (74.1%)

Lack of training 17 (29.3%)

Ineffective follow-up 17 (29.3%)

Lack of infrastructural 26 fucility (44.8%)

Lack of technical know-how

17 (29.3%)

Lack of managerial skills 16 (27.6%)

Lack of education 3 (5.2%)

Traditional attitude II

Lack of labour

(J9.0%)

II (19.0%)

Lack of Motivation 6 (JO.3%)

Lack of family 2 or community support (3.4%)

Lack of electricity 3 (5.2%)

33 (63.5%)

10 (19.2%)

15 (28.8%)

23 (44.2%)

17 (32.7%)

34 (65.4%)

35 (67.3%)

34 (65.4%)

5 (9.6%)

14 (26.9%)

26 (50.0%)

35 (67.3%)

Earlier tribals had self-sustenance economy. The tribals used to satisfy their needs

through barter-system. As the concept of money was not prevailing in terms of 'capital', they

lacked their own finance to initiate, run and expand their business activities. Data show that

the majority (72.4 per cent in Meghalaya and 88.5 per cent in Chotanagpur) of the respondents in

both regions find lack of finance as major impediment for the development of entrepreneurship. It

is found that the financial problem is more acute in Chotanagpur than in Meghalaya. It can

198

be concluded that both regions have financial problems, but it is comparatively more serious in

the Chotanagpur region.

b) Lack of Marketing

The marketing problem has been one of the ll1l\ior hindrances for the development of

entrepreneurship in the regions of MeghaIaya and Chotanagpur. Table(5.22) reveals that 69.0

per cent of the respondents in Meghalaya and 61.5 per cent in Chotanagpur find lack of

marketing facilities as constraint for the selling their products or services. There seems to be

many factors associated with marketing problem like lack of proper communication, seasonality

in demand for the products, transport problem, poor purchasing power of the local consumers,

competition in the market etc. Hence, it can be concluded that both the regions have similar

types of marketing problems.

c) Lack of Raw Material

The non-availability of raw materials is one of the problems to run business successfully.

Around 2\5th of the respondents of both regions perceive this problem. This problem has been

faced more by those respondents who are engaged in bamboo work, mat making and related

handicraft as well as in repair works. They have to travel to the city market to buy equipments

resulting in waste of time, money and energy. The main reasons for inaccessibility of raw

materials are reported to be shortage of raw materials and increasing trend in price.

d) Lack of Transport

Lack of transport is one of the major constraints for the development of

entrepreneurship particularly in Meghalaya. More than 3\4th of the respondents in MeghaIaya

and around I \4th of the respondents in Chotanagpur perceive lack of transport as a major

problem. Both the regions vary significantly with respect to the lack of transport. Absence of

railway line in Meghalaya adversely affects the development of industrial ventures in this region.

199

e) Lack of infrastructural facility

Table(S.23) shows around 2\Sth of the respondents in both the regIOns I.e. Meghalaya

and Chotanagpur perceive lack of infrastructural facilities which are important for the

emergence and sustenance of entrepreneurship. Lack of communication, low level of

education, lack of drinking water, absence of postal services, inadequate health facilities are the

common problems in the tribal areas ofChotanagpur and Meghalaya.

I) Lack of Training facility

Training appeared to be important to those prospective entrepreneurs who wanted to

initiate entrepreneurial activities like repair of watch, electrical appliances and radio, silk rearing,

knitting, stitching etc. But some traditional activities like weaving, basket, rope & mat making

do not require fonnal training.

Data indicate that around 3\lOth (29.3 per cent) of the respondents in Meghalaya and

nearly I\Sth (19.2 per cent) of the respondents in Chotanagpur lack training facilities in their

respective regions. This problem is comparatively more in Meghalaya than Chotanagpur. It

appears that the major reason for the lack of training facility is few number of non-governmental

organizations to provide training in the Meghalaya region.

Moreover, the other significant constraints are found to be ineffective follow-up (29.3

per cent and 28.8 per cent in Meghalaya and Chotanagpur respectively) lack of technical

know-how (29.3 per cent in Meghalaya and 32.7 per cent in Chotanagpur), lack of managerial

skills (27.6 per cent in Meghalaya and 6S.4 per cent in Chotanagpur), lack of education (S.2

per cent in Meghalaya and 67.3 per cent in Chotanagpur), existing traditional-stereotype

attitude (19.0 per cent in Meghalaya and 6S.4 per cent in Chotanagpur), lack of electricity (S.2

per cent in Meghalaya and 67.3 per cent in Chotanagpur), lack of family or community support

(3.4 per cent and SO.O per cent in Meghalaya and Chotanagpur respectively) etc.

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The statistical analysis shows that the constraints such as lack of education, lack of

managerial skills, traditional attitude, lack of motivation, lack of family and community support

and lack of electricity are more severe in Chotanagpur than Meghalaya. But, the constraints

such as lack of training facility and lack of transport are comparatively more serious in

Meghalaya than Chotanagpur. Other constraints are more or less similar in both the tribal

regions, Meghalaya and Chotanagpur.

Constraints Perceived by the support system

Data collected during the discussions with officials, trainers, and staff reveal that

they also perceive several constraints and problems while executing tribal entrepreneurship

development programmes. The sources of data are Small Industries Service Industries, Tura,

District Industries Centre, Jowai, Vijaya Bank, Shillong, SBI, Tura & Co-operative Societies

in Meghalaya and SISI, RancID, SIRTDO, Ranchi Industrial Area Development Authority

(RIADA), Vikash Maitri, Society for Rural Industrialisation (SRI), XISS, Rural

Entrepreneurship Development Institute (REDI), AROUSE (Gurnla) and Bank oflndia, Ranchi

in Chotanagpur region. The various constraints reported by them can be summarised as follows:

(i) Lack of finance is the serious problem faced by different government agencies and non

governmental organizations operating to enhance entrepreneurship in both tribal

regions. Banks and financial corporations have financial limitation for entrepreneurial

training.

(ii) Training institutes frequently observe poor participation and motivation from tribal

people in entrepreneurial training programmes.

(iii) Infrastructural problems such as lack of communication, transport, postal services,

health medical facility etc. are constraints faced by institutions to impart training in

remote areas.

(iv) Shortage of staff to conduct proper follow-up action and monitoring after training is the

serious problem.

(v) Communication and language problem have been felt by most of the trainers, motivators

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and officers as they are from outside resulting into communication gap.

(vi) Low rate of repayment ofloans and the high incidence of defaulters are the problems for

the banks to refinance.

(vii) Lack of awareness and indifference of tribals towards entrepreneurship because they

are bereft of entrepreneurial culture.

(viii) Sometimes, entrepreneurship development programmes are stopped in between due to

lack of proper co-ordination among different government departments and training

agencIes.

(ix) Bureaucratic approach is one of the reasons for failure of entrepreneurship development

programmes.

(x) Non-availability of guest speakers in rural areas.

(xi) In some tribal areas, the geographical condition are so hostile that it is difficult for EDP

people to reach potential entrepreneurs.

It can be concluded from foregoing analysis that the respondents of both the regions

Meghalaya and Chotanagpur observe the role of institutional support system as pre-requisite for

the inception, sustenance and expansion of business enterprises in their regions. Training as an

important ingredient of entrepreneurial inculcation particularly among the potential tribal

entrepreneurs, assumes significant importance in both regions. The major inputs acquired

through training programmes are found to be technical know-how (4\5th of the respondents in

Meghalaya as well as Chotanagpur), planning skills (68.4 per cent and 58.3 per cent in Meghalaya

and Chotanagpur respectively), motivation (68.4 per cent in Meghalaya and 54.1 per cent in

Chotanagpur), financial skills (57.8 per cent in Meghalaya and 54.1 per cent in Chotanagpur)

and marketing skills (52.6 per cent in Meghalaya and 62.5 per cent in Chotanagpur). Role of non

governmental organizations has been instrumental in imparting training particularly in

Chotanagpur region. The family and community support have been contributing factors for the

enhancement of entrepreneurship in Meghalaya than Chotanagpur region. The facilities

provided by the support system are reported to be electricity, technical services, training

programmes, infrastructural facilities, and finance in both the regions of Meghalaya and

Chotanagpur.

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The major constraints perceived by the respondents of both regions are financial

problem, Jack of marketing, lack of technical know-how and Jack of infrastructural facilities.

But the constraints such as lack of electricity, less family and community support, low education,

and less managerial skills are more serious problems in Chotanagpur. Lack of transport facility

is more acute in Meghalaya. The financial constraint has been felt as a major problem for the

institutional support system also. Other impediments perceived by the support system for the

development of entrepreneurship are found to be infrastructural problem, poor participation of

tribal people and lack of co-ordination between agencies in both regions.

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existing support system and...

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