CHAPTER-3 ROLE OF GOVERRNMENT INSTITUTIONS IN DEVELOPING ENTREPRENEURSHIP

CHAPTER-3 ROLE OF GOVERRNMENT INSTITUTIONS IN DEVELOPING ENTREPRENEURSHIP Entrepreneurship development is the main input for economic development of a nation. The Government of India has taken varoius measures to develop entrepreneurship in the late sixties with the industrial campaign. Entrepreneurship development started in India with the establishment of Small Industry Extension and Training Institute (SIET) in 1962 at Hyderabad. It was the Gujrat Industrial Investment Corporation (GIIC) which for the first time started a three month training programme on industrial development in 1970. By the later half of 1970s, SIET and Small Industry Development Organisation (SIDO) through Micro, Small and Medium Enterprises (MSMEs) earleir known as Small Industry Services Institute(SISI) and Industrial Development Bank of India (IDBI) through Technical Consultancy Organisations (TCOs) started organising EDPs (1). But as these institutions were not sufficient to meet the growing demand for training needs of the entrepreneurs, the Indian Government has established various other institutions/departments at the national, regional and state level viz., National Small Industries Corporation ltd. (NSIC), Entrepreneurship Development Institute of India (EDII), Indian Institute of Entrepreneurship (IIE), National Institute of Small Industry Extension and Training (NISIET), State Small Industries Development Corporation (SSIDC), Assam Industrial Development Corporation LTd. (AIDC), Madhya Pradesh Consultancy Organisation Ltd., Calcutta Y Self Employment Centre (CYSEC) etc. to improve the quality and quantity of the entrepreneurs. These institutions assist the 85

entrepreneurs by providing various kinds of facilities along with training and finance, being the main components of growth of entrepreneurship. Besides, the Government of India has been implementing various programmes/schemes since the Ist Five Year Plan in order to reduce Poverty and Unemployment. No doubt, these programmes/schemes have developed the economic status of the poor people in our country but the problem of unemployment and poverty still exists. The Government institutions/departments organises EDPs under various programmes/schemes namely Prime Minister s Integrated Urban Poverty Eradication Programme(PMIUPEP-1996), Small and Marginal Farmers and Agricultural Labourers Development Agency (SMFALDA--1974),Training for Rural Youth for Self-Employment (TRYSEM- commenced in 1979 but later on merged with other schemes as SGSY in 1999), Nehru Rojgar Yojana (NRY-launched in 1989,recasted in 1990 but later on subsumed with Swarna Jayanti Shahari Rojgar Yojana), Margin Money Scheme (MMS) for Village Indusries(1997), Scheme for providing Self- Employment to Educated Unemployed Youth (SEEUY-1983 but subsumed with PMRY in 1993 ), Prime Minister s Rojgar Yojana (PMRY), Swarna Jayanti Shahari Rojgar Yojana (SJSRY), Swarna Jayanti Gram Swarojgar Yojana(SGSY), Schemes for preparing Ex-Serviceman for Self-Employment, Integrated Rural Development Programme (IRDP), Schemes for Liberation and Rehabilitation of Scavengers(SLRS), Development of Women and Children in Rural Areas (DWCRA) etc. in the country. In Assam, steps for entrepreneurship development were undertaken during seventies. Assam, for the first time, started an integrated approach for entrepreneurship development in 1973 by setting up a district level agency known as Entrepreneurial Motivation Training Centre (EMTC) to identify, select and train prospective entrepreneurs and to provide them all support services to establish and 86

manage their enterprises. But in 1999, the Government of Assam merged the EMTCs with District Industries Centres (DICs) (2). Among various organisations/ instituions imparting EDP s in Assam, IIE, NSIC, MSME, DIC, North Eastern Industrial and Technical Consultancy Organisation (NIETCO), AIDC and Assam Engineering Institute (AEI) are prominent (3). But in Karbi Anglong District, District Industries and Commerce Centre (DICC), District Rural Development Agency (DRDA), Br. MSME and the Town Committees are the Government instituions/departments which are actively involved in organising EDPs in the district under various types of income generating and self-employment schemes/programmes launched by the Government from time to time. Besides, banks have also been playing a vital role in the process of entrepreneurship development in the district. NON FINANCIAL GOVERNMENT INSTITUTIONS ORGANISING EDPs IN THE COUNTRY 1. National Small Industries Corporation Ltd.( NSIC) (4) The National Small Industries Corporation Ltd. was established by the Government in 1955 as a Public Sector Company, with a view to promoting, aiding and fostering the growth of micro, small and medium enterprises (MSMEs) in the country with focus on commercial aspects of their operations. NSIC implements rural schemes to help the MSMEs in the areas of raw material procurement, product marketing, credit rating, acquisition of technologies, adoption of improved management practices through its 7 Zonal Offices, 26 Branch Offices, 15 Sub- Offices, 5 National Technical Services Centres, 2 Softwae Technology Parks and 3 Technical Services Extension Centres, spread practically over the country. Besides, it imparts training in various industrial trades. The Corporation has also set up a number of Turn-Key Projects in many developing countries. 87

The mission of NSIC is to assist small enterprises with a set of schemes, under which various facilities and support is provided to the small enterprises viz., marketing support, credit support, technology support etc. NSIC, since its inception, has been working with its mission of promoting, aiding and fostering the growth of micro and small enterprises and enhance their competitiveness by providing integrated support services and Marketing, Technology, Finance and support services. During the year, 2008-09, NSIC has organised/ participated in 19 exhibitions/ trade fair, buyer-seller meets up to September, 2008. NSIC has also conducted 368 intensive campaigns/ marketing promotion seminars all over the country up to November, 2008. At present, International Cooperation Scheme, which commenced during the Ninth Plan, is under operation (2007-2012). The important objective of the scheme is Technology Infusion and upgradation of Indian Micro, Small and Medium Enterprises (MSMEs), their modernisation and promotion of their exports. The main functions of the Corporation are-- 1. Supply of both the indigenous and imported machines on easy hire-purchase terms through the composite term loan scheme. 2. Procurement, supply and distribution of indigenous and imported raw materials. 3. Export small industries products and developing export-worthiness of small scale units. 4. Enlisting competent units and facilitating their participation in government stores purchase programme. 5. Training in several technical trades. 6. Monitoring advisory services. 7. Setting up small-scale industries in other developing countries on turn-key basis. 88

2. Entrepreneurship Development Institute of India (EDII) (5) EDII, is an acknowledged National Resource Institute engaged in Entrepreneurship Education, Research and Training. EDII, an autonomous body set up in 1983 in Ahmedabad, is sponsored by apex financial institutions namely the IDBI Bank Ltd., IFCI Ltd., ICICI Ltd., State Bank of India (SBI). The institute is registered under the Societies Registration Act, 1860, and the Public Trust Act,1950. The Government of Gujarat pledged twenty-three acres of land on which stands the EDI campus. The main aim of EDII is to provide innovative training techniques, competent faculty support, consultancy and quality teaching and training material. EDI has started the entrepreneurship movement with a belief that entrepreneurs need not be born but can be developed through well conceived and well-directed activities. The main functions of EDII are 1. Creating a multiplier effect on opportunities for self-employment. 2. Augmenting the supply of competent entrepreneurs through training. 3. Augmenting the supply of entrepreneur trainer motivators. 4. Participating in institution building efforts. 5. Inculcating the sprit of Entrepreneurship in youth. 6. Promoting micro-enterprises at rural level. 7. Developing and disseminating new knowledge and insights in entrepreneurial Theory and practice through research. 1. Facilitating corporate excellence through creating intrapreneurs( entrepreneurial managers). 2. Improving management capabilities of Small Scale Industries. 3. Sensitising the support system to facilitate potential and existing entrepreneurs establish and manage their enterprises. Collaborating with similar organisations in India and other developing countries to accomplish the above objectives. 89

The training programmes of the Institute are grouped under 4 heads Entrepreneurship in Education. Micro-finance and micro-enterprise development. Performance and growth of existing entrepreneurs. Performance Improvement of ED Institutions and ED Programmes. EDII organises training programmes on Informal Micro-Credit Delivery Systems (IMCDS) and management for strengthening the participating NGOs in the area of Informal credit. In 1984, the EDII initiated Performance Improvement Programmes in anticipation of the need of management strategy and growth-oriented awareness and competencies. It regularly organises trainers meets and chief executives meets to foster linkages among trainers and chief executives of ED organisations to facilitate experience sharing. Moreover, EDII has supported creation of Centres for Entrepreneurship Development and Institutes of Entrepreneurship Development in various states of the country to achieve institutionalisation of ED activities. 3. National Institute of Small Industry Extension Training (NISIET) (6) The National Institute of Small Industry Extension Training, formerly known as State Industry Extension Training Institute, was established by the Government of India in 1960. It is located at Hyderabad and provides training in industrial arrangement for small-scale units. The main functions of NISIET are ----- 1. To provide, supervise and plan training for persons engaged in small industry development and management activities. 2. To undertake, sponsor or plan research programmes related to the development of small industry, and 90

3. To enter into and executive technical assistance/agreement with international or other organisations for the provision of services for the development of small industry. The Institute has gained immense experience and expertise in the areas of entrepreneurship development, technology, management, extension and information services over the years. The inherent capacity of the Institute to innovate together with its top class infrastructure have enabled it to excel in its endeavour towards small enterprise promotion. From the time of inception, NISIET has been continuously providing support to small and medium industries and has evolved to be the best institution offering services like research, consultancy, information, training and extension enterprise to enterprise as also to several aspiring and expanding entrepreneurs. Among NISIET S numerous milestone are the Kakinada experiment of Prof. David McClelland, the pioneering study in developing the first entrepreneurship model, the first international training programme (1967), Small Industry Promotion in Developing Economies(SIPDE), assistance from UNIDO under the Centre of Excellence Scheme(1984), a UNESCO Chair(1997), and Enterprise Development and Government Effectiveness(EDGE) programme with Sri Lanka(1998). NISIET functions through 10 centres of excellence devoted to various facets of Small Industry Development. Besides, the Govt. of India has set up a Cell at NISIET to promote entrepreneurship through Mentor concept in order to gear up the entrepreneurship development programmes. It is further expected that NISIET would intensify the present effort towards entrepreneurship promotion by involving various training institutions and also successful entrepreneurs as role models to take up the task of Mentor in promoting entrepreneurship among potential individuals. 91

4. National Institute of Entrepreneurship and Small Business Development (NEISBUD) (7) It is an apex national level institute set up at New Delhi in 1983 by the Ministry of Industries(now Ministry of SMEs),Govt. of India, coordinating and overseeing the activities of various institutions/ agencies engaged in Entrepreneurship Development, particularly the area of small industry and small business. The policy, direction and guidance to the institute is provided by its Governing Council whose Chairman is the Minister of SSI. The main objectives of the institute are: 1. To accelerate the process of entrepreneurship development throughout the country and among all segments of the society. 2. To help institutions/agencies in carrying out activities relating to entrepreneurship development. 3. To evolve standardised process of selection, training support and sustenance to potential entrepreneurs enabling them to set up and run their enterprises successfully. 4. To provide information support to trainers, promoters and entrepreneurs by organising documentation and research work relevant to entrepreneurship development. 5. To provide functional forums for integration and exchange of experiences helpful for policy formulation and modification at various levels. The main functions of the Institute are as follows: (i) Evolving effective training, strategy and methodology. (ii) Formulating scientific selection procedure. (iii) Standardising model syllabus for training for various groups. (iv) Developing training aids, manuals and other tools. 92

(v) Supporting 9ther agencies engaged in entrepreneurship development. (vi) Conducting such programmes for promoters, trainers and entrepreneurs which are commonly not undertaken by other agencies. (vii) Organising all those activities that help develop entrepreneurial culture in the country. (viii) Publishing literature for furtherance of entrepreneurship and small business development. 5. Indian Institute of Entrepreneurship (IIE) (8) The Indian Institute of Entrepreneurship was established in 1993 at Guwahati by the Ministry of Industry ( now Ministry of Small Scale Industries and Agro and Rural Industries, ( MoSSI&ARI), Govt. of India to undertake training, research and consultancy activities in the field of small industry and entrepreneurship. The Institute was registered under the Societies Registration Act, 1960. It started its operation from April, 1994. Besides, the Govt. of India, the North Eastern Council, Small Industries Development Bank of India, Government of Nagaland and Arunachal Pradesh are its sponsors. The Institute takes up various activities to create an entrepreneurial culture in the society such as developing new entrepreneurs, helping the growth of existing entrepreneurs and educating the youths on entrepreneurial education. Objectives To organise and conduct training for entrepreneurship development. To evolve strategies and methodologies for different target group and locations and field test system. 93

To identify training needs and offer training programmers to Government and Non-Government Organisations engaged in promoting and supporting entrepreneurship. To document and disseminate information needed for policy formulation and implementation related to self-employment. To identify, design and conduct training programmes for existing entrepreneurs. To prepare and publish literature related to entrepreneurship and industrial development. To organise seminars, workshops and conferences for providing forum for interaction and exchange via by various agencies and entrepreneurs. To conduct research to generate knowledge for accelerating the process of entrepreneurship development. To act as a catalyst for development of self-employment / entrepreneurship, industry / business. To evolve, design and help use of various media for creating entrepreneurship. 6. National Alliance of Young Entrepreneurs (NAYE) (9) NAYE has arranged several schemes of entrepreneurial development in collaboration with public sector banks such as Bank of India, Dena Bank, Punjab National Bank, Central Bank of India and Union Bank of India. The objectives of the schemes are the following: 1. Help young entrepreneurs in identifying investment and self-employment opportunities. 2. Secure proper arrangement for their training. 3. Provide necessary financial assistance on the basis of project reports. 94

4. Secure package of consultancy services. 5. Arrange for getting assistance, facilities and incentives extended to entrepreneurs by the government and other institutions. 7. Technical Consultancy Organisations (TCOs) All India financial institutions and state governments have set lip a net work of technical consultancy organizations. The functions of the TCOs include--conducting surveys on industrial potential, preparing project profiles, undertaking techno-economic appraisal of projects, carrying out market research, providing technical and managerial assistance to entrepreneurs, assistance in modernisation, technology upgradations and rehabilitation programmes and organising information cell and Data Bank concerning industrial and economic activities and provide these to entrepreneurs (10). In Tamil Nadu, the Industrial Technical Consultancy Organisation of Tamil Nadu offers a wide variety of consultancy service. In Assam, the North Eastern Industrial and Technical Consultancy Organisation (NIETCO) was set up at Guwahati in 1973. NIETCO provides various types of facilities including technical and administrative assistance to the potential entrepreneurs for promotion and management of industries. 8. Small Industries Development Organisation (SIDO) (11) Small Industries Development Organisation (SIDO) is a subordinate office of the Department of SSI & ARI and a nodal agency for formulating, coordinating, and monitoring the policies and programmes for promotion and development of smallscale industries. SIDO carries out its activities through a network of institutions and associated agencies created for specific functions. At present, the SIDO functions through 27 Offices, 31 Small Industries Service Institutes (now renamed as Micro, 95

Small & Medium Enterprises), 37 Extension Centres, 3 Product-cum-Process Development Centres and 4 Production Centres. All small-scale industries except those falling within the specialised boards and agencies like KVIC, Coir Boards, Central Silk Board etc. fall within the purview of the SIDO. The main functions of the SIDO are - To evolve a national policy for the development of Small Scale Industries. To co-ordinate the policies and programmes of various State Governments. To maintain a proper liaison with the related Central Ministries, Planning Commission, State Governments, Financial Institutions, etc. To co-ordinate the programmes for the development of industrial estates. To reserve items for production by small-scale industries. To collect data on imported consumer items and then, encourage the setting of Industrial units to produce these items by giving coordinated assistance. To render required support for the development of ancillary units. To encourage small scale industries to actively participate in Government Stores Purchase Programmes by giving them necessary guidance, market advice and assistance. To provide technical services for improving technical process, production planning, selecting appropriate machinery, preparing factory lay-out and design. To provide consultancy and training services to strengthen the competitive ability of small-scale industries. To render marketing assistance to small-scale industries to effectively sell their products. To provide assistance in economic investigation and information to smallscale industries. 9. MSME--Technology Development Centres (MSME - TDCs) (12) MSME-TDCs are product specific centres to look into specific problems and render technical services. The main functions of MSME-TDCs are- 96

To develop human resources in various fields like electronic items, instrumentation industries, sports goods, glass industries etc. To promote and modernise glass industry, foundry and forge industries. Technological upgradation of essential oils, aroma chemicals, fragnance and flavour industry. To organise training courses on repairs and maintenance of CNC machinery, fibre optics testing facilities and tailor-made training modules designed as per the need of the industry. 10. Central Footwear Testing Institute (CFTI) renamed as MSME Technology Development Centre - Footwear (MSME - TDC) (13) CFTIs provide training facilities and design development facilities for the footwear and leather industry. They have their branches at Agra, Chennai, Mumbai and Kolkata. These instiutes have proved to be useful for small industries not only at the places where its branches exist but also at other places where it has no branch. The functions of MSME - TDCs: Footwear To develop human resources for footwear and allied industries through various training programmes on footwear technology and allied services. To conduct long-term, short-term and part-time on various subject of footwear technology. To provide technical support services to the user industry by making the facilities available to them. To provide services for the development of new products and patterns as per given sample or concept. 97

11. Small Scale Industries Board (SSIB) (14) The Small Scale Industries Board (SSIB) was first constituted in 1954 to render advice to the Government on small scale industries in the county. The range of developmental work in small scale industries involves several departments/ ministries and several organs of the Central/ State Governments. The Industries Minister of the Government of India is the Chairman of the SSIB. The SSIB comprises of 50 members including State Industry Minister, some members of Parliament, Secretaries of various Departments of Government of India, Financial Institutions, Public Sector Undertakings, Industry Associations and eminent experts in the field. 12. Khadi and Village Industries Commission (KVIC) (15) Khadi and Village Industries Commission (KVIC) is a statutory body created by an Act of Parliament. It was established in April 1957 as KVIC and it took over the work of the former All India Khadi and Village Industries Board set up in 1950. It is engaged in the task of promoting and developing Khadi and Village Industries (KVI) with a view to creating employment opportunities in the rural areas, thereby strengthening the rural economy. It functions under the administrative control of Ministry of Micro, Small and Medium Enterprises, Government of India. The broad objectives of the KVIC are - The social objective of providing employment; The economic objective of producing saleable articles and The wider objective of creating self-reliance amongst the people and building up a strong rural community spirit. 98

Functions of KVIC i) It has been charged with the function of planning, promotion, organisation and implementation of programmes for the development of Khadi and other village industries in the rural areas, in coordination with other agencies engaged in rural development. ii) Its functions also comprise building up of a reserve of raw materials and implements for supply of producers, creation of common service facilities for processing of raw materials as semi- finished goods and provision of facilities for marketing of KVI products. It organises training of artisans engaged in Khadi and Village Industries. iii) It is also charged with the responsibility of encouraging and promoting research in the production techniques and equipments employed in the KVI sector and providing facilities for the study of the problems relating to the same. It also promotes the use of non-conventional energy, bio-fertilizer and other organic products. iv) It is also entrusted with the task of providing financial assistance to institutions and persons engaged in the development and operation of Khadi and Village Industries and guiding them through supply of designs, prototypes and other technical information. KVIC promotes and extends financial support for implementation of Khadi Programme through registered institutions and cooperative societies. Besides, it implements Khadi Programme departmentally and through State Khadi and Village Industries Boards. In the process of implementation of the programme, KVIC extends support in the form of loan and generate employment opportunities for the traditional 99

artisans, thereby promote traditional artistic skills and products for which the country enjoys pride recognition. KVIC provides training to identified Prime Minister s Employment Generation Programme (PMEGP) entrepreneurs for Entrepreneurship Skill Development covering managerial, accounting and marketing management through accredited Institutions, free of cost. 13. Industrial Estates (16) Industrial Estates are institutions established to promote industrialisation in the country. In India, Industrial estates have been utilised as an effective tool for promotion and growth of small-scale industries. The main objectives of Industrial Estates are - i. To provide infrastructure and accommodation facilities to the entrepreneurs. ii. iii. iv. To encourage the development of small-scale industries in the country. To decentralise industries to the rural and backward areas. To encourage ancillarisation in surrounding major industrial units and v. To develop entrepreneurship by creating a congenial climate to run the industries in these estates/ areas/ townships, etc. In India, industrial estates are established to provide readymade buildings, factory sheds at subsidised rates, infrastructure facilities etc. to the small-scale units. The first Industrial Estate in India was set up at Rajkot in Gujarat in September, 1955. By now, the number of industrial estates in the country had gone upto more than 650 making it the largest programme of its kind in the word (17). 100

14. Indian Investment Centre (IIC) (18) This organisation was set up by the Government of India in 1960 to promote joint ventures and to conduct EDPs. It has set up an Entrepreneurial Guidance Bureau to guide entrepreneurs in establishment of new ventures. The functions performed by the IIE are stated below- i. Identification and selection of potential entrepreneurs. ii. Developing entrepreneurial skills to perform entrepreneurial job. iii. Increasing managerial knowledge of entrepreneurs iv. Helping entrepreneurs to start their own projects 15. State Small Industries Development Corporation (SSIDC) (19) The State Small Industries Corporation (SSIDC) were set up in various States under the Companies Act,1956, as State Government Undertakings to cater to the primary developmental needs of the small, tiny and village industries in the State/ Union Territories under their jurisdiction. The important functions of the SSIDC includes i) To procure and distribute scarce raw materials. ii) To supply machinery on Hire Purchase System. iii) To provide assistance for marketing of the products of small scale industries. iv) To construct industrial estates/ sheds/ providing allied infrastructure facilities and their maintenance. v) To extend seed capital assistance on behalf of the State Government concerned. vi) To provide management assistance to production units. 101

16. Xavier Institute of Social Services (XISS), Ranchi (20) It is an educational institute in Ranchi, established as an extension department of St. Xavier s College, Ranchi, in 1955. In 1973, the institute was registered as a separate educational society under the Societies Registration Act, 1860 to develop human resources for various sectors such as industries, business, rural development, healthcare etc. It assists the trainees in drafting project proposals and in obtaining the required finance. It offers a six months programme to tribals for developing the entrepreneurial skills. Besides, it provides financial and follow up assistance to the entrepreneurs. 17. Madhya Pradesh Consultancy Organisation Ltd. (21) This institution has been promoted by All India Financial Institutions and State Corporations. It undertakes assignments for project planning, market surveys, management services, market surveys and conducts entrepreneurship development programmes for technical people, unemployed youth, backward castes people and for women. Besides, it creates opportunities for the entrepreneurs and thus, helps in the process of entrepreneurship development. 18. Calcutta Y Self-Employment Centre (CYSEC) (22) It was organised as a registered society by a number of industrialists, businessmen, bankers, professionals and social workers in order to control the rapidly growing unemployment and social unrest in Calcutta in the early 1970s. It provides vocational training and assistance to the unemployed youths in starting the business enterprises. It trains the unemployeds in productive enterprises, assists them in 102

drawing up a business plan, securing bank loans and arranges initial business contacts for their services and productions. 19. Assam Industrial Development Corporation Ld. (AIDC) It is an organisation started by the Assam Government in 1965, as one of the industrial implementing agencies in medium and large sector. It provides provides training to entrepreneurs, engineers, diploma holder's etc. under its Human Resource Development programme to create a sound entrepreneurial base and to prepare the technical manpower for competitive environment. It provides technical, financial, managerial and consultancy services and infrastructural support to the entrepreneurs. The Corporation has trained a number of graduate engineers and diploma holders as a part of its orientation-training programme at EDII, Ahmedabad and Refinery etc. The Corporation has also arranged training programme for Women Entrepreneurs at Guwahati. The Corporation also acts as a financial institution to provide financial assistance for setting up medium scale industries in the State. The Corporation operates the Refinance Scheme of IDBI and the Assisted Sector Equity Scheme of Government of Assam to provide the necessary financial assistance. The Term Loan assistance has already been provided to various units under IDBI's Refinance Scheme and Equity assistance under assisted sector scheme. The Corporation provided financial assistance of Rs. 174.93 lakhs in the year 1993-94, Rs. 349.56 lakhs in 1994-95, Rs. 154.58 lakhs in 1995-96, Rs. 83.17 lakhs in 1996-97 and Rs. 92.19 lakhs in 1997-98 to the entrepreneurs (23). 20. Assam Engineering Institute (AEI) (24) Assam Engineering Institute was established on 16 th January, 1948 in Guwahati. It is an important and premier institution in Assam and North East providing 3 year degree Diploma courses in Civil, Chemical, Computer Engineering, 103

Electrical, Electronics and Telecommunication and Mechanical. It provides training to the youths and arranges many workshops on carpentry, fitting, painting, welding etc. and thus, helps in creating self-employment opportunities for the entrepreneurs. 21. MSME (Micro Small & Medium Enterprises) Development Institutes ( Old Name- Small Industries Service Institute (SISI) ) (25) The Micro Small and Medium Enterprises (MSME) Institutes are set up to provide consultancy and training to both existing and prospective small entrepreneurs. The activities of MSMEs are coordinated by the Industrial Management Training Division of the DCSSIs office. There are 28 MSMEs and 30 Branch MSMEs set up in the State Capital and other places all over the country.the main functions of MSMEs are- to serve as interface between Central and State Governments, to render technical support services, to conduct Entrepreneurship Development Programmes and to initiate promotional programmes. Besides, the MSMEs also render assistance in regard to - economic consultancy, information, EDP consulatancy, trade and market informations, project profiles, state industrial potential survey, district industrial potential surveys, modernisation and inplant studies, workshop facilities and training in various trade or activities. In Assam, the MSME, Guwahati has been set up by the Government of India to supplement the activities of the State Government for promotion or development of small scale industries. The MSMEs network in the state of Assam, Meghalaya and Arunachal Pradesh is a part of the national network under the Small Industries Development Organisation (SIDO) - which is an apex body administered by the Ministry of Industry. The Institute provides assistance and renders various Extension services for the growth and development of small-scale ventures in the state of Assam, Meghalaya and Arunachal Pradesh. 104

In Karbi Anglong district, the Br. MSME has been organising different activity-based training programmes but it do not provide any follow-up assistance to the trainees. It gives publicity of the training programme through advertisement in the local newspapers and by giving notice in the Office board. The Br. MSME provides both theoretical and practical training to the trainees. The trainees are selected on the basis of application. The duration of the training programme varies from 15-30 days. As per data available from the Office of the Br. MSME, the Br, MSME has conducted training programmes on Computer Hardware Repairing and Maintenance, Soft Toys Making and Designing and Fashion Designing and Readymade Garments during the period 2004-05 to 2006-07. A total of 79 trainees participated in 3 number of training programmes organised by the Br. MSME during the period 2004-05 to 2006-07. The number of trainees participated in the training programmes organised by the Br. MSME in different years is shown in the following table - Table No. 3.1 Number of Trainees in the Training Programmes Organised by Br. MSME in Karbi Anglong District (2002-03 to 2006-07) Year No. of Training Programme No. of Trainees 2002-03 N/A N/A 2003-04 N/A N/A 2004-05 1 27 2005-06 1 24 2006-07 1 28 Total 3 79 Source: Office of the Br. MSME, Karbi Anglong, Diphu. No doubt, the Br. MSME officials are highly satisfied to be a part of the entrepreneurship development process but they are highly dissatisfied so far as the 105

entrepreneurial units undertaken by the trainees in between the year 2004-05 to 2006-07 are concerned. 22. District Industries Centre (DIC) (26) The District Industries Centre (DIC) programme was started on May, 1978 with a view to provide integrated administrative framework at the district level for the promotion of small-scale industries in rural areas. But now it is renamed as District Industries and Commerce Centre (DICC).Services and support to small entrepreneurs are provided under a single roof through the DIC. DIC is the implementing arm of the Central and State Governments of the various schemes and programmes, specially meant for employment generation. Besides, registration of small scale industries is also done at the district industries centres. The DIC help the small entrepreneurs in the following respects - i) Identification of suitable Schemes. ii) iii) iv) Preparation of feasibility reports. Arrangements for supply of machinery and equipments. Provision of raw materials, credit facilities and inputs. v) Marketing of the products. DIC is headed by a General Manager. He is assisted by a team of specialists in economic investigation, machinery and equipment, research extension and training, raw materials, credit facilities, marketing and cottage industries. Moreover, the Credit Specialists or the Credit Manager has been deputed by the Bank to the District Industries Centre. These specialists provide the necessary guidance, assistance and support required by the entrepreneurs in procuring credit at the right time on right terms from right Institutions. DIC makes appraisal of the credit proposals of the small entrepreneurs and the sponsor them to the credit institutions with the 106

recommendations of the Credit Manager. Of course, the credit managers do not have the power to sanction loans. However, they considerably facilitate and speed up the process of providing credit to the small entrepreneurs because of their expertise in their respective area. In Karbi Anglong District, District Industries and Commerce Centre (DICC) has been implementing various entrepreneurship development schemes viz. PMRY, KVIC-MMS, PMEGP etc in the district. DICC organises various activity-based training programmes under the entrepreneurship development schemes in which both theoretical and practical type of training is imparted. The duration of the training programme in regard to activities related to industry and service sector is 20 days and 10 days for activities related to Business. It gives publicity of the training programme through advertisement in the local newspapers and by giving notice in the Office board. The entrepreneurs for the training programmes are selected on the basis of personal intervew. A total of 1252 trainees participated in 17 number of training programmes organised by the DICC during the period 2002-03 to 2006-07. The number of trainees participated in the training programmes organised by the DICC in different years is shown in the following table - Table No. 3.2 Number of Trainees in the Training Programmes Organised by DICC in Karbi Anglong District (2002-03 to 2006-07) Year No. of Training No. of Trainees Programme 2002-03 4 251 2003-04 3 222 2004-05 4 348 2005-06 3 285 2006-07 3 146 Total 17 1,252 Source: Office of the District Industries and Commerce, Karbi Anglong, Diphu. 107

DICC also provides follow up assistance to the entrepreneurs in selection of the project, getting finance from the banks, monitoring the enterprises and also provides sustenance support. The DICC officials of Karbi Anglong are dissatisfied so far as the operation of entrepreneurial units undertaken by the entrepreneurs in between the year 2002-03 to 2006-07 is concerned. But the DICC officials are satisfied on their involvement in the entrereneurship development process. 23. District Rural Development Agency (DRDA) (27) Poverty alleviation through Self-employment and Wage-employment programme is the theme of rural development. It is District Rural Development Agency (DRDA) at the District level which overseas the implementation of different anti-poverty programme. DRDA came into existence with effect from 1.4.1980. Previously it was known as Marginal Farmer & Agricultural Land Development Agency (MFALDA). Later on it became Small Farmer Development Agency (SFDA). These agencies were only to cater the development of Marginal Farmers and Agricultural Labourers in rural area. Now DRDA has embraced manifold activities for upliftment of rural poor. DRDA has become an autonomous agency having its own Governing Body registered under Society Registered Act. 1960. After 73 rd amendment act past in the year 1993 President of Zilla-Parishad is the Chair Person of the Governing Body and the District Collector is its Chief Executive Officer. The main activities of DRDA is to implement Self-Employment Programme and Wage- Employment Programme 108

Role of DRDA i. Principal facilitators for drawing of Plan and Programmes. ii. Allocates funds, Maintains accounts and collects Utilisation Certificates. iii. Co-ordinates Executive Agencies, financial institutions, NGOs, Government and Panchayati Raj Institutions at different levels. iv. Supervises and monitors various programmes implemented in the field. v. Ensures successful implementation of the programmes. vi. Keeps inform Zilla-Parishad and Government through reports and returns. vii. Creates awareness and transparency amongst the common people. viii. Safe guards the interest of SC/ST. Women and Physically Handicap Persons. DRDA was established in the Karbi Anglong District the year 1980. Since then, the department has been implementing various entrepreneurship development schemes namely, IRDP, TRYSEM, DWCRA, SGSY etc. But at present, SGSY is the only scheme in operation. DRDA organises activity-based training programmes in which both theoretical and practical training is provided to the trainees by engaging a resource person with specialised knowledge base. It gives publicity of the training programme through advertisement, notice in the Office board, notice to SHG and through SHG to SHGs. The applicants for the training programmes are selected on the basis of application and activity. The duration of the training programme depends on the activity i.e., 1-4 days training is imparted for piggery, 7-25 days training for weaving, 1-4 training for fishery, 2 days training for Agriculture and Horticultural units, 15 days training for Cane and Bamboo and 1-4 days training for Dairy units. DRDA has conducted 292 training programmes with 4,256 trainees during a period of five years i.e., from 2002-03 to 2006-07. The number of training programmes 109

organised by DRDA with the number of trainees in different years is shown in the Table. No. 3.3. Table No. 3.3 Number of Trainees in the Training Programmes Organised by DRDA in Karbi Anglong District (2002-03 to 2006-07) Year No. of Training Programme No. of Trainees 2002-03 48 624 2003-04 66 225 2004-05 61 1,032 2005-06 58 1,448 2006-07 59 927 Total 292 4,256 Source: Office of the District Rural Development Agency, Karbi Anglong, Diphu. DRDA provides follow up assistance to the entrepreneurs in selection of the project, getting finance from the banks and monitoring the enterprises. It does not provide sustenance support to the entrepreneurs. The DRDA officials of Karbi Anglong are satisfied from the entrepreneurial units undertaken by the entrepreneurs (i.e., SHGs) in between the year 2002-03 to 2006-07. Moreover, the DRDA officials are also satisfied on being engaged in the entrereneurship development process. 24. Town Committee A Town Committee is generally set up to look after all the issues concerning the development of the town. In Karbi Anglong District, there are six town committees located at Diphu, Dokmoka, Bokajan, Hamren, Howraghat and Donkamokam. All these Town Committees have been implementing the SJSRY scheme under the supervision of Town and Country Planning Department, Karbi Anglong, Diphu. As such the Town Committees have been organising training 110

programmes for the applicants under the SJSRY scheme.they give publicity of the training programme through advertisement and notice in the Office board.they provide theoritical training to the trainees for a period ranging from 1 week to 15 days and the trainees are selected on the basis of application.these Town Committee Offices have reported a total of 10 training programmes with 110 trainees during the pereiod 2002-03 to 2006-07. The number of training programmes conducted by the Town Committees with number of trainees in different years is shown below- Table No. 3.4 Number of Trainees in the Training Programmes Organised by Town Committees in Karbi Anglong District (2002-03 to 2006-07) Year No. of Training Programme No. of Trainees 2002-03 2 9 2003-04 2 19 2004-05 3 60 2005-06 3 22 2006-07 N/A N/A Total 10 110 Source: Deputy Director, Town and Country Planning Department, Karbi Anglong, Diphu. The Town Committees provides follow up assistance to the entrepreneurs in selection of the project, getting finance from the banks and monitoring the enterprises but they does not provide any type of sustenance support to the entrepreneurs. On the one hand, the Town Committee officials are highly satisfied on being involved in the entrepreneurship development process and on the other hand, they are highly dissatisfied from the performance of the enterprises undertaken by the trainees in between the year 2002-03 to 2006-07 are concerned. 111

FINANCIAL INSTITUTIONS OF THE GOVERNMENT ASSISTING ENTREPRENEURS IN THE COUNTRY 1. Small Industries Development Bank of India (SIDBI) (28) The Small Industries Development Bank of India is an institution set up by the Government of India under a special Act of Parliament in October 1989 as a wholly owned subsidiary of the IDBI, with a view to ensure larger flow of financial and nonfinancial assistance to the small-scale sector. The Bank commenced its operation from 2 nd April,1990 with its head office at Lucknow. The important functions of SIDBI are - 1. To initiate steps for technological upgradation and modernisation of existing units. 2. To expand the channels for marketing the products of SSI sector in domestic and international markets. 3. To promote employment oriented industries especially in semi-urban areas to create more employment opportunities and thereby checking migration of people to urban areas. The SIDBI s financial assistance to small-scale industries is channelised through the existing credit delivery system compromising State Financial Corporations, State Industrial Development Corporations, Commercial Banks and Regional Rural Banks. 2. Commercial Banks (29) Commercial Banks plays an important role in the development of small scale industries. Twenty-seven commercial Banks through their country wise network of 112

more than 68,000 branches cater to the working capital need of the small scale industries. They have offered about 17.5% of the net bank credit to this sector. Besides, the short-term assistance, the SSI sector also receives term loans and other assistance by the nationalised banks. Moreover, specialised branches are opened I selected industrial estates and cities to exclusively cater to the requirements of the small- scale entrepreneurs. 3. Regional Rural Banks (RRBS) (30) Regional Rural Banks are created in different regions of the states in order to promote agriculture, trade, commerce and industry in rural areas and thereby improve rural economy. They provide credit facilities in the rural areas particularl to the artisans, farmers and small entrepreneurs. With the restructuring of 139 branches of RRBS, the RRBs have been able to meet the demands of the small entrepreneurs more efficiently. 4. Co-operative Banks (31) Co-operative banks, through a network of over 12,000 branches provide working capital funds to small entrepreneurs. The Primary Agriculture Co-operative Society (PACS) finances the agriculture and agriculture related industry. The Primary Co-operative Banks (PCBs) plays a vital role in meeting the working capital needs of cottage and tiny industries. 5. National Bank for Agriculture and Rural Development (NABARD) The NABARD was set up in 1982 in order to meet the credit needs of agriculture and rural sector. It oversees the rural credit system managed by the lending agencies such as the co-operatives and regional rural banks. It helps state co-operative banks to finance regional weavers society for working capital and marketing. It provides re-finance to financial institutions under the integrated rural development 113

programme (IRDP) and also monitors term lending by banks for agricultural purposes. NABARD also has a scheme for soft loan assistance to provide margin money to prospective entrepreneurs (32). The National Bank for Agriculture and Rural Development is an apex development bank, playing an important role in the development of informal sector in rural areas, primarily addressing the issues of (i) facilitating access to financial services and thereby accelerating the flow of institutional credit to the informal sector, (ii) building entrepreneurial and technical skills of the rural poor, (iii) facilitating market linkages and (iv) improving the productivity of agriculture in dryland areas. In recent years, NABARD has evolved and implemented various microfinance approaches in order to solve the problems of informal sector. The informal sector procures fund from both non-institutional sources and institutional sources (Formal Banks).But the findings of the All India Debt and Investment Survey,1992 shows that the share of non-institutional sources in the outstanding cash dues of rural households continue to be quite high at 36% (33). In addition, to facilitate graduation of the poor to micro-enterprise stage, NABARD supports Skill upgradation programmes, Entrpreneurship Development Programmes and marketing of the produce. ENTREPRENEURSHIP DEVELOPMENT PROGRAMMES / SCHEMES IMPLEMENTED BY THE GOVERNMENT INSTITUTIONS/ DEPARTMENTS IN KARBI ANGLONG DISTRICT The following are the various Entrepreneurship Development Programmes/Schemes that were in operation in Karbi Anglong district during the period 1993-94 to 2006-07. Among these schemes, SGSY, SJSRY are in operation in 114

the district now. Besides, the Prime Minister s Employment Generation Programme (PMEGP) launched on 2 nd October, 2008 is also in operation in the district. 1) Integrated Rural Development Programme (IRDP) The programme commenced in 1978 in 2300 selected blocks of the country. The programme was reviewed in 1978-1979 to integrate the methodology and approach of the three major ongoing special projects of SFDA, Community Area Development and Drought Prone Area Programmes (DPAP). All the principal contents of these three major programmes were integrated into a new programme called IRDP. Up to 1978-1979, IRDP was a central sector scheme and 100% funds were provided by the Central Government but after this period, funding was shared between the Centre and the State on 50:50 basis except Union Territories, where funding was totally done by the State. IRDP was extended to cover all the 5011 blocks covering 5.64 lakh villages in the country with effect from 2 nd October, 1980 and since then it continued to 1st April, 1999, to be a major instrument of poverty alleviation in the rural India. Thereafter, it was subsumed with SGSY. The main objective of the programme was to help the target groups (selected families living below the poverty line i.e., families earning an annual income of Rs.6400or less) to cross the poverty line. The families of the target groups were provided with productive assets and inputs through financial assistance in the form of subsidy by the Government and term credit and advances by the Banks. The programme was implemented by the DRDA in Karbi Anglong District. The DRDA in collaboration with the Lead Banks organised the training programmes under this scheme to create awareness for the benefit of IRDP beneficiaries. 115