Meaning of Rural Entrepreneurship

Entrepreneurship emerging in rural areas is called rural entrepreneurship.

Establishing industries in rural areas refers to rural entrepreneurship.

Rural entrepreneurship is synonymous of rural industrialization.

Definition

According to the KVIC : -“Rural industry means any industry located in rural areas, population of which does not exceed 10,000 or such other figure which produces any goods or renders any services with or without use of power and in which the fixed capital investment per head of an artisan or a worker does not exceed a thousand Rupees.”According to Government of India : -“Any industry located in rural area, village or town with a population of 20,000 and below and an investment of Rs. 3 crores in plant and machinery.”

Classification of Rural Industries

All rural industries have been classified into the following six categories:-

1.Mineral-based industries.2.Forest-based industries.3.Agro-based industries.4.Engineering and non-conventional industries.5.Textile industry (including Khadi), and6.Service industry.

Need for Rural Entrepreneurship

The need for developing rural entrepreneurship is to promote rural development in the country. This is justified as follows :Rural industries being labor intensive serve as an antedote to the widespread problems of rural unemployment.It helps in reducing disparities in income between rural and urban areas.These industries promote balanced regional development by dispersing industries to rural areas.

Need for Rural Entrepreneurship contd.

Development of rural industries serves as an effective means to build up village republics.Rural industries also help preserve the old rich heritage of the country by protecting and promoting art and creativity.Rural industrialization fosters economic development in rural areas.Rural industries also lead to development without destruction.

Problems of Rural Entrepreneurship

Developing rural entrepreneurship is important but not so easy. The general bottlenecks in the development of village industries are :

Financial constraints.Lack of technical know-how.Lack of training and extension services.Management problems.

Problems of Rural Entrepreneurship contd.

Lack of quality control.High cost of production due to high input cost.Lack of communication and market information.Poor quality of raw materials.Lack of storage and warehouses.Obsolete and primitive technology.Lack of promotional strategy.

How to Develop Rural Entrepreneurship

The following measures may prove effective instruments for developing entrepreneurship in rural areas of country :A policy formulation for strengthening the raw material base in rural areas in the country.Finance for running an industry, needs to be made available at soft and easy terms and conditions to the prospective entrepreneurs.Measures like common production-cum-marketing centres be taken to solve the marketing problem faced rural industries.Inculcate and develop entrepreneurial aptitude among entrepreneurs to make them successful in their ventures.

How to Develop Rural Entrepreneurshipcontd.

Imparting entrepreneurial education at the school, college and University may be one of the effective ways to inculcate the entrepreneurial attitude among the prospective entrepreneurs in rural areas of the country.

Disseminating information about various facilities available for prospective entrepreneurs to set up industries in rural areas.

The NGOs should be encouraged to contribute to development of rural industries in the country.