Impact of Women Entrepreneurship Development on Families: A Study of Women run micro-enterprises in

Selected districts of Maharashtra.

Thesis Submitted to the Padmashree Dr. D. Y. Patil University, Department of Business Management in partial fulfillment of the requirements

for the award of the Degree of

DOCTOR OF PHILOSOPHY In

BUSINESS MANAGEMENT

Submitted by MS. RASHMI GOPINATHAN

(Enrollment No. DYP-PHD 066100016)

Research Guide Dr. R. GOPAL

DIRECTOR DEAN & HEAD OF DEPARTMENT

PADMASHREE DR. D.Y. PATIL UNIVERSITY, DEPARTMENT OF BUSINESS MANAGEMENT,

Sector 4, Plot No. 10, CBD Belapur, Navi Mumbai – 400 614

June 2010

IMPACT OF WOMEN ENTREPRENEURSHIP DEVELOPMENT ON FAMILIES :

A STUDY OF WOMEN RUN MICRO ENTERPRISES IN SELECTED

DISTRICTS OF MAHARASHTRA

DECLARATION

I hereby declare that the thesis entitled “Impact of Women

Entrepreneurship Development on Families: A Study of Women run

micro enterprises in selected Districts of Maharashtra” submitted for the

Award of Doctor of Philosophy in Business Management at the Padmashree

Dr. D.Y. Patil University Department of Business Management is my original

work and the thesis has not formed the basis for the award of any degree,

associate ship, fellowship or any other similar titles.

Place: Navi Mumbai. Date: Signature of the Guide Signature of the

Head of the dept. Signature of the student

CERTIFICATE This is to certify that the thesis entitled “Impact of Women

Entrepreneurship Development on Families: A Study of Women run

micro enterprises in selected Districts of Maharashtra” and submitted by

Ms. Rashmi Gopinathan is a bonafide research work for the award of the

Doctor of Philosophy in Business Management at the Padmashree Dr. D. Y.

Patil University Department of Business Management in partial fulfillment of

the requirements for the award of the Degree of Doctor of Philosophy in

Business Management and that the thesis has not formed the basis for the

award previously of any degree, diploma, associate ship, fellowship or any

other similar title of any University or Institution.

Also certified that the thesis represents an independent work on the part of

the candidate.

Place: Date: Signature of the Head of the Department Signature of the Guide

ACKNOWLEDGEMENT

I am greatly indebted to the Padmashree Dr. D.Y. Patil University, Department

of Business Management which has accepted me for the Doctoral Program

and provided me with an excellent opportunity to carry out the present

research work.

I am grateful to my guide, mentor, philosopher Dr. R.Gopal for having guided

me throughout the research span of time and for providing his constructive

criticism which made me bring my best. I would also like to thank sir for being

there at any point of time without considering his own precious personal time.

I would also like to thank Mr. Mahendra Gamre Sir, Training Head MAVIM

and also all the District Heads of MAVIM. Special thanks to Dr. Veena

Punecha, Research Head (SNDT University) having discussed and guided

me with the topic. Prof. Kumar (IIM – Bangalore), Mrs. Kusum Balsaraf,

Deputy M.D.- MAVIM for having supported me throughout the study. I would

be failing in my duty if I did not thank the grass root level workers for helping

me throughout the field work.

I sincerely thank my father for providing me the necessary motivation for

completing this dream project. I also wish to place on record my sincere

thanks to my revered deity and my late mother who have provided me with

the strength and ability to carry this research out of the best of my ability.

Lastly I also wish to thank all my near and dear ones who have been directly

and indirectly instrumental in the completion of my dissertation.

Place: Date: Signature of the student

CONTENTS

CHAPTER NO.

TITLE PAGE NO.

List of Tables

List of Figures

List of Abbreviations

EXECUTIVE SUMMARY

1. Introduction – Development of Entrepreneurship – A conceptual and Theoretical Interpretation

1

1.1. The Entrepreneur: Origin of the Concept. 1

1.2. Concepts of Entrepreneurship. 2

1.3. Historical Development of Entrepreneurship in India.

5

1.4. The Colonial Era 6

1.4.1. Post Colonial/ Modern Era 7

1.4.2. New Classical Economic Theories. 10

1.4.3. Psychological Theories. 12

1.4.4. Sociological Theories 18

1.4.5. Contemporary Theories 20

2. Literature Review 21

2.1. Western Research on Entrepreneurship 21

2.2. Indian Research on Entrepreneurship. 33

2.3. Studies on Women Entrepreneurship in Indian Context.

37

2.4. Studies on Entrepreneurship from Low Income Group.

46

3. Statement of the Problem 51

3.1. Objectives of the Study 51

3.2. Hypothesis 52

4. Research Methodology 53

4.1. Understanding the issue 53

4.2. Pre-Study 53

4.3. Primary and Secondary Data 54

4.4. Instrument for Survey. 54

4.5. Selection of Samples. 55

4.6. Pre Testing Phase 57

4.7 Tabulation and Statistical Analysis of Data. 58

4.8. Interpretation and Report Writing. 58

4.9. Limitations of Study. 58

5. Development of Women Entrepreneurship. 59

5.1. The Existing Scenario 59

5.2. Entrepreneurship Among Poor Women. 62

5.3. Women and Micro Enterprises. 62

5.4. Profiles and Typology of Women Entrepreneurs. 65

5.5. Entrepreneurs in Large and Medium Sectors. 66

5.6. Entrepreneurs in Small Sectors. 67

5.7. Micro Entrepreneurs. 67

5.8. Small Scale Entrepreneurs. 67

5.9. Role of Government/ Non Government Organizations in Development of Women Entrepreneurship.

68

6. Microfinance and Micro Enterprises 70

6.1. Microfinance Globally (Europe & Asia). 71

6.2.1. Microfinance in Europe. 72

6.2.2. The Case of Ireland. 72

6.2.3. The case of Germany. 73

6.2.4. Microfinance Lessons Learned from Europe. 75

6.3. Microfinance in India. 76

6.3.1. Origin and Early Development. 76

6.3.2. Medieval India. 79

6.3.3. British India. 80

6.3.4. Independent India. 81

6.4. Linking Formal and Non Formal Finance: A Financial Innovation.

85

6.4.1. MFI and their approaches. 90

6.5. Micro enterprise. 94

6.5.1. Micro enterprise Development. 95

6.5.2. Micro enterprise and Economic Self Sufficiency. 101

6.5.3. Micro Enterprise and Women. 102

7. Role of Government and Non Government Organization for Entrepreneurship Development in Maharashtra.

106

7.1. Maharashtra Centre for Entrepreneurship Development.

106

7.2. Annapurna Mahila Mandal. 108

7.3. Bhartiya Yuva Shakti Trust. 110

7.4. National Small Industries Corporation Ltd. 112

7.5. Small Industries Development Corporation. 115

7.6. Central Social Welfare Board. 117

7.7. State Bank of India. 122

7.8. District Industries Centres 123

7.9. Mahila Aartik Vikas Maha Mandal. 126

8. Data Interpretations and Findings 137

8.1. Data Interpretation 137

8.2. Summarisation of Findings. 183

9. Conclusion 192

10. Suggestions and Recommendation 196

Reference Section. 201

Annex. I - Bibliography .

Annex. II – Questionnaire.

Annex. III- List of Activities

Annex. IV – Statistical Tables of SPSS Findings

Annex. V– Region and District Profile

LIST OF TABLES

List of Tables Page No.

4.2. Detail of Sample Size 57

5.1. Average Annual Growth of Enterprises

under Women.

61

6.1. Microfinance Services. 93

6.2. Sectoral Classification of Micro-

enterprises.

98

8.1.1. Age 137

8.1.2. Educational Level 138

8.1.3. Religion 139

8.1.4. Marital Profile 139

8.1.5. Family Type 140

8.1.6 (a) Monthly Income – Before 140

8.1.6 (b) Monthly Income – After 141

8.1.7 (a) Choice of Entrepreneurial Activity 141

8.1.7 (b) Relation between Entrepreneurial Activity

and Age.

143

List of Tables Page No.

8.1.7 (c) Relation between family type and type of

entrepreneurial activity.

144

8.1.7 (d) Relation between Entrepreneurial Activity

and Income.

145

8.1.8. Years of Experience in existing business. 146

8.1.9. Motives for venturing into

entrepreneurship.

146

8.1.10. Interdependence of women entrepreneurs

and families.

Annex. IV 247

8.2.1 (a) Occupation 149

8.2.1 (b) Impact of Entrepreneurship on Income 150

8.2.1 (c) Change in the Monthly Income of

Respondents.

151

8.2.2. Type of decision maker and decision on

spending.

153

8.2.3. Impact of entrepreneurship development

on Asset Formation.

154

8.2.4. Debt Status 155

8.2.5.1 Control over earnings. 156

List of Tables Page No.

8.3. Impact of women entrepreneurship on

standard of living.

249-Annex.IV

8.4. (a) Key Drivers, Mean and Std. Deviation. 254-Annex.IV

8.4. (b) Correlation matrix. 255-Annex.IV

8.4. (c) Communalities. 255-Annex.IV

8.4. (d) Total Variance. 256-Annex.IV

8.4 (e) Rotated Component Matrix. 257-Annex.IV

8.4. (f) Component Transformation Matrix. 258-Annex.IV

8.4. (g) Covariance Matrix 259-Annex.IV

8.4. (B) Logit Model 260-Annex.IV

8.5.1. Entrepreneurial Characteristics. 165

8.5.1 (a) Independence 166

8.5.2 Leadership 167

8.5.3. Decision Making 168

8.5.4. Risk Taking Ability 169

8.5.5. Future Planning 170

8.5.6 (a) Initiative of Borrowing Finance. 171

8.5.6 (b) Experience of Borrowing Finance. 172

List of Tables Page No.

8.5.6 (c) Purchase of Raw Materials 173

8.5.6 (d) Marketing Initiative 174

8.5.7 (a) Support from Family 175

8.5.7 (b) Support from Community 175

8.5.8.1 Demographic Factors 177

8.5.8.2 Type of Venture 178

8.5.8.3 Type of Traits 178

8.5.8.4 Internal Inputs 179

8.5.8.5. External Inputs 179

LIST OF FIGURES

List of Figures Page No.

1.1 Mc- Cleland’s Theory Model 13

1.2 Hagen Theory Model 15

1.3. Atkinson’s Model 15

1.4. Shapero’s Model 16

1.5. Kunkels Theory Model 17

5.1. Women Entrepreneurs Economic

Development.

61

6.1. Types of Programs for Economic Self

Sufficiency.

102

7.1. Organizational Chart of DIC. 126

8.1. Entrepreneurship Development Stages in

Rural Maharashtra

182

LIST OF ABBREVIATIONS

MAVIM Mahila Aartik Vikas Mahamandal

GAD Gender and Development Approach

ILO International Labour Organisation

NGO Non Government Organization

MFIs Microfinance Institutions.

ROSCAS Rotating Savings and Credit Association

SHG Self Help Group

B.C. Before Christ

RRB’s Regional Rural Banks

RBI Reserve Bank of India

NABARD National Bank for Agricultural and Rural Development

SIDBI Small Industries Development Bank of India

IRDP Integrated Rural Development Programme.

SEWA Self Employed Women’s’ Association

RMK Rashtriya Mahila Kosh

MCED Maharashtra Centre for Entrepreneurship Development

SICOM State Industrial and Investment Corporation of Maharashtra

MSSIDC Maharashtra Small Scale Industries Development Corporation.

MELTRON Maharashtra State Electronics Corporation

MIDC Maharashtra Industrial Development Corporation

MITCON Maharashtra Industrial Technical Consultancy Organization.

IDBI Industrial Development Bank of India.

IFCI Industrial Financial Corporation of India

ICICI Industrial Credit and Investment Corporation of India

SIDO Small Industries Development ORganisation.

EDP’s Entrepreneurship Development Programmes

DPSE Development Programmes for Self Employment

MCRP Maharashtra Rural Credit Project

BPL Below Poverty Line.

NOC No Objection Certificate

DIC District Industries Centre.

PMRY Prime Minister Rojgar Yojana

VTP Vocational Training Programmes.

AMM Annapurna Mahila Mandal

GBF Group Based Finance.

BYST Bharatiya Yuva Shakti Trust

ODA Overseas Development Administration

PFC Project Formulation Committee.

PEC Project Evaluation Committee (PEC)

NSIC National Small Industries Corporation Limited

CSWB Central Social Welfare Board.

NAYE National Alliance of Young Entrepreneurs (naye).

NAWEE National Association of Women Entrepreneurs and Executives.

SBI State Bank of India

IRDP Industrial Rural Development Programme

AWAEK Association of Women’s Entrepreneurs of Karnataka.

KVIC Khadi and Village Industries Commission

AMC Assistance for Marketing Centre

RRC Research and Resource Centre.

IAS Indian Administrative Service.

MRCP Maharashtra Rural Credit Project

SGSY Swarnajayanti Gram Swarojgar Yojana

SLP Special Component Plan

TSP Tribunal Sub Plan

RSVY Rashtriya Sam Vikas Yojana

KSY Krishi Saptak Yojana

NORAD Norwegian Agency for International Development

STEP Support to Training and Employment Programme.

DRDA District Rural Development Agencies

IWEP Integrated Women Empowerment Programme.

EERP Emergency Earthquake Rehabilitation Project.

SUDA State Urban Development Agency

DUDA District Urban Development Agency

MSFC Maharashtra State Finance Corporation

EXECUTIVE SUMMARY

The past decade have seen a growing interest in strategies to enhance the

economic status of women, especially in the developing world through

promotion of small and informal sector enterprises. This interest on women

managed enterprises has mainly focused on sectors such as industry,

commerce and services. The number of women moving into these sectors is

on the rise because women are of the opinion that there are better prospects

in improving their economic standing in these sectors than in the traditional

agricultural sector.

The existing scenario is that women form an important part of the labour force

and the economic role played by them cannot be isolated from the framework

of development. Emergence of entrepreneurships considered to be closely

linked with social, cultural, religious and psychological variables. These

changes seem to have become acceptable norms in the context of women at

work in India today’s with increasing number of women participation in

economic development. Women entrepreneurship in India is a recent

phenomenon which has come on the scene in the seventies but became more

prominent in the eighties especially in the latter half of the decade. The

recognition of entrepreneurship as a quick route to socio economic

development by planners, the declaration of the international decade of

Women (1975-85) and setting up of a separate ministry for Women and Child

Welfare in 1985 have given a spurt to women entrepreneurship (Sethi 1994).

Studies suggest that it is more difficult for women to start and be in business

due to lack of opportunities to develop business skills, granting of business

credit, domestic responsibilities that make them have a feel of conflict

between their roles.

Under such circumstances it is very essential to study the economic

independence of women entrepreneur on family especially in case of micro

enterprise. Several facets of women entrepreneurship have been probed by

different scholars of instance the psychological aspects of entrepreneurial

behaviour. Several research has been carried on characteristics, motivation

and constraints of women entrepreneurship process and general

entrepreneurship, no review of literature revealed the impact of women

entrepreneurship on families and also inculcating entrepreneurial and general

values in family.

The studies done so far have not touched the low income and women run

micro enterprise across several districts of Maharashtra with a similar

geographic contours.

Objective of the study were :

1. To study and find the interdependence of women entrepreneurs and

families.

2. To study the impact of women entrepreneurship development on family

with respect to standard of living.

3. To identify the key drivers of economic independence of women

entrepreneurs.

4. To create an independent model with respect to economic

independency of women entrepreneurs.

5. To make recommendations in order to have empowerment of women

especially among disadvantaged group.

Parameters on the basis of which research questions were formed.

1. General information.

2. Information related to Enterprise.

3. Information related to family.

4. Information as to reasons for entering into entrepreneurship.

5. Information about income of self and family.

6. Information about standard of living and change.

7. Information related to interdependence of women on family and their

support for success.

Methodology Adopted :

The study concentrated both on primary and secondary data. The secondary

data gave information on the state of Maharashtra and Districts of

Maharashtra.

The primary survey was critical component of the study as it would yield

crucial data on the impact of women entrepreneurs on their families from.

o Women Entrepreneur Respondents.

o Grassroot Workers.

o District Officers (MAVIM).

The local of study was Maharashtra State and 10 districts of Maharashtra was

selected using judgemental sampling and 500 entrepreneurs were selected

using proportionate sampling.

Findings of the Study:

1. Profile of the respondents: Most of the entrepreneurs belong to the age

group between 30 and 40 years, with an upper secondary educational

background and belonging to Hindu Community and most of the

respondents were married.

2. Interdependence of Women Entrepreneur and Family: Major

respondents had entered entrepreneurship to support the family though

they supported the family financially and were economically

independent in the income bracket upto Rs. 5000 but above Rs. 5000

the respondents were dependent on the family and both the groups

were dependent on the family morally.

3. The key drivers for entrepreneurship was monetary benefits as most of

the respondents were from financially weak family background.

4. With the help of the study the independency model was created which

depicts the importance of 4 parameters that influence entrepreneurship

process and help the respondents to become successful and

economically independent.

5. The study also brought to light that most of the respondents have

brought a change in their financial positions thus bringing a change in

the standard of living of their family. This has brought about a positive

self esteem in the women entrepreneurs thus proving that there has

been empowerment of women entrepreneurs through entrepreneurship

development which has brought a positive impact on the lives of the

family and improvement in the community and society at large.

Recommendations

1. Requirement of proactive role of government and non-government

organization.

2. Training programme for women entrepreneurship should be more

specific and practical oriented.

3. Formation of professional bodies where the entrepreneurs could come

together and establish linkages for mutual benefit.

4. A database of resource and resource linkages for entrepreneurship

development.

5. Involvement of banks to uplift women through entrepreneurship

development.

6. Better established links among all the organizations working towards

the same objective rather than competition among themselves.

7. Involvement of academicians for change process along with

government and non-government organisations.

Chapter – 1

INTRODUCTION

Development of Entrepreneurship – A Conceptual and Theoretical

Interpretation

In recent times entrepreneurs have been referred to as necessary pre-

requisite to mobilize capital, exploit natural resources and create

markets to carry on trade (Harbinson and Myers 1984). Entrepreneurs

are agents who perform a vital role in the economic development of a

country and are linked to the overall industrial development of a nation.

The present concept of an entrepreneur however, has developed

through the last two or three centuries and has been defined with

subtle variations by different researches in the field of social sciences.

1.1. The Entrepreneur: Origin of the concept:

The word entrepreneur is derived from the French verb “entrepredre”

which means, “to undertake”. In the early 16th century, the Frenchmen

who organized and led military expeditions were referred to as

“entrepreneur”. For Cantillon, an entrepreneur was a kind of person

who was engaged in production activities and made certain payments

to owners of production factories in expectation of uncertain receipts

and was bearing non-insurable risks (Aitken, 1965). According to

Haggen (cited in Desai, 1991) an entrepreneur is an economic man

who tries to maximize his profits by innovations. Innovations involve

problem solving and the entrepreneur gets satisfaction from using his

capabilities in attacking problems. The New Encyclopedia Britannica

considers an entrepreneur as “an individual who bears the risk of

operating a business in the face of uncertainty about future conditions”.

Walrus (cited by Guha 1987) gave recognition to the entrepreneur as

an organizer. In 1934, Schumpeter added a new dimension to the

entrepreneur. He defined the entrepreneur in an advanced economy

as “an individual who introduces something new in the economy – a

method of production not yet tested by experience in the branch of

manufacture concerned, a product with which consumers are not yet

familiar, a new source of raw material or of new markets and the like”.

Schumpeter viewed an entrepreneur as a leader who gets the

satisfaction of using his capabilities in attacking problems.

The phenomenon of entrepreneurship is comparatively new. The

studies done of women entrepreneurship in taking into consideration

the cultural and the characteristics of an entrepreneur. A woman

entrepreneur for the present study is a woman who has managed to

procure capital to set up a small enterprise and is actively involved in

running and managing the enterprise in all functional areas of

management and earns a livelihood for herself and her family from the

enterprise and belongs to low income group.

1.2. Concepts of Entrepreneurship:

The concept of entrepreneurship can be described as a creative and

innovative response to the environment. Such responses can take

place in any field of social endeavour, business, industry, agriculture,

education, social work, and the like. Thus doing new things or doing

things that are already being done in a new way is therefore a simple

definition of entrepreneurship. According to Hartman (1959)

“Entrepreneurship is the process whereby people, money markets,

production facilities and knowledge are brought together to create a

commercial enterprise which did not exist before According to

Schumpeter’s system entrepreneurship is essentially a creative

activity. These definitions have been used in many studies to study the

characteristics of those who have started business ventures. However,

the contributions of these to the understanding of concept of

entrepreneurship is not substantial because they have not tried to

focus on the critical function of the entrepreneur and so the concept

remains elusive. According to Pareek and Nadkarni (1978)

entrepreneurship refers to the general trend of selling up new

enterprises in a society and is a dynamic function of individual, socio-

cultural factors, support systems and the environment. Drucker (1986)

illustrates entrepreneurship and intrapreneurship with numerous

examples of innovations. Timmons (1986) stated entrepreneurship to

be an ability to create and build something from practically nothing.

Sugumar (1996) refers to entrepreneurship as the qualities which are

required to innovate and start a new enterprise accept the challenge

and bear the risk. In India the term entrepreneurship connotes a

restricted meaning. It generally veers round efforts which result in

establishing and running factories and industrial enterprise alone.

Moreover, there is a market tendency to relate it only to operations,

which exceed a particular size. This narrow overview of the concept

perhaps reflects the preponderance of values nurtured by urban white

collar class in the society. Secondly entrepreneurship has been viewed

as a phenomenon occurring around the individual and benefiting only

an individual. It is rarely appreciated as one that could be harnessed to

benefit the larger groups. Likewise there is a tendency to view the

occurrence only in terms of the total aggregate society. This approach

ignores the distinctly varying social environments which confront the

large variety of smaller groups and which present both opportunities as

well as challenges dissimilar in nature. This consideration of

entrepreneurship has also negated the role that the joint family system

played in the sphere of economic development. Moreover, it is often

not recognized that the process of transformation from the rural and

agricultural society to entrepreneurial society, would have to cover all

sizes, shapes and types of economic activities. Harbinsen (cited by

Singh 1992) defines entrepreneurship as a skill to build an

organization. He spots the crux of entrepreneurship in the ability to

multiply by effectively delegating responsibilities to others. He further

stresses that the ability to create an organization is the most crucial

skill as it facilitates the economic use of other innovations and that in

the absence of this skill other innovations fail to stimulate economic

development. Thus entrepreneurship is basically concerned with the

development and coordination of entrepreneurial functions. Deolankar

(2003) observes that entrepreneurship among the weaker section

Tribal and women who constitute a large section of the Indian masses

needs to be brought into the main stream of development.

1.3. Historical Development of Entrepreneurship in India.

1.3.1. Pre-Colonial Era : The entrepreneurial history of any country evolves within the context of

the general economic history of the particular country. Before India

came into contact with the West, people were organized in a peculiar

type of economic and social system, the unit of which was the

agricultural village. The artisans/ entrepreneurs of those times would

produce goods that a village would require for its growth. The village

life was in no way dominated by towns and it had other than economic

linkages with the towns. The towns in India had more of religious

importance and were aloof from the general life of the country. The

entrepreneurs of this era were effectively protected from the pressures

of external competition by the closely knit system of the village

economy and this resulted in the absence of localization of industry in

India. Organized industrial activity was evident in a few recognizable

products. During this time, neither the economic activities nor the

technology was complex enough to require or engender

entrepreneurship of high order. But there is no doubt that the functions

performed by artisans resembled the functions of their prototype in the

modern age (Bisht and Sharma,1991). According to Deshpande (1982)

the Indian entrepreneurship in this period was markedly affected by the

occupational caste system. The entry into industrial activity was greatly

influenced by the caste to which a person belonged. The required skills

for manufacturing were inherited from the father. The father’s place of

work was the training ground of the new comers.

1.3.2. The Colonial Era: In colonial era (the beginning of the European commercial activities in

India) the entrepreneur was seen more as a trader cum money lender

cum merchant, bound rigidly by caste affiliations and sex, religious,

cultural and social forces ranging from the philosophy of ‘karma’ to the

system of the joint family (Vinze, 1987). During this period, the Indian

entrepreneurs were generally men because of the social norms, which

governed the administrative actions and the planning process. The

entrepreneurial arena during this period did not provide sufficient

scope to entrepreneurs. This part is evident from the migration of large

number of traders and money lenders to countries. According to

Tripathi (1971) multiple factors such as the lack of capital lack of

political unity, network of custom barriers, existence of innumerable

systems of currency regional markets plagued by arbitrary political

authority, taxation policies and the low prestige accorded to

entrepreneurs by society were responsible for lack of entrepreneurial

growth in India. The ‘concepts of entrepreneurship’ prevailing during

this era was very different from what we understand today. The

prevailing socio-cultural beliefs political and economic factors had a

inhibiting effect on the spirit of enterprise among the Indians. Until

around the third decade of 19th century, the existing socio-cultural and

religious-economic factors restricted the development of

entrepreneurship among both men and women (Patel and Nair, 1996).

1.3.3. The Post-Colonial/ Modern Era.

The first half of the 20th century witnessed gradual changes in the

entrepreneurship scenario. This changing scenario could be accorded

to the spread of secular education, rising nationalist feelings and social

reform movement. The two world wars also created opportunities for

the growth of entrepreneurship. It is since the Second World War that

the Indian Economy has been undergoing rapid changes with regard to

its industrial polices and the market. The government of India helped

entrepreneurs in expanding their venture thereby helping them to earn

profits. These measures helped in establishing and extending the

factory system in India.

Independent India’s economy was designed from a socialistic

perspective. By its very nature such an economic system could not

adequately focus on entrepreneurship as a catalyst of economic

development. The entrepreneurial scenario in India changed in the

Eighties with globalization and concept of ‘open economy’ The new

Industrial Policy of 1991 promoted and further strengthened the small

scale sector thereby, creating a conducive environment for

development of entrepreneurship in this sector. A wide range of

empirical inquiry on entrepreneurship development has provided

theoretical interpretation in terms of the nature, internal dynamics of

the function of entrepreneurship that further highlights understanding of

entrepreneurship.

1.4. Theories of Entrepreneurship.

The field of entrepreneurship research has expanded considerably

over the past two decades. Not withstanding this expansion, dynamics

of entrepreneurship is at the rudimentary stage and is quite

fragmented. The theoretical foundations of entrepreneurship are still at

the pre-paradigm stage. There is an absence of well structured and

comprehensive framework despite the existence of various conceptual

models. The inter connection of serial entrepreneur antecedents within

the theories of entrepreneurship does not seem to be very strong,

consequently the explanatory and predictive power of the existing

entrepreneurial theories are limited. According to Perry Man, M.R

(1982), entrepreneurship research is presently characterized by the

absence of both a definitive set of precepts and a universally accepted

methodology process. He further elaborates that entrepreneurial

research is in its formative stages and is similar to ‘normal science’

phase of the Kuhnian Scientific structure. However recent

entrepreneurial research endeavours have made significant

contribution to the knowledge of entrepreneurship and their successful

application in mitigating economic stagnation indicates maturity

towards paradigm building in entrepreneurship. The importance given

to entrepreneurship as a causal variable in the growth process is

strongly conditional by different disciplines. The economist view that

the genesis of entrepreneurial function is rooted in the structure of

economic incentives. The psychologists hold that the risk bearing and

innovation as non-materialistic and inner psychic concern are

essentially the prime movers for the entrepreneurial activity. For the

sociologists, there are non-economic factors or conditions based on

society’s value and hierarchy, which determine the extent of

entrepreneurial activity (Singh 1985). Thus, the multi disciplinary

nature of different factors for entrepreneurship forms the basics for the

emergence of different theories of entrepreneurship development. It

has been found that there has not been any monolithic approach

towards theory building in the field of entrepreneurship. Various

scholars have taken multiple approaches to study entrepreneurship as

no single factor works as the only determining variable for the

phenomenon of entrepreneurship. The theories of entrepreneurship

emergence can be classified mainly into four broad categories. The

first category falls in the domain of economies, the second one is

within the realm of psychology and the third category is based on

sociology perspective. The fourth category i.e. the contemporary

approach is used to research the characteristics of entrepreneurs.

Among those who contemplate entrepreneurial emergence on the

basics of economics are Cantillon, IB say, Walrus, Marshal A.H. Coli.

The psychological theories advocated by Schumpeter et al, McClelland

Hagan and Kunkel. The theories with sociological interpretations are

postulated by Weber, Wochran, and Young. The two most common

contemporary approaches are the trait and demographic approach as

postulated by Robinson, Stimpson, Huefner, and Hunt. However, there

are some factors like conducive business environment, political

structure of a country or a region, other support systems like

availability of finance, and family support which play significant roles in

the emergence of entrepreneurship in general and women

entrepreneurship in particular. Some recent researches highlight the

‘Integrated Approach’ as the most appropriate to explain the

phenomenon of entrepreneurship.

1.4.1. Economic Theories of Entrepreneurship:

The economic theories of entrepreneurship have been described in

early economic history as well as within the existing classical and neo

classical economic framework. Entrepreneurship as a concept entered

the economic literature mainly through the work of Richard Cantillon

(1680 – 1734), who gave the concept an analytical prominence and

assigning the entrepreneur an economic role. According to cantillon it

is the entrepreneur’s reaction to price movement that continuously

bring about a tentative balance between supply and demand in specific

markets (Gopakumar, 2008). Cantillon was the first person who coined

the term “entrepreneur” and also defined the entrepreneur as one ‘who’

buys factors services at certain ‘prices’ with a view to sell their

products at uncertain prices and become a bearer of an uninsurable

risk (Desai 1989).The evaluation of economic theories on

entrepreneurship can be divided into two schools of thoughts classical

economic theories and neo classical economic theories.

1.4.1.1. Classical Economic Theories.

By the mid 18th century, new forms of production, social relations,

governance and social thought began to emerge. In the economic

stream, this phase marks the rise of classicism. I.B Say (cited by

Aitken, 1965) identified the entrepreneur as an organizer. According to

him, the entrepreneur is an economic agent who unites all means of

production and produces a socially valuable product. In order to be

successful, say mentioned that the entrepreneurs must have the ability

to assess future demand (a factor of judgement) to determine the

appropriate quantity of goods and their timings (market research and

analysis) to calculate probable production costs and selling price and

to possess the art of administration (management). Say added the

concept of management in a form with which modern industry is

familiar.

1.4.2. The Neo Classical Economic Theories:

The entrepreneur is rarely studied within the context of the basic neo-

classical framework of economic. Brock and Evan (1989) mention that

economists have concentrated overwhelming on large business.

Recent textbooks in economics have little discussion of small business

and entrepreneurship. C. Kent (1990) points out that courses in

entrepreneurship and economics seems to be lacking. This is probably

due to the failure of economists to adequately integrate

entrepreneurship into economic theory. Herbert and Link (2009)

believe that the history of economics clearly demonstrates that the

entrepreneur was gradually excluded from economic analysis when

economists attempted to emulate the physical science by incorporating

the mathematical method. As there was no satisfactory mathematical

method to deal with the dynamics of economic life, economic analysis

solved by concentrating on comparative statistics, and the

entrepreneur took a purely passive role J.G. Eisenhaver (1995)). The

entrepreneur, thus in the new classical framework is a mere spectator

with no real scope for individual decision making. A few thinkers

however, kept the interest in entrepreneurship alive in limited ways, the

most important of these being Alfred Marshal (1980).

1.4.3. The Psychological Theories:

The initiation of entrepreneurial study and the process of setting up a

new venture involved assumptions about psychological characteristics

of the entrepreneurs. Despite conducive economic circumstances,

social networking, support system, entrepreneurial teams, finance,

marketing and government policy, enterprise, sometimes cannot be

created. It requires a ‘person’ who can combine all these factors in a

productive manner, who believes in innovation or meta innovation and

who has the motivation to accomplish the goals. For a person and his

process to be successful definite psychological perspectives are

essential. Flood (cited in Priyadarshi, 2007) describes an entrepreneur

as a person who initiates and manage new ventures. The theorists

who have emphasis the contribution of psychological factors to

entrepreneurship are Schumpeter (1934), Mc Clelland (1961), Hagen

(1962) Kunkel (1965).Schumpeter’s Theory – Joseph Schumpeters

(1934) theory provides the most thorough analysis of the

entrepreneurial function. The analysis of Schumpeter’s theoretical

system is based on three basic assumptions (a) the nexus between

entrepreneurship innovation and leadership in his theory of economic

development (b) the relationship between the entrepreneurial function

in the analysis of social classes and (c) the facing away of the

entrepreneur as a key in explaining the crisis of capitalism (Martinelli

1994). The theory further stresses that the key variable to

entrepreneurial function is innovation. Innovation is defined as the

introduction of a new combination of the factors of production i.e. land

and labour when combined with credit, breaks into the static

equilibrium of the circular flow of economic life and raises it to a new

level. The entrepreneur changes the conditions of supply, combines

exis0ting resources in new ways, and thereby set ups a new

production function (Martinelli 1994). The Schumpeterian entrepreneur

is an economic leader motivated by a will to achieve, having an

inherent capacity to select correct answers, energy and capacity to

withstand social oppositions (Dhillon, 1993).

Mc Clellands Theory : According to Kilby (1971), David Mc Clellands

theory has developed from Weber’s protestant ethics in which an

intermediary psychological motive (the need for achievement) is

introduced. Mc Clelland extends Webers’s casual sequence producing

entrepreneurial behaviour as follows.

(Webers casual sequence)

Fig. 1.1 – Mc Clellands Theory

Source: Peter Kilby, Hunting the Heffalump (1971).

Ideological

Values

Entrepreneurial

Behaviour

Ideological

Values

Family

Socialisation Need for

achievement

Entrepreneurial

behaviour

Mc Clelland has tried to offer explanations for some societies that were

more likely to produce entrepreneurs than others. He appeared

concerned with the influence of cultural attitudes in primary

socialization which in turn can foster entrepreneurial altitudes. He

ascribed inculcation of the achievement motive to child rearing

practices which stress on standards of excellence, low parental

(father’s) dominance, maternal warmth and self reliance training

(Martinelli 1994).

Hagen’s theory: Hagen’s Theory (1962) is more sophisticated in terms

of the relation between socialization and entrepreneurial personality

and has its own importance in the emergence of entrepreneurship.

Hagens model combines a psychoanalytical interpretation of the

entrepreneurs personality with an analysis of his conditions as a

member of a group that is deviant from the cultural norms of the larger

society. As an economist Hagen’s view of economic development was

based on non-economic factors. According to him, economic

development is almost exclusively a process of technological change,

which is brought about by the technological creativity of individuals in

society.

The main focus of this theory is on the authoritarian creative

personality dichotomy. He postulates that the complex changes

separating the typical authoritarian personality of a stable traditional

society from the emergence of a creative entrepreneurial activity .

Fig. 1.2 – Hagen Theory

Source: Peter Kilby, hunting the Heffalump 1971.

Motivation plays a significant role in planning of socio-economic

change (Pareek, 1968) and that motivation alone cannot bring about

change unless accompanied by perceptible change in the societal

system. A term borrowed from the Atkinson’s model shows that

expectancy is necessary and the societal system provides the

expectancy frame. An elaboration of the paradigm is as follows.

Societal system Motivation (Values) Reinforcing

Mechanism Expectancy Behaviour

Fig. 1.3 : Atkinson’s Model

Source: Peter Kilby, Hunting the Heffalump (1971). Entrepreneurship

and Economic Development Free Press, New York.

Traditional Authoritarian

child rearing Non-innovative personality

Anger/ Anxiety

Mothers rejection of

father and husband,

protective nurturance

Father & Husband protective

Suppression of

values

Creative son

Relative Social blockage

Entrepreneurial

behaviour

nurture

Along the same lines, young (1971) found that entrepreneurship

occurs when a group has a low status, has been denied access to

mainstream society but still has more resources than other marginal

groups. Shaperol (1975) generalizes that most entrepreneurs are

displaced persons who have been dislodged from their familiar niche.

Precipitating Displacing Event

Fig. 1.4: Shapero’s Model

Source: Kilby, Hunting the Heffalump (1971). Entrepreneurship and

Economic Development Free Press, New York.

Even in Shapero’s model the displacing event plays an important role

for entrepreneurial behaviour along with desirability feasibility and

propensity to act.

Kunkels Theory: Kunkels Theory (1965) of entrepreneurial study is

based on the behaviouristic model and emphasizes behaviour of the

individual. Unlike Moung’s (sociological treatment) ways of looking at

the school of psychic needs and values as passive phenomenon

reflecting group level activity, Kunkels theory moves in the opposite

direction values and personality types are explained on the basis of

Perceived desirability culture, family peer colleagues mentors.

Perceived feasibility by financial support. Demonstration effect model partner

Propensity to act.

Exogenous Inferences

Intentions credibility

Entrepreneurial behaviour

the behavioural pattern from which they are inferred. In his model,

behaviour patterns are determined by reinforcing aversive stimuli

present in the social context. The rewards and punishments are limited

and based on the child rearing period. Therefore Kunkel’s views on

entrepreneurial behaviour are a function of the surrounding social

structure both past and present and can be influenced readily by

manipulable economic and social incentives. His model of analysis is

based on experimental psychology and identifies sociological variables

as the determinants of entrepreneurial supply (Dhillon, 1993) which is

put in the

Physiological Characteristics

SD

Or R

S Sr Sa

(Discriminative Behaviour Reinforcing stimuli Controlling Stimuli) So

Fig. 1.5: Kunkels Theory

Source: Peter Kilby, Hunting the Heffalump (1971). Entrepreneurship and

Economic Development Free Press, New York.

SSC. Societal context SV

Or

Where R = any activity

Sr = reinforcing stimulus (like rewards)

Sa = aversive stimulus (like punishment)

So = absence of any consequences

(rewards or punishments).

SD = Stimulus in whose presence R has been reinforced

S = Stimulus in whose presence R has not been reinforced

SV = State variable (i.e. conditions of deprivation

and Satiation).

According to this model, an individual’s behaviour pattern is shaped

(established by means of operant conditioning procedure involving the

differential reinforcement of activities) after they have been performed.

Only certain activities desired by a society or a group are positively

reinforced and others may be punished. Positive reinforcement

enhances the probability of repetition and if such reinforcement is

frequent and intermittent, the probability is a certainty and this is

explained by the diagram of Kunkels behaviour model.

1.4.4. The Sociological Theories:

The sociological perspectives and research provide essential and

distinctive contributions to the understanding of entrepreneurship in

various ways. Sociologists consider the entrepreneur as a role

performer corresponding to the role expected by the society. Different

societies are characterized by different customs and taboos, rewards

and restraints ethnic values and child rearing practices, nationalistic

attitude and patriotic inculcation and different ethics. According to

Marris (cited in Priyadarshi, 1997), to assemble or reassemble from

what is available very concrete kind of imagination, to see what others

have missed, sensitivity to business and social environment and

entrepreneurial courage are the factors that make an entrepreneur.

The theorists who have stressed on the contributions of sociological

variables to entrepreneurship are Wiber (1960), Cochrom (1965) and

Young (1971).

Max Weber’s Theory: Webers (1960) theory involved four conditions

contributing to entrepreneurship: rational capital accounting involving

the appropriation of all means of production as disposable property of

autonomous private industrial enterprises, free and voluntary labour,

rational technology and mechanization, public credit and freedom of

the market. These conditions were studied by Weber, as a complex, of

inter-related institution. Weber also added the analysis of cultural

factors, which become effective conditions for the emergence of

capitalism. In other words Weber studied the phenomenon of profit

making and free wage labour in terms of cultural and motivational

significance. (Martinelli 1994).

Cochran’s Theory: Cochran’s Theory (1965) is based on the premise

that fundamental problems of economic development are non-

economical. He emphasized role expectations, social sanctions and

cultural values as key elements that determine the supply of

entrepreneurs Cochran (1965) does not see the entrepreneur as being

deviant or super normal individual, but rather as a representation of

society’s model personality. In this model, the prevailing child rearing

practices and schooling common to a given culture mould personality.

The individual performance as an entrepreneur is generally influenced

by three factors (a) his own attitude towards his occupation (b) the role

expectations held by the sanctioning groups (c) the operational

requirements of the job.

Young’s Theory: Frank Young’s theory (1971) shares a commonality

with Cochran’s theory with regard to the unimportance of personality

factors but does not focus on values and society wide phenomena like

Cochran. Young’s theory focuses on the inter group relations. It is a

theory of change based on incorporation of reactive sub-groups in

society (Dhillon, 1993).

1.4.5. Contemporary Approaches.

The two most common approaches used in researching the

characteristic of entrepreneurs have been the trait approach and the

demographic approach (Robinson et al, cited in Balakrishnan et. Al

1998). In the trait approach, the entrepreneurship is assumed to be a

particular personality type whose characteristics are key to explaining

entrepreneurship as a phenomenon (Gartner, 1988, 1989). In the

second approach i.e. the demographic approach, demographic

information is used to arrive at a profile of a typical entrepreneur

assuming that people with similar backgrounds possess similar

underlying stable characteristics.

Chapter – 2

LITERATURE REVIEW

2. Studies on Entrepreneurship: A brief Review : From the discussion of major and contemporary perspective, an attempt can

be made to explore the applicability of such theorization into empirical

enquiries with regards to western as well as Indian studies that would help to

develop a theoretical framework for the present study. According to Hornday,

the Churchill (1987) the accumulation of past research has produced sufficient

empirical data to allow some development of theoretical concepts.

The existing literature can be grouped into four broad categories. The first

which is not really concerned with theory focuses on a definition of the word

“entrepreneur” which has been discussed in the proceeding pages. The

second category is the literature on entrepreneurship in western countries. A

third category of literature refers to the studies done on entrepreneurship in

general in Indian context. In fourth category there are studies dealing

specifically with women entrepreneurs in the Indian context. Finally studies

dealing with women entrepreneurs from low income group.

2.1. Western Research on Entrepreneurship:

The early researches on entrepreneurship was carried out by McClelland

(1969 and revealed that individuals with personality characteristics, which are

indicative of high need for achievement are likely to behave entrepreneurially.

He regarded the following as distinctive characteristics of high, need

achievement (i) a performance for moderate risks and a propensity to work

harder in such situation (ii) a belief that one’s personal efforts will be influential

in the attainment of some goal and pleasure derived from this belief. (iii) A

tendency to perceive the probability of success in attaining a goal as being

relatively high, (iv) a need for feedback regarding success or failure of one’s

efforts (v) the capacity to plan ahead and to be particularly aware of the

passage of time and (vi) interest in excellence for its own sake.

The study by Collins and Moore (1964) after interviewing 150 small business

entrepreneurs at Michigan reported that (a) most of the entrepreneurs were

orphans or half orphans (b) entrepreneurs lack social mobility drives. They

have no attraction towards posts of authority and rewards associated with

power and status (c) they indulge in punishing pursuits of task and choice

fatigue, when one job is done, they like another to conquer. (d) They lack

problem resolution (e) they categorize subordinates as either good or bold (f)

they rebel against peers and parents, generally strained with partners but

good with those outside the business (g) they are independent and (h) they

don’t like authorities above them.

The studies focusing on personality characteristics of entrepreneurs found

that older entrepreneurs take no risk option more frequently than the younger

entrepreneurs. The fear of failure hinders their decision to take risks (Winich

(Cited by Dhillon, 1993). Hornaday and Abond (1971) analyzed a number of

characteristics such as achievement, autonomy, aggression, support,

conformity, recognition, independence, benevolence and leadership which

were felt to be significantly associated with entrepreneurs. The research found

that out of these characteristics, need for achievement, support,

independence and leadership emerged as most significant.

The study by Decarlo and Lyons (1979) on the personality characteristics of

minority and non-minority female entrepreneurs revealed that both minority

and non-minority entrepreneurs differed significantly from those women who

were not entrepreneur on tests measuring achievement, autonomy,

aggression, conformity, independence benevolence and leadership.

Differences were also obtained between minority and non-minority women

entrepreneurs with minority entrepreneurs reporting that they started their

business at a later age than non-minority women entrepreneurs. The non

minority entrepreneurs scored higher on ratings of need for achievement and

independence. The minority women entrepreneurs placed greater value on

conformity and benevolence.

Mc Irish (1982) (cited by Churchill, N.C. 1987) g model and locus of control

(LOC). He reviewed research relating LOC, to decision making and LOC (as

measured by Rolters Internal – External locus of Control scale) to portfolio

risk. LOC and portfolio risk were examined in combination with sex, marital

status, age, educational level, asset level and number of value of common

stock held. The LOC and portfolio risk relationship were also considered. The

distribution of both LOC scores and portfolio risk scores were positively

skewed. There was a positive relationship between portfolio risk and the

standard deviation of portfolio risk of the securities in the portfolio. Age, assets

and values of common stocks held were also significant determinant of risk

level.

The study by Sectan and Kent (1981) (cited in Bhanushali, S.G. (2007)

revealed the younger female entrepreneurs were better educated and placed

slightly higher emphasis on profession than their families. They also

compared characteristics of female entrepreneurs and executives revealed

that female entrepreneurs were only slightly less educated than female

executives. The executives view their ability to work with people as the

greatest factor in success, while entrepreneurs viewed hard work and

persistence as more important. Entrepreneurs tend to follow their fathers who

are engaged in business although they do not acknowledge their fathers as

role models. Female executives do not follow in their fathers footsteps. The

executives were older and showed more job stability than entrepreneurs. The

characteristics of female entrepreneurs are different from female executives.

Cromie and Johns (1983) measured psychological and entrepreneurial

characteristics. The study indicates that new aspiring entrepreneurs

possessed unique personal characteristics. But that after some years of

managing one’s own business, entrepreneurial qualities diminish and

established entrepreneurs begin to resemble career executives. The study

concluded that the skills necessary to enter the growth and development of an

enterprise may be different from those required to conceive and launch a

business.

An indepth survey was carried out Hisrich and Brush (1984) on women

entrepreneurs and profiled the ‘typical’ women entrepreneur. According to

them, a women entrepreneur is generally the first born child of middle class

parents with a self employed father and a mother who does not work outside

home. The typical women entrepreneur after obtaining a literal arts degree,

marries a college educated man who work in a professional or technical

occupation, has children and works as a teacher, administrator or a secretary.

The biggest start up problem faced by her is finance, credit and lack of

business training. Her greatest operational problem is lack of financial

planning experience.

Durang (1983) (cited by Bygrave, W.D. & Hofer C.W. (2005) has found that

need achievement training for achievement-motivation (NACH) has been

limited to programme person who could afford the time and monetary costs of

the longer training sessions. He found that a substantially shortened training

design when combined with skill training, demonstrated many of the effects

and benefits of the original need for achievement training among the sample

studied.

The analysis of women entrepreneurs by Goffe and Scase (2008) shows how

business start up enables many women, but not all, to achieve forms of

economic and social independence that they would not otherwise enjoy.

Further they illustrate ways in which business proprietorship has a wide

variety of effects upon individuals, and upon their personal relationships and

lifestyles. They refute the notion of a single entrepreneurial experience and

argue that the causes and consequences of business start up are highly

conditioned by the excellent to which women are committed to traditionally

prescribed roles and to profitability.

Exploring the life events and experiences that had influenced women to

choose entrepreneurship as a career alternative Huntley (1985) indicates that

women entrepreneurs were determined hard working and self-confident.

Inspite of having faced financial hurdles, their determination, courage and

optimism helped them to overcome these hurdles. Most of women ventured

into entrepreneurship because of a desire to be independent and to be in

control of their lives. They defined their own measurement of success, i.e.

succumbing to social expectations and definitions. They were looking for a

balance of personal and professional interest and admitted to career

satisfaction which transuded other aspects of their lives.

A biographical study was done by Williamson (1986) on depth Joyce Eddy, a

successful women entrepreneur in order to provide a role model for existing

and would be women entrepreneur. The result showed that Joyce’s percentile

score were more like those of general population and that she was successful

despite her short comings with regard to personal characteristics and

requirement, often equaled with entrepreneurial success. It was therefore

concluded that there is no one formula for entrepreneurial success.

Mc Clung and Parkar (1986) carried out a study on female entrepreneurs in

Oklanoma to identify associations between entrepreneurial characteristics and

financial performance. The findings of confirmatory and exploratory analysis

indicated that there was some association between entrepreneurial

characteristics and financial performance.

The study by Donckels and Dupton (2009)) found that small firms generate

more new entrepreneurs in Belgium than larger firms, and that such

entrepreneurs often have an entrepreneurial family background. The study

also found that (a) in recent years there has been a substantial increase in the

number of unemployed starting their own business (b) start up capital was

mostly low (c) government support hardly had any importance at all (d) almost

half of the new entrepreneurs were employed in private industry before

starting their own enterprise.

Bowen and Hirrich (1986) have developed a comprehensive career model

(determinants of entrepreneurial behaviour for women) that adopts a career

perspective and life cycle approach to entrepreneurial career in terms of

educational environment, work history, adult development history, adult family

work history, current work situation and current perspective family/ non work

situation.

The study by Mc Donald (1986) identified traits and characteristics of women

entrepreneurs and compared the perceptions of successful women

entrepreneurs with those of the less successful ones. The survey method was

used to question the responder on demographics, traits and characteristics. A

Likert type scale and a demographic survey of 519 women entrepreneurs

concluded the following (a) Net Profits is a factor of success in the opinion of

more successful women entrepreneurs and not in that of less successful ones

(b) length of time in business is a predictor of success. (c) successful women

entrepreneurs perceive the same traits and characteristics necessary for

success (d) Having entrepreneurial parents does not affect the success of

women entrepreneurs.

Hisrich (1986) developed a theory on women entrepreneurs career. The

analyzed data reveals demographic information, motivations for beginning the

business venture, management skills and personality traits, business

problems. The authors state that while the backgrounds of self employed

women vary considerably the women entrepreneurs do share similarities in

personality, motivation, education and family background. The majority of

women entrepreneurs are first born children from middle or upper middle

class family in which the father was self employed. Education was an

important factor for the upbringing of most of the women entrepreneurs, and it

continued to play a major role in helping them to cope with deficiencies in their

business skills.

The development of entrepreneurial characteristics and career selection

tendencies of individuals using social learning theory to investigate the effects

of parent entrepreneurial role models was undertaken by Schwartz, E.B.

(2008). The impact of role model was studied on a set of entrepreneurial

characteristics like achievement, motivation, risk taking propensity, innovation

and locus of control orientation.

Birley, S (2009) study on women and men micro entrepreneurs in Ecuador

confirms that male entrepreneurs manage larger firms than women and men’s

businesses yield higher net incomes. There was a significant increase in

monthly net incomes of the entrepreneurs one year after the baseline

measures. The result also confirms the dynamism of the micro enterprise

sector, where some firms are able to increase net income in the course of a

year, despite a lack of access to credit and other inputs available in then

formal sector. All micro producers and micro vendors’ borrowers, irrespective

of borrower’s sex show a significant increase in hourly income. The results

also show the preference among women entrepreneurs for using the credit to

increase efficiency is explained by women’s two fold responsibility of

producing at the work place and producing at home. The results are also

indicative of the fact that women micro producers in manufacturing and

services as well as women micro vendors access to credit was a key factor in

the increased productivity. This signifies that credit was available to large

number of low income women micro producers and micro vendors and was

able to keep a considerable number of women micro producers active.

Dignard and Havert (1995) study the women owned micro and small scale

entrepreneurs in both formal and informal economic sectors. The study is a

compilation of articles and case studies by various authors and focuses on

understanding women micro entrepreneurs economic values and behaviour,

gap in policies and programme with regards to micro enterprises, problems of

women’s access to credit technology and training which are essential for

designing women owned micro and small scale enterprise, and general policy

interventions. Case studies of five countries are also discussed in the book.

Wolfensohn, J.D. (2008) investigates whether the acquisition of greater skills,

resources confidence and social position through repeated micro-credit

borrowing might reduce the effectiveness of mechanisms which promote

repayment based on the experience of Bangladesh Rural Advancement

Committee, the author suggests that a micro-credit intervention, based

strongly on incentives for individuals self enrichment alone, eventually

undermines the social forces including repayment by changing the incentives

and costs associated with honouring the financial contract.

The study by Hansraj (2009) discusses two innovative approaches to

fostering group entrepreneurship to address the urgent employment and

income needs of urban and rural workers in developing countries and

countries undergoing privatisation and structural changes. The study

concludes that group entrepreneurship provide the basis for a dynamic

employment and enterprise development strategy.

Micro enterprises are no longer a means by which the poor scrape a living.

They can become an integral part of the economy, providing jobs and

contributions for economic growth. Berger and Giullamon (2006) describe the

variety of ways in which banks and NGO’s are attempting to provide

sustainable basis.

Stemper (2006) examines the experience of a group of commercial banks

catering to micro enterprise women clients. The results indicate that a small

number of commercial financial institutions are expanding the coverage and

depth of financial services to these businesses, both at the wholesale and

retail levels, and could act as leaders in the provision of financial services to

the micro enterprise sector, and specifically women entrepreneur. Rather than

focusing on one specific type of institution as the viable alternative, the overall

supply of financial services to women micro entrepreneurs – credit for

enterprise and household investments, savings and payment services comes

from a variety of institutions including NGOs, banks credit unions and other

formal and semi formal financial intermediaries. The study further concluded

that less flexibility was found in loan repayment for banks than NGO’s. The

NGO practices indicate that schemes adjusted to women owned micro

enterprises use more frequent payments, or set payments in a more flexible

way. They also found relative absence of trust between banks and private or

government institutions involved in micro enterprise development. The banks

have identified awareness building in high ranking executives, in addition to

technical staff, as an important way to become active in micro enterprise

lending.

Marrison, A.M. White R.P. and Velsor, E. Van (2007) observe that female

entrepreneurs are the fastest growing segment of the small business

population, with numbers increasing dramatically since 1980.

A framework to assess the attitudes of low income individuals towards

entrepreneurship on the basis of a survey of the residents of a public housing

in a major south western city in the United States was developed by Hood and

Young (1997). They concluded from the study that business creation and

entrepreneurship represent one possible tool for addressing the poverty

paradox on a long term basis. Entrepreneurship education and training form a

vital component within an entrepreneurial infrastructure which is required to

successfully launch enterprise in any community.

In a study of women entrepreneurs in Cameroon by Catherine (2008)

revealed that a poor choice of business venture often meant that they run at a

loss. However many women value their business for non-financial reasons,

such as the fact that they get them out of the house. Though women running

micro enterprise face long hours with low returns and often accumulate debts

they are critical for the survival of their households.

Vander, Weisc Ramijn H (2005) discuss the impact of micro finance industry

becoming a global phenomenon. The study examine the financial products

aimed at women entrepreneurs and calls for more products such as savings

accounts, money transfers, or loans for domestic equipment. Financial

services should be delivered as effectively as possible, but subsidies may

continue to be a necessary component in achieving this. The SHG continue to

play a strategic role in the development of micro enterprises among women

entrepreneurs.

The study by Choudhury (2000) conducted on light engineering firms in

Dhaka reveals that the entrepreneurs not only produce spare parts but also

build up the base for potential entrepreneurs. To maximize the economic

welfare and to become self employed these entrepreneurs took initiatives that

in most of the cases were not in their family traditions. The entrepreneurs

demonstrated strong willingness and had managerial capability. They were

aware of the necessity for improving the quality of their products and towards

this end they attempted to adopt new production processes. The process of

production in these enterprises was labour intensive and utilized capital more

efficiently. They received little support from the government with regard to

credit and other facilities. Development institutions has done little to improve

their quality, technology and marketing facilities. Only those who succeed

were able to take advantage of whatever opportunities were available.

The study by Rutherford (2000) attempts to clarify the situation by defining all

financial services for poor people as means of turning their savings into

usefully large lump sums to meet needs arising from life cycle events and

from emergencies to invest in land productive household assets and in

business.

2.2. Indian Research on Entrepreneurship:

The Indian research on entrepreneurship have heavily focused on small scale

sector entrepreneurs from various parts of the country. The study by Gaikwad

and Tripathi (1970) on small entrepreneur of the Janku region of the West

Godavari district in A.P. brought out the prerequisite for successful

entrepreneurship. The study found that all entrepreneurs were persons with

initiative, drive and hard work, though the majority of the entrepreneurs had

neither technical knowledge nor strong economic base or strong political

connections. Moreover among the entrepreneurs studied, very few had an

idea of the work involved and the relevant government policy. The study also

brought out an interesting finding regarding the opinion of traders about

industrial entrepreneurship. The traders interviewed were of the opinion that

industrial entrepreneurship had a lot of scope and better status but it required

a large capital outlay, high managerial and organizational skills and technical

knowledge. It was difficult for traders to venture into industrial

entrepreneurship as it involved a long gestation period before obtaining terms.

Nandy (1973) also carried out an intensive study by comprising a group of

small scale entrepreneurs with non-entrepreneurs from Howrah in West

Bengal. The objective of his study was to draw a comparison between

enterprising and non-enterprising cultures. The study revealed that in a

enterprising community, entrepreneurial exposures contribute substantially to

entrepreneurship and that such a phenomenon was an important determinant

of entity and survival in business. The need for achievement was found o b e

the best predictor of entrepreneurial motives, followed by need for power and

a sense of efficacy. The significant association between need for power and

entrepreneurship is surprising as it goes against the popular belief.

The study by Bhatia (2004) on 50 small manufacturing firms comprising of

less than 50 employees located in the state of Punjab examined the socio-

economic background of entrepreneurs, their attitude towards industry, the

ways in which they made transition to industry and the problems they faced in

establishing and building up their entrepreneurs. The research findings

showed that entrepreneurs established their business in various sectors like

service, trading, manufacturing and agriculture. The research analysis

showed no relationship between growth of firms and socio-economic

background of the entrepreneurs. The study revealed that firms which

continuously expanded, had a gradual growth and were started with a

relatively favourable capital base were mostly established by merchants. The

entrepreneurs showed a tendency to diversify instead of expanding after a

point and the researcher suggests that this was because of the lack of vital

information about wider markets.

Nagporewalla, Dr. G.B. (2008) also studied entrepreneurs from small-scale

manufacturing enterprise in Visakhapatnam, A.P. He found that a highly

disproportionate number of entrepreneur, especially the successful ones were

from higher castes and from high economic status families. The study further

suggested that the socio economic class status of businessmen were

substantially higher than that of the general population not only in India but

probably also in a larger part of the rest of the non-socialist world.

A change in the trend was noticed in entrepreneurial research from the late

seventies the focus of the studies were now on entrepreneurial characteristics

and their relation to various demographic variable like age, education, family

background etc.

Bhattacharjee and Akhouri (1975) empirically tested the entrepreneurial

characteristics and developed a profile of a small industry entrepreneur. The

study found that the most significant characteristics appeared to be the need

for achievement, power, independence, propensity to take risk, personality

modernity, business experience leadership, lack of social mobility and

symbolic or actual rejection by father. The factors which were empirically

tested but not statistically supported, are autonomy, aggression, conformity,

recognition, benevolence innovativeness, occupational background caste,

family background, age and education.

The study by Sharma (1976) on the inner state patterns of entrepreneurial

performance between the states of Punjab and Uttar Pradesh revealed that

inter state variations in industrial climate give rise to variations in

entrepreneurial performance and better that climate the better world be the

performer and that the socio-economic background of the enterprises matters

for entry into manufacturing. This has been affirmed by the study (in Dhillon

1993).

Ansari & Ahmed (2007) analyzed the relationship between risk taking

behaviour and age among entrepreneurs. The late entry of entrepreneurs into

business having a higher level of education could be on account of two

reason. First on account of the time they were required to spend on education

and secondly on account of their failure to get another job which maintained

parity with their higher educational qualifications.

Venkatapathy R (2006) using purposive sampling technique studied 75 first

generation and 58 second generation entrepreneurs. The results of the

investigations suggested that first generation entrepreneurs perceive the

father as a loving person and parents as encouraging and overprotective.

They are influential by the father attribute greater importance to friendship,

initiative venture to promote self employment, desire to be a model to others.

They consider social awareness and involvement as essentials for a business

venture which are the second generation entrepreneurs perceive the father as

being dominant, are not influenced by any one, attribute least importance to

friendship adopt a venture to avoid unemployment consider social awareness

and involvement as not essential for a business venture.

Venkatapathy and Subramanians (1988) study reveals the entrepreneurs feel

less alienated than non-entrepreneurs because entrepreneurs have more

chance to experience power and that their ventures are often by choice, which

gives them satisfaction, a sense of achievement and a feeling of relevance of

their role in society.

Case studies of four self employed persons, with scheduled tribe background

was carried out by Gupta and Sharma (2007). Out of the four cases two

opted, for self employment due to family tradition of living on one’s own

without going for job. The other two entrepreneurs preferred to be

entrepreneurs after having been dissatisfied due to exploitation by employers.

The study by Deivasenpathy (1986) on 45 entrepreneurs from sick units and

53 entrepreneurs from successful units found that family support and previous

job experience influence success, whereas educational level and family

background do not have an influence on the entrepreneurial venture.

The extension approach, as a phenomenon was used by Kanitkar (1994) to

discuss that in developing economies like India, Microenterprise is a source of

self employment and income for rural youth. The study reveals that the micro

enterprise program implementation institutions maximum potential can be

tapped by encouraging innovation, organization flexibility, the impact of

training on entrepreneurs. After examining the results of planned training

interventions it is argued that lack of ‘extensive approach’ in the industrial

promotion agencies and support systems seems to be the major causes of

failure of trainees to establish business cultures. He therefore suggests

integration of the approach in the functioning of promotional agencies. He

revealed the experiences in organizing a training programme aimed at

motivating the officers of the industrial support system. The review concludes

that if the external environment is to be influenced and the human component

of the industrial support system to be sensitized then it is essential to integrate

the extension approach in the entrepreneurship development activities.

2.3. Studies on women entrepreneurship in Indian context.

The studies on women entrepreneurship became prominent from the 1980’s

when the focus of development shifted from women the ‘objects’ to ‘subjects’

of development. Surthi and Sarupriya (2003) investigated the psychological

factors affecting women entrepreneurs. They examined the role stress

experienced by women entrepreneurs the effect of demographic variables,

such as marital status and type of family, and how women entrepreneurs cope

with stress. The results indicated that unmarried women experienced less

stress than married women. Those from joint families tended to experienced

less role stress than those from nuclear families, probably because they share

their problems with other family members. External focus of control was

significantly related to role stress, and fear of success was related to result

inadequacy and role inadequacy dimension of stress.

According to Mohiuddin (2006) women (in his study) became entrepreneurs

due to the following reasons. (a) Economic needs. (b) As a challenge to

satisfy some of their personality needs (power, achievement novel experience

etc. (c) Educated women like to utilize their knowledge gained. (d) Family

occupation and (e) As leisure time activity women face the same difficulties as

those by men.

Certain studies like Singh and Sengupta (1986) on women entrepreneurs

have been on entrepreneurs attending entrepreneurship development

programmes. The conclusion drawn by Singh and Sengupta (1986) revealed

that the profile of a women entrepreneur was not dominated by either

education or lack of it. Educated women perceived entrepreneurship as a

challenge, ambition fulfillment and for doing something fruitful, whereas less

educated entrepreneurs had clarity about their projects but needed moral

support from males and other family members for setting up their enterprises.

Shah’s (1987) study was based on three categories of sample (i) women

entrepreneurs of middle and high middle income groups including working

women and housewives. (ii) women entrepreneurs having science and

technology background and coming from middle and lower middle income

groups and (iii) women entrepreneurs of low income group coming form the

lower strata of society. The data analysed revealed that the distinctive

features of women entrepreneurs in all the three categories were needed for

achievement self sufficiency in terms of internal and external resource

awareness, initiative taking, problem solving and risk taking. Among the

motives to become an entrepreneur were economic needs which was an

important motive in the low income, utilization of experience and education

was reported by women with science and technology education, husband’s/

family support and interest, availability of full time and finance, desire to be

independent and personal ego satisfaction of doing something on one’s own

were expressed b y women in all groups.

Singh, Sengal, Tinani and Sengupta (1986) carried out an exploratory study of

successful women entrepreneurs examined their identity, expectations,

motivations, types of problems encountered by them to reach the level of

success and to identify the operational problems they were confronting. The

sample comprised of 60 successful women entrepreneurs from in and around

Delhi. The analysis indicates that there is quite a large variation in age,

educational qualifications, marital status, type of family, age of children and

occupation of family members of these successful women entrepreneurs. The

five dominant motivating factors rank wise were to keep busy, to fulfill

ambition, to pursue own interest, by accident or circumstances beyond control

and to earn money. The main factors responsible for the choice of product

were high demand, processing skills, ready market future prospects and

requiring creativity. Majority of the entrepreneurs felt no role conflict between

family role and entrepreneurial role.

The study by Vinze (1987) was an empirical study of 50 women entrepreneurs

of Delhi. Her study gave a first hand report about their perception of the

prospects and future of their enterprises, problems faced, their involvement in

the enterprise and effects on family life. The study point out that women

lacked confidence to start their own ventures, Social pressure and attitude of

doubling women’s capability and restricting their freedom of movement were

found to be yet another hurdle. Financial organizations were also held

responsible for not encouraging women entrepreneurs. The analysis revealed

that the fifty women entrepreneurs studied felt that the future prospects of

their enterprises were bright. To the query as to which trade or enterprise has

bright future all mentioned only those enterprises in which they themselves

were engaged. In spite of the fact that they were educated most of the

entrepreneurs were ignorant of government organizations that could help

them. With regard to credit facilities and loans almost all of them felt that such

facilities were available only on paper but in practice there were too many

problems such as nepotism, favoritism and corruption. All the women on

becoming entrepreneurs felt economically secured and independent.

Iyer (2007) did a qualitative study on women entrepreneurs from AWAKE

(Association of Women Entrepreneurs in Karnataka) and highlighted two

major issues relating to starting and sustaining a business. The first is

perception of society, in particular those of men, towards women as

entrepreneurs and the built in gender bias. She found that traditional

upbringing hampers the ability of men to relate to women as business women.

In India, women take up entrepreneurship due to various reasons and not

essentially economic independence or to gain freedom from subordination in

the family. With regards to role conflicts and role demands, while women do

not draw any boundaries with their own families, strict boundaries are drawn

around their mobility and activities outside the family. Another conflict which

entrepreneurial women go through is the guilt feeling as career women. The

credit worthiness of women were essentially linked to their ability to provide

collateral. The reluctance to provide assistance, delay in the release of

working capital by the commercial banks also cause considerable problems to

the entrepreneur. She also revealed that when “AWAKE raised these issues,

they were considered women’s issue and not entrepreneurial one.

Kanitkar and Contractor (1992) studied women entrepreneurs in the

manufacturing sector. The study discloses that for the women their sector it

has been “the search for identity during the period of mid-life crisis” which has

lead them to entrepreneurship. Though for some of the entrepreneurs,

economic necessity was the push factor, all of them were imbibed with a goal

to achieve something significant in their lives. The first major hurdle which

they faced was monetary followed by dealing with bureaucracy location,

managing production and employees growth.

The study by Anselm (1992) studied female entrepreneurs in three cultural

milieu. Hong Kong, Madras (South India) and Toronto (Canada).The study

highlights the facts that despite marginal earnings, entrepreneurship had

helped these women evolve from positions of relative subordinates to

carefully carved niches of self determination social maturity, and fulfillment

within the arenas of both economic and social progress. Their day to day

interactions with members of their families, co-workers and business

associates had given these women a sense of power, importance and above

all self esteem.

Singh (1992) attempts to highlight the existing status of women

entrepreneurs. The author has also made an attempt to diagnose the women

entrepreneurial profile and has identified the dominating entrepreneurial traits,

their motivational forces and performance both qualitatively as well as

quantitatively. Their communication and linkage capabilities among

themselves and at the government level along with the nature and magnitude

of different constraints in entrepreneurial career have been also dealt with by

the author. The sample consisted of 64 women entrepreneur from Haryana.

The study showed that majority of the entrepreneurs preferred trading type of

enterprises probably because of less risk involvement, low gestation period,

no necessity of technical staff and less problems in procurement and

marketing. The data also proved that most of the respondents had high

motivational and value orientation characters, medium level of job satisfaction

usually took independent intra family and entrepreneurial decisions, and

belonged to nuclear and small families with high level of education and

services as their main occupation. Majority of the entrepreneurs possessed

high level of confidence, decision making ability, managerial skills, far

sightedness, communicability, skill competence, innovativeness, competitive

spirit, change, proneness, amicable nature, independent and high aspiration

low degree of credit orientation and risk preference.

Singh’s (1985) study deals with the factors impinging on and influencing the

processes of the birth and growth of women’s enterprises are no different

from those characterizing the entrepreneurial manifestation of men. The

study further discloses that women entrepreneurs have entered a variety of

fields involving relatively complex technologies which demand considerable

managerial abilities. It further revealed that like men, women entrepreneurs

are motivated by need for self fulfillment autonomy and independence. The

findings do not suggest that entrepreneurship is gender specific. The study

stresses that what women need is exposure to wider environment and access

to facilities in order to appreciate their entrepreneurial potential.

Lalitha Rani (2006) studied women entrepreneurs in the city of

Visakhapatnam. The findings of the study shows that different women have

different attitudes towards entrepreneurship and the growth profitability and

survival of the enterprise depend on this attitude or view towards

entrepreneurship. Some women consider “business as a challenge” were

ambitious “career oriented” and “innovative”. Entrepreneurship was their first

priority and they were prepared to take risks. For some, entrepreneurship was

an avenue for additional income but despite their need for money the first

priority was the home. This attitude towards entrepreneurship was

categorized on the basis of education.

The study by Gupta M (2008) highlight the constraints faced by women

entrepreneurs such as lack of knowledge about various important aspects

related to their enterprise, lack of finance, support from family, male

dominance, lack of information about various organizations and institutions

supporting women entrepreneurs and they were not aware of the institutions

or programmes for women entrepreneurs.

Banerjee and Talukdars (2007) study of 30 women entrepreneurs reveal that

majority of them were above 50 years of age, had good educational

backgrounds, belonged to higher income group families and were

concentrated in urban areas. It was further found that women entrepreneurs

had greater motivations, greater job involvement and higher annual family

incomes. AT the same time, those with high entrepreneurship faced less

conflict in their roles as entrepreneurs and housewives whereas those with

low entrepreneurship faced more conflict comparatively more number of

women belonged to joint families, approached institutions for financing their

enterprises and hired labour from outside than those having low extent of

entrepreneurship.

The profiles of 35 women entrepreneurs who own and manage small to

medium sized enterprises in two states in South India was studied by Das

(1999). Based on their reasons for starting a business, the women were

classified into three categories ‘chance’, ‘forced’ and ‘created’ or pulled’

entrepreneurs. The study indicated that there were both similarities and

differences between the experiences of women from the three categories. The

women in this study were found different when compared with their western

counter parts in some antecedent conditions (for example family background

and marital status), incubator organizations issues (as most did not work

before starting a business) and environmental factors (for example, support

services). The study suggests that there is a rationale for focusing on ‘created’

or ‘pulled’ entrepreneurs as they seem to perform better and view their

success as resulting from business skills they possess. It could be inferred

that finance motivations can lead to success in entrepreneurial activities.

The study on ‘Development of SSI’ and Women Entrepreneurs’ by Manimala,

M.J. (2008) reported that with the help of policy initiatives, incentives and

facilities by Government of India, the small scale sector will continue to grow

at a faster rate facing the challenges posed by liberalization and globalization

and contribute substantially to the Indian economy. Since women

entrepreneurs also constitute an inseparable segment of SSI sector,

promotion and empowerment of women entrepreneurs is implicit in the

expectations.

Khan M.A. (2006) examined the emergence of women entrepreneurs in

Andhra Pradesh. The study concluded that entrepreneurship among women

requires a congenial entrepreneurial climate which motivates and facilitates

them to take up entrepreneurial career.

The emerging socio psychological profile of successful women entrepreneurs

in Jammu and Kashmir was studied by Khajuria and Sinha T.N. (2000). The

trend of women turning to entrepreneurship has been growing many fold in

the region during the last three decade. Most of the women were first

generation women entrepreneurs who joined this field primarily ‘to remain

busy’ and ‘fulfill ambition’. Women have shown a high single mindedness

purpose to achieve perfection in quality of their products and services and

establish their business well. Most of the women interviewed, have shown

upwards trends in their profits and turnovers. Though the study had limitations

in terms of small sample of successful women entrepreneurs, it throws

substantial light on the entrepreneurial characteristics of successful women

entrepreneurs in an average Indian city.

Koshy and Joseph (2000) conducted a study of 65 small scale industrial units

managed by women entrepreneurs. The findings of the study reveal that the

units exhibited a satisfactory growth rate in most of the cases. About 88

percent of the units were making profits and only 2 reported losses. 75% of

the units expanded since establishment. The units in the food chemical sector

registered a higher growth rate in general. Most of the entrepreneurs limited

their growth due to reasons of fear of managerial problems, loss of tax

incentives for SSI units marketing problems, scarcity of finance and other

related issues. The entrepreneurs faced problems with respect to marketing

and finance. The authors concluded that training and development in

imparting professional management skills could be a been to women

entrepreneurs especially first generation entrepreneurs.

2.4. Studies on women Entrepreneurship from the Low-Income Group:

Poor women from the low income group are venturing into entrepreneurship in

the micro enterprise sector due to the changing economic scenario.

Rao (1995) attributes the inadequacy of entrepreneurship amongst rural

women to the absence of congenial and appropriate entrepreneurial climate

and an industrial base. The GOi has initiated entrepreneurial development

programmes for women in rural areas. These programames do contribute to

social transformation since they absorb rural women in income generating

activities either on full or part time basis. But in developing entrepreneurship

among women there have been several problems and identifying and

eradicating such problems that inhibit the growth of grassroot

entrepreneurship will help in envisaging active participation and contribution of

women.

He assessed the factors that impede and slowdown the process of

entrepreneurial development among women in the backward mandals of A.P.

as (a) poor financial status (b) lack of cooperation from the family and society

keeping them away from mainstream development (c) illiteracy.

The study by Rathore and Chhabra (1991) rural that with little training women

could do business in the agro-based industries sector like food preservation,

bakery, dairy poultry etc. As women have been helping men in such activities

without getting any credit or financial remuneration. In areas, where forests

are predominated they can do forest preservation, collection absortment and

classification of medicinal plants. Apart from traditional industry women could

be encouraged and trained in maintenance and repairs of small machinery

etc. They concluded that women in both rural and urban areas needed

training, finance and the cooperation and encouragement from the family, the

society and governmental organizations to enable them as entrepreneur to

enter the mainstream of the country’s economy.

Ramamurthy, V.M.J.A., Krishnakumar, T. (2008) discussed how training

programmes can effectively address the wider needs for confidence building

as well as business orientation among poor women entrepreneurs. He

concluded that women development agencies including NGOs have to be

sensitive to the training needs of the target group. He adds that there is an

urgent need to change the orientation of the people who are administering the

programmes and policies. The recent pronouncements of governments and

international agencies recognizing the important role played by micro

enterprises will not yield result unless the relevant policies and programmes

as well as people are re-oriented suitably.

Jyothi and Prasad (2009) find a striking difference in the educational

background of women entrepreneurs in general and those belonging to rural

India. Social factors like caste, community and religion were found to strongly

influence the growth of entrepreneurship. The findings reveal that the system

of joint family was on decline and that there was no significant relation

between occupational background and entrepreneurial character of the

women. A majority of them misperceived training as a pre-requisite for getting

finance. The main reason, which urged them to take up business activities,

were unemployment and inadequate educational qualification.

Sarngadharan and Beigum Resia (1995) studying the institutional support and

problems faced by women entrepreneurs in Kerala confirm that women

entrepreneurs confront numerous problems like outside financial support

being meager, marketing purchase of raw materials, competition from larger

units, slackness in demand as major problems in promoting and running their

enterprises.

Awasti D.N. (2005) conducted a case study of women owned micro and small

enterprises within India’s self Employed Women’s Association (SEWA) and

reports that women change in two ways when they organize on the basis of

work to join a union or form a cooperative. First their self perception evolves,

they realize that they actually are workers that as such they contribute to the

nations economy and so become conscious of the fact that they have more

roles than those traditionally emphasized by society i.e. as mother-wife and

housekeeper. Second women come to disregard their differences of caste,

religion or community and manifest relatively high levels of solidarity

especially in times of crisis.

The study by Nair (2006) received the strategies and approaches in training

women entrepreneurs in the Indian rural sector. The review stresses the

incorporation of gender in policy making and implementing agencies as

gender has a direct bearing not only on the access to resources and the

ability of individuals to realize their productive potential but also on the entire

socio-cultural fabric of societies. The nexus between gender and economic

deprivation is so complex that policies and schemes addressing these issues

need to be extra-sensitive and flexible to the social and cultural echoes of the

rural communities before settling on to resolve their economic problems.

Manimekalai and Rajeswaris (2008) study on women entrepreneurs running

micro enterprises in Trichirappally rural that women were engaged in trade

and service units. Majority of them were sole proprietorship. The raw material

and marketing were mostly within the district or state and a number of

agencies helped the women entrepreneurs in starting and running the

enterprise including banks district industries centre, the family and friends and

relatives.

The impact of skill development training programmes for promoting/ creating

self employment for women of the vulnerable sections of society was studied

by Begum and Srinivasan (2000).The findings suggest a need for increasing,

the awareness about the existing training programmes which can motivate

women to become self employed. The study further implied that more

knowledge input programmes should be planned in the extension work of the

community.

The study by Awasthi (undated) on women’s work and credit reveals that

women operated micro businesses do not grow because of inadequate

investment capital coupled with low levels of skills which compel them to

adopt low technology based production process and the inadequacy of

working capital forces them to buy raw materials in smaller quantities making

it costlier. All this affects their cost of production adversely and limits their

ability to experiment or introduce new products and designs.

The review of literature reveals by and large, comprehensive and focus study

on women entrepreneurs especially from below poverty line villages is scarce

and limited in nature. Thus there is a wide scope for further research to

investigate issues pertaining to women entrepreneurs in low income group/

below poverty line villages.

Chapter – 3

OBJECTIVE OF THE STUDY

3. Statement of problem/scope of study

Studies suggest that it is more difficult for women to start and be in business

due to lack of opportunity to develop business skills, granting of business

credit, domestic responsibilities that make them have a feel of conflict

between their roles. Under such circumstance it is very essential to study the

economic independence of women entrepreneur on family especially in case

of micro-enterprise. Several facets of women entrepreneurship have been

probed by different scholars of instance the psychological aspects of

entrepreneurial behaviour. Several research has been carried on

characteristics, motivation and constrains of women entrepreneurship process

and general entrepreneurship, no review of literature revealed the impact of

women entrepreneurship on families and also inculcating entrepreneurial and

general values in family.

3.1. Objective of Study

Based on the secondary data, literature review and the gaps identified the

objectives of the study was framed. The objectives of the study is as follows:-

1. To identify the key drives of economic independence of women

entrepreneurs.

2. To study the impact of women entrepreneurs on family with respect to

standard of living.

3. To study the interdependence of women entrepreneurs and families.

4. To create an independency model with respect to economic

independence of women entrepreneurs.

5. To make recommendations in order to have empowerment of women

especially among disadvantage group.

3.2. Based on the above objectives, the following hypothesis were

initiated.

H01 : Financial conditions of the family do not play significant

role for involvement of women in entrepreneurship.

H11 : Financial conditions of the family play significant role for

involvement of women in entrepreneurship.

H02 : Involvement of women in entrepreneurship does not play

significant role in standard of living of family.

H12 : Involvement of women in entrepreneurship does play a

significant role in standard of living of family.

H03 : Women’s involvement in entrepreneurship process does

not happen due to monetary benefits.

H13 : Women’s involvement in entrepreneurship process

happen due to monetary benefits.

H04 : Women’s involvement in entrepreneurship process are

independent of the interest and financial condition.

H14 : Women’s involvement in entrepreneurship process are

dependent of the interest and financial condition.

Chapter – 4

RESEARCH METHODOLOGY

Research Methodology is a blue print of the Study conducted, which

includes steps of data collection, sample selection, type of

questionnaire, process of data and finally interpretation of the data.

4.1. Understanding the issue:

The research had to be started by understanding the concepts of

entrepreneurship development, women entrepreneurship and status of

the entrepreneurship development in rural India to be more precise its

impact in Maharashtra which stands third in industrial development in

the rural India. The organizations involved in women entrepreneurship

in the interiors of Maharashtra had to be studied. Hence secondary

data analysis was very essential.

4.2. Pre-Study:

This was done by having an open conversation with the organizational

heads of MAVIM (Mahila Aartik Vikas Mahamandal). This organization

was chosen as it has its presence felt in major districts of Maharashtra

and is a body from the governments side which helps to bring in

entrepreneurship development in the districts of Maharashtra and

working exclusively for the upliftment of women. Several organizational

books and manual were referred to understand the details.

4.3. The study concentrated both on primary and secondary

data.

a) The Secondary data provided details of the State of Maharashtra

and districts of Maharashtra and the entrepreneurial activity

among women.

b) The primary survey was critical component of the study as it

would yield crucial data on the impact of women

entrepreneurship on their families from women Entrepreneur,

grass root workers and district officers.

The survey would give an idea on :

1. The Entrepreneurial activities.

2. Prevailing socio-economic data of the village and the

composition of population.

3. Details of women who have been entrepreneurs and whether

they are part of SHG.

4. Special efforts made by women from socially backward group.

4.4. Instrument for Survey :

The instrument used was a questionnaire. The questionnaire was

prepared taking into consideration certain parameters such as

1. General Information

2. Information related to enterprise.

3. Information related to family.

4. Information as to reasons for entering into entrepreneurship.

5. Information about income of self and family.

6. Information about standard of living and change.

7. Information related to interdependence on family and their

support or success.

4.5. Selection of Samples:

Locale of Research and sample size: The state of Maharashtra was

selected as locale for the present study as it is the second most

popular and third largest state by area in India. The state covers an

area of 307,731 km (118,816 sq.ft) or 9.84% of the total geographic

area of India. It is also the richest state in India contributing to 15% of

the country industrial output and 13.2% of GDP. The ratio of the urban

to rural population is 42% and 58%. The study was limited to rural

Maharashtra Mumbai, the capital city of the state, is Indias largest city

and the financial capital of the natioin. Marathi is the language of

Maharashtra. Maharashtra has 35 districts geographically, historically

and according to political sentiments. Maharashtra has five main

regions.

• Konkan (Konkan Division)

• Vidarbha or Berar (Nagpur and Amravati Division)

• Marathwada (Aurangabad Division)

• Northern Maharashtra and Kandesh (Nashik Division)

• Desh or Western Maharashtra (Pune Division)

4.5.1. Considering that Maharashtra has 35 districts and is divided into

Western Maharashtra, Marathwada,Vidarbh, Konkan and Northern

Maharashtra and also considering the large size of districts talks with

the officials and guide revealed that the study be conducted for all the

regions of Maharashtra as mentioned above, but taking only 2 districts

from each region based on judgmental sampling.

Consequently the districts selected were :

1. Konkan Region : Ratnagiri, Sindhudurg

2. Western Maharashtra : Pune, Kolhapur.

3. Marathwada : Latur, Osmanabad

4. Vidarbh : Gadchiroli, Bhandara.

5. Northern Maharashtra : Nashik, Ahmednagar.

The selection of the districts was also supported by MAVIM. Mahila

Artik Vikas Mahamandal a state government run organisaiton which

works towards the empowerment of women in rural areas of

Maharashtra who felt that these area would represent all the 5 major

region of Maharashtra.

The total number of women entrepreneurs is 500 through proportionate

sampling and the villages chosen were on the basis of judgemental

sampling.

4.5.2. The following table gives details of sample size throughout 10

districts of Maharashtra.

No. of Villages (SV) No. of Women

Entrepreneur(s) Sr. No.

District Population

Sample selected

Population Sample selected

1. RATNAGIRI (187) 4 2572 17

2. SINDHUDURG (176) 6 3830 25

3. PUNE (201) 10 7694 50

4. KOLHAPUR (137) 5 2693 18

5. LATUR (242) 8 8759 57

6. OSMANABAD (154) 8 5816 38

7. GADCHIROLI (451) 8 13076 85

8. BHANDARA (355) 6 12355 80

9. NASIK (326) 8 4021 26

10. AHMEDNAGAR (206) 10 15928 104

TOTAL 500

Source: Mahila Arthik Vikas Mahamandal.

4.6. Pre Testing Phase:

The first survey was done on pilot scale at Ratnagiri followed by which

the questionnaire was revised. Further again the questionnaire was

administered randomly on 30 entrepreneurs.

4.7. Tabulation and Statistical Analysis of Data.

The responses observed for each of the items in the questionnaire

were scored and tabulated into a master sheet. The statistical tools

included chi square test, factor analysis, F-test, regression and logit

model. Paired t test. The analysis was done using SPSS/PC package.

4.8. Interpretation and Report writing:

The analyzed data were finally interpreted to draw the inference and

reported with the objective of the study in view.

4.9. Limitations of the study:

The study was carried out with some assumptions regarding time,

study area and sample size. The identification of the respondents and

gathering information from them was one difficult task faced by the

researcher. Accessibility of the researcher to the rural areas was also

considered while selecting the state of Maharashtra.

Chapter – 5

DEVELOPMENT OF WOMEN ENTREPRENEURSHIP IN INDIA

5.1. The existing scenario:

Women form an important part of the labour force and the economic

role played by them cannot be isolated from the framework of

development. The role and degree of integration of women in

economic development is an indicator of economic independence and

higher social status of women. Emergence of entrepreneurship is

considered to be closely linked with social, cultural, religious and

psychological variables. These changes seem to have become

acceptable norms in the context of women at work in India today, with

increasing number of women participation in economic development.

Women Entrepreneurship in India is a recent phenomenon, which has

come on the scene in the seventies but became more prominent in the

eighties, especially in the latter half of the decade. In the eighties, the gender

and development approach (GAD) influenced by social feminism, post

modern and post colonial theorists, look into account the totality of women’s

lives, rejecting the public/ private dichotomy which serves to devaluate the

work of women at home. Focus on perspectives on development makes

women the ‘subjects’ rather than ‘objects’ of development, change agents

rather than welfare recipients. The GAD approach is to move women from the

margin to the centre (Hooks 1984) by women gaining a sense of control over

their lives (empowerment).

Around 73 percent (Sethi 1994) of the women entrepreneurs, in India have

launched their enterprises in the eighties and this trend appears to continue in

the nineties. The recognition of entrepreneurship is a quick route to socio

economic development by planners, the declaration of the International

Decade of Women (1975-85) and the setting up of a separate ministry for

women and child welfare in 1985 have given a spurt to women

entrepreneurship (Sethi 1994).

Women make the second largest target group for identification of potential

entrepreneurs, being slightly less than 50 percent of the total population.

There are 99.4 million women workers in a labour force of 272.84 million in

India. Majority of the women seek employment out of economic necessity, but

of these a large number are unable to find employment. Their share in total

employment (40%) is higher than their share in the labour force (33%)

(Rathore and Chhabra, 1991). It is not always easy for women to find

employment compatible with their family responsibilities and household

chores. Thus many women are attracted to the idea of self employment in

enterprises adjoining their premises, with flexible hours allowing them to take

care of both home and business. The last two decades has seen not only a

substantial increase in employment of women but the last decade has seen a

prominent role played by women entrepreneurs in the process of economic

development (Fig.).

4

96

5

95

9

91

13

87

20

78

24

72

0

10

20

30

40

50

60

70

80

90

100

1980 1985 1990 1996 2000 2006

Women

Men

Source: The Economic Times Financial Daily, March 17, 2007

The data shows that the participation of women in entrepreneurship during the

post liberalization period is encouraging since the preparation has increased

from 4% in 1980 to 13% in 1996 to 24% in 2006. There is also gradual

increase in the rate of participation in the economy during the post

liberalization period. The average annual growth of women entrepreneurship

during the last decade is quite encouraging considering the inadequate

growth during the first three decades of post independence period (Table 2.1.)

Average Annual Growth of Enterprises under Women

Year Percentage of increase

1971 -80 1.58

1981-1990 5.19

1991-1996 9.65

1997-2006 13.23

Source: The Business Line, Economic Daily March 17, 2007.

5.2. Entrepreneurship among Poor Women:

The concept of entrepreneurship among poor women is becoming a global

phenomenon today as poor women are increasingly turning to

entrepreneurship as a way of coping with poverty. Venturing into micro

enterprises to generate income is increasingly being adopted by poor women

as a livelihood strategy. The studies by Bhatt, Pecera, Anderson and

Barohona (1995) illustrated how poor women micro entrepreneurs, have

utilized their entrepreneurial skills to become economically independent and

provided economic support to the family through entrepreneurship. Marrison,

white and Van Velser (1987) and Belcourt, Burke and Lee Gosselin (cited in

Das 1999) found that women are turning to entrepreneurship as it provides

way to cope with the discriminations existing in the society. It is thus important

to recognize and acknowledge the entrepreneurial spirit and approach which

lie behind survival and livelihood strategies of poor people. Also, it is

important to foster and promote the spirit of self reliance by directing

entrepreneurial support services, programmes and policies to those who live

at the edge of economic survival (Mahler, 1998). No deliberate distinctions

have been made between income generating activities or self employment

activities in the informal sector and entrepreneurship.

5.3. Women and Microenterprises

While the trend is to focus more on entrepreneurship development and

enterprise creation at all economic levels, there needs to be clarity about

terms women micro entrepreneurs or micro enterprise. IT is thus necessary to

explain the terminology of micro enterprises with relevance to women

entrepreneurs.

There is no clear cut definition of what constitutes a micro enterprise

particularly those relevant for women. Indian study of women entrepreneurs

defined women’s enterprise as “a small unit where one or more women

entrepreneurs have not less than 51 per cent holding” (Mishra 1996). Thus, in

such a case the women’s enterprise is measured in terms of size and financial

holding. Sometimes women’s enterprise is understood to mean not only

majority ownership by one or more women, but also the comparative numbers

of female employers. Thus a women’s enterprise can also be defined (Iyer

1991) as an enterprise owned and administered by women entrepreneurs

having a minimum of financial interest of 51 percent of the share capital and

giving atleast 50 percent of the employment generated in the enterprise to

women”. Sing (1992) a woman entrepreneur is a confident innovative,

and creative women capable of achieving economic independence

individually or in collaboration, generates employment opportunities for

others through initiating establishing and running an enterprise by

keeping pace wither personal, family and social life. The typical woman

entrepreneur like the independence associated with the

entrepreneurial career, is a dreamer with high hopes and ambitions.

She has a positive approach to competition, is confident of her ability

to deal wither problems and has a belief that hard work is a sure

ingredient of success in entrepreneurial venture. David (1992) defined

micro enterprises as small undertakings (upto 10 people) run by individuals

who take up the responsibility of managing a business venture and often

involve the family. Micro enterprise suit the life style of women because of the

multiple roles and the need to reorganize time. Originally, micro enterprises

for women, were extension of kitchen activities in stereotyped roles such as 3

P’s, Pickle, Powder, Pappad. Now women have ventured into non traditional

business like Xeroxing, beauty parlours, photographs. Women especially poor

women generally venture out as entrepreneurs in the micro enterprise sector.

They find the micro enterprise sector attractive because of low barriers to

entry and flexible the nature of the work, which make it easy to combine

gainful employment with domestic responsibilities. Sometimes these

enterprises grow and become larger established organizations. Growth is a

relative term and cannot be measured in isolation or absolute figures. It is

usually assessed in terms of sales turnover profit, market share and such

other indicators. Dowing (1991) studied growth strategies used by male and

female entrepreneurs in many developing economics and asserted that men

and women employ different strategies due to different circumstances. For

example while make owned enterprises usually grow vertically, women’s

enterprises tend to grow by diversifying into other activities. A female

entrepreneur tends to involve her family in her business with very few

exceptions. Women involved in micro enterprises are largely concerned with

survival of their families rather than running successful ventures. According to

Cromie (1987), women see entrepreneurship as a means of simultaneously

meeting their career needs and childcare roles. This contribution made by

women to the economy goes unrecognized because of prevailing societal

perceptions. Though women entrepreneurs are classified into separate

category vis-à-vis labouring women, what is often forgotten is the gender

issue which straddles women across sectors. Family values, hierarchical

structure and kinship network continue to be powerful determinants in their

lives and status. Taking up entrepreneurship has not relieved them of the

prescribed roles or familiar responsibilities (Iyer 1991).

Some recent researcher indicate that several women become entrepreneurs

due to the pull and push factors of the traditional and changing values

(Asghari 1983). Under the pull factors, the women entrepreneurs choose a

profession as a challenge, as an adventure with an urge to do something new

and to have an independent occupation under the push factors women take

up, business enterprises to get over financial difficulties when responsibility is

thrust on them due to family circumstances. As such women both in rural and

curb an sectors turn to entrepreneurship to fulfill their aspirations both

economically and socially.

5.4. Profiles and Typology of Women Entrepreneurs:

One may consider it only natural to raise question of what kinds of business

are usually operated by women. But when the same question is asked about

enterprises run by women, it is usually with different connotations. In other

words it is seen positively self employment is a legitimate and acceptable

occupational status. However for a women stereotyping is often implicit as a

result of the traditional definition of legitimate roles in society. Instead two

roles of women have almost undisputed acceptance, these of wife and

mother. The existing variety of generated division the perception of what are

suitable economic activities women engage in, is not universal. What is

unacceptable in one social context maybe more easily accepted or be

common practice in another. For example, blacksmiths are generally

expected to be men, but in northern India, women ironsmiths are found

hammering metal into agricultural implements. Similarly weaving may be

widely categorized as a “traditionally female” occupation, but in many parts of

Africa, it is the man who weaves (Carr, 1984). The Life cycle of women is

generally seen as having a critical bearing on the kinds of businesses they

operate. According to Vinze (1987) women entrepreneur in India

represent a group of women who have broken away from the beaten

track and are exploring new vistas of economic participation. They

have long stories of trials and hardships. The task has been full of

challenges. They have had to encounter public prejudices and

criticism. Family opposition and social constraints had to be overcome

before establishing themselves as independent entrepreneurs. Vinze

has developed a typology of women entrepreneurs in India based on their

business activities. They are :

5.4.1. Entrepreneurs in large and medium sector :

In the large and medium sectors women entrepreneurs are educated and

professionally qualified and can take initiative and manage business. In this

category of entrepreneurs, women are mostly from urban upper and middle

classes. They have received the basic managerial training and sometimes

have possessed a MBA degree. These women usually have been the heads

of large and medium units.

5.4.2. Entrepreneurs with benevolent attitude:

This category of entrepreneurs work in cities and slums to help women with

lower means of livelihood. The enterprises owned by them are service

oriented organizations. Women entrepreneurs heading such organizations

need government support in marketing as well as getting finances at

concessional rates for their products under preferential purchasing policy of

the government.

5.4.3. Entrepreneurs in the small sector :

Those women entrepreneurs, who are educated or had any formal training in

management, but have developed skills to take to small scale industry. They

choose the product they are familiar with, like garments, weaving, pickles,

dolls and handicrafts. Aasthi (undated) has classified women entrepreneurs in

the Indian context based on their credit needs. His classification is as follows:-

5.4.4. Micro entrepreneurs:

Women earning low incomes in rural and urban areas by engaging

themselves as home based workers (producers), small vendors, petty traders

and hawkers, producers and suppliers of service and cultivators. They are

mostly illiterate and are from the lower strata of the society (in terms of caste

and communities), have very low level of skills, mostly learnt as part of their

household work (cooking, knitting, bamboo basket, weaving textiles and

handicrafts) and have little or no technology and cater to the low and of the

market segment.

5.4.5. Small Scale Entrepreneurs:

This segment belongs to the urban middle and upper middle class women

entrepreneurs who have relatively easy access to the government support

infrastructure. They are better qualified and have more exposure to the

market. They also have better business networks through their families and

friends who may be in the same business.

5.4.6. Women Owners of large business:

These entrepreneurs come from wealthy class of the social strata, coming

mostly from business houses or from the families of serial inheritance or

division of large business houses.

In the present study the researcher focuses on the women entrepreneurs in

rural area with micro enterprises.

5.5. Role of Government/ Non-Government Agencies in the

Development of Women Entrepreneurship:

Women development was not distinguished as an identified sector in the initial

years of planning. It was only during the VIth plan, which began in 1980, that

the magnitude of women’s problems was perceived and the need to make

special efforts for the economic development of women recognized. The

Employment Policy envisaged for the VIth Plan (1980-85) was designed with

two major goals viz. reducing under employment and lowering the age of

retirement. The plan provided a “New Deal”, for self employment by providing

a package of services such as training, credit, marketing, and general

guidance for those who wanted to launch self employment ventures. The main

thrust of the new deal was to ensure that the necessary information

application forms etc. required for various facilities of self employment were

made available at one place, utilizing the “one window” approach. Special

attention was paid to the large section of women who were neglected as part

of the work force, by giving financial and technical assistance through

organizations engaged in various development activities. In the VIIth Plan

(1985-90) there was a definite shifts in focus from the welfare concept to

development concept in programming for women, this ushering in a new

thrust for the development of women. The plan suggested the following:-

♦ Treat women as specific target groups in all development programmes.

♦ Properly diversify vocational training facilities, for women to suit their

varied needs and skills.

♦ Encourage appropriate technologies, equipments, and practice for

reducing their drudgery and increase their productivity.

♦ Provide marketing assistance at the state level.

♦ Increase women’s participation in decision making.

The new Industrial Policy of 1991 has also stressed upon the need for

conducting special entrepreneurship programmes for women. It emphasized

on product and process oriented courses so as to enable women to start

small scale industries. The policy further added that the objective of such

courses would be to give representation to women in the filed of small

industry development with a view to uplift their status in the economic and

social fields.

Chapter – 6

MICROFINANCE & MICRO-ENTERPRISES

6.1. Microfinance Globally:

In a number of European countries microfinance evolved from informal

beginning during the eighteenth and nineteenth centuries as a type of

banking of the poor, juxtaposed to the commercial and private banking

sector. Almost from the onset, microfinance meant financial

intermediation between micro savings and micro credit, and was

powered by intermediation. Legal recognition, regulation and

mandatory supervision evolved in due course and led to a process of

mainstreaming during the twentieth century when micro finance

become part of the formal banking sector. In Germany, the former

microfinance institution now account for around 50% of banking

assets; outreach is to around 90% of the population.

Microfinance in Asia presumably has a much longer history, though

little seems to be known about the early history of the heir in China, the

chit funds in India, the arison in India or the Paluwagn in Philippines to

name a few. Financial institutions of indigenous origin, most of them

informal, are still exceedingly wide spread but have been largely

ignored in financial sector development. There are exceptions on a

limited scale, as in India where chit funds are regulated and in

Indonesia with its highly diversified rival and microfinance sector where

various forms of informal financial institutions have been registered

and eventually regulated throughout the twentieth century. Not a single

country has made indigenous forms of microfinance a pillar of its

modern financial system.

As neither commercial nor development banks nor state dominated but

unsupervised cooperatives delivered to the rural and urban masses,

credit NGO’s, during the 1970’s ushered in what came to be know as

the micro credit revolution powered by donor support and international

publicity. Grameen Banking became the new model of micro credit, its

founder the prophet of micro credit movement. The term microfinance,

originally meant to comprise financial intermediation between savers

and borrowers, was created only in 1990. In the mid 1990s, it was

taken up by CGAP, the donor consultancy group to assist the poor,

which has turned the micro credit revolution into the microfinance

revolution and professionalized microfinance. To some extent it has

reinvented history not only in Europe but also in Asia and elsewhere

where micro or informal finance and indigenous banking have always

been based on principles of self-reliance, viability and sustainability.

CGAPs rediscovered the principles, but not the indigenous financial

sector, be it informal or formal. Has the time come to revisit indigenous

finance in Asia and re-examine its potential for upgrading,

mainstreaming and innovating (Seibel 1997, 2001. India may serve as

an example far older and more complex, yet also far less conclusive,

than the European experience.

Microfinance as a new solution for poor people in newly developing

countries. Microfinance is not a recent development, and neither are

regulation and supervision of microfinance institutions (MFIs). Every

now developed country and some developing countries, particularly in

Asia, have a long history of microfinance. It is important to recognize

this because it presents a view different from that of many in the

microfinance community who associate microfinance with credit NGOs

and believe that micro finance history was invented in Bangladesh

some thirty years ago.

6.2.1. Microfinance in Europe: Ireland and Germany.

The birth of microfinance in Europe dates back to tremendous increase

in poverty since the 16th and 17th century. In response, microfinance in

a number of European countries evolved from informal beginnings as a

type of banking with the poor, juxtaposed to the commercial and

private banking sector. Almost from the onset, microfinance meant

financial intermediation between micro savings and micro credit, and

was powered by that intermediation. Legal recognition prudential

regulation and mandatory supervision evolved in due course and led to

a process of main streaming during the twentieth century when

microfinance became part of the formal banking sector. However in

one case, that of Ireland regulations has also been used, upon the

initiative of commercial banks, to curtail the further growth of

microfinance.

6.2.2. The case of Ireland:

The early history of microfinance in Ireland covers the period 1720 to

1950, it is unrelated to recent initiatives to introduced credit unions. It

is the story of how self help led to a financial innovation, legal backing

and conducive regulation created a mass microfinance movement, and

adverse regulation instigated by commercial banking interest brought it

down. The so called Irish, loan funds emerged in the 1720’s as

Charities, initially financed from donated resources and providing

interest free loans, but soon replaced by financial intermediation

between savers and borrowers. Loans were short term and

installments weekly. Peer monitoring was used to enforce repayment.

After a century of slow growth, a boom was initiated by two events (a)

a special law in 1823, which legalized financial intermediation by

allowing the funds to collect interest bearing deposits and to charge

interest on loans; and (b) the establishment in 1836 of a loan fund

board for their regulation and supervision. By 1840, around 300 funds

had emerged as self-reliant and sustainable institutions, generating

their own resources through deposit collection and providing small

loans to the poor.

6.2.3. The Case of Germany:

The story of microfinance in Germany, covering more than two

centuries, is one of self help, regulation and superior which have

created, relative to its population, the largest microfinance sector of

any country. It comprises two networks: community savings funds now

referred to as savings banks in English, and member owned

cooperative associations, now referred to as cooperative banks. The

community owned financial institutions started during the latter part of

the 18th century. Having learned from the early Irish charities (a) that

charity is not sustainable (b) that there is a strong demand among the

poorer sections of the population to for safe deposit facilities, the first

thrift society was established in Hamburg in 1778, followed by the first

communal savings funds to expand their credit business, including

agricultural lending. The Prussian state responded with regulation,

passing the first Prussian savings Banks Decree in 1838- fifteen years

after the Irish government had passed a law on loan funds.

In 1884 the savings banks formed the German savings banks

association. The Second Microfinance movement started after the

hunger years of 1846-47. Starvation was widespread; many peasants

lost their fields to the moneylenders, and many small business went

bankrupt. Two men are prominent among those who took action:

Raiffeisen in rural areas, creating credit associations (Darlehnskassen-

Vereine) predominantly of farmers, later known as Raiffeisenkassen

and now Raiffeisenbanken; and Schulze Delitzsch in urban areas,

establishing savings and credit cooperatives among craftsmen and

other small entrepreneurs now called Volksbanker (peoples banks).

Raiffeisen established a rural charity association in Weyerbusch,

bringing in grain from non-affected areas in the East. Within a few

months, this brought down the price of bread by 50%. His initiative was

paralleled in 1850 by Schulze – Delitzsch’s first urban credit

association, who insisted on self-help without charity from the

beginning. Raiffeisen soon realized that charity did not lead to

sustainable institutions. In 1864 he established the first rural credit

association in Heddesdorf, following Schulze – Deltzschs example who

rejected charity. During the next twenty years, the initiative gradually

turned into a movement, but growth was slow, reaching not more than

245 rural co-operatives in the mid 1880’s. The turn around came in

1889, when both the rural and the urban networks of credit

associations were brought under the law; the co-operative act often

German Reich the first cooperative law in the world.

6.2.4. Microfinance Lessons Learned from Europe:

Three centuries of microfinance in Europe have taught a number of

lessons that financial systems developers should be aware of,

including the following informal local initiatives based on self help have

a tremendous potential. Their foundations are savings, provided by

depositors or shareholders. Savings are the essence of self help and

self reliance, both of the household or small enterprise and of local

financial organizations. The viability and sustainability of small

enterprise (farm or non farm) and of local financial institutions are

intertwined, they fall or grow together. Continual access to financial

services, particularly savings and credit, over long periods of time are

crucial in poverty alleviations without economic development. Local

financial institutions, some of them very small, have proven their ability

of providing such services for generation after generation of crucial

importance in the evolution of local financial institutions have been two

factors.

• The first is regulation through an appropriate legal framework, with

changes and amendments overtime.

• The second is effective supervision delegated because of their

large number to apex organizations of MFI networks, which in turn

are supervised by the national financial authorities. While Germany

and countries like Italy have stuck to a multitude of local financial

institutions, the Netherlands have credited a central cooperative

banking institutions, Rabobank; France has its credit, Agricole and

Sweden has merged its savings and cooperative banks into a single

national banking institution. One may hypothesize that Germany is

a federation and therefore tends to institutional diversity, but Italy

shows a similarly diversified structure of local financial institutions

and is not a federation. There is just no single best practice model.

6.3. Microfinance in India:

6.3.1. Origins and early developments –

The case of India shows that the origins of microfinance predate those

reported above in Ireland and Germany by more than two and perhaps

even three millenniums. There are at least three strands of indigenous

finance of great historical depth in India, moneylenders, chit funds or

rotating savings and credit associations (ROSCAS), and merchant

bankers each with a complex and interlinked history, much of it yet to

be written. To draw lessons from this experience would require

systematic historical research from a microfinance perspective. The

following may serve as an inducement to embark on such research

and share the results with the microfinance community. This is all the

more important as India, over a period of tree thousand years, has

spread its culture trade and banking through vast parts of south and

south- east Asia and may continue to do so far as its latest rural

finance innovation is concerned: SHG banking.

Moneylenders who provide loans from their own resources as their

only financial service are the oldest of these professions, dating back

to prehistoric times. There was probably a long period of transition

from gift exchange, reciprocal lending and trading cum lending to

specialized lending, and from lending in kind to lending in money

before the first millennium B.C. Money lending became an organized

and subsequently regulated profession in India around 1700-2200

years ago as shown below. Money lending is still widespread today,

and remnants of its historical informal precedents are still in existence,

re-emerging time and again according to demand. Many (informal and

formal) moneylenders may have turned into (formal) merchant bankers

at various times in history, or into organizers of (informal or formal) chit

funds.

Chit funds or ROSCAs are widespread institutions of ancient origin in

India. A number of people, usually under an organizer, join together to

regulatory (e.g. daily, weekly, monthly) contribute equal amounts of

money (or kind) allocated to one member at a time, a cycle ends when

each participant has his turn. It appears that historically they were

relatively small and unregulated. There are two types: the

conventional type found all over the world, in which the full amount

contributed (part from minor deductions) is allocated to one member at

a time, either by lot, demonstrated need or in an agreed upon

sequence and an advanced type found in a number of Asian countries

including, China Vietnam and Nepal where the amount collected is

allocated by auction to the lowest bidder and the balance returned to

the members, or by tender. In response to increasing business

opportunities, the bidding type has been gradually replacing the

conventional type. As chit funds grew in size and volume and the risk

of fraudulent pyramid schemes increased there has been a tendency

of regulating the chits. Starting with the Travancore Chit Act of 1945

followed by other state level laws, they were increasingly included in

the formal financial sector. Chit funds attained such importance that in

1982, after ten years of deliberations, a federal chit funds Act was

passed, providing legal status to chits as non-banking financial

intermediaries. The act regulates minimum capital, ceilings on

aggregate chit amounts, procedures of dispute settlement, etc. This

has greatly contributed to the growth of licensed chit funds, which are

found all over India in large numbers.

Merchant Banking i.e. financial intermediation comprising lending

deposit taking and other financial services – evolved in India during the

first millennium B.C. and was widespread in India and beyond as early

as the third century B.C. Merchant guilds which dealt in good and

money, appeared already in the Vedic scripts, the oldest parts of which

date back beyond the first millennium B.C. between 200 B.C. and 300

A.D. a differentiation took place between the guild of money lenders

and the guild of traders, followed by the emergence of a guild of

merchant bankers. The guilds eventually turned into strictly hereditary

castes and banking became a sub-caste of the traders caste (Vaisya).

Regulation evolved during the first two centuries. A.D. when a law

code, dharmashastras, was written regulating loan deeds law courts

and debt procedures in detail. Money lending and banking became

licensed and tax paying professional. Usury initially was a major issue

of religious disputation. This was eventually resolved by agreements

over “reasonable” interest rates, e.g. 15% pa.. on secured loans and

higher rates on unsecured loans. The latter ranged from 2% p.m. on

loans to a priest (Brahman) to 5% p.m. to a cultivator (Shudra)

supposedly reflecting different assessments of risk by caste. Interest

payments could also be made in kind, but at a substantially higher rate.

Unrecovered loans were written off after 10 years. In addition there

was social banking i.e. interest free loans to the deserving and the

poor (Bhargava 1934; Schrader 1997: 71-83).

6.3.2. Medieval India:

The period from the mid thirteenth century to the beginning of British

rule during the eighteenth century, with its highly monetized economy

was the hey day of indigenous banking with domestic and international

long distance trade merchant banking grew enormously held by

individual firms, joint family firms and partnership firms all within the

same baniya caste but differentiated into numerous sub-castes. Their

customers include European private merchants and trading

companies. They also advanced working capital to weavers and other

artisans to produce goods on order for Indian or European merchants

– an Indian (monetized) version of the pulling out system. Some

secured commercial interest rates during the 17th century were

reported between 0.5 and 1.25% p.m. risky commercial credit fetched

a flat rate 40-60% per trade venture. The basic principle merchant

banking were mutual trust and mutual benefit. Very much in contrast to

what emerged at the same time in rural finance.

6.3.3. British India : Microfinance and banking changed substantially,

starting 1757 (Battle of Plassey). The imposition of trade restrictions.

The imposition of trade restrictions and long distance maritime trade

led to a decline of indigenous trading and merchant banking.

Interventionist polices such as the preferential importation of cloth from

England dealt a death blow to Indian textile manufacturing and the

ancient commercial structure. However, this was followed by a rise in

domestic trade and a shift to Bombay as the main centre of indigenous

industry and banking. European finance limited itself largely to

European enterprise. In rural areas, new legislation on land revenue

collection, private property and land mortgaging and the transformation

of subsistence agriculture into cash crop production created new

opportunities for money lender, who could now enforce their claims in

court. During the first half of 20th century, rural indebtedness first

increased, then was reigned in by money lender, usury and tenancy

legislation, but finally led to the rise of new types of lenders with an

interact in acquiring the land of their borrowers. Cooperatives

introduced top down, at the same time the bankers castes rose to new

heights. In the sphere of big business, they adopted Western banking

by pooling their capital, establishing joint stock companies or buying

shares of banks, in the small and medium business sphere indigenous

style banking continued.

6.3.4. Independent India: Searching for new approaches to reach the

rural poor.

Upon independence India faced an underdeveloped rural economy,

high levels of indebtedness and a lack of efficient financial services.

Since the 1950’s the lack of rural development has been attributed to a

lack of access to credit to finance production assets. Private banks that

should have provided such credit were absent from rural areas; and

informal finance, through moneylenders friends, relatives and rotating

chit fund was inadequate. 80% of the population lived in rural areas;

40% of GDP was contributed by agriculture, but only 2.2% of total

credit went to agriculture. Almost exclusively to medium and big

farmers. No attempts were made to build on indigenous informal

finance, despite the fact that, according to Reserve Bank of India

findings, informal credit accounted in 1951 for 90% and in 1971 for

70% of rural indebtedness, there was no mentioning of savings.

Instead to remedy the situation, the union government took three

related measures in 1969; the nationalization of 14 private banks

(followed by another six in 1980); the requirement to open two rural

branches for every urban branch and a mandatory system of priority

sector lending.

A stock taking in 1975 revealed that as a result of the institutional

expansion policy, 10,882 rural and semi urban branches had been

opened, yet the poor still lacked access to credit. It was concluded that

rural branches of large commercial banks, be they private or public,

are thus not the right answer. Hence, the government introduced a

new network of government owned Regional Rural Banks (RRB’s)

regulated and supervised banking institutions with a low capital base of

around $ 2,50,000 each covering with its branches a designated

service area of 1 – 3 districts. By 2005 there were 196 RRB’s with a

rural branch network of 14,000 including 12,084 rural and 1,875 semi

urban branches. Yet the problem persisted: RRB’s and cooperative

banks catered for farmers not the vast numbers of landless, migrant

labourers and illiterate women. In 1981 RBI carried out the All India

Debt and Investment Survey, published in 1983. After years of massive

branch expansion, policies of directing credit to the rural areas,

massive self employment programs, and large numbers of donor credit

lines among them over $ 1 billion from the World Bank with the

requirement that at least 60% went to small farmers – a total of 14

million small loans had been provided by banks, yet some 250 million

of the rural poor had no access to formal finance and 39% of rural

indebtedness stemmed from informal sources (though a huge

reduction compared to 1951 and 1971).

In 1982 RBI transformed its agricultural credit department into a new

apex bank. The National Bank for Agriculture and Rural Development

(NABARD), with responsibility, eventually for some 1,60,000 rural

financial outlets, among them around 1,00,000 credit co-operatives

(PACS), NABARD concluded that, while India had one of the most

complex rural financial infrastructures of any developing country, the

system had failed to attain its objective of reaching the rural poor.

Among the reasons identified were a sole emphasis on production

loans, prohibitive transaction costs for tenders and borrowers, failure to

mobilize savings, and overly complicated procedures. The

contradiction between a highly diversified rural financial infrastructure

and lack of access of the rural masses to financial services continues

to plague India, this is paralleled by another contradiction between an

emphasis on institutional diversity and a lack of emphasis on

institutional viability. There are 97 commercial banks with 57,772

branches, 32,244 of them (56%) located in rural areas. Among them

are 27 state banks which hold more than 80% of commercial banking

assets and dominating the banking sector. There are 196 Regional

Rural Banks with 11,944 rural retail outlets. In addition there are

1,15,000 rural co-operative outlets. The total number of rural outlets of

the normal sector is thus around 1,60,000. Yet according to a rural

finance access survey conducted in 2003, over 70% of small farmers

and landless have no deposit account; 87% have no access to formal

credit. The commercial banking sector has been the first to be

reformed, followed by the regional rural banks which is still ongoing.

Turning from the old to new world of rural finance during the second

half of the 1980’s, NABARD argued that programs with the poor have

to be savings led and not credit driven and that the poor have to have

a say in their design. In the years to come, they looked or new

partners, new delivery systems and new financial products. One of

these new partners was MYRADA one of now 700 credit NGOs and

MFIs whose action research into credit management groups during

1985 – 88 was funded by NABARD jointly with IDA. The study was

based on a new paradigm: savings first. Three options were discussed,

all hinging on prior savings by the groups matching grants, matching

interest free loans, or loans with interest. In search for a sustainable

solution, NABARD opted for the latter (Seibel 2005).

6.3.5. Co-operative Finance: Replication gone as tray:

It is difficult to do justice to the complexities of the Indian financial

sector and its changes over time. The financial co-operative sector is a

major part of rural finance in India, which is included but however

briefly. It dates back to 1892 when the government of Madras

presidency felt inspired by the German Raiffcisen movement of

savings and credit cooperatives and recommended just three years

after the passing of the German Cooperative Act in 1889, to replicate

the approach in India. In 1901 the government of India accepted the

proposal and in 1904 enacted the Co-operative Credit Societies Act,

followed by the more comprehensive co-operative Societies Act in

1912. This was to serve as a framework for promoting self help among

farmers and artisans under the Government of Indian act of 1919,

authority over co-operatives was transferred to the provinces, which

were authorized to enact their own co-operative laws. IT is not clear

whether state dominance evolved from here and how soon self help

and self reliance were undermined by well meaning state interventions.

6.4. Linking Formal and Non-Formal Finance :

A financial innovation. Reform of the regional rural and co-operative

financials sectors is not seen as a solution for reaching some 250-300

million rural poor. The trigger in the search for rural financial

innovations in India to reach the poor was an external event. The

APRACA regional workshop in Nanjing, China in May 1986, where

GTZ presented a linkage model based on the existing formal and non

formal financial infrastructure (Siebel 1985). Elements included SHGs

as informal financial intermediary savings based credit linkages with

banks, informal groups holding savings and credit accounts in banks;

NGO (SHPIS) as social, and initially also financial intermediaries;

flexible models of cooperation between SHGs, NGOs and banks as

autonomous business partners each with its own existing financial and

institutional resources (APRACA 1986). Several Asian Countries took

up the challenge. In contrast to those countries were a GTZ expert

carried out feasibility studies, NABARD coordinated a field study of

SHGs in 1987 with a term from various Indian institutions. To identify

SHGs, the team approached NGOs; SHGs without any link to an NGO,

including the ubiquitous chit funds, were thus not included in the study.

Almost all the groups were of recent origin, emphasized self help were

largely homogenous in terms of caste and activity, built a common fund

from very small regular savings and interest income and lent to their

members for period of 1-3 months at 2-3% interest per month.

Recovery of these loans was excellent and an impact, however small,

was felt, reaching from emergency assistance to release from bonded

labour. While the groups preferred to remain informal they shared

basic features of formal bodies in terms of book keeping and

management. Access to formal credit was virtually non existent. NGOs

reportedly had “played a commendable role in organizing the rural poor

into self-help groups and thereafter promoting their proper functioning

given the very low resources base of internally generated savings on

the one hand and some not able exceptions of “effectively developed

credit links between the target groups and banks, the team thought it

“desirable to consider development of flexibility models of linkages

appropriate for various situations.”

IN 1988 Bank Indonesia, the Central Bank started a pilot project linking

Banks and SHGs in Indonesia, with technical assistance from GTZ.

With increasing participation from banks and NGOs, this become

APRACAs and GTZ’s first experimental station for linkage banking in

Asia. Given an abundance of financial self help groups in Indonesia the

project limited itself to those and made no attempt to establish new

groups. The general manager and alter chairman of NABARD Y.C.

Nanda, visited the project several times, learning that the central bank

had authorized its public and private banks to accept informal groups

as customers and lend to them without physical collateral, repayment

rates at the time were close to 100%.

Intensely monitored and reported upon at APRACA meetings and

international conventions, it attracted widespread attention, among

others by the president of the World Bank, who declared in the

foreword of the World Development Report 1989 (pp iv, 119) “Informal

financial institutions have proved able to serve the household,

agricultural and micro enterprise sectors on a sustained basis.

Measure that link informal institutions to the formal financial system will

improve that service and ensure a competitive environment. APRACA

member institutions, including NABARD, felt inspired.

Reviewing the situation of rural finance in India again in 1989, it was

observed that most of the 196 Regional Rural Banks (RRBs) were loss

making and thus did not present a viable solution. This led to a

discussion in parliament about the feasibility of a Grameen Bank,

following the model of Bangladesh as a new national banking

structure. Inspired by the linkage experience under APRACA,

NABARD argued for a different approach.

• Using the existing infrastructure of banks and social organizations.

• It should be savings rather than credit led.

• Using bank rather than donor resources.

Between 1989 and 1991, NABARD (1991) entered into a policy

dialogue with RBI to make preparations for a pilot project linking

informal groups to banks. On 24th July, 1991 RBI issued a circular to

commercial (RPCD No. Plan B.C. 13/PL-09-22/90-91) advising them

to actively participate in the pilot project refinanced by NABARD, for

linking SHGs with banks. The groups may be registered or

unregistered, have 10-25 members, should have been in existence for

atleast six months, and should have actively promoted the savings

habit.

The pilot phase covered the period 1992-96. The banks noted a

contradiction between a directive of the RBI of 27 December 1985,

which restricted the opening of savings accounts and the circulars of

RBI and NABARD authorizing bank linkages of informal groups. Self

Help Groups registered or unregistered may be allowed to open

savings Bank Accounts with banks.” AT mid term, March 194, 637

SHGs (80% women’s groups) with 11,000 members most of them

women, had be credit linked to 28 banks, comprising 16 commercial

and 12 regional rural banks. 34 NGOs were involved as facilitators.

Large number of officers of NABARD were sent to MYRADA and other

NGOs for exposure training. By March 1996, 4,757 SHGs with 80,000

members had been mobilized by 127 NGOs and credit linked to 95

bank branches. During the pilot phase mainly SHGs were linked to

banks that had previously been established by NGOs.

NABARD evaluated the project and found that the program was highly

suitable for poor and very poor women particularly in marginal,

resource poor area, membership has come mostly from the poorest

section of the society; women frequently need credit, but at irregular

intervals; they use the loans for productive and non-productive

purposes, with a trend towards productive investments incomes have

gone up, even the poorest of the poor do save and their savings

increase with the income; Transaction costs of banks and SHG

members go down the repayment rate is close to 100% in contrast to

the usual rate of 50 – 60% in agricultural credit. IN comparison to the

Grameen Bank Model, NABARD found that “the SHG linkage model

appears more sustainable and appropriate in the Indian conditions

were (India has) in place a vast network of rural bank branches… and

SHGs which are functioning on their own and waiting to be linked to

the banking system” (Nanda 1995).

Nationwide mainstreaming started in 1996 after clarifying two issues by

circular (i) SHG members who had earlier defaulted on bank loans and

were therefore not bankable could obtain loans from the groups’ own

internal funds if decided (ii) informal groups were limited to 20

members, beyond which they would be required to legally register. To

implement mainstreaming, NABARD did the following (i) it provided

refinancing to participating banks (ii) it declared SHG banking the

dominant, but non-mandatory approach of lending to the poor

replacing bank retail lending (iii) it propagated its grand vision of one

million SHGs, representing a population of 100 million of the rural poor,

to be credit linked by the year 2008 endorsed by NABARD regional

directors and subsequently articulated by union government in all its

budget speeches (iv) it created a Micro credit innovations Department

(MCID) as the program steering unit, with representations in all states

through Micro Credit Innovation Cells (v) it set up a special fund to

finance massive capacity building measures as the motto of expansion

(vi) it supported the establishment and maintenance of SHGs, through

numerous NGOs and GO’s and (viii) it subsequently allowed for

initiatives to organize SHGs in self sustained federations (Nair 2005)

under a new legal form as Mutually Aided Co-operative Societies

(MACS).

6.4.1. MFI and their approaches:

There is a vast network of banking and cooperative finance institutions

in India and therefore formal financial services are, in theory, available

and accessible to low income families in virtually every part of the

country. However their availability is a mirage. Stung by the

deficiencies of the directed credit programmes, particularly in the

1980s, the banking institutions in India have virtually withdrawn from

lending to the poor while the cooperative credit system is bankrupt and

all but defunct in large parts of the country.

It is in this situation that the non-government microfinance sector has

attempted to provide an alternative to the often high cost informal

financial service providers on whom most low income clients must rely.

Despite the supporting efforts of apex funding organisations such as

NABARD and SIDBI, however the outreach of the microfinance sector

remains minuscule in relation to the need. Barely 3 million of the

estimated 60 million poor families in India have been covered by the

microfinance sector. While many MFIs and the NABARD programme,

have done well in terms of promoting a semi formal credit culture,

however this success has been achieved at the cost of flexibility.

Formal financial services are, in theory available to low income families

mainly through 33,000 so rural and 14,000 suburban branches of the

major banks and RRBs and by 94,000 cooperative outlets – either

bank branches or villages level societies. Financial services to the poor

are also available from the village or (town) neighbourhood – level

agents of NBFCs. The RRBs, in particular were established specifically

in order to meet the credit requirements of the poor small and marginal

farmers, landless workers, artisans and small entrepreneurs and

should, therefore, have emerged as a major source of microfinance. A

total of 1,40,000 institutional outlets serving the rural sector and the

poor implies the availability of one outlet for every 5,600 persons – in

theory, a very favourable ratio for creating to the financial needs of the

poor.

For many years, bankers and senior government officers were fond of

describing the government of India’s main poverty alleviation

programme the Integrated Rural Development Programme (IRDP) as

“the world’s largest Microfinance Programme”. And so it was. It

involved the commercial banks in giving loans of less than Rs.15,000

to poor people and, in nearly 20 years, resulted in financial assistance

of around Rs.250 billion to roughly 55 million families. The problem with IRDP

was that its design incorporated a substantial element of subsidy (25 – 50% of

each family’s project cost) and this resulted in extensive malpractices and

misutilisation of funds.

Over the past 20-25 years the resultant vacuums in the financial system has

started to be filled initially with the pioneering efforts of organizations such as

SEWA Bank (Ahmedabad) and Working Women’s Forum (Madras) but, more

vigorously during the 1990s, by the entrance of significant numbers of non-

government organizations (NGOs) into microfinance. Current estimates of the

number of NGOs engaged in mobilizing savings and providing micro-loan

services to the poor lie in the range of 800, 1000 organisation. Initially, many

NGO microfinance institutions (MFIs) were funded by do not support in the

form of revolving funds and operating grants. In recent years, development

finance institutions such as NABARD, SIDBI and micro finance promotion

organizations such as the Rashtriya Mahila Kosh (RMK – the National

Women’s Fund) have also started to provide bulk loans to MFIs. This has

resulted in the MFIs becoming intermediaries between the largely public

sector development finance institutions and retail borrowers consisting of

groups of poor people or individual borrowers living in rural areas or urban

slums. In another model, NABARD refinances commercial bank loans to self

help groups (SHGs) in order to facilitate relationships between the banks and

poor borrowers. Though the (mainly) NGO micro finance sector has made a

start in providing “user friendly” formal financial services to the poor its

outreach is still miniscule in comparison with the need. A compilation of

support provided by major institutions to micro finance in India shows that the

cumulative disbursement of bulk loans to MFIs by domestic financial

institutions did not exceed Rs.3.5 billion (US$ 72 million)by March 2001 with

an outreach to less than 2 million families – at best less than 5% of the poor in

India. Even allowing for a significant volume of donor grants, the total

coverage is likely to be under 3 million families.

The common characteristics across these current approaches to the provision

of microfinance services can be summarized as follows:-

Table 6.1. Microfinance Services

Financial Service

Characteristic Description

Credit Loan amount Determined by the longevity of the clients

association with the MFI. Not often directly

related to the credit needs of the borrower.

Loan term Usually 12 months, occasionally less,

sometimes greater.

Repayment

installments

Monthly or weekly usually fixed, equal

amounts.

Interest

charges

Range : 24-36% usually levied as a flat charge

partially to simplify calculations for both the

MFI and the client. Some MFIs in India charge

lower rates but unfortunately suffer from poor

sustainability as a result.

Collateral No physical collateral but often linked to some

compulsory savings component which acts as

financial collateral. Some MFIs also create

reserve funds to cover the risk of default.

Financial Service

Characteristic Description

Savings Amount

deposited

Grameen: Compulsory usually, a fixed

proportion of the repayment installment.

SHG: Compulsory fixed amounts per (weekly

or monthly).

Insurance Life Some MFIs are starting to offer life insurance

covering client loan repayments plus a small

payment to the family in case of the death of

the client. This is done either through the

creation of a reserve fund for the purpose or

by buying insurance from the organized sector

on behalf of the client/ member.

Source : Manual of NABARD – 2008.

6.5. Micro enterprise is a type of small business, often unregistered having

five or fewer employees and requiring seed capital of not more than $ 35,000.

The term is often used to refer to a business with a single owner – operator

and no employees.

Generally speaking

• In developed countries micro enterprises comprise the smallest end (by

size) of the small business sector, whereas

• In developing countries, micro enterprises comprise the vast majority of

the small business sector – a result of the relative lack of formal sector

jobs available for the poor. These micro entrepreneurs operate micro

enterprises not by choice, but out of necessity. Micro enterprises typically

have little to no access to the commercial banking sector, they often rely

on “micro loans” or micro credit, in order to be financial. Micro finance

institutions often finance these small loans, particularly in the Third World.

Those who found micro enterprises are usually referred as entrepreneurs.

The terms micro enterprise and micro business have the same meaning,

though traditionally when referring to a small business financed by micro

credit, the term micro enterprise is used. Similarly when referring to a

small, usually legal business that is not financed by micro credit, the term

micro business is used.

6.5.1. Micro enterprise Development:

Micro enterprise development projects can serve four major objectives (i)

Poverty reduction (ii) The empowerment of women (iii) Employments

generation and (iv) Enterprise development as an end in itself. Micro

enterprise development contributes to widening the pool of entrepreneurship

available to society and it broadens the base of the private sector.

Some aspects of micro enterprise development are size, gender, location and

sector of activity. Most micro enterprises are single person, owner operated

enterprises or slightly larger units engaging one or more family members.

Enterprises that hire wage employees tend to be the exception. A higher

proportion of livelihood enterprises tends to be owned and operated by

women than do growth oriented micro enterprises. Women run livelihood

enterprises out number those run by men in many countries. Certain

livelihood enterprises tend almost invariably to be run by women, and indeed

to viewed as women’s enterprises in some cultures, such as poultry rearing

and weaving. In the seven countries studied in Hiedholm and Mead (1995),

the share of enterprises owned by women ranged from 46 to 84 percent with

women owing more than half in four countries (or 54 percent) in the six cost

countries). There is no standard classification by sector and sub sector of

activity for micro enterprises. The most useful classification of micro

enterprises from the policy point of view is with respect to their needs and the

constraints they face. A distinction often made in the literature is between

“survival” (sometimes called “subsistence”) enterprises on one hand and

“viable” enterprises on the other. A “survival” activity is said to be one into

which the entrepreneur is often pushed for want of more profitable

alternatives, whereas one is attracted, or pulled into a viable activity by

considerations of profitability, and is an entrepreneur by choice. In the former

case, the activity is often just one of many part time or seasonal activities

undertaken to support family income, whereas in the latter case it is usually

the main source of family income. In the case of survival activities, usually no

skills or very rudimentary skills are involved, so that there are very low entry

barriers to the activity, and it is overcrowded. In the case of “viable” activities,

considerable experience and skills are often involved which restrict entry. In

the former case, net earnings tend to be used for survival, where as in the

latter some part of the surplus is reinvested in the expansion and growth of

the enterprise, with potential for growth. Such as tailors moving into garment

making, while the distinction between “survival” and “viable” enterprises in the

form above is useful from a descriptive point of view the value laden

terminology it uses has misleading implications for policy and should therefore

be used carefully, if at all. While it is true that many people are “:pushed” into

survival activities, once in them, they often stay in them by choice, not only

because they do make a living out of them, but for variety of psychological

reasons that are not easy to quantify. Survival activities are indeed often

among several secondary sources of income of the household, while viable

activities are more often the primary source. Survival activities tend to grow

rapidly during times of stress. Several studies have found that most of the

enterprises financed by micro enterprise programs are secondary sources of

household income and are often seasonal, intermittent and part time.

However, it is misleading to move from this finding to normative conclusion

that survival enterprises do not require assistance. The challenge is to

increase the vital supplement to the household income they represent. There

may be a need to balance the abandonment of certain goods and services

with the general process of growth. The effort should be to make them more

productive as long as they exist. If they are part time or seasonal, programs

should be designed that take this into account.

Most survival enterprises do earn small surpluses. The fact that the surpluses

tend not to be reinvested for expansion is not an inherent characteristics of

survival enterprises. Rather, it is a reflection of the poverty of the

entrepreneurs who operate them. They tend to apply their surpluses to

household expenditure to sustain and raise their level of living.

Table 6.2. Sectoral classification of Micro enterprises.

Sector Livelihood Enterprises

1. Non crop agriculture related activities

Pig, goat raising, milch cattle, backyard poultry, vegetable growing on leased land, fruit trees on home stead sericulture.

2. Trading Ambulant vegetable vending, buying and sell fish.

3. Food and refreshments Juice stand, small tea shop, candy and snack stall.

4. Food and agro-processing Rice cakes.

5. Manufacturing

a) Textiles Pit loom, seamstress.

b) Wood, rattan, bamboo, and grass products.

Matt and basket weaving rotten furniture.

c) Footwear and leather Wayside shoemaker.

d) Bricks, tiles and pottery Village potter.

e) Handicrafts Hats for local market.

f) Fabricated metal products and repair services.

Simple agricultural implement maker roadside bicycle repair.

6. Fishing Single person fishing boat.

7. Transport Cycle rickshaw, mule, bullock cart.

8. Other Services Wayside hair dresser.

Source : Manual of NABARD – 2008.

The potential of survival enterprises for growth is usually limited by a host of

factors relating to both the environment, and to the lack of skills of the

entrepreneurs themselves. The absence of skill requirements in survival

activities does indeed result in low barriers to entry and to overcrowding. Very

few survival activities have the potential for growth beyond a certain size and

level of income yielded, and this is the crucial distinction between the two

types of enterprises.

Micro Enterprises can be classified into growth oriented micro enterprises and

Livelihood Enterprises. The growth oriented Micro enterprises include :

• Stall fed mini-dairy of high yielding cows “scientific”, poultry or duck

raising, fish fry and fingerling raising.

• Larger grocery store, vegetable wholesaling.

• Restaurant or tea shop at busier location with hired employees.

• Packaged candies, processed meat products, perhaps with labels.

• Power loom, garment maker, bulk orders for uniforms.

• Larger furniture – making unit.

• Larger ready made footwear making unit, leather bags.

• Larger brick making unit.

• More sophisticated handicrafts for the export market.

• Small engineering workshop doing job work, repairs to heavier agricultural

implements.

• Larger mechanized boat with crew members.

• Mechanized three wheeler, hand tractor

• Rental services.

• Beauty parlour.

Table 6.3. Livelihood Enterprises

1. Capitalization Relatively low.

2. Education Little formal education

3. Skills and

experience

Relatively low, except for skills acquired

traditionally, as in handicrafts, trading often a

fertile training ground for later manufacturing of

same product.

4. Gender Participation of women.

5. Sector Higher proportion in livestock, backyard poultry,

food processing and petty trading.

6. Competition Usually function in perfectly competitive markets

with low barriers to entry and little scope for

cutting costs by intensive use of family labour and

even by offering credit.

7. Seasonality Often seasonal, tied to crop cycle, school year

major festivals.

8. Contribution to

household income

Usually a secondary source (although vital).

9. Whether only

enterprise

Usually one of several “multiple” enterprises (to

compensate for seasonality and low returns).

10. Use of hired labour Mostly use family labour.

11. Surplus and

reinvestment

Surplus limited and often plowed back into

household expenditure.

12. Use of credit Trading activities often started on a consignment

basis.

13. Potential for growth Limited in terms of new employment generation.

Source : Manual of NABARD – 2008.

Micro enterprises: Details of the micro enterprise functioning include:

• Higher but initial capitalization often similar.

• Usually at least secondary schooling required.

• High participation of women.

• Niche markets.

• Less affected by seasonality.

• Often primary.

• Involvement of relatives and children.

• Reinvestment of surplus.

6.5.2. Micro enterprise and Economic Self Sufficiency:

Just as assistance rendered to the two types of enterprises corresponds to

two different sets of development objectives, these objectives themselves

correspond to two major types of programs.

Livelihood programs have poverty reduction as their main objective and seek

to upgrade the productivity or increase the turnover of the multitude of

livelihood enterprises. They entail bringing about small improvements for

many enterprises, often providing only credit which is why they are sometimes

characterized as being “minimalist”. Growth oriented micro enterprise

programs on the other hand have enterprise development as their immediate

objective and attempt to lift micro enterprise to a qualitatively higher level of

sustainability, setting them on the path to long term growth and seeking to

provide a comprehensive range of services including credit, training, technical

assistance, and the inculcation of business skills. Being more staff intensive

and entailing forms of assistance which, with the exception of credit, take a

longer time to deliver, growth oriented micro enterprise programs which can

reach a much smaller number of enterprises. There is a trade off therefore

between making a short term impact.

Micro enterprises …

consist of

which tend ….

themselves to

the objectives of

Through …

Figure 6.1. Two types of programs for Economic Self Sufficiency

Source: Manual of NABARD. (Sept. 2009) Mostly through self employment on the one hand and longer term growth

oriented enterprise development on the other, but for a much smaller number

of direct beneficiaries.

6.5.3. Micro enterprise and Women:

The empowerment of women is an object that goes beyond increasing the

income of low income women. Women have other less tangible priorities,

Livelihood

Activities

Growth oriented

Micro enterprises

Poverty

Reduction and

Women’s

Empowerment

Employment

generation and

Enterprise

Development

Livelihood

Programs

Micro enterprises

Programs

Enterprise

“Expansion”

(but usually only

one step up)

Enterprise

“Transformation”

(Escalator)

such as a more equal role, and a greater sense of efficacy, within and outside

the household. Micro enterprise programs can lead to empowerment in its

social as well as economic dimensions. The mobility of women and their

access to information is strengthened by the process of participation in micro

enterprise program activities, including attendance at weekly meetings and

other interactions in the public sphere that come about as a result of

economic activities. Empowerment leads in turn to social benefits. The micro

enterprises have led to a certain level of women’s empowerment such as

physical mobility, economic security, ability to make various purchases on her

own, freedom from domination and violence within the family, political and

legal awareness, participation in public protests and political campaigning.

Women constitute by for the largest share of borrowers of several major micro

enterprise programs in South Asia, both rural and urban. These programs

help women in building up self reliant organization through which women can

develop leadership skills and lobby to remove some of the policy biases,

market distortions and legal and regulatory constraints in the working

environment facing them.

Micro enterprises have built up the creditworthiness of women as reliable

borrowers over a number of years, they are now accessing much larger and

longer term loans for their families. This aspect of empowerment contributes

to the role of women in decision making in the family and their status outside

it. In the course of forming the micro enterprise, it is also true that in some

societies loans granted to women are either fully or partially controlled by

men, while the responsibility for repayment remains with women. But this also

leads to welfare enhancing and development of the micro enterprise. A recent

study indicates that 39 percent of loans provided to women by four major

NGOs are either fully or partially controlled by men, while, further 24 percent

are partially controlled by themselves.It was also seen that when women do

control loans, it is usually for traditional women's micro enterprises and their

activities. Study also finds that a higher proportion of 55 percent of widowed

separated or divorced women fully control their loans. Given differences in

cultural attitudes to women’s work and autonomy, women’s enterprises and

relatively more important in some countries than in others. However, women’s

enterprises are present in all countries and share certain common

characteristics.

Characteristics of Women’s Micro enterprises: Women's micro enterprises

tend to be home based because of their family responsibilities especially in

South Asia because of traditions of female seclusion as well. Chen et al

(1996) point out that land surplus, labour scarce communities often assign

women work outside the home, whereas land scarce, labour surplus

communities are more likely to confine women to tasks within the homestead.

Similarly, the norms of good and bad behaviour vary. In land surplus and

labour scarce societies, women’s mobility outside the home tends to be more

condoned, than in labour surplus societies. Another characteristics of

women’s enterprise is the high degree of concentration in activities with the

lowest capital and skill – entry barriers which makes them overcrowded, with

low return and subject to short term volatility. Due to the burden of domestic

work, such enterprises tend also to be part time, to constitute a secondary

source of household income (the main being the husbands wage labour) to be

seasonal and to be one of several multiple activities. Women enterprises are

concentrated in sectors with particular case of entry and low returns, new

starts and closure tend to be higher for enterprises run by women, and to be

particularly sensitive to changes in the overall level of the economy. Closures

take place not only because of business failures, better opportunities (moving

from one business enterprise to another) as well as personal reasons, such

as illness. The personal reason taken into account, female enterprise closure

rates are higher Women's enterprises tend to be relatively small, have

informal structures, flexibility, low capital needs, modest educational

requirements and depend on local raw materials. Women’s micro enterprises

are also characterized by their dependence on family labour and limited

technical and managerial skills. These enterprises are not registered, usually

maintain no business records and do not have access to credit from formal

credit institutions.

Chapter – 7

ROLE OF GOVERNMENT AND NON-GOVERNMENT ORGANISATION FOR ENTREPRENEURSHIP

DEVELOPMENT IN MAHARASHTRA.

There are several government and non-government organizations who

focus on the Development of Women Entrepreneurship process in

Maharashtra providing their services and products. They are as

follows:-

7.1. Maharashtra Centre for Entrepreneurship Development (MCED)

The state promoted organizations SICOM, MSSIDC, MIDC, MSFC,

MELTRON and MITCON conducted a study and found that there was

a need for entrepreneurship development trainings as the District

Industries centre was funding entrepreneurs who did not have

adequate knowledge to manage their enterprises and make them profit

earning organizations. MCED is an apex body of the government of

Maharashtra devoted to training entrepreneurs.

The MCED was born out of the need for the entrepreneuring society

for securing professional and practical training on entrepreneurship to

individuals and developing them as entrepreneurs in Maharashtra, in

the year 1988. It is a state government promoted organization

sponsored by the State Industrial and Investment Corporation of

Maharashtra (SICOM), Maharashtra Small Scale Industries

Development Corporation (MSSIDC), Maharashtra State Electronics

Corporation (MELTRON), Maharashtra Industrial Development

Corporation (MIDC) and Maharashtra Industrial Technical Consultancy

Organisation (MITCON). The headquarters of MCED is at Aurangabad

with regional offices at Mumbai, Pune, Nashik, Nagpur, Amravati,

Kolhapur with a trainer in each district.

MCED was not provided with any financial support directly by the State

government or the Central Government. It however, had to move

around marketing its programmes and getting sponsorship from

various governmental and non-governmental organizations and fees

from the participants of various programmes. Since its inception, 1988

The focus of MCED activities in on developing entrepreneurs. The

working of MCED is based on the concept that “Entrepreneurs need

not be born, they can also be developed”.

The main objectives of MCED are :

♦ To spread the entrepreneurial culture

♦ To develop entrepreneurs through systematic training.

♦ To disseminate information and data regarding entrepreneurship.

♦ To help industries and institutes in mobilisation of human resource

in a more entrepreneurial way.

♦ To create awareness about emerging and future entrepreneurial

opportunities and challenges.

To achieve these objectives, MCED conducts a variety of activities like

the Entrepreneurship Development Programmes, Entrepreneurship

Awareness Programme for Women and Training for the Prime Minister

Rojgar Yojana etc.

7.2. Annapurna Mahila Mandal (AMM)

Annapurna Mahila Mandal is an NGO in Mumbai set up in 1975 during

the International Year for Women. A large number of women working

in the textile mills of Mumbai found themselves without job because the

mill owners did not like their profits being affected by a set of rules and

regulations beneficial for women. AMM chose to adopt a constructive

and positive stance by finding alternative ways to women’s economic

empowerment. Since, the poor women did not have capital resources

to utilize their entrepreneurial instincts, AMM plays the role of

meditating between the banks and these women. This brought the

written culture banking procedure within the grasp of poor, illiterate

women. It is one of the few NGOs in India, which opted to work as an

intermediary between the formal banking system and the poor women

micro entrepreneurs in the informal banking sector. From facilitating

women’s access to institutional credit AMM has now set up its own

credit and cooperative society with systems that are flexible and

member friendly.

Credit has helped these women to find self employment and income on

one hand and self esteem and status on the other. AMM took the

responsibility of reaching out to women micro entrepreneurs in slums

of Mumbai and organizing them to help them free themselves from the

exploitation of money lenders. As an organization helping the women

micro entrepreneur, AMM undertakes the following activities.

♦ Identification of beneficiaries, who are self employed, to use the

loan to invest in productive activities.

♦ Fulfilling all the procedural requirements of banks on behalf of

illiterate beneficiaries.

♦ Explaining the procedures of banks to beneficiaries in the local

language.

♦ Inculcating in the borrowers a sense of responsibility towards

repayment of the loan through meetings and the instrument of

group guarantee.

♦ Collection of repayment dues from the door step of the loanee so

that she does not loose a full days earnings in “waiting at a bank”

and

♦ Monitoring and utilization of the loan for the started purpose.

The process of enabling women to become micro entrepreneurs and

self-employed workers have involved a great deal of social animation

aimed at promoting organized behaviour among them. It has helped

the women to discover the strength within them by collectively looking

at their own survival problems. It has also included training them to

manage the work place, market, credit and enhancement in

productivity and income earned. Today, many of these women are

occupied in selling vegetables, fruits, bangles, flowers, fish, dry fish,

grain, papad and masala sari fall beeding, toy making, tanning etc.

The objectives of the organization are as follows:-

♦ To educate women in general health, nutrition mother and child

care, family planning literacy, environmental sanitation and more.

♦ To delink women from greedy money lenders.

♦ To enable women to take independent decisions and move towards

self reliance.

♦ To motivate, organize and train rural and urban poor women to

acquire confidence and status in their household and neighbours.

♦ To enable poor women to accrue assets for their development.

♦ To give exposure to credit and financial knowledge and link them

with nationalized banks.

7.3. Bharatiya Yuva Shakti Trust (BYST):

Bharatiya Yuva Shakti Trust (BYST) is a unique non-government organization

working in the field of “Entrepreneurship development” for youth in the under

privileged category. The trust was founded in 1991 at the initiative of the

Prince of Wales and the Business leaders Forum and is managed by

Confederation of Industries in India. Since its inception, the trust has launched

more than 300 new ventures in Delhi, Haryana, Chennai and Pune. BYST is a

non-profit organization which helps under privileged youth in the age group of

18-35 years to start their ventures. It has its unique model of enterprise

development in India, due to the fact that it is industry initiated, supported and

managed with its specific feature of mentoring and unique selection process

of its beneficiaries. The mission of BYST is to identify, nurture, groom and

empower the disadvantaged young assistance and involvement of the

corporate sector.

BYST has the following long term objectives :-

♦ Upliftment of underprivileged Youth: BYST helps to promote the social and

economic welfare of and upliftment of under privileged youth with

entrepreneurial skills.

♦ Create awareness of the real option of self employment through the

formation of business enterprise that provide employment opportunities to

others. To convert job seekers in to job creators, helping to alleviate the

unemployment situation in a much broader framework.

♦ Corporate Responsibility amongst Indian Industry and multi national in

nation building by supporting financially and through business counseling

of small enterprise of under privileged youth.

♦ Replication by acting as a role model for small enterprise development by

providing the concepts of mentorship and guidance among financial

institutions that currently only provides monetary support. To help them

address the under privileged youth sector. Role models are provided by

BYST in major regions on India.

♦ Franchising options for appropriate organization corporation enable BYST

to outreach to new areas. Research and Development by BYST on

franchising of this non profit organisation enable BYST to act as a role

model to others.

♦ Young Women: BYST to ensure that at least 50% of the new ventures

started will be by female entrepreneurs.

♦ Sustainability: To become self sufficient through the interest earned on

corpus funds and the repayment of BYST’s seed capital.

♦ Financial Leverage: Relationship built with financial institutions will

increase the financial leverage by BYST seed capital.

♦ International linkage: To link to similar youth business Trust developing in

other countries of the region and globally to learn from each other and

share technical expertise.

7.4. National Small Industries Corporation Limited:

The National Small Industries Corporation Limited (NSIC) was set up

in February 1955 by the government of India to assist, finance, protect,

promote and develop small scale industries in the country. The

Corporation provides support to the small scale industries sector in the

following area:

i) Machines on hire purchase. This scheme was launched in March

1956 to supply both indigenous and imported machines on easy

hire-purchase basis to help new small scale and ancillary

industries to establish and to help the already existing industries

to modernize. NSIC provides single window service to

entrepreneurs for the import of machinery.

ii) Marketing Assistance: The Corporation takes up marketing of

small industries products within the country. The Corporation

since 1976 in its internal marketing programme adopted a

consortia approach that is units manufacturing the same or

similar product form a consortium. The corporation explorer

markets, secures orders for bulk quantities and places orders

with small units according to their consortia approach are hosiery

items, electric fans copper clad utensils, sewing threads etc.

iii) Supply and distribution of indigenous and imported raw

materials. The corporation has been supplementing the

availability of raw materials to a large number of small industries

in the country through its distribution system. Under the industrial

raw material assistance centre scheme, the corporation assists

in the impact of OGL items, the Corporation assists in the import

of OGL items as per the import export license raw material from

local sources because units often cannot lift raw materials in

bulk. The Corporation however supplies raw materials to small

units according to certain terms and conditions.

iv) Exports: The Corporation has adopted a single window

assistance approach for export of small industries products. It

render export assistance to small units in the form of obtaining

enquirer, specifications and samples through its indenting

agents, and assists small units to develop counter samples and

to dispatch them for approval of the foreign buyers negotiating

contracts with foreign buyers and forming them out to small

scale units to attend to the entire export documentation work, to

arrange for import of raw materials and to monitor production, to

make 90% payment in advance to the units, to obtain licenses

etc.

v) Project Exports: Turnkey projects were taken by NSIC in 1975.

The first turnkey project was with the government of Tanzania,

and since then, it has executed more than 50 projects. There is

considerable demand from the developing countries for

assistance in supply of projects on turnkey basis. This incurred

preparation of project report, infrastructure facilities, training,

supply of equipment, commissioning of plants and deputation of

personnel for initial operation and training in the host country.

Many small scale units in India are associated with the execution

of such products.

vi) Training: The NSIC also runs prototype development and

training. The objectives being-

(a) To impart practical and classroom training in several

industrial trades.

(b) To develop prototype of machines, equipment and tools

which are then passed on to manufacturing units for

commercial production.

(c) To take up production of machines and equipment as per

market acceptability.

(d) To design, develop and produce improved tools for use of

rural artisans so that their productivity and thereby their

earnings may increase etc.

7.5. Small Industries Development Organization (SIDO)

The small industries Development organization (SIDO) is the national

apex agency under the Ministry of Industries, headed by a

development Commissioner with its headquarters in Delhi. Its functions

through a network of small industries services institutes, branch

institutes and extension centre. The objective of this organization is to

supplement the efforts of the state governments and co-ordinate their

activities and those of other agencies so as to facilitate the

development of small scale industries in those states. The functions of

this organization are

i) To provide policy advisory services including an all India policy

and programme for the development of small scale industries

advise for government of India and state government on matters

relating to small scale industries, effecting liaison between state

and centre government or between financial institutions etc.

ii) Providing technical advisory services to existing and potential

entrepreneurs such as preparing designs and drawings for

production equipments, new products and by-product layout,

installation and operation of plant and machinery, choice of

machinery etc.

iii) To provide workshop and laboratory services to small scale

entrepreneurs which include testing raw material, carrying out

experiment on new and substitute raw materials, to demonstrate

the use of modern technical processes on selected machines,

assist in quality control etc.

iv) To provide management consistency, services such as advice

on cost reduction quality improvement, financial management,

production management marketing etc.

v) Management and technical training service such as improving

and upgrading the skill of workers and managerial personnel.

vi) To provide economic services to the entrepreneurs such as

markets forecast, background information for the formation of

government pans and policies, prospects of further

developments, selection of new items of productions or

expansion of existing ones etc.

vii) To provide information services such as guidance on the

establishment of new enterprises, to prepare and publish

promotional literature like technical bulletins, model schemes,

industry prospects sheet etc.

viii) To provide assessment and general services like recommending

licensing for machinery, emergency spares or to recommend

small scale industries to public and private large industries for

supply of stores or financial assistance from state bank or to

undertake exports, advice on procuring machinery on hire

purchase basis etc.

ix) To undertake entrepreneurial development. The entrepreneurial

development division and its cells in the states provide advice on

industries that have a good scope for development, suitable

location and infrastructure facilities available size of an

enterprise and its investment, sources of supply of machinery

and equipment, raw material, labour, methods of production and

production management, training perspective entrepreneurs and

managers of existing small units etc.

7.5. Central Social Welfare Board:

The Central Social Welfare Board (CSWB) is one of the pioneering

national organizations in the country. It has taken up various

programmes for the welfare of children, women and the handicapped.

It runs vocational training courses leading to better employment

prospects for poor and needy women. It provides socio-economic

programme assistance to voluntary organization to take up a wide

variety of income generating activities for poor women and the

handicapped. The Board also gives training to rural women in public

co-operation to enable them to participate more effectively in the

process of social and economic development and to acquire leadership

qualities.

One of the important objectives of the socio-economic programme of

the Board is the establishment of ancillary units, as feeder units to

larger industrial undertakings. Another significant feature of the socio-

economic programme of the Board is the organization of self

employment units through which many women have been able to

acquire sewing machines, knitting machines, handloom and such other

equipments which they can use in their own homes and thereby earn a

substantial income. Assistance is provided to women through voluntary

organization, in the form of interest free loans for the purchase of the

equipment required by them, and grants to meet working capital

requirements to carry out small business, ventures like vegetables and

rice vending, fish vending, selling up general stores etc.

In the recent past, the board had made efforts to involve the

nationalized banks to supplement the Boards assistance to voluntary

organizations. The Boards assistance for setting up production units is

in the form of grants, which cover the cost of machinery and

equipment, the expenditure on training and also a part of the working

capital. Bank finance is made available for augmenting the working

capital requirement of the units. Assistance from the Board includes a

fixed amount towards deposits with which an organization can

commend Bank guarantee.

This approach of involvement of financial institutions in the economic

activities of voluntary organization is gaining momentum and the Board

intends to increase the involvement base, thereby to generate large

amounts of credit on easy terms for pursuing economic activities.

7.6. National Alliance of Young Entrepreneurs:

The National Alliance of Young Entrepreneurs (NAYE) was set up to

promote and develop entrepreneurship among women. The women’s

wing of NAYE was set up in 1975 the international year of women

announced by the U.N. The progress made by the wing in securing the

rightful place for women in the national economy since then has been

impressive. The women’s wing has set up chapters in five states. In

other states, associations of women entrepreneurs have affiliated

themselves with the women’s wing of NAYE, making it the most

representative organization of women entrepreneurs in the country. It

has been instrumental in organizing three International Conference

and Nine National Conventions in different parts of the country.

The eights convention of NAYE was held in New Delhi in September

1989. Over 300 women entrepreneurs attended it from 14 states and

union territories, besides senior official from government departments,

banks, financial institutions and other development agencies. The

convention provided an opportunity to review the progress made so far

and to recommend measures to give a vigorous thrust to activities in

the coming years. An exhibition of products manufactured by women

entrepreneurs was organized so as to give opportunity to women

entrepreneurs to display their products so as to create a market for

their products.

The background papers for the conventions covered subject such as

women entrepreneurs their problem and successes, promoting women

entrepreneurial activities in Goa, promoting entrepreneurship/ self

employment among women in Gujarat, experience of GSFC in

financing women entrepreneurs, status of women entrepreneurs in

Himachal Pradesh etc.

The 9th National Convention of Women Entrepreneurs was held in

February 1991 in Trivandrum, Kerala. The convention of Women

Entrepreneurs covered topics such as technology and training, role of

government agencies in promoting women enterprises and rural co-

operatives.

It was during this convention, the definition of women entrepreneurs as

formulated by the Ministry of Industry was debated upon at length. It

was generally agreed that it might be pertinent to ask women

entrepreneurs, who receive the benefit of financial incentives, to create

employment for women. But, it was felt that if this was made

compulsory, it would be discriminatory. The Ministry of Industry

explained that through such incentives were misused at times by the

men folk, at least employment would be generated. The convention

strongly recommended that the percentage of financial incentive be

reduced to 25% as against 50% stipulated by the government. The

priority should be given by the financial institution and other

promotional agencies to women desires marketing support to women

entrepreneur, the convention recommended that the government make

reservations for purchase of products/ services manufactured/

provided by women entrepreneurs. The convention also recommended

30% reservation for women entrepreneurs in ancillary industries and

the industrial licenses must take it obligatory to provide sub-contracting

for ancillary units promoted by women. It was further discussed in the

convention that the Entrepreneurship Development Programmes

(EDPs) conducted by different agencies, and their contents, needed

revision. Efforts must be made to reach a large numbers of women, in

urban as well as rural areas through target oriented EDP’s.

7.7. National Association of Women Entrepreneurs and

Executives:

The National Association of Women Entrepreneurs and Executives

(NAWEE) is an All India non-political, non-profit membership

organization performance the following functions:-

• To act as a clearing house on problems and opportunities facing

women entrepreneurs at all levels and to assist them in self

development and protection.

• To act as a training and development institute so as to further equip

women to be able to meet the various challenges in their respective

environment.

• To work closely with industries and organizations concerned with

women entrepreneurs in establishing benchmarks on successful

operations through research and analysis.

• To work closely with the government and other public institutions on

the role women entrepreneurs in all spheres of economic and social

institutions.

• To act as a ‘spoke person’ for women entrepreneurs and help

project the correct image of its constituent members.

• To establish branches (local, state) regional bodies and units of

NAWEE throughout the country.

• To establish hostels, dormitories and apartment facilities for women

entrepreneurs.

• To perform any other function(s) deemed fit by the office bearers of

NAWEE or by the National Government Council.

7.8. State Bank of India

The State Bank of India (SBI) is a pioneer in the financing of small

scale industries and other priority sectors. As the premier banking

institution of the country the SBI has contributed to the growth of small

scale industries and several of its schemes are suitable for women

entrepreneurs. The liebralise scheme caters to all the financial needs

of SSI entrepreneurs viz. term loans, cash credit for working capital,

better credit bank guarantees, packing credit for exports etc. In

additions to this Bank have special schemes for SSI units, vis.

Entrepreneurs schemes and equity fund scheme. Where loans can be

given at a very low/ nil margin to technically qualified and experienced

persons. The equity fund scheme of the bank provided equity support

to needy small scale units by way of interest free long term loans

repayable over a period of 5 to 7 years after a moratorium of 5 to 7

years. Entrepreneurship development programmes conducted at the

Banks cost provide entrepreneurial and managerial skills training to

those who have no exposure to business.

In the service and small business sector, the Bank assists trading

establishments, business enterprises providing services like laundries,

tailoring, crèche, beauty parlour, manufacturing of ready made

garments, transport operations etc. Entrepreneurs are also financed

under government sponsored schemes like IRDP, SEEU, SEPUP etc.

to make the assistance to women entrepreneurs more effective and to

ensure a wide coverage; the bank has introduced the Stree Shakti

packages. This involves a financial package aimed at reinforcing the

banks efforts in the area of developing entrepreneurship among

women. Concessions in respect to margin and rate of interest have

been built into this package. A 5% reduction in margin for all categories

of advances and concessions in the rate of interest varying from 0.5%

to 1.5% are the two distinct benefits of this package. Also invested in the

package are entrepreneurship development programmes designed

exclusively for providing entrepreneurial and managerial skills to those women

entrepreneurs who have no formal training on exposure to business. These

programmes are free for women entrepreneurs.

7.9. District Industries Centres:

The setting up the District Industries Centres (DICs) through out the country

was an important decision taken by the government of India since the

announcement of the National Industrial Policy of 1977. The main thrust of the

Industrial Policy statement of 1997 was a on the effective promotion of

cottage and small industries widely dispersed in rural areas and small towns.

The statement explicitly stated that whatever could be produced in the small

and cottage sectors should not be produced in the large scale sector. The

statement pointed out the need for a single organization at the district level for

the effective development of small and cottage industries.

The Programmes of the District Industries centre was started on May 1, 1978.

It was a centrally sponsored scheme with a view to providing under one roof

all inputs including licenses/ clearances, raw materials, machinery and

equipment and arrangement for credit facilities as well as marketing. The

DICs, functioning under the Director of Industries and commerce, were

envisaged to be the focal point at the district level for the promotion of small,

tiny, village and cottage industries, widely dispersed in rural and semi urban

areas. They are to provide all essential service and supports required by small

entrepreneurs at pre-investment, investment and post-investment stages at

the district level. The centers also assist entrepreneurs, Government

Corporation and financial institutions for implementing various supporting

schemes such as seed capital assistance, financial assistance to

entrepreneurs belonging to scheduled caste and scheduled tribes etc. DIC

programme continued during the seventh plan and the share of the central

government was raised to Rs.4 lakhs per DIC per year from April 1985 to

meet the demands of entrepreneurs. During 1987-88, 4.75 lakhs small and

artisan based units were established in the country providing additional

employment opportunities to 11.85 lakh persons.

DICs have been established in almost all districts of the country. The total

number of approved DICs now stands at 422 which cover 431 districts. The

four metropolitan cities are outside the purview of this programme.

The DICs function under the Director of Industries and Commerce. They

provide services and facilities to entrepreneurs including the identification of a

suitable scheme, the preparation of feasibility report, arrangement for the

supply of machinery and equipment, provision of raw materials, credit facilities

and input for marketing and extension services quality control, research and

entrepreneurial training. The DICs role is also to ensure that small industries

continue to be viable and for this purpose it provides all facilities to the

entrepreneurs under one roof at the district and sub-district levels.

A General Manager who is assisted by seven functional managers and other

supporting staff, heads each DIC. The seven functional managers deal with

the following subjects.

• Economic Investigation

• Machinery and Equipment.

• Research, Extension and Training

• Raw Materials.

• Credit

• Marketing

• Cottage industries.

Figure 7.1. Organizational Chart of DIC

Source: Manual of DIC

There are a number of non-governmental organizations working for

entrepreneurship development among women. One such organization is

discussed below:-

7.10. Mahila Arthik Vikas Maha Mandal (MAVIM)

Mahila Arthik Vikas Mahamandal (MAVIM) is registered under Companies

Act, 1956 having district officers in 34 districts of Maharashtra and Head

General Manager

Consultancy Committee

Functional Managers

Manager Economic Investigation

Manager Machinery Equipment

Manager Credit Financial Management

Manager Cottage Industries Tiny

Manager Research extension and training

Manager Raw Material

Manager Marketing

Supporting Staff

Office in Mumbai. An officer form Indian Administration Service (IAS) is Chief

Executive of MAVIM as Managing Director.

The Board of Director consist official and non-official members. The Managing

director appointed for MAVIM is an officer from Indian Administrative Service

(IAS).

The vision of MAVIM is empowerment of Women and objectives are as

follows:-

• Building organization of women

• To build up capacities of women.

• Building confidence among women.

• Strengthening entrepreneurship among women.

• Building linkages between employment opportunities and markets

possibilities.

• Increasing participation of women in education and governance.

Board perspectives of MAVIM functioning:

1. MAVIM function as an Apex body for various is development scheme

promoted by the Central and State Government.

2. It organizes training programmes on issues of women development

along the lines of

• Training in capacity building.

• Skill Training and vocational trainings (based on agriculture and non-

agricultural activities).

• It also functions as a coordinating agency between the self help groups,

financial institutions, voluntary organization and the concerned

government department.

MAVIM through the SHGs (Self Help Groups) implements several projects.

• Maharashtra Rural Credit Project (MRCP).

• Swarnajayanti Gram Swarojgar Yojana (SGSY).

• Ramai Mahila Sakshamikaran Yojana (Special Component Plan – SLP).

• Advisasi Vikas Prakalp – Tribal Sub Plan (TSP).

• Rashtriya SamVikas Yojana (RSVY).

• Krishi Saptak Yojana (KSY).

• NABARD “add – on”

• Mahila Swavalamban Nidhi Yojana.

• NORAD – Norwegian Agency for International Development.

• STEP – Support to Training and Employment Programme.

MAVIM has started its activities in 33 districts and also in metropolis of

Mumbai. MAVIM has progressed remarkably since then and also made

remarkable progress in respect of Self Help Groups (SHGs). Taking into

consideration achievements of MAVIM and its commitment towards the

society the government has given responsibility to MAVIM of implementation

of Ramai Mahila Sakshamikaran Yojana under which 20,2 50 SHGs of

Scheduled Caste women have been formed and under Tribal Sub Plan (TSP)

4600 SHGs of tribal women in 8 districts have been formed. Under these 2

schemes efforts are being made to form SHGs of poor and needy women and

bring them in mainstream of society. As envisaged under these schemes 70

to 80% women are from scheduled castes or scheduled tribes and remaining

20 to 30% include women from poor, needy, deserted nomadic tribe

categories of the society.

7.10.1 Maharashtra Rural Credit Project:

MAVIM was one of the implementing agencies for implementation of

International Fund for Agriculture Development (IFAD) assisted Maharashtra

Rural Credit Project (MRCP). The MRCP gave direction to functioning and

working of MAVIM and influenced its policies for empowerment of women.

5321 SHGs covering 79,944 women from rural Maharashtra were formed

under MRCP. The successful implementation of MRCP established that SHG

is an important tool for women empowerment. Taking into consideration

effective work of women empowerment done by MAVIM under MRCP, the

State government approved the proposal of MAVIM to work for promotion of

SHG in all the districts of the state. MAVIM continued to nurture and guide the

old SHGs through existing Sahayoginis Formation of Federations of SHGs

and bringing clarity about their role was given emphasis. The quality of SHGs

formed under MRCP was very good due to well planned strategy and capacity

building.

7.l0.2 Swarnajayati Gram Swarojgar Yojana (SGSY):

SGSY is centrally sponsored scheme for poverty alleviation and being

implemented by Rural Development Department and District Rural

Development Agencies (DRDA). As per the procedure of the scheme

gradation is done depending on age of SHG. Gradation is done jointly by

representatives of banks, DRDA, GO or MAVIM. However many a times

representatives of all these agencies do not come together, this creates a

delay in the entire process keeping in view the practical difficulties for

implementation of the scheme a detailed discussion was held in the workshop

“Vision 2020” held in December 2003 and all aspects were presented before

Hon’ble Principal Secretary, Rural Development Department, Officials of

Women and Child Development Department, Chief Executive Officers of Zilla

Parishads and Project Directors of DRDA’s.

7.10.3. Swyamsiddha – Integrated Women Empowerment Programme

(IWEP).

Central government sponsored India Mahila Yojana and Mahila Samruddhi

Yojana merged into a new scheme under the name Swyamsiddha –

Integrated Women Empowerment Programme (IWEP). Swyamsiddha is

central government sponsored scheme and central government takes review

in meetings once in every 2 months. Since women and child development is

nodal agency, it takes review of the progress of scheme from time to time and

makes available funds for the scheme. The central government undertakes

visits to review the progress of the scheme.

7.10.4. Ramai Mahila Sakshamikaran Yojana Ramai Mahila Sakshamikaran Yojana is formed exclusively for the scheduled

caste women. During the 3 years of project period, apart from organizing

women through SHGs, capacity building training programmes for women is

conducted on various aspects and issues like gender equality,

entrepreneurship, social awareness and self protection. The main emphasis

under the scheme is given on formation of women SHGs and providing them

micro credit out of their own savings through internal lending as well as

through bank credit. Special emphasis is given on improving status of women

in the society along with improvement of their financial status. Women are

disadvantaged part of our society. This is more so in case of women

belonging to scheduled castes. The self experience of the women indicates

that these women who had seen life beyond doorsteps of house and those

who are illiterate have doors open for them for progress and prosperity.

7.10.5. Adivasi Vikas Prakalp

The Adivasi Vikas Prakalp is basically for empowerment of tribal women for 8

districts of Maharashtra Nasik, Nandurbar, Thane, Chandrapur, Gadchiroli,

Gandia, Amravali and Bhandara under Tribal Sub Plan of Tribal Development

Department. Main objectives of the scheme is socio-economic development of

tribal women, to organize them into pressure group and make available to

them sources of information and knowledge.

7.10.6. Rashtriya Sam Vikas Yojana (RSVY):

Rashtriya Sam Vikas Yojana is centrally sponsored scheme being

implemented by MAVIM. It is being implemented in each district in different

way. This scheme is mainly focused on underdeveloped district of

Maharashtra. The main characteristics of scheme are

1. The focus of scheme is on formation of self help groups along with

capacity building of women and further skill development of women.

2. The scheme has provision for revolving funds for women who want to

start their entrepreneurship activities. Scheme has special provision of

building two MAVIM Mahila program on pilot basis. This prangan will

provide marketing and training facilities to women on district level.

7.10.7 Krishi Saptak Yojana (KSY)

Implementation of KSY started in 4 districts of Amravati, Washim, Chandrapur

and Sangli. The scheme is very important as it envisages organizing women

into SHGs and providing them with latest agro technological inputs. The

objective of the scheme is to increase rate of agricultural production and its

quality through capacity building of women by imparting knowledge of latest

agro-technology and modern practices.

Objectives of the scheme are as follows:-

• Training of rural women to make their participation more effective in

agriculture.

• Making rural women self sufficient in farm management.

• Giving inputs of new technology of agriculture and provide women of equal

opportunities through capacity building.

7.10.8 NABARD add-on:

It was decided to implement ‘NABARD add-on’ project in 10 districts of

Buldhana, Usmanabad, Jalna, Kolhapur, Aurangabad, Hingoli, Latur,

Parbhani, Washim and Gondia with financial support from NABARD.

Objective of Scheme:

• Formation of 1000 SHGs in 10 districts.

• Organize 15000 women through SHGs.

• Capacity building of women through SHGs.

Efforts were made to provide basic training to these SHGs on lines with other

SHGs. The members of these committees include lead district officers. These

committees review and monitor the progress of the project.

7.10.9. Mahila Swavalamban Nidhi Yojana

The devastating earthquake affected Latur and Osmanabad districts in 1993.

The earthquake had wide spread adverse effect on women. MAVIM started

Maharashtra Emergency Earthquake Rehabilitation Project (EERP) with

assistance from World Bank and Implemented Women Empowerment project.

The Mahila Swavalamban Nidhi Scheme in order to bring in women already

organized in SHGs in development mode by imparting them entrepreneurship

training and making available to them hassle free credit. District Resource

Centres were opened at Ausa and Khillari in districts of Latur and Usmanabad

for socio-economic development of women from earthquake affected areas.It

was proposed under the scheme to form 400 SHGs of women and provide

them financial assistance for starting micro enterprises. The area of operation

of the scheme was restricted to only 2 districts of Latur. However, as per the

decision taken in 7th meeting of Managing Committee of the scheme, the area

of operation of the scheme was expanded to entire state of Maharashtra. A

proposal is under consideration to convert Mahila Swavalamban Nidhi into

Micro Financial Institution (MFI).

7.10.10. NORAD – Norwegian Agency for International Development.

NORAD is a central Government sponsored scheme for imparting skill base

training to women belonging to backward, widow, deserted, daily wage

working, migrated, other backward class, economically backward, poor and

other such categories. The subjects selected for training cover wide spectrum

like computer learning, beauty parlour, typing, shorthand, ready made

garment, jari craft and pattern work, embroidery, canteen management, book

binding, community, health work, consumer electronic repair, electronic

assembly, food processing, hair and skin care, handloom weaving, hosiery,

honey production etc. A stipend of Rs.250/- per month is given to

beneficiaries during the training. NGOs and district officers and Head Office of

MAVIM conduct the training programmes under the scheme. 100%

expenditure of the training is received from Central Government.

7.10.11. STEP – Support to Training and Employment Programme.

STEP is central government sponsored scheme started in 1987. Under the

scheme, the training is imparted to poor and needy rural women belonging to

categories of widow, deserted, backward class, other backward classes and

economically backward classes. The activities covered for training are

poultry, sheep and goat rearing, dairy, sericulture development of waste land,

agriculture fishery, handloom, handicraft, social forestry and khadi and village

industry. Under this scheme 90% of assistance is provided by the Central

Government and remaining 10% is to be contributed by the institution.

7.10.12. Swarn Jayanti Sahakari Rojgar Yojana (SJSRY):

SJSRY is Central Government sponsored scheme for development of

below poverty line (BPL) families of urban areas. The main objective of

the scheme is to make available self employment and improve the

standards of living of BPL families. Under the scheme, the

encouragement is given to unemployed or semi employed person to

start income generating self employment activities. The scheme is

implemented by Municipal Corporations/Councils through NGOs.

Central and State Governments provide the financial assistance in

ratio of 75:25. The scheme covers two employment programmes –

main urban employment programme and urban labour employment

programme. The sanction, monitoring and implementation of the

scheme is looked after by State Urban Development Agency (SUDA)

and District Urban Development Agency (DUDA).

7.10.13. Kamdhenu Scheme:

In order to enable needy women to undertake some income generating

activity at their house itself and to make women financially independent

as well as to give them priority in getting work related to manufacturing

and trading sectors, it was decided to give preferential treatment to

women institutions in tenders for supply of articles/ items required by

various local bodies and government and semi government

departments including zilla Parishad, Municipal councils, Municipal

Corporations etc. They require various articles like uniforms, bed

sheets, pillow covers, clothes for patients, dusters, brooms as well as

food items like papads, bed sheets, pillow covers, clothes for patients,

cluster brooms as well as food items like papads, pickles and spices.

For this purpose women institutions should have been registered under

Registration Regulation Act, 1860, Public Charitable Act 1950,

Societies Registration Rule 1960 or under Companies Act 1956. It had

been decided that 50% of supply orders will be awarded to such

women institutions and they will be given 10% more rates than

sanctioned tenders.

7.11. Self Help Group Movement and MAVIM:

MAVIM has been doing work of women empowerment through Self

Help Groups in many villages in state of Maharashtra. While

performing its role as apex institution for women development in the

state, MAVIM has taken decision to work along with other institutions

working at breadth and length of the state in SHG movement in order

to bring maximum number of women in development process. Initially,

MAVIM had discussions with 2 networks in Maharashtra viz “Mahila

Rajsatta Andolan” (MRA) and ‘Chalana’ as a step in this direction.

MAVIM and these two networks have created a state level common

coordination platform in consultation. Main objective of this initiative

are as under.

1. To strengthen the cooperation between Government and NGOs

to expand and strengthen SHG movement in Maharashtra.

2. To form a state level forum/platform to work as coordinator and

to study and to solve the practical difficulties and give right

direction to SHG movement in the state.

Chapter – 8

DATA INTERPRETATION & FINDINGS

Entrepreneurial and Socio-Demogrpahic Profile of the Woman

Entrepreneur.

This finding attempts to draw socio-demographic profile of women

respondents covered in the study. It includes Profile of the respondents

and the entrepreneurial activities.

8.1.1. Age in years

Categories 20 – 30 31 – 40 41 – 50 50 & above

Total

Frequency 115 294 84 7 500

%age (23%) (58.8%) (16.8) (1.4%) (100%)

Age Distribution:

Age of respondents has been used to determine two aspects of

entrepreneurship – age of venturing into entrepreneurship and the

correlation of age with the kind of activity. The frequency and

percentage distribution for age show that the highest percentage

(58.8%) is in the age group of 31 – 40 years followed by 20 – 30 years

which is (23%). There was very negligible (1.4%) existing in age group

above 50 years who venture into entrepreneurship. This indicated that

women ventured in their mid age of life. The discussion also revealed 3

main reasons for this, increased needs in family, growing household

expenses, education of children, marriage of daughters which forced

women to look for sources of income to support the family.

Table 8.1.2. Educational Level

Categories Illiterate Literate with no formal

education

Upto class VIII

Graduation Total

Frequency 112 169 206 13 500

Percentage (22.4%) (33.8%) (41.2%) (2.6%) (100%)

Educational Qualifications:

Education is an important tool for increasing and improving the scope

of women’s self employment and empowering them to think for

themselves. The details of the table 8.1.2 shows that maximum

respondent (41.2%) had studied upto class eight followed by

respondents who are literate but with no formal education was

(33.8%) and the respondents with graduation was negligible with

(2.6%). From the details and discussion it was seen that education and

entrepreneurship was inversely selected. The entrepreneurial activities

undertaken by the respondents do not require much education as it did

not have direct impact on the activities. The skills such as (cooking,

stitching, grinding etc.) they possessed more importance for the

management of their enterprise.

8.1.3. Religion:

Table 8.1.3. Religion

Categories Hindu Muslim Boudh Christian Other Total

Frequency 201 111 169 19 -- 500

Percentage (40.2%) (22.2%) (33.8%) (3.8%) -- (100)

The details of the table reveal that maximum entrepreneurs belonged

to the Hindu community with a percentage of (40.2%). Most of them

felt that their community was never a hindrance in thinking about

entrepreneurship for economic independence this was followed by the

Boudh Community with (33.8%), the discussion also lead to the fact

that the participation could have been more but many of the women in

the Boudh community withdrew themselves as in certain villages the

Brahmin community threw stones and stopped them from using water

etc. in District of Nasik. The percentage of Christian community being

very low at (3.8%) as this community was not at majority in the

population.

8.1.4. Marital Profile

Table 8.1.4. Marital Profile

Categories Single Married Widow Divorce Total

Frequency 21 376 92 11 500

Percentage (4.2%) (75.2%) (18.4%) (2.2%) (100%)

The data reveal that majority of the respondents (75.2%) were married.

Socio-cultural and religious beliefs dictate that the marriage of both

sons and daughters is a sacred duty to be performed by parents but in

the case of daughters especially parents feel far more pressured to

marry them off as soon as possible.

8.1.5 Family Type

Table 8.1.5 Family Type

Categories Nuclear Family

Joint Family Total

Frequency 372 128 500

Percentage (74.4%) (25.6%) (100%)

Family is the primary group where in every member is directly

associated with its activities. The type and size of the family

determines the extent to which an entrepreneur can take decisions by

herself and does not have to depend on others. The data in the table

8.1.5 shows that the majority of respondents belonged to nuclear

families (74.4%) and only (25.6%) lives in joint families.

8.1.6. Monthly Income – Before

Table 8.1.6 (a) : Monthly Income – Before

Categories Below Rs.2000

Rs.2000 –Rs.3000

Rs.3000 – Rs.5000

Rs. 5000– Rs.10000

Total

Frequency 450 25 21 4 500

Percentage(%) (90%) (5%) (4.2%) (0.8%) (100%)

Monthly Income – After business

Table – 8.1.6 (b) : Monthly Income – After business

Categories Below Rs.2000

Rs.2000 – Rs.3000

Rs.3000 – Rs.5000

Rs. 5000- Rs.10000

Total

Frequency 102 156 113 129 500

Percentage(%) (20.4%) (31.2%) (22.6%) (25.8%) (100%)

Monthly Income : The monthly income of the family is an indicator of

the financial support that the respondent provided to her family after

she started business. As per the table 8.1.6 (a) before the start of

business majority of the respondents (90%) fell in the bracket of

income below rupees two thousand followed by an income bracket

between two and three thousand of (5%) and very negligible of (0.8%)

in the income bracket of five thousand and ten thousand. The monthly

income after the business was majority in the income bracket between

two thousand and three thousand of (31.2%) followed by five thousand

– ten thousand income bracket (25.8%) and the least being in the

income bracket of below rupees two thousand (20.4%).

8.1.7. (a) Choice of Entrepreneurial Activity:

Table 8.1.7 (a) : Choice of Entrepreneurial Activity

Categories Service Trading Manufacturing Total

Frequency 252 192 56 500

Percentage (50.4%) (38.4%) (11.2%) 100

Respondents in the study can be classified into three major categories

according to the respondent’s choice. Table 8.1.7 shows that majority

of the respondents (50.4%) are involved in service based

entrepreneurial activity followed by trading (38.4%) and with

manufacturing (11.2%). The service related entrepreneurial activities

some of them were:-

• Selling Tiffin’s

• Managing xerox

• Telephone booths

• Saree fall beading

• Beauty parlour etc.

The trading related entrepreneurial activities some of them were:-

• Kirana Shop

• Gift and snack shops.

• Vegetables/Fish/Fruit/Flower stalls.

• Aggarbathi

• Garments – Readymade.

• Plastic item shops.

The manufacturing related entrepreneurial activities some of them

were:-

• Pappad making unit

• Masala unit

• Fur toys unit.

• Bags unit

• Shoes unit

• Payals

• Chattai and sanitary Napkins unit

8.1.7. b) Relation between Entrepreneurial Activity and Age

Table 8.1.7 (b) : Choice of Entrepreneurial Activity

Entrepreneurial Activity Age in years

Service Trading Manufacturing Total

Below 30 years

55 20 40 115

Percentage (47.82%) (17.39%) (34.78%) (100%)

Above 30 years

270 78 37 385

Percentage (70.12%) (20.25%) (9.61%) (100%)

The data as per table 8.1.7 (b) shows that the respondents who are

younger below the age of 30 are willing to take more risk as compared

to the people above the age of 30 as is reflected in the Respondents

number who are involved in manufacturing with (34.78%) as compared

to (9.61%). The case is opposite in case of service involved

entrepreneurial activity where below 30 years shows a percentage of

(47.82%) as compared to (70.12%) for age above 30. This data

reflects that younger people are generally more energetic, innovative,

willing for change and progressive as compared to the respondents

above the age of thirty.

8.1.7 (c) Relation between family type and type of

entrepreneurial activity.

Table 8.1.7 (c) Relation between family type and type of

entrepreneurial activity.

Family Type Type of Activity Total

Service Trading Mfg.

Nuclear Family 188 164 20 372

Percentage (%) (50.53%) (44.08%) (5.37%) (100%)

Joint Family 14 16 98 128

Percentage (%) (10.93%) (12.5%) (76.56%) (100%)

Total 202 180 118 500

The data of table 8.1.7 (c) revealed that respondents from nuclear

family were more interested in service and trading as compared to

manufacturing. Similarly when the joint family was considered they

were more interested in manufacturing and trading sectors as

compared to service. The respondents from the joint family were more

confident in dealing with challenges of manufacturing and trading

sectors as they had support and help from other family members to

initiate the activity. The nuclear family respondent had support from

spouse but had more responsibilities and had to give more time to

children as per discussion during the filling of questionnaires.

8.1.7.(d) Relation between Entrepreneurial Activity and Income

Table 8.1.7 (d) Relation between Entrepreneurial Activity and

Income

Activity Type Upto Rs.2000

Rs.2000- Rs.5000

Rs. 5000 – Rs.10000

Total

Service 76 42 10 128

Percentage (%) (59.38%) (32.81%) (7.81%) (100%)

Trading 26 212 22 260

Percentage (%) (10%) (81.54%) (8.46%) (100%)

Manufacturing - 15 97 112

(13.39%) (86.60%) (100%)

Total 102 269 129 500

As per the entrepreneurial activity and income details table 8.1.7 (d)

maximum number of respondents were belonging to the category of

income bracket Rupees 2000 – Rs. 5,000 were involved with trading

activity, the respondents who fell into the income bracket of Rs. 5,000

– Rs. 10,000 were more involved in manufacturing activity. Those who

earned income upto Rs.2,000 were more involved in service activity

followed by trading with nil involved in the manufacturing. Through

details of table and discussion it was understood that manufacturing

activity did earn the respondents a higher income but people involved

had to be high risk takers.

8.1.8. Years of experience in the existing business

Table 8.1.8 : Years of experience in the existing business

Categories < 2 years 2-5 years 5 – 10 yrs >10 yrs. Total

Frequency 118 278 97 7 500

Percentage (23.6%) (55.6%) (19.4%) (1.4%) (100%)

As per the details of Table 8.1.8 most of the Respondents fell in the

category of 2 to 5 years of experience or involvement in business

(55.6%) followed by Respondents with less than 2 years (23.6%) and

least being people who have been involved for more than ten years

(1.4%).

8.1.9. Motives for venturing into entrepreneurship.

Do women group venture into entrepreneurship for economic reasons.

The data in table 8.1.9 identify the main motives of respondents for

venturing into entrepreneurship.

Reasons for venturing into Entrepreneurship (Multiple Responses).

Table 8.1.9. Motives for venturing into entrepreneurship.

Reasons Yes % No % Total

1. To support family earnings

487 (97.4%) 13 (2.6%) 500

2. To gain social recognition

201 (40.2%) 299 (59.8%) 500

3. No job 424 (84.8%) 76 (15.2%) 500

4. Pursue Interest 206 (41.2%) 294 (58.8%) 500

5. Independence/ Self Confidence

118 (23.6%) 382 (76.4%) 500

The data revealed that (97.4%) majority of the respondents ventured

into business to support the family earnings. The discussion also lead

to information the reason for this was because the adult male in the

households (father/ husband/ son/ father in law) were unemployed or

were employed but spend their earnings on alcohol and gambling or

were daily wage workers who did not earn enough to support the

family. Several of the respondents were driven to entrepreneurship by

the sense of responsibility and obligation towards the family. This is

also evident through the percentage of no job being (84.8%). Income

supplementation factor tempted women to become entrepreneurs and

to establish themselves in society.

8.1.10. Interdependence Of women entrepreneurs and families.

H01 : Financial conditions of the family do not play significant

role for involvement of women in entrepreneurship.

H11 : Financial conditions of the family play significant role for

involvement of women in entrepreneurship.

It was assumed that the financial conditions of family does not play

significant role for involvement of women in entrepreneurship and the

dependency of the women on the family does not depend on the

income level of family. The data as per table 8.1.10 – Annex. IV and

the discussions, project that X2 calculated 72.212 was much greater

than the tabulated values of 3.143 at 0.05 level of significance hence

the null hypothesis was rejected, proving that the respondents with

income level less than Rs.5000 had the family depend on them more

as compared to respondents with family income more than Rs.5000.

This also proves that the women play more important role in less

income bracket and the family income does play a very important role

in entrepreneurship involvement and interdependence of women and

family also depends on the income level of the family. The discussions

during the filling of the questionnaire also revealed that the

respondents who belong to weaker financial condition of families took

more initiative in starting their venture and managing their venture in

terms of decision.

8.2.1. Impact of Entrepreneurship Development on the socio-

economic status of respondents and their families with

respect to standard of living.

One of the objectives of the study was to assess the impact of women

entrepreneurship on family with respect to standard of living. This also

examined the Respondents socio-economic status with a view to

examine whether their economic and social status has lead to

empowerment of respondents. The process of empowerment is a state

of mind, an attitude of women entrepreneurs in defining, challenging

and overcoming barriers, in increasing their ability to shape their lives

and their environment. To assess the empowerment of women after

venturing into entrepreneurship the change in economic and social

status. The questionnaire was designed to collect data from

respondents with regard to their followings. Income, assets, Debts,

savings and consumption patterns, both before and after they had

venture into entrepreneurship. After the data was collected, simple

frequencies were calculated. Based on the frequencies, values were

calculated for each of the components and then recorded. All positive

values were recorded as 2, that is ‘increase’, all negative values as 1

“decrease” and all zero value as “no change”. Then the frequencies

and percentages for the recorded values were computed to measure

the change.

8.2.1. Change in Economic Status:

The indicators used for assessing the change in the economic status of

the respondents were occupation, monthly debt status, change in the

expenditure patterns in terms of education of children, food, household

expenses and health.

8.2.1.a. Occupation:

8.2.1.a. The majority of the respondents (about 62%) were housewives

and about (38%) were employed as daily wage workers before

venturing into entrepreneurship. The observations are shown in Table

8.2.1.a.

Table 8.2.1.a. Occupation:

Previous Occupation F (%)

Employed (Daily wage worker)

190 (38%)

Housewife 310 (62%)

Total 500 (100%)

It was reported by the respondents that MAVIM – Mahila Artik Vikas

Mahamangal and various other financial organizations had provided

micro finance help, thereby economically empowering the respondents

to start their business. The respondents were further supported by the

organizations through training for developing their entrepreneurial

skills, facilitating the process of credit availability information and

guidance, counseling and follow up. A majority of the entrepreneurs

went for micro enterprises as they were more attractive to respondents

because of low barriers to entry and flexible nature of work, which

made it easy to combine gainful employment with domestic

responsibilities.

8.2.1.b. Monthly Income

Income measures the financial stability of a family. It also reveals the

purchasing power of the family to take care of basic household

expenses, education of children and the like. It was found that the

monthly income of the respondents had changed after they started

their business.

Table 8.2.1. (b)

Impact of Entrepreneurship on Income

Change in income No. of Respondents

Percentage (%)

Increase 408 81.6%

Decrease 64 12.8%

No change 28 5.6%

Total 500 100%

The data in the table 8.2.1 (b) reveals that (82%) of the respondents reported

an increase in the monthly income, around (13%) reported decrease and (6%)

reported no change in income. The quantum change in income was also

calculated on Table 8.2.1. (c).

Table 8.2.1. (c) : Change in the Monthly Income of Respondents

Change in Income level

Monthly Income

Before After

% change increase/ Decrease

Upto 2000 93.6% 6.4% - 87%

Rs. 2001 – Rs.3000 69.6% 30.4% -39.0%

Rs. 3001 – Rs.5000 8.6% 48.8% + 40.0%

Rs. 5000 & above 0.8% 13.6% + 12.8%

The data show that majority of the respondents (about 94%) had a

monthly income upto Rs. 2000, followed by (70%) who had an income

between Rs.2001 to Rs.3000, (9%) had an income between Rs. 3001

to Rs.5000 and a very negligible percentage earned (0.8%) Rs. 5000

and above before they started the business activity.

The data further indicated that starting business had made an impact

on the financial situation with the percentage of respondents who were

earning between Rs. 2001 – Rs. 3000 decreasing by (39%) and a

corresponding increase in the percentage of the respondents earning

between Rs. 3001 – Rs. 5000 by (40%) and (13%) of the respondents

also moved into the higher earning category of Rs. 5000 and above.

This improvement in the financial condition empowered the

respondents to take decisions independently or jointly regarding the

expenditure pattern of the household food, children education. They

also gained freedom to a greater extent to do “what they wanted to do”.

The financial independence also helped the respondents to raise their

standards of living. The data when further analysed revealed

significant ‘p’ value (Table 8.2.1. (d). indicating that venturing into

entrepreneurship had a positive influence on the monthly income.

Paired t-Test

Paired Differences

95% Confidence Interval of the Difference

Mean Std. Deviation

Std. Error Mean Lower Upper t df

Sig. (2-tailed)

Pair 1 VAR00001 - VAR00002

-5.82800

3574.16358

159.84145 -6142.04520 -5513.95480

-36.461 499 .000

8.2.2. Change in the Decision making ability and Enterprise

Development.

Entrepreneurs have to make decisions and this decision making

capacity comes from years of experience of being exposed to making

necessary decision, in situations both at work and home. The data in

the table 8.2.2. shows the type of decision makers who took decisions

regarding the spending patterns before and after respondents started

their business activities.

Table 8.2.2. Type of decision maker and decision on spending.

Decision on spending Type of Decision Maker

Before After

Change Increase/ Decrease

Spouse 385 (77%) 102 (20.4%) - 56.6%

Self 50 (10%) 317 (63.4%) + 53.4%

Joint 55 (11%) 72 (14.4%) + 3.4%

Family members 10 (2%) 9 (1.8%) Negligible change

The data in the table reveal that most of the decisions were made by

the spouses (77%) before the respondents started the business which

was reduced to (20.4%) which decreased by (56.6%). The most

important part in the transition from spouse to self, where the self

decisions were (10%) which increased to (63.4%).The involvement of

the respondent and her spouse also increased from (11%) to (14.4%)

an increase by (3.4%). This implies that on becoming entrepreneurs

they were exposed to making necessary decisions in increasingly

complex situations which enhanced their self-confidence to take

independent decisions. The data revealed that with monetary returns

from business the respondents experienced a change in decision

making.

8.2.3. Asset Formation: The value of assets possessed by a family is

an important indicator of a secure condition of the family. The assets in

the present study have been categorized in terms of fixed assets like

house, jewellery, other household gadgets and savings. It was found

that in case of (66%) of respondents, assets (in terms of value) had

increased while (32%) there was no substantial change and very

negligible percent decrease (1.6%).

Table 8.2.3: Impact of entrepreneurship development on

Asset Formation

Change in Asset No. of Respondents

Percentage

Increase 330 (66%)

Decrease 10 (1.6%)

No change 160 (32%)

Total 500 100%

The Respondents reported that they invested in buying jewellery for

their daughters, in household gadgets like mixer grinder refrigerators

and gas stoves. They further shared that they had started saving and

had bank account in their name. They did not only spend for

themselves but a lot for their family. All these indicated a positive

impact on the lives of the family of the Respondents.

8.2.4. Debt Status: It was seen that another parameter to measure the

standard of living is the debt status of the family. The amount which the

family could repay, has there been change in the debt status.

Table 8.2.4. : Debt Status

Change in Debt Status

No. of Respondents Percentage

Increase 65 13%

Decrease 420 84%

No change 15 3%

Total 500 100%

The data as per table 8.2.4 the debt status as it was found was that it

decreased by (84%), (13%) respondents stated that it increased and

(3%) stated that there was no change. The increase respondents

mentioned that the debt has increased as there was certain cases with

spouses meeting with accident or daughters delivery etc. The

respondents during the discussion also mentioned that some of the

respondents with the entrepreneurial activity profit did not go in for debt

payment but reinvested in business. The entrepreneurial activity did

change the debt status for the respondent and their families which

shows a positive impact.

8.2.5. Change in Social Status:

To assess the impact on the social status the following indicators were

used control over earnings with regard to priority areas of spending

and change in lifestyle with increase in the power of earning.

8.2.5.1. Individuals Control Over Earnings: As per discussions the

respondents revealed that there was a drastic change in the status of

control over earning after they entering the entrepreneurial activity. The

table below 8.2.5.1. gives the details of the respondents responses.

Table 8.2.5.1. : Individuals Control Over Earnings

Categories Control of Earnings

Yes No

Frequency 390 110

Percentage (78%) (22%)

The data on control over earning revealed that majority of the

respondents (78%) had control over the earnings from the business

with certain priority areas for expenditure. During the discussion with

the respondents they also mentioned the priority areas of spending of

respondents related to household expenses, where education of

children by being able to buy milk, fruits, egg, chicken on regular basis

and their own health. Based on different areas of spending the

respondents responded (97%) spend part of their earnings like buying

monthly ration and clearing previous debts, (52%) spend on the

education of their children and (21%) responded on meat, fish, and

milk regularly for their children. The least priority was their own health.

8.2.5.2. Change in Life Style:

The change in lifestyle was defined as the change in the purchasing

power of the respondents ability to purchase goods and services for

their families. It was observed as per the data collected that (71%) of

the respondents reported that there was changes in their lifestyle. The

data further revealed that around (72%) of the respondents had

purchased goods for house like gas stove, refrigerator, mixer, grinder,

television etc. About (37%) of them started savings in co-operative

banks and Bank of India, State Bank of India etc. and (24%) disclosed

that they were now able to buy clothes during the festival seasons like

Ganesh Chaturthi, Navaratri and Dipawali. Thus the respondents felt

more responsible towards their families and were able and determined

to improve their financial situation and facilities at home.

8.3. Impact of Women Entrepreneurship Development on Family

with respect to Standard of Living :

The hypothesis for the study tested :-

H02 : Involvement of women in entrepreneurship does not play

significant role in standard of living of family.

H12 : Involvement of women in entrepreneurship does not play

significant role in standard of living of family.

The impact of women Entrepreneurship was further analysed with the

number of years of involvement of the respondents in business. The

analysis was done through discriminant analysis. Based on time

duration, two groups were formed one group who were involved in

business for less than 2 years and the other group for more than 2

years. F test was used for checking the significance of variation in

standard deviation.

The study of 500 respondents was undertaken to determine the correlates of

the standard of living of the family on the following characteristics. The

predictor variables are consumption of food, house assets, status of house,

children’s education, health issues, savings created ,literacy rate, social

status, livelihood assets, psychological benefit. The dependant variable was

the respondent’s involved in entrepreneurship, involvement for less than two

years and more than two years of which two groups were identified.

Respondents who reported their involvement in entrepreneurship less than 2

years classified as group 1 and those with more than 2 years are classified as

group 2.

The findings emerged as in Table (8.3. – Annex. IV) as consumption of food,

house assets, savings created, lively hood assets which were the most

effective variables in discriminating among group 2 as compared to Group 1.

The results obtained by examining the group means and standard deviations,

it appears that the two groups were more widely separated in terms of

consumption of food, house assets, savings created, lively hood assets than

other variables.

Discriminant Analysis:

In testing for significance in the study noted that the Wilks Lamda value

associated with the function is .439 which transforms to chi – square of

405.947 with 11 degrees of freedom. This is significance beyond the

0.05 level. (Table 8.3 – Annex. IV). The significance of the unvariable F

Ratio indicates that when the predicators are considered individually

consumption of food, house assets, savings created, livelihood assets

significantly differentiates who belong from group 2. The Eigen value

associated with function is 1.280a (As per Table 8.3 – Annex. IV) and

the canonical correlation associated with function is 0.749. Hence the

null hypothesis is rejected. Also with discussions with the respondents

and previous data analysed, most of the respondents within a short

span of time brought about drastic change in their ownership as well as

in the standard of living of the family. Kaccha to Paccka house,

consumption of nutritional food, and increase in assets such as

cupboard, television, gas stove, fan, jewellery, livelihood assets etc.

Thus the null hypothesis being rejected, it was evident that

involvement of women in entrepreneurship does play a significant role

in standard of living of family.

8.4. Key Drives for involvement of women in entrepreneurship:

The hypothesis for the study tested :

H03 : Women’s involvement in entrepreneurship process does

not happen due to monetary benefits.

H13 : Women’s involvement in entrepreneurship process

happens due to monetary benefits.

This was analysed through factor analysis. The variables for factor

analysis were framed based on previous studies and experience with

respondents during pilot study. Following were the pre-assumed key

drivers, acquired skills, availability of funds, passion, hobby, family

business, need, jobless husband, money, improvement, in standard of

living, resources available. Respondent’s response was taken based

on 7 points Likerts scale.

The analytical process is based on a correlation between the variables.

Factor Analysis : The correlation matrix, constructed from the SPSS data

sheet obtained to understand financial condition of the family are influencer

for women involvement in entrepreneurship. There is relatively high

correlation among money, need, jobless husband and improvement in std of

living. We would expect these variables to correlate with the same set of

factors. Likewise, there are relative high correlation among passion, hobby

and acquired skills these variables may also be expected to correlate with the

same factors The null hypothesis, that the population correlation matrix is an

identity matrix, is rejected by Bartlett’s test of sphericity. It can be seen that

the communality for each variables v1,v2 … vn as unities. The table labeled

‘Initial Eigenvalue’ shows the eigenvalues in decreasing order of magnitude

as we go from factor 1 to end the eigenvalue for factor indicates that total

variance attributed to that factor.

The Scree Plot and Total Variance clearly explains the distinguishing

10 components in 2 factors which includes 66.687 percent variance.

(As per Table 8.4 (d) – Annex. IV) The co-relation matrix (As per Table

8.4 (b) – Annex. IV) and component plot in rotate matrix (As per Table

8.4. (e) – Annex. IV) identifies 2 clusters, one included factors which

were economically significant and the other included the interest

factors. These clusters were then defined as segment of economical

benefit and interest. Thus the null hypothesis was rejected. The

findings as per the analysis and discussion brings to the fact the

respondents enter into entrepreneurship for monetary benefits or to

stabilize the family financially. In due course of time with monetary

benefits coming the respondents would take initiative to improve the

condition of her family, raising the standard of living by creating

savings, increasing the consumption of nutritional food, giving good

education to the respondents children. The other important driver

would be of interest such as hobby, passion, acquired skill versus

passion is .775, family versus acquired skill is .421, Hobby versus

availability of funds is .821, Need versus resources available is .929.

(As per Table 8.4. (b) – Annex. – IV).

Graph 8.4. (2) Component Plot

Interest

Variables at the end of an axis are those that have high loadings on only that

factor and hence describe the factor. Variables near the origin have small

loadings on both the factors. Variables that is not near any of the axes are

related to both the factors.

The component interest is highly related with variables hobby, passion and

acquired skill. Thus, factor 1 may be labeled as interest of the individual. A

plot of the factor loading confirms these interpretations. Variables money,

need, improvement in std of living and jobless husband are at the ends of

horizontal axes.

Financial status of family

8.4.(B) In order to further cross check as to which holds more

importance among both the clusters further, a hypothesis framed was

anlaysed.

H04 : Women’s involvement in entrepreneurship process are

independent of the interest and financial condition.

H13 : Women’s involvement in entrepreneurship process are

dependent of the interest and financial conditions.

Women’s involvement in entrepreneurship are independent of their

interest and financial conditions of the family. This was tested by the

Logit Model. Based on the survey of the respondents and interaction

with experts five parameters were considered for study they were

acquired skills based training, financial benefit, low family income,

social benefit, interest in respective business. The respondents were

asked to score the five parameters on Likert scale. As per the data

collected and analysed.

Logistic regression or logit model: 350 respondent are the analyis sample,

175 of whom are in entrepreneurship due to self interest labeled as group 1

and 175 of whom are due to economical need labeled as group 2 , we

measure their interest and economical need on the seven point Likerts scale.

Following are the parameter for study

1. Acquired skill based training programme.

2. Financial benefit.

3. Low family income.

4. Social benefit.

5. Interest in the respective business.

The objective is to estimate the probability of respondent being economically

poor as a function.

The Cox and Snell R square(.015) and Nagelkerke R square measures(.020)

(as per Table 8.4. (b) – 1 (Annex. IV) the significance is based on Walds

Statistics for Financial benefit and low income which are respectively

4.558 and 3.109, significance value is .033 and .078 respectively. (As

per Table 8.4. (b) – 3 (Annex. IV). On this basis, it can be concluded

that both financial benefit and low family income play a significant role

which represents economical need. Thus the positive sign for co-

efficient indicate that the economical need are more significant. It can

be derived that financial benefit is the key driver over interest for

women involving themselves in women entrepreneurship.

8.5. Importance of Socio-Psychological Characteristics,

Managerial Ability and Support System.

While some may consider entrepreneurship to simply be a form of

management, the essence of entrepreneurship in fact is the initiation of

change. It is the act of starting a business, either at the micro or at the

macro level. Essentially the entrepreneur seeks an opportunity to fulfill

a personal need or meet a personal want or a need in the market

place. The need in the market place is a rare case as for micro

enterprise. In the need to achieve the above, he or she brings together

all the expertise such as materials, labour, capital, self confidence etc.

To be independent and entrepreneurial involves combining personal

characteristics, financial means, resources within an environment,

demographic factors and also the type of venture an individual

chooses.

One of the most important aspects for independence is identify the

characteristics for being independent.

Table 8.5. Identified Characteristics :

Characteristics Details

Self Confidence Confidence, Independence Individuality, Optimism.

Task result oriented Need for achievement, Profit oriented, Hard work, Initiative.

Risk Taker Likes Challenges.

Originality Innovative, Creative Resourceful, Flexible, Versatile.

Future Oriented.

Source: Meredith et al, 1982, The Practice of Entrepreneurship.

All the traits are inter related, that is people who are self-confident will

probably accept responsibility for their own decision and be willing to

take risks and become leaders. They would also identify with their

environment. Meredith et al 1982, the Practice of Entrepreneurship

also mentioned that the demographic factors also play important role to

identify with these characteristics and become independent.

In order to identify with the above and to create the independency

model the below aspects were put across to the respondents to know

their response.

8.5.1. Independence: In the study independence was related to

decision making, self confidence of the respondents or do they consult

their dear ones for decision making.

Table 8.5.1.

Independence item Responses

Yes No

Self confidence 492 (98.4%) 8 (1.6%)

Own Decisions 404 (80.8%) 96 (19.2%)

Takes independent

decisions

408 (81.6%) 92 (18.4%)

Consult family & friends 340 (68.0%) 160 (32.0%)

As per the Table 8.5.1. around (98.4%) respondents were confident

and (1.6%) respondents were not confident. Similarly (80.8%)

respondent took their own decision though around (68%) do consult

their family and friends before taking their own decision whereas

(19.2%) mentioned that they do not take their own decision, besides

(81.6%) mentioned that they take their independent decisions whereas

(18.4%) said they do not take independent decisions. (68%)

respondents felt it essential to consult family and friends so that in

future they could expect their support but their decision would always

be theirs while (32%) felt they did not consult their family and friend but

were independent. From the data analysed it is seen that most of the

respondents were self confident.

8.5.2. Leadership:

The person who is a risk taker, self confident and willing to take the

responsibility of one self and the entire team is a leader. Entrepreneurs

need to be leaders as they have to identify and accept every success

and failures of theirs. In order to analyse this, the data were collected

and analysed for leadership. It is also essential that the leader needs

to support others in business, besides have variation in thinking with

the business issues and also have the will to tackle competition, but by

being there in the competition.

Table 8.5.2. Leadership

Leadership items Responses

Yes No

Support to others in business

396 (79.2%) 104 (20.8%)

Mobility in dealing with business issues

376 (75.2%) 124 (24.8%)

Tackling competition 256 (51.2%) 244 (48.8%)

As per the table 8.5.2 the respondents (79.2%) agreed that they do

support others in business, as they do this they also find a lot of

learning for themselves besides the entire community looks up to one

while (20.8%) disagreed and mentioned that they did not support

others as they did not find time and comfort to support others in

business. (75.2%) respondents agreed to have mobility in dealing with

the issues of business while (24.8%) they did not have mobility in

dealing with business issues. (51.2%) agreed that they can tackle

competition and (48.8%) of the respondents mentioned they could not

tackle competition and sometimes also could not accept the fact

someone else is far better than them in the same business. As per the

data in the table most of them agreed that they did possess leadership

quality.

8.5.3. Decision Making:

In entrepreneurship it is very essential to have a quality where one

brings in solution to the obstacles and take responsibility for their

decision. This was analysed by taking the respondents response to the

decision making ability in them.

Table 8.5.3.: Decision Making

Independence item Responses

Yes No

Deal with problems 492 (98.4%) 8 (1.6%)

Innovative solutions 356 (71.2%) 144 (28.8%)

Family follows views 448 (89.6) 52 (10.4%)

As per most of the respondents (98.4%) felt that they could deal with

problems only (1.6%) felt that they could not deal with problems.

(71.2%) felt they could being in innovative solutions and (28.8%) felt

they could not bring innovative solutions (89.6%) responded that their

families also agreed to their decisions and followed their decisions.

8.5.4. Risk Taking Ability: As entrepreneurial venture requires a lot of

risk taking ability with respect to monetary decisions, moving through

unfamiliar routes and take risk in solving problems. Only if one had the

ability to taking risk then only could they think of economic

independence.

Table 8.5.4. Risk Taking Ability

Risk Taking items Responses

Yes No

Money 420 (84%) 80 (16%)

Willing to travel through unfamiliar routes

320 (64%) 180 (36%)

To face problems 440 (88%) 60 (12%)

As per the data analysed it seen that most of the respondents are

willing to take risk with respect to money (84%) said they were willing

to take risk while (16%) believe that they would not be able to take risk

in terms of money while (64%) are willing to travel through unfamiliar

routes i.e. to trace new markets and opportunities. (88%) respondents

also agreed that they were willing to face problems with respect to

setting up the venture such as from the Panchayat, bank, family,

community.

8.5.5. Future Planning:

One of the most essential aspect for an entrepreneur is planning for

the future so that one becomes sure that the business would sustain

and they need not depend on any one economically when future

planning is concerned it talks about growth opportunities, type of

venture chosen and long term goals.

Table 8.5.5. : Future Planning

Future Planning Responses

Yes No

Growth Opportunities 208 (41.6%) 292 (58.4%)

Type of Venture Chosen 384 (76.8%) 116 (23.2%)

Long term goals 32 (6.4%) 468 (93.6%)

Most of the respondents (58.4%) responded that they did not plan for

their growth opportunities or expansion of business at the initial stage

while (41.6%) responded that they did think of the growth opportunities

around (76.8%) mentioned that they did think about the type of venture

to be chosen, whether it is traditional or non-traditional (93.6%) of the

respondents mentioned that they did not plan for their future with

respect to business while (6.4%) mentioned that they had long term

goals planned for themselves. During the discussion the respondents

also mentioned that growth opportunities and long term goals were

aspects which they considered to be thought about only after a certain

stage where as the type of venture had to be thought about before

starting the business.

8.5.6. Taking Initiative :

In order to be entrepreneurial in nature it is also essential to take

initiatives for borrowing finance, purchase of raw material, marketing

the products etc. unless they do not explore these areas they would

not be bale to take risk and go ahead with decisions on the business

aspect.

Finance :

a) Initiative of Borrowing Finance:

Table 8.5.6 (a) : Initiative of Borrowing Finance

Initiative of Borrowing Responses

Yes No

Self 218 (43.6%) 282 (56.4%)

Self and Spouse 204 (40.8%) 296 (59.2%)

Self and Friends/Family 72 (14.4%) 428 (85.6%)

Self and SHG member 397 (79.4%) 103 (20.6%)

The data as per table 8.5.6 (a) most of the respondents (79.4%) of

them go along with self help group member for the initial application of

loan, (43.6%) respondents go all by themselves, (40.8%) respondents

choose to go along with their spouse, while only (14.4%) prefer to go

with family/ friends. During the discussion which happened during the

filling of questionnaire, it was also mentioned by the respondents that

only for the initial one or two times, they needed somebody, later they

did the follow up by themselves.

(b) Experience of Borrowing Finance :

This discusses whether the respondents had to undergo a trouble or

obstacles to receive finances. It also discusses as to whether their

experience was favourable or not favourable.

Table 8.5.6 (b) : From Bank, NGOs and other Financial Institutions

Categories Favourable Unfavourable Total

Frequency 323 177 500

Percentage (64.6%) (35.4%) (100%)

As per the data of table 8.5.6 (b) most of the respondents (64.6%)

responded their borrowing experience was favourable and (35.4%)

their experience was not good from the bank. The discussions brought

to light certain bank managers did not believe in the ability of the

respondents to do business and repay back. This was specially

discussed in the regions of Gadchiroli and Bhandara.

(c) Purchase of Raw Material: One of the most important aspect of

being involved in entrepreneurship is the ability to identify with the

geographical raw material available, availability of raw material to do

business and also the willingness to take decision to purchase.

Purchase Decision of raw materials which was discussed in initiative of

starting business.

Table 8.5.6. (c) : Purchase of Raw Material

Initiative of Purchase of Raw Material

Responses

Yes No

Self 112 (22.4%) 388 (77.6%)

Self and Spouse 278 (55.6%) 222 (44.4%)

Self and Family/Friends 125 (25%) 375 (75%)

Self and SHG member 298 (59.6%) 202 (40.4%)

The data in the table 8.5.6 projects that majority of the respondents

(59.6%) go along with the self help group members to purchase the

raw material followed by the combination of self and spouse (55.6%).

During discussion it was mentioned by the respondents that if the

products were for a kirana shop they preferred their husbands and it

was ready made garments like saree, petticoat they preferred their

SHG members.

(d) Marketing:

Entrepreneur have a constant need for information on the market. The

purpose of marketing is to satisfy the demand of customers (Meredith

et al 1982). No matter how good one might be in all aspects of

operating a business one can not be successful unless one can sell

the products, since business success is ultimately determined by

customer demand. Hence it was essential to analyse whether the

respondents venture out for marketing.

Table 8.5.6. (d) – Marketing Initiative

Initiative for Marketing Responses

Yes No

Self 301 (60.2%) 199 (39.8%)

Self and Spouse 274 (54.8%) 226 (45.2%)

Self and Family/Friends 116 (23.2%) 384 (76.8%)

Self and SHG Members 154 (30.8% 346 (69.2%)

The data in the table 8.5.6 (d) projects that majority of the respondents

did their marketing initiative by themselves (60.2%) but it is also

interesting to see that most of the respondents also seeked the help of

their husbands (54.8%) which was also discussed during the filling of

questionnaire that the trust factor is more with respect to husband and

it also becomes a job for the husband who is jobless. It was also

mentioned that the final decision was made by the respondent with

respect to price and location.

8.5.7. Support System:

The support system includes the help received by the respondent from

the family and community with respect to morale, physical, monetary

and knowledge.

(a) Support from Family:

Table 8.5.7. (a) : Support from Family

Support items Responses

Yes No

Monetary 206 (41.2%) 294 (58.8%)

Physical (Land)/Space 223 (44.6%) 277 (55.4%)

Knowledge 97 (19.4%) 403 (80.6%)

Morale 435 (87%) 65 (13%)

The data as per the table 8.5.7 (a) most of the respondents (87%)

receive morale support from their family in the form of taking care of

children, taking the initiative of handling a customer, looking out for

markets which the respondents felt was of greater help to go ahead to

do the business.

b) Support from community

Table 8.5.7 (b): Support from community

Support items Responses

Yes No

Monetary 20 (4%) 480 (9.6%)

Physical (Land/Space) 326 (65.2%) 174 (34.8)

Knowledge 51 (10.2%) 449 (89.8%)

Morale 476 (95.2%) 24 (4.8%)

The table 8.5.7 (b) data projects that most of the respondents (5.2%)

received morale support from community. (65.2%) respondents also

mentioned they received space or physical help from the panchayat.

During the discussion the respondents also mentioned that in some

villages the sarpanch himself or herself promoted entrepreneurship so

that the women in community become independent and empowered.

8.6. Economic Independency Model Based on the respondents feedback and literature review certain

parameters were considered in order to understand their importance

for the independency model. The parameters were :

1. Demographic Factor.

2. Type of venture

3. Traits

4. External Support system

5. Internal Support System.

The study to create the model was done to understand the weightage

which needs to be given to each parameter in order to understand if

the respondents would become independent. This would also give

insight to different organizations working towards women

entrepreneurship development as to though according to literature

review all the four parameters form pillars of women entrepreneurship

development all four aspects cannot be focused simultaneously in

order to achieve success.

Identification of key success factors for Women Entrepreneur

Development – Independency Model.

The analysis of the study indicate that the key factors for success of a

women entrepreneur are following. Each of these factors have several

sub factors. They are as follows:-

1. Rate the following statement in 7 point Likert scale.

Table 8.6.1. Demographic Factors

Factors Mean for Factor

F1 Age 4.5

F2 Education 5.5

F3 Religion 3.4

F4 Social Category 4.1

F5 Marital Status 3.9

F6 Family 5.2

F7 Location 4.8

8.6.2. Type of Venture Rate the following in 7 point Likert Scale.

Type of Venture

Table 8.6.2. Type of Venture

F Factors Mean for Factor

F1 Identify right opportunities 4.23

F2 Willingness to move through unchartered water

4.25

F3 Essential to be innovative to be successful.

5.56

F4 Not essential to be innovator to be successful

4.75

F5 Convince counts to choose venture 3.50

F6 Market Availability is important for venture

5.50

F7 Skills not essential to choose venture 5.00

F8 Essential not to be risk taker in choosing venture

3.21

8.6.3. Traits

Table 8.6.3. Traits

F Traits Mean for Factor

F1 Self Confident and Multi skilled 4.24

F2 Confident for Decision Making 5.45

F3 Risk Taker 5.00

F4 Innovative 4.56

F5 Result Oriented 4.78

F6 Managerial Ability 4.04

8.6.4. External Input System

F General Input Items Mean for Factor

F1 Support of Bank 5

F2 Availability of Fund 4.21

F3 Government Support 3.49

F4 Involvement in SHG 4.56

F5 Resource of Raw Material 3.45

F6 Input & Support of Society 4.45

8.6.5. Internal Input System - Family

F Internal Input Item Mean for Factor

F1 Monetary 5.00

F2 Physical (Land)/Space 3.56

F3 Knowledge 3.21

F4 Morale 5.00

F5 Involvement of entire family 4.00

F6 Involvement in Decision making 4.21

The study indicated that these major factors play an important role but

in varying degrees towards the development and success of women

entrepreneurship development. This degree of success can be measured by

formula.

V = Σ r Fi

N

Where r = coefficient of correlation

F1 = Mean of individual sub factors

n = Total number of sub factors

V = Value of importance for that factor

Based on this study it was found that value of importance for the factors is as

follows:-

Demographic factors = 2.51

Type of Venture = 3.06

Risk taking ability and other traits = 3.65

Internal Support = 2.82

External Support = 2.30

Thus from the above, it is clear that government and non government

organizations like Mahila Artik Vikas Mahamandal need to identify factors

which are critical for the success of entrepreneurship development among

women. Thus according to the independency model, the most critical factor

for the success is.

1. Traits: Is the entrepreneur capable of taking risk which is high in value

of (3.65).

2. The type of venture: Is the entrepreneur able to identify with the

opportunity and decide whether traditional or non-traditional business

format would work, the value is (3.06).

3. Closely followed by Internal Support System of family (2.80).

Demographic factors and external support are important but not so critical at

the initial stages. The value for demographic factor being (2.51) and the

external support system being (2.30).

It is essential to understand these values as most of the organizations invest

huge amount in entrepreneurship development among women but the most

common mistake among them is focusing all aspects simultaneously but the

independency model clearly gives indications for the organizations to function

in the form of conceptual diagram (Fig. 8.6.2), stage wise approach so that

there is realization among the women also about themselves and the

changes. To give importance for the investment by the organization it is very

essential to create this realization among the respondent groups.

8.7. Summary of Findings

The salient findings of the study can be stated as follows:-

1. Profile of the Respondents :

In the case of women run business, entrepreneurial and socio-demographic

profile of the entrepreneurs is considered necessary as only meaningful

conclusion drawn from them can be further used for entrepreneurship

development which would bring a drastic impact on the individual, family and

community at large

i. Age : Major number of respondents belong to the age group 31-40

years which consists 58.8%.

ii. Education: Most of the respondents have education upto class 8, which

was sufficient to understand how to seek loan and how to go about with

the business.

iii. Religion: The maximum respondents belonged to the Hindu

Community 40.2% followed by Boudh Community 33.8%.

iv. Marital Profile : Maximum respondent got involved in entrepreneurship

process after marriage as they felt that after marriage they were able to

cope with pressure better with the morale support of their spouse

though not much of economical support was attained from the families

end.

v. Entrepreneurial Activity: Most of the respondents were involved in

service activity i.e. 50.4% followed by trading 38.4%.

2. Interdependence of Women Entrepreneur and Family:

i. The monthly income of the family is an indicator of the financial support

that is there for the women entrepreneur. It was assumed during the

study that the financial conditions of the family do not play significant

role for involvement of women in entrepreneurship.

ii. It was analysed that major women entrepreneurs had weak financial

background during her entry into the entrepreneurial activity. But her

involvement occurred in order to raise the income of the family. It was

seen that after the women entered the business, she provided financial

support to the monthly income of the family. During the analysis, it was

seen that before the respondents ventured into business 90% of the

respondents had an income below Rs. 2000 which changed drastically

with decrease upto 39% and the number of respondents increasing in

the income bracket of Rs.3000 – Rs.5000 and Rs.5,000 and above

also.

iii. Most of the women entrepreneurs had husbands who were either

unemployed or were employed on contractual or daily wages. It was

assumed that the family would be dependent on the respondents but

through the analysis, it was found that respondents with family income

level less than Rs. 5000 had the family depend on the respondents as

compared to respondents with family income more than Rs. 5000. In

both the cases, the respondents income is merged with the income of

the family and considered as income. The less than Rs.5000 bracket

income respondents have their way as far as all the decisions are

concerned where as the respondents with income bracket of more than

Rs.5000 depend on their family.

iv. The women entrepreneurs whose financial condition were weak and

families where the husband is a drunkard or there is no other earning

member the family is dependent on the women entrepreneur. Aspects

such as decision making inhouse or for business was majorly done by

the women entrepreneur. Most of the respondents in such a situation

have income level less than Rs. 5000.

v. It was also analysed that the respondents felt that family is the primary

group where in every member gets directly associated with the

activities. The family type and size of the family determines the extent

to which an entrepreneur can take decision by herself and does not

have to depend on others.

vi. Women entrepreneurs from nuclear families did not have help available

at home and they single handedly had to take care of all the housework

and children. Thus they did not have much time to spend running

around for financial support and so found it difficult to access loans

single handedly. The lengthy procedure for getting credit, no support

available at home and no motivation from credit institutions de-

motivated the respondents from nuclear families to access credit from

banks and other financial institutions. The case in terms of joint family

was there was lot of support system existing for the women

entrepreneur to do follow up for availing credit from financial institution

even if she was engaged in family activities.

3. Impact of women entrepreneurship with respect to standard of

living of family.

As per the analysis the predictor variables are consumption of food, house

assets, status of house, children education, health issues, savings, literacy

rate, social status, livelihood assets, psychological benefit. The two groups

identified for study was respondents involvement in entrepreneurship for less

than two years and respondents involvement for more than two years. The

respondents were categorized as group 1 and group 2. It appeared that the

two groups were more widely separated in terms of consumption of food,

house assets, savings created and livelihood assets than other variables. The

f test was used for checking the significance of variation in standard deviation.

As the f test value increases, the significance level decreases so the

hypothesis is rejected.

i. The women entrepreneurs when enter into entrepreneurship have

kachha house. House made of mud with a low entry and just with one

room, no electricity and no demarcating space for cooking with cow

dung floors. The respondents who have been in the entrepreneurship

process for more than two years have brought remarkable change in

the type of house. Most of the respondents who had their venture for 2

years, had pucca house made of cement. They had drawn electricity

line and few of them even had brought in tap connections. One thing

very peculiar observed was some of them build a totally new house

and kept the old house as a monument to keep marketing their journey

and show the children and family the beginning.

ii. Consumption of Food : The other variable which was studied showed

that major lot of families who had only one income earner (i.e. women

not being involved as income earner) had basic diet as Dal, roti/

chappati/ bhakti and one sabji (may or may not be). Through

discussions and analysis, the findings revealed that when the women

enter into entrepreneurship the consumption pattern of the house also

changes. The women who have been earning money over two years

responded that they do consume fish, egg and chicken atleast once in

a week. Some of them also responded that they did bring chicken twice

a week. In regions of Konkan it was responded that they would bring

costly fish such as silver pomfert and black pomfret for the family

especially for the children. This also reflects the nutrition level for the

family such as intake of protein, calcium, magnesium etc. Healthy

living is brought through the process of women becoming income

earners through entrepreneurship.

iii.. House assets: As the respondents during the interview responded that

many of them who have been involved in entrepreneurship process for

over two years have brought cupboard, gas, table fan, cooker and

other utensils, bed, some have even gone to the extend of purchasing

computer for their children. The most purchased item for group 1 and

group 2 was jewellery, fan,g as. In case of women who have been in

the business less than two years are happy that they could atleast

purchase jewellery and have a shift from chulla to gas. Women

involved over two years have also build bathrooms.

iv. Savings : the women who have involved in entrepreneurship for less

than two years have their SHG savings and house assets more. Most

of them rather than focusing on savings of self have been focusing on

sustaining their business by rolling their earnings back into the

business. The people who have involved themselves in the

entrepreneurship have generated self savings through savings account

in bank on their name or children name. Most of them have also

invested money in post office savings and taken LIC policy. But it has

also been found that those who have focused only on expansion of

business and where the husbands involvement in business and

decision making is totally controlled by husband the savings on the

women’s name is least. In areas such as Gadchiroli they do not believe

in savings but living life each other.

v. Livelihood Assets: It was observed and analysed that most of the

women did have an attachment towards purchase of livelihood assets

such as goat, sheep, cow, pig etc. The only difference is in the

responses attained from different geographical regions. In regions such

as Gadchiroli people invested more in pig where as regions such as

Konkan belt invested in cow and Nasik and Ahmednagar invested in

goat and sheep. Those who have responded and have been there in

business over two years mentioned that they had began with one goat

and today have fifteen to twenty goats. Thos who have just recently

entered have only one goat or nil livelihood assets.

4. Key drives for involvement of women in entrepreneurship:

i. The hypothesis women’s involvement in entrepreneurship process

does not happen for monetary benefits but there are other important

factors. This was analyzed through factor analysis. Factor analysis was

used for identifying the key drivers, which we framed based on

previous studies and the experience with respondents during pilot

study. Following were the pre-assumed key drivers acquired skills,

availability of funds, possession of hobby, family business, need,

jobless husband, money, improvement in standard of living, resources

available. Respondents response were taken into consideration and

were analysed. based on. The responses were analysed using

principle component analysis. Scree plot and total variance explained

clearly the distinguishing 10 components in 2 factors.. After evaluating

the co-relation matrix and component, plot in rotate matrix 2 clusters

were identified. One included the factors which were economically

significant and the other included the interest factors. These cluster

were then defined as segment of economical benefit and interest. Thus

the null hypothesis was rejected. The finding of the analysis is the key

drivers for women involvement in entrepreneurship happens for money,

the need for her to pull the family or stabilize the family financially. In

due course of time with monetary benefits coming she would like to

improve the condition of her family, such as standard of living by

creating savings, increasing the consumption of food, giving good

education to her children. Certain general aspects for her involvement

would be existing family business. The other important drivers would

be of interest such as hobby, passion, and acquired skills.

ii. In order to further cross check as to which holds more importance

among both the clusters further, a hypothesis framed was checked,

women’s involvement in entrepreneurship are independent of their

interest and financial conditions of the family. This was tested by the

Logit Model. Based on the survey of the respondents and interaction

with experts five parameters were considered for study they were

acquired skill based training, financial benefit, low family income, social

benefit, interest in the respective business. On this basis it can be

concluded that both financial benefit and low family income play a

significant role which represents economical need. Thus the positive

sign for co-efficient indicate that the economical need are more

significant. Thus one can conclude that economical benefit/ financial

benefit is the key drivers over interest for women involving themselves

5. Key parameters for success of the women in entrepreneurship

development.

Based on the above findings the study indicates that for a woman

entrepreneur to be successful there are 7 steps. These 7 steps can be

schematically drawn as follows:-

Not Entering Entrepreneurship

Improvement of society

No Improvement

Stage 1

Age Capability for Education Becoming Experience Entrepreneur Stage 1

Trait No

Identif. Stage 2 Yes Type of Venture Stage 3 Yes Internal No Stage - 4 Support Yes Stage-5 External No Support Yes State-6 Improvement of family Yes Stage-7

Fig. 8.1 : Entrepreneurship Development in Village.

The study indicates that :-

1. Age/Education/Experience

2. Trait identification

3. Type of Venture

4. Internal Support

5. External support

6. Improvement of family.

7. Improvement of society.

Which are the major parameters which have a high impact on the success of

a women entrepreneur. Identifying with the model and the analysis indicates

that 5 parameters are critical and have a high impact on the women

entrepreneurship development. These 5 parameters are as follows:-

1. Traits (weightage ~ 3.65 for success)

2. Type of venture (weightage ~ 3.06 for success)

3. Internal support (weightage ~ 2.82 for success)

4. Demographic factors (weightage ~ 2.51 for success)

5. External factors (weightage ~ 2.30 for success)

6. Miscellaneous Factors (weightage ~ 0.66 for success)

Based on a total scale of 15 points.

Importance of the model

This model indicates that while external factors, which include external

funding (as provided by the government/ NGO’s etc) is a very important

factor, however it is not a very critical factor. The most important factor is the

trait factor. Sometimes also revealed as the “fire in the belly “ or the risk taking

ability, closely followed by the type of venture as this includes the traditional

type business and the modern type business (Annex. III) and the internal

support which includes support from the family. The model depicts that these

parameters need to be given more attention during the women

entrepreneurship development tomake the women independent.

Chapter – 9

CONCLUSION

The growth of entrepreneurship signifies the economic development of a

country. Women constituting nearly 50% of the population have specific role

to play in this area. Of late women entrepreneurs especially in rural

Maharashtra have been able to show certain achievements. They have not

only brought a change in themselves but have also brought drastic changes in

their families and villages. The impact of entrepreneurship development

among women with micro enterprise have displayed a positive impact on the

family. For attaining this several promotional agencies and institutions have

been set up at national and state levels.

The objectives of the study have brought about certain conclusions with

respect to the study. The socio-demographic profile of women respondents

brings out the fact that most of the women ventured into entrepreneurship in

their midage of life. The three main reasons for this is increased needs in the

family, growing household expenses, education of children marriage of

daughters which forced women to look for sources of income to support the

family. It was also revealed during the study that women focus on

entrepreneurship post 30 years of age because that is the time when the

women focus on their own interest and maturity at this stage of life enables

them to cope better with the pressure of a male dominated society specially in

rural region.

Similarly education definitely has an impact on entrepreneurship as it opens

up an arena in which women can complete with men and prove their

independent identity. Education also makes a women more confident and

capable of recognizing the potential area of exploration in various stage of the

entrepreneurial activity. Most of them with a middle school education felt it

important as it seemed to have facilitated them in approaching relevant

organizations for financial loans and articulate in day to day running and

marketing for their enterprise. Being schooled also enabled them to maintain

accounts and deal with finances but the success of such women running

micro enterprise obviously depend on factors other than formal education.

Religion is the belief followed by the community. This was taken into

consideration as certain communities and religions do not encourage

entrepreneurship. Most of the region covered large number of Hindu

community women who ventured into entrepreneurship.

The marital profile, as regards entrepreneurship, there is a strong belief

among respondents that it is only after marriage that women are more

capable of withstanding the pressures of business life. The discussions also

brought to fact that spouses were largely perceived as helpful and supportive

of the business activity. It also brought forth that most of the respondents

were already married when they started their business; they also considered

that they could not have been better entrepreneurs had they been unmarried.

The unmarried were usually those who were not marriageable age or have

not married because of economic responsibility.

Family type, the respondents from nuclear families reported that they did not

have help available at home and they had to take care of all the house work

and children. Thus they did not have much time to spend running around for

financial support and so found it difficult to access loans. The lengthy

procedures for getting credit sanctioned, no support from credit institutions,

lack of follow up demotivated the respondents from nuclear families could

cope the stress more easily. At the same time, it was mentioned that the

respondents from the nuclear families had to face fewer problems as far as

answering the in-laws for their actions taken at home as well as in business.

Women from joint families had the advantage of leaving their children at home

with their in-laws. The family thus plays an important role in the

entrepreneurship development process of women. The socio demographic

profile is important so that the organizations focusing on women

entrepreneurship development can focus accordingly to bring in the change.

Women Entrepreneurship Development in women is mostly happening as it

brings monetary benefit to the individual and her family. Though there is

monetary benefit, the women are still dependent on their families for reasons

of support to bring about a sustainable venture. The dependence is for morale

support to balance the family affairs and for managing the business.

The key driver for entrepreneurship development among women has been

money due to families economical problems such as jobless husband or

husband who is drunkard or on contractual work. During the course of study, it

was researched that though initially, it is a monetary benefit the women

venture into business, but later it is the interest and passion towards business

which helps her to sustain the business.

During the study a model was created identifying the parameters which have

critical impact for economic independence of women entrepreneur. The study

through the model proves that the 5 pillars for the success of women

entrepreneurship development are the individual traits of a person, the type of

venture chosen, the demographic factors the internal support system and the

external support system. This model can be used by the grassroot level

workers of the government and non-government organization to identify

whether the entrepreneurship programme would be successful.

The study also brought to light that most of the respondents have brought a

change in their financial positions after starting the business which has also

brought about a change in the standard of living of the family. This has finally

brought about a positive self esteem in the women entrepreneurs. Thus

proving that there has been empowerment of women entrepreneurs through

entrepreneurship development which has brought a positive impact on the

lives of the family and improvement in the community and society at large.

Chapter – 10

SUGGESTIONS AND RECOMMENDATIONS

The findings of the study noticed that rural area especially interiors of

Maharashtra is a potential area for bringing about entrepreneurship

development. It was seen during the study that each geographic region has its

own natural resource availability which is not being utilized to its optimum

capacity due to unawareness of the locals. Most of the women in the interiors

of Maharashtra especially in the low income group are also a part of the self

help group, but still there are areas of improvement. Suggestions/ remedial

measures for change to be brought.

1. Requirement of Proactive Role of Government and Non-

Government Organisations/ Institutions

i) The entrepreneurship development process is maximum among the

age group of 31 to 40, but this happens mostly due to mid life crisis

especially due to economic crisis. It becomes very essential that the

organizations and institutions work with the women at a close level and

educate the women with importance of entrepreneurship and economic

independence. The institution and organizations should classify their

target groups educate them before the women can enter into a mid

married phase of life and work only for money keeping short term

benefit in mind.

ii) As it was also analysed and observed that women move towards this

area only for financial benefits though they may possess the in born

qualities of an entrepreneur they cannot identify it themselves and

need another person to educate them about the same. Absence of

focus oriented functioning and future planning such as they are not

aware about certain aspects involved in business. It is at this stage that

there are many government and non-government bodies who work with

these ladies through their grassroot level workers, hence they need to

bring in a light format or method in the local language to make the

women realize the importance of passion, leadership, business and the

output of this being money rather than focusing only on money. The

grass root level workers are also not aware of certain aspects such as

how to come up with an idea, how to create a business plan, maintain

accounting and counseling the women and men. They do not take

interest as they are not paid well for their work by the organization and

institutions. Hence the organisation needs to take care of them well to

bring results.

(iii) Most of the women in the interiors of Maharashtra only think of

business in terms of doing it at an individual level and bringing about

change for herself and her family and village even the government and

non government organizations have only focused on individual

business inspite of women doing the same business with the same

resources. Government and non-government organizations should

start focusing on cluster development in entrepreneurship based on the

natural resource availability.

2. Training Programme for women Entrepreneurs should be more

specific and practical oriented:

i) Technical Modules:

Introduction of proper education modules needs to be done. Such as

leadership module, Accounting Module, Marketing module in simple

language can be done among the self help groups. The Self Help

Groups have been focused as most of the women in rural Maharashtra

are a part of the self help group and the group meetings could be the

time when these modules can be taught to them keeping a duration

period of 2 weeks for each module and then revising it as per the need

of the village.

ii) Support Modules:

Major lot of women who enter into entrepreneurship with respect to any

region do face a lot of obstacles from family till they prove themselves

Though they become income earners, in the first year of business they

are dependent on the family to sustain themselves in the business.

Hence it is very essential that when the women is being educated

about the entrepreneurship process the head decision makers of the

family or the husband also be educated about entrepreneurship. But

while doing this it should also be seen that they do not become

decision makers for the women’s business. Introduction of support

programmes can be done by the government and non government

training centres.

(iii) Social and Health Modules:

As per observation, it was seen that women as they begin to earn they

spend their earnings on value items such as jewellery, television,

purchase of bike for jobless husband and ignore important issues such

as health, food etc. Government officials when do the monitoring of the

upliftment of family ignore this issue and its importance. Hence

counseling needs to happen or training needs to be given with respect

to the health issue and its importance.

b) There is also the need to train the women about sanitary conditions to

be followed for themselves and the family so that it spreads across the

village. Women have modified their house from Kaccha house to pucca

house but have not build toilets. The contribution of women to family is

low in such case especially those with young daughters. Hence training

for “Swasta Ghar and Swach Village” needs to be focused.

(iv) Modern Business Modules:

As seen and observed during the study that most women focus on

individual business than group business not understanding the format

of cluster business. Hence training needs to be given to the women

about cluster development and its importance.

3) The village bodies along with the government and non government

organizations could facilitate the formation of professional bodies

where the entrepreneurs could come together and establish linkages

for mutual benefit.

4) A database of resource and resource linkages for entrepreneurship

development should be developed at the headquarters of all the

organization which are working for the upliftment of women in rural

Maharashtra.

5) There should be better established links among various organizations

who are working for entrepreneurship development and women's

empowerment rather than having competition for yearly target

achievement amongst themselves.

6) Banks need to increase their fund release during the gradation of self

help group and their business so that the women are motivated to do

business so that they not only bring a change for themselves but also

for the family and society.

7) Involvement of academicians for the change process along with

government and non government organization is recommended to see

a new rural Maharashtra.

ANNEXURE - I

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ANNEXURE - II

Padmashree Dr. D.Y. Patil University Department of Business Management

“Impact of Women Entrepreneurship Development on Families: A Study of Women run micro enterprises in selected Districts of Maharashtra”

QUESTIONNAIRE

Please tick (����) the appropriate answer.

1.A. Identification of Women Entrepreneur.

1.1. Name : 1.2. Age : Category Code

1. Below 20 years 1

2. 21 – 30 years 2

3. 31 – 40 years 3

4. 41 – 50 years 4

5. 50 years and above 5

1.3. Education of the Entrepreneur. Category Code

1. Illiterate 1

2. Literate (without formal education) 2

3. Primary school 3

4. Middle School 4

5. High School 5

6. H.S.C. completed 6

7. Graduation Completed 7

8. Other (specify) 8

1.4. Religion

Category Code

1. Hindu 1

2. Muslim 2

3. Christian 3

4. Others (specify) 4

1.5. Marital Status

Category Code

1. Married 1

2. Unmarried 2

3. Divorcee 3

4. Widow 4

2. Description of the family

Category Code

Type of Family

1. Nuclear 1

2. Joint 2

3. Extended 3

2.1. Head of the Household

Category Code

1. Father-in-Law 1

2. Husband 2

3. Other 3

4. Self 4

2.2. Total Income of the family before business

Category Code

1. Upto Rs. 1500 1

2. Rs. 1500 – Rs. 3000 2

3. Rs. 3001 – Rs. 5000 3

4. Rs. 5000 – Rs. 10000 4

5. Rs. 10000 & above 5

2.3. Total income of the family after business.

Category Code

1. Upto Rs. 1500 1 2. Rs. 1500 – Rs. 3000 2 3. Rs. 3001 – Rs. 5000 3 4. Rs. 5000 – Rs. 10000 4 5. Rs. 10000 & above 5

2.4. Do you have income earning assets

Category Code

Yes 1 No 2

3. Enterprise and Entrepreneurial Activity.

3.1. Name your Entrepreneurial Activity.

Category Code

1. Manufacturing 1

2. Beauty Parlour 2

3. Printing 3

4. Flower/ Bangle shop 4

5. Grocery Shop 5

6. Fish/ Vegetable 6

7. Tailoring 7

8. Any other 8

3.2. Years of experience in existing business

Category Code

1. 0 – 2 years 1

2. 2 – 5 years 2

3. 3 and above. 3

3.3. Factors which motivated you for venture.

Category Code

1. To support family earning 1

2. To gain social recognition 2

3. No job 3

4. To pursue interest 4

5. Independence/ Self Confidence 5

3.4. Who runs the enterprise?

Activities Code

1. Production

2. Getting raw material

3. Bargaining

4. Marketing

5. Other (specify)

Codes of Person

Person Code

Self 1 Self & Spouse 2 Self & Children 3 Self & Others 4

3.5. Do you go out for marketing

Category Code

Yes 1 No 2

3.6. Have you gained confidence to run your enterprise ?

Activities Yes (2)

No (1)

Talking to customers

Buying Material for packing

Finding new markets

Buying raw materials

Increasing the scale of business

Solving problems

Dealing with regulatory bodies

3.7. Are you confident going out alone to places.

Places/ People Yes (2)

No (1)

Loan

Bank for Money transaction

To express views in public.

To solve matters at home and society.

3.8. Have you taken loan for starting business.

Category Code

Yes 1 No 2

3.9. If yes then from which source?

Activities Code

1. Internal loan 1

2. Bank 2

3. NGO/SHG 3

4. Money Lender 4

5. Government Agency 5

6. Co-operative Society 6

3.10. Did you take the initiative for loan.

Category Code

Yes 1 No 2

3.11. How did you find the process of financial borrowings?

Category Code

Favourable 2 Unfavourable 1

3.12. Do you possess land on your own for business.

Category Code

Yes 1 No 2

4. Occupation before entering into venture.

Category Code

Daily wage worker 2 House-wife 1

4.1. Have you joined SHG?

Category Code

Yes 1 No 2

4.2. Did you undergo any training?

Category Code

Yes 1 No 2

4.3. If yes, then what kind of training?

Kind of training Usefulness of training

1. Training for banking

2. Skill based training

3. Training for social awareness.

4. Functional Literacy

5. Importance of group.

6.. Training for gender equality.

Category Code

Useful 1

Not Useful 2

Very useful 3

Not Applicable 4

5. Saving pattern of women entrepreneurs.

Category Prior After

Were you able to save

If yes, then:

Home

Bank

Post Office

Chit Fund

SHG

Category Code

Yes 1 No 2

6. CONTROL OVER INCOME

6.1. If you earn wage or income, who has control over it.

Yes – 2 No – 1

No. Exercise of control Prior to business

After the business

i. No income hence not applicable ii. Self iii. Share with family members iv. Handed over to spouse v. Handed over to family members

7. SHIFT IN ECONOMIC STATUS

Yes – 2 No – 1

7.1. Household assets.

No. Assets Owned before

Owned after

Present status

i. Land ii. House iii. Addition/Alteration of the

house

iv. Car/Jeep/Tractor v. Cyle vi. Radio vii. Television viii. Utensils ix. Refrigerator. x. Cooking gas xi. Mixer xii. Room cooler xiii. Water filter xiv. Jewellery xv. Steel almirah xvi Sewing machine

embroidery

xvii Loom xviii Fan/table fan xix Telephone xx Other

7.2. Agricultural and livestock.

No. Exercise of control Prior to Business

After the business

i. Plough ii. Bullock/Bullar iii. Cow iv. Buffalo v. Goat vi. Sheep vii. Hen/cock viii. Other

7.3. Standard of living: Codes Yes – 2 No - 1

a. If your house _______________________ i. Owned. ii. Rented iii. Others.

b. Type of house _______________________ i. Kachha ii. Pucca

iii. Semi puca

c. Changes occurred in the facilities available to the household?

No. Facilities Before After

1. Number of rooms 2. Electricity 3. Water tap in house 4. Hand pump 5. Toilet – Sanitary 6. Toilet – dry 7. Bathroom 8. Soak pit 9. Change in type of house.

Codes Yes – 2, No – 1, N.A. – 0

d. Consumption of food/nutrition.

Food items Has the intake increased? Yes/No

Dal Milk Meat/Fish/Egg Grains Vegetables

Codes : Yes – 2, No – 1, N.A. – 0

e. Health improvements before and after business.

Access and use of Medical facility Before After i. Govt. Hospital/Dispensary ii. Govt. doctor. iii. Private doctor/Hospital iv. Specialist. v. Ayurvedic vi. Homeopathic vii. Homeoremedies. viii. Traditional ix. Bhagat x. Vaccination

Codes : Yes – 2, No – 1, N.A. – 0

f. Education

Codes : Yes – 2, No – 1, N.A. – 0

No. Improvement in schooling of children

Before After

i. Regular attendance of children. ii. Admission of girl children iii. In terms of higher education iv. In terms of facilities – books,

dress etc.

v. Avoidance of drop out. vi. Any other (specify)

g. Awareness about socio-political issues extend of awareness.

Code : Yes – 2, No – 1

After business No. Aspects Yes/No Heard Know details

i. Legal age of marriage ii. Family welfare programme iii. Minimum wage. iv. 33% reservation for

women

v. Mahila Gram Sabha vi. Prohibition of child labour

8. INITIATIVE/OPINION/DECISION MAKING

Codes : Yes – 2, No – 1, N.A. – 0

No.

Decision on Before doing business

After doing business

i. Final decision in purchase of fixed assets

ii. Purchase of radio, television. iii. Sending children to school and

higher education

iv. The initiative to vaccinate children

v. Send girl child to school vi. Purchase of things related to

business

vii. Taking loans viii. Migration in search of

employment

ix. Children marriage x. Any other specify

8.1. Social status:

a. Do your family members accept your advice/suggestions in household matters. Codes : Yes – 2 No - 1 8.2. a. Do you think this is due to your becoming more enterprising and

its related activities? Codes : Yes – 2 No - 1 b. If yes how has the change come about ?

_____________________________________________________ _____________________________________________________

8.3. a. Has this enabled you to command more respect in family/ neighbourhood?

Codes : Yes – 2 No - 1

b. If yes give example. ___________________________________________________________________________________________________________________

8.4. Do you enjoy better status in the community (village/ caste)? Codes : Yes – 2 No - 1 9. Leadership status before doing and after doing business. a. What is your involvement in social and political activities?

No. Participation Before After

i. Gram Panchayat ii. Panchayat Samiti iii. Gram Sabha iv. School Committee v. Health Committee. vi. Women Group. vii. Water Committee viii. Forest Committee

Codes for type of participation.

1. Merely attendance.

2. Active member

3. Office bearer

4. No participation.

9.1. a. Did you vote during the recent elections? ____________________

Codes : 1. Yes 2. No

b. If yes, how did you exercise your choice?

No. Elections Whether voted Tick (�)

How decision was made

1. Gram Panchayat 2. Panchayat Samiti 3. Zilla Parishad 4. State assembly 5. Lok Sabha

* Code of Code : 1. On your own. 2. Influenced by family 3. Influenced by others

9.2. If you are elected to the Panchayat, are you able to function independently?

Codes : Yes – 2, No – 1, N.A. – 0

10. OBSERVATION BY INVESTIGATOR.

_____________________________________________________

_____________________________________________________

_____________________________________________________

ANNEXURE – III

LIST OF ACTIVITIES UNDERTAKEN BY WOMEN ENTREPRENEURS

1. Garment Shop

2. Vegetable Shop

3. Kirana Shop

4. Sale of Tiffins

5. Sarees, Dress Material and cutlery shop.

6. Xerox and computer Typing.

7. Tailoring Shop.

8. Fur Toys Manufacturing.

9. Stationery shoop.

10. Papad unit

11. Saree – Fall beeding and embroidery.

12. Beauty Parlour.

13. Cycle renting and repairing.

14. Distribution and Preparing Agarbatti.

15. Hosiery Shop.

16. Shoes and Bags manufacturing.

17. STD/PCO booth.

18. Photo studio.

19. Bakery Shop.

20. Cosmetic shop.

21. Cigarette and Chocolate stall.

22. Grinding shop.

23. Soaked lentils.

24. Dry fish

25. Flower shop.

26. Vada Pav Shop.

27. Bangles

28. Fish

29. Milk stalls

30. Maternity pad

31. Woolen garments.

32. Block printing.

33. Pepsi Cola Manufacturing

34. Sanitary Napkins

35. Matts

36. Bamboo brooms

37. Honey unit

38. Liquor unit

39. Cashew unit

40. Perfume unit etc.

ANNEXURE - IV

STATISTICAL TABLES

8.1.10. Interdependence of women entrepreneurs and families:

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

status_of_women * income_of_family

500 100.0% 0 .0% 500 100.0%

Status_of_women * income_of_family Crosstabulation

income_of_family

less than 5000

greater than 5000

Count 95 219 women depend on family Expected Count 140.7 173.3

Count 129 57

status_of_women

family depend on women Expected Count 83.3 102.7

Count 224 276 Total

Expected Count 224.0 276.0

Chi-Square Tests

Value Df

Asymp. Sig. (2-sided)

Exact Sig. (2-sided)

Exact Sig. (1-sided)

Pearson Chi-Square 72.212a 1 .000

Continuity Correctionb 70.640 1 .000

Likelihood Ratio 73.522 1 .000

Fisher's Exact Test .000 .000

Linear-by-Linear Association

72.068 1 .000

N of Valid Cases 500

a. 0 cells (.0%) have expected count less than 5. The minimum expected count is 83.33.

b. Computed only for a 2x2 table

Symmetric Measures

Value Approx. Sig.

Nominal by Nominal

Contingency Coefficient

.355 .000

N of Valid Cases 500

T-Test

[DataSet2]

Paired Samples Statistics

Mean N

Std. Deviation

Std. Error Mean

VAR00001 1.7700E3 500 405.49828 18.13443 Pair 1

VAR00002 7.5980E3 500 3509.56266 156.95241

Paired Samples Correlations

N Correlation Sig.

Pair 1 VAR00001 & VAR00002

500 -.103 .021

8.3. Table

Analysis Case Processing Summary

Unweighted Cases N Percent

Valid 500 100.0

Missing or out-of-range group codes

0 .0

At least one missing discriminating variable

0 .0

Both missing or out-of-range group codes and at least one missing discriminating variable

0 .0

Excluded

Total 0 .0

Total 500 100.0

Group Statistics

Valid N (listwise)

VAR00011 Mean Std. Deviation Unweighted Weighted

VAR00001 5.0398 1.49077 251 251.000

VAR00002 4.0120 1.66969 251 251.000

VAR00003 2.8606 1.86989 251 251.000

VAR00004 4.0359 1.60334 251 251.000

VAR00005 3.1992 1.88047 251 251.000

VAR00006 3.7131 1.73130 251 251.000

VAR00007 3.0717 1.90022 251 251.000

VAR00008 3.9203 1.76907 251 251.000

VAR00009 3.9124 1.73444 251 251.000

VAR00010 3.9522 1.58925 251 251.000

1

VAR00012 1.9402 1.66386 251 251.000

VAR00001 5.0843 1.55961 249 249.000

VAR00002 4.0482 1.70320 249 249.000

VAR00003 5.4940 4.60025 249 249.000

VAR00004 4.1406 1.65598 249 249.000

VAR00005 4.6867 1.94228 249 249.000

VAR00006 4.5743 1.99685 249 249.000

VAR00007 4.9357 1.97665 249 249.000

VAR00008 4.0602 1.61407 249 249.000

VAR00009 3.9237 1.63819 249 249.000

VAR00010 3.7751 1.62318 249 249.000

2

VAR00012 6.3414 4.43592 249 249.000

VAR00001 5.0620 1.52407 500 500.000

VAR00002 4.0300 1.68487 500 500.000

VAR00003 4.1720 3.74252 500 500.000

VAR00004 4.0880 1.62898 500 500.000

VAR00005 3.9400 2.04959 500 500.000

VAR00006 4.1420 1.91551 500 500.000

VAR00007 4.0000 2.14971 500 500.000

VAR00008 3.9900 1.69341 500 500.000

VAR00009 3.9180 1.68551 500 500.000

VAR00010 3.8640 1.60707 500 500.000

Total

VAR00012 4.1320 4.00233 500 500.000

Tests of Equality of Group Means

Wilks' Lambda F df1 df2 Sig.

VAR00001 1.000 .106 1 498 .744

VAR00002 1.000 .058 1 498 .810

VAR00003 .876 70.510 1 498 .000

VAR00004 .999 .516 1 498 .473

VAR00005 .868 75.700 1 498 .000

VAR00006 .949 26.557 1 498 .000

VAR00007 .812 115.560 1 498 .000

VAR00008 .998 .853 1 498 .356

VAR00009 1.000 .006 1 498 .940

VAR00010 .997 1.519 1 498 .218

VAR00012 .697 216.392 1 498 .000

Analysis 1 Box's Test of Equality of Covariance Matrices

Log Determinants

VAR00011 Rank Log Determinant

1 11 3.115

2 11 8.659

Pooled within-groups 11 7.291

The ranks and natural logarithms of determinants printed are those of the group covariance matrices.

Test Results

Box's M 704.714

Approx. 10.432

Df1 66

Df2 7.907E5

F

Sig. .000

Tests null hypothesis of equal population covariance matrices.

Summary of Canonical Discriminant Functions

Eigenvalues

Function Eigenvalue % of Variance Cumulative % Canonical Correlation

1 1.280a 100.0 100.0 .749

a. First 1 canonical discriminant functions were used in the analysis.

Wilks' Lambda

Test of Function(s) Wilks' Lambda Chi-square df Sig.

1 .439 405.947 11 .000

Standardized Canonical Discriminant Function Coefficients

Function

1

VAR00001 -.039

VAR00002 -.098

VAR00003 -1.780

VAR00004 .248

VAR00005 -.072

VAR00006 -.048

VAR00007 1.029

VAR00008 .093

VAR00009 -.080

VAR00010 -.413

VAR00012 1.990

Structure Matrix

Function

1

VAR00012 .583

VAR00007 .426

VAR00005 .345

VAR00003 .333

VAR00006 .204

VAR00010 -.049

VAR00008 .037

VAR00004 .028

VAR00001 .013

VAR00002 .010

VAR00009 .003

Pooled within-groups correlations between discriminating variables

and standardized canonical discriminant functions.

Variables ordered by absolute size of correlation within function.

Canonical Discriminant Function Coefficients

Function

1

VAR00001 -.026

VAR00002 -.058

VAR00003 -.508

VAR00004 .152

VAR00005 -.038

VAR00006 -.026

VAR00007 .531

VAR00008 .055

VAR00009 -.047

VAR00010 -.257

VAR00012 .595

(Constant) -1.510

Unstandardized coefficients

Functions at Group Centroids

Function

VAR00011 1

1 -1.125

2 1.134

Unstandardized canonical discriminant functions evaluated at group means

Classification Statistics

Prior Probabilities for Groups

Cases Used in Analysis

VAR00011 Prior Unweighted Weighted

1 .500 251 251.000

2 .500 249 249.000

Total 1.000 500 500.000

Classification Function Coefficients

VAR00011

1 2

VAR00001 2.166 2.108

VAR00002 .828 .697

VAR00003 -.172 -1.319

VAR00004 .655 .999

VAR00005 .318 .233

VAR00006 .654 .596

VAR00007 -.240 .959

VAR00008 .492 .616

VAR00009 1.399 1.293

VAR00010 .475 -.106

VAR00012 .123 1.466

(Constant) -15.001 -18.421

8.4 (a) Key Drives, Mean and Std.Deviation.

Descriptive Statistics

Mean Std. Deviation Analysis N

Acquired Skills 4.1000 1.65635 500

Availability of Funds 4.0800 1.65864 500

Passion 4.1100 1.68748 500

Hobby 4.0920 1.65802 500

Family Business 4.0400 1.65284 500

Need 4.0180 1.69097 500

Jobless Husband 3.9340 1.68503 500

Money 4.0180 1.69097 500

Improvement in Standard of living

3.9340 1.68503 500

Resource Available 4.0900 1.68153 500

Table 8.4. (b) Correlation Matrixa

Acquired Skill

Avail-ability Funds

Passion

Hobby

Famil Business Need

Jobless_Husband Money

Improv-ement Std

Resourceavailable

Acquired Skills

1.000 .260 .775 .289 .421 .262 .101 .262 .101 .252

Availability of

Funds

.260 1.000 .292 .821 -.058 -.016 -.152 -.016 -.152 -.018

Passion .775 .292 1.000 .360 .359 .152 -.017 .152 -.017 .143

Hobby .289 .821 .360 1.000 -.063 -.011 -.135 -.011 -.135 -.014

Family Business

.421 -.058 .359 -.063 1.000 .123 .166 .123 .166 .077

Need .262 -.016 .152 -.011 .123 1.000 .648 1.000 .648 .929

Jobless Husband

.101 -.152 -.017 -.135 .166 .648 1.000 .648 1.000 .577

Money .262 -.016 .152 -.011 .123 1.000 .648 1.000 .648 .929

Improvement in Standard of living

.101 -.152 -.017 -.135 .166 .648 1.000 .648 1.000 .577

Resource Available

.252 -.018 .143 -.014 .077 .929 .577 .929 .577 1.000

8.4.(c) Communalities

Initial Extraction

Acquired Skills 1.000 .655

Availability of Funds 1.000 .559

Passion 1.000 .660

Hobby 1.000 .600

Family Business 1.000 .140

Need 1.000 .886

Jobless Husband 1.000 .752

Money 1.000 .886

Improvement in Standard of living

1.000 .752

Resource Available 1.000 .796

Extraction Method: Principal Component Analysis.

8.4. (d) Total Variance

Total Variance Explained

Initial Eigenvalues Extraction Sums of Squared Loadings

Rotation Sums of Squared Loadings

Compo- nent Total

% of Varianc

e Cumulat

ive % Total

% of Varianc

e Cumulat

ive % Total

% of Varianc

e Cumulat

ive %

1 4.196 41.957 41.957 4.196 41.957 41.957 4.153 41.527 41.527

2 2.491 24.910 66.867 2.491 24.910 66.867 2.534 25.340 66.867

3 1.436 14.358 81.225

4 .853 8.527 89.752

5 .546 5.458 95.209

6 .222 2.222 97.431

7 .168 1.678 99.109

8 .089 .891 100.000

9 2.567E-16

2.567E-15

100.000

10 2.156E-16

2.156E-15

100.000

Extraction Method: Principal Component Analysis.

8.4. (1) Graph

8.4. (e) Rotated Component Matrixa

Component

1 2

Acquired Skills .357 .727

Availability of Funds -.059 .746

Passion .226 .781

Hobby -.043 .773

Family Business .255 .275

Need .941 -.006

Jobless Husband .831 -.249

Money .941 -.006

Improvement in Standard of living

.831 -.249

Resource Available .892 -.004

Extraction Method: Principal Component Analysis.

a. 2 components extracted.

Rotated Component Matrixa

Component

1 2

Acquired Skills .237 .774

Availability of Funds -.177 .727

Passion .099 .807

Hobby -.166 .757

Family Business .208 .312

Need .930 .144

Jobless Husband .860 -.114

Money .930 .144

Improvement in Standard of living .860 -.114

Resource Available .881 .138

Extraction Method: Principal Component Analysis. Rotation Method: Equamax with Kaiser Normalization.

a. Rotation converged in 3 iterations.

Component Transformation Matrix

Component 1 2

1 .987 .159

2 -.159 .987

Extraction Method: Principal Component Analysis. Rotation Method: Equamax with Kaiser Normalization.

Variables at the end of an axis are those that have high loadings on only that factor and hence describe the factor. Variables near the origin have small loadings on both the factors. Variables that is not near any of the axes are related to both the factors. Factor one is highly related with variables hobby, passion and acquired skill. Thus, factor 1 may be labeled as interest of the individual. A plot of the factor loading confirms these interpretations. Variables money, need, improvement in std of living and jobless husband are at the ends of horizontal axes (factor 2). The component 2 caan be labelled as financial status of the family.

Table 8.4. (h) Component Score Coefficient Matrix

Component

1 2

Acquired Skills .038 .302

Availability of Funds -.062 .293

Passion .003 .318

Hobby -.059 .305

Family Business .042 .119

Need .222 .033

Jobless Husband .211 -.067

Money .222 .033

Improvement in Standard of living

.211 -.067

Resource Available .210 .032

Extraction Method: Principal Component Analysis.

Rotation Method: Equamax with Kaiser Normalization.

Component Score Covariance Matrix

Component 1 2

1 1.000 .000

2 .000 1.000

Extraction Method: Principal Component Analysis.

Rotation Method: Equamax with Kaiser Normalization.

Table 8.4 (B) Logit Model Analysis

Case Processing Summary

Unweighted Casesa N Percent

Included in Analysis

350 100.0

Missing Cases 0 .0

Selected Cases

Total 350 100.0

Unselected Cases 0 .0

Total 350 100.0

a. If weight is in effect, see classification table for the total number of

cases.

Dependent Variable Encoding

Original Value Internal Value

Group 1 0

Group 2 1

Block 0: Beginning Block

Classification Tablea,b

Predicted

Group

Observed Group 1 Group 2

Percentage Correct

Group 1 175 0 100.0 Group

Group 2 175 0 .0

Step 0

Overall Percentage 50.2

a. Constant is included in the model.

b. The cut value is .500

Variables in the Equation

B S.E. Wald df Sig. Exp(B)

Step 0 Constant -.008 .089 .008 1 .929 .992

Variables not in the Equationa

Score df Sig.

VAR00001 1.521 1 .217

VAR00002 .058 1 .810

VAR00003 1.521 1 .217

VAR00004 .423 1 .515

VAR00005 1.178 1 .278

VAR00006 .855 1 .355

VAR00007 .006 1 .940

VAR00008 .855 1 .355

VAR00009 .006 1 .940

Step 0 Variables

VAR00010 1.521 1 .217

a. Residual Chi-Squares are not computed because of redundancies.

Block 1: Method = Enter

Omnibus Tests of Model Coefficients

Chi-square Df Sig.

Step 7.725 6 .175

Block 7.725 6 .175

Step 1

Model 7.725 6 .175

Model Summary

Step -2 Log likelihood Cox & Snell R

Square Nagelkerke R

Square

1 685.415a .015 .020

a. Estimation terminated at iteration number 3 because parameter estimates changed by less than .001.

Classification Tablea

Predicted

Group

Observed Group 1 Group 2

Percentage Correct

Group 1 150 101 59.8 Group

Group 2 133 116 46.6 Step 1

Overall Percentage 53.2

a. The cut value is .500

Variables in the Equation

B S.E. Wald df Sig. Exp(B)

VAR00001 -.137 .064 4.558 1 .033 .872

VAR00002 -.056 .096 .335 1 .563 .946

VAR00004 .121 .099 1.474 1 .225 1.128

VAR00005 .104 .059 3.109 1 .078 1.109

VAR00006 .090 .068 1.740 1 .187 1.094

VAR00007 -.058 .070 .691 1 .406 .944

Step 1a

Constant -.294 .417 .496 1 .481 .746

ANNEXURE – V-A

MAHARASHTRA REGION DIVISION

1. Konkan Region also called as the Konkan coast or Karavati, is

a rugged section of the western coast line of India from Raigad to

Mangalore. Konkan is also one of six administrative sub-divisions of

the State of Maharashtra comprising of the coastal districts. The

Maharashtra Konkan Districts are Sindhudurg, Ratnagiri, Raigad which

includes Alibag, Colaba, Mumbai Urban, Mumbai Suburban and

Thane.

2. Western Maharashtra is also called as desh means country

which is a Sanskrit word. This region of Maharashtra state is in central

India. Western Maharashtra is bounded on the west by the western

ghats or the Sahyadri range, on the north by the Kandesh and on the

east by the Marathwada regions of Maharashtra and on the South by

the State of Karnataka. The region of Western Maharashtra includes

Pune, Kolhapur, Satara and Sangli.

3. Marathwada has its origin in the word Bara – Hatti – Vada

meaning a region of Dhangar community. On August 15, 19o47 India

received its independence from the British Raj, Nizam ruling at that

time chose to merge with Hyderabad State into India. Subsequently on

November 1, 1956. Marathwada was transferred to Bombay State.

Bombay State was then divided into Maharashtra and Gujarat State.

Marathwada becoming a part of the former. The districts under this

region are Aurangabad, Nanded, Latur, Jalna, Beed, Parbhani,

Osmanabad, Hingoli.

4. Vidarbh: In 1956 Vidarbha was transferred to Bombay State

alongwith all Marathi speaking area. In 1960 Bombay State was split

along linguistic lines into the States of Maharashtra and Gujarat.

Marathi speaking Vidarbha became part of the state of Maharashtra

and Gujarat. Marathi speaking Vadarbha became part of the state of

Maharashtra. Vidarbha occupies 31.6% of total area and holds 21.3%

of total population of Maharashtra. It is the eastern region of

Maharashtra and is made up of the Nagpur and Amravati Division. The

eleven districts of Vidarbha Region include Nagpur, Amravati, Akola,

Buldhana, Washim, Yavatmal, Wardha, Chandrapur, Gadchiroli,

Bhandara and Gondia.

5. Khandesh/Northern Maharashtra is a region of Central India,

which forms the northwestern portion of Maharashtra state. Originally

the Khandesh state was found and ruled by Taruqi dynasty with capital

at Burhanpur. During 1388 to 1888 the Khandesh State covered the

areas of the today’s Jalgaon, Dhule, Nandurbar districts of

Maharashtra State and Burhanpur district of Madhya Pradesh state.

The term “Khandesh” and “Deccan” thus connote historical and

political affiliations. Khandesh lies on the North Western corner of the

Deccan plateau, in the valley of the Tapti River and is bound to the

north by the Satpura Range, to the east by the Vidarbha region, to the

South by the hills of Ajanta belonging to the Marathwada region of

Mararashtra and to the west by the Northernmost ranges of the

Western ghats and beyond them the coastal plain of Gujarat. After

India’s independence in 1947, Bombay province became Bombay

State which in 960 was divided into the linguistic states of Maharashtra

and Gujarat and Khandesh became a part of Maharashtra and now

identified as the Northern Maharashtra region. The Northern

Maharashtra includes Nashik, Dhule, Jalgaon, Nandurbar and

Ahmednagar.

Source : Maharashtra Gazetter and respective Dist. Gazetter, Government of Maharashtra.

ANNEXURE – V-B

DISTRICT DETAILS

1. Ratnagiri District is located in the South Western part of

Maharashtra state on the Arabian sea coast. The surrounding area is

bordered by the Sahyadri Hills on the East and Arabian sea on the

West. In 1948 the independent princely state of Sawantwadi was

merged with the Indian Union in 956 with Bombay Province. In 1960

with the creation of Maharashtra, Ratnagiri became a district. In 1981

Ratnagiri district was bifurcated and the new district of Sindhudurg was

created. Ratnagiri has nine tahsils of Mandangad,Dapoli, Khed,

Chiplun, Gunagar, Sangamneshwar, Ratnagiri, Lanja and Rajapur. The

total area of Ratnagiri is 8196 sq.kms. The total population is

16,96,482. The main crops being rice, mango, cashew, coconut and

the main language spoken is Marathi. It is also possesses the

distinction that Lokmanya Bal Gangadhar Tilak was born at Ratnagiri.

Ratnagiri is also famous for its alphonsa mango. Some of the main

occupations in the region of Ratnagiri is agriculture and fishing.

2. Sindhudurg is the land of culture and Natural beauty.

Sindhudurg is famous for its natural beauty like beaches, backwaters,

water falls and pilgrimage centres. Sindhudurg is also famous for its

forts, Sindhudurg one of the sea forts built in the 17th century and the

famous Padmagarh fort. The name of the fort itself is given to the

district. Sindhudurg is boarded by the Arabian Sea on the West and

the Sahyadri hills ranges to the East with a total area of 5,207 sq.km. It

is also famous for its tropical fruits such as alphonso mangoes,

cashews, jamuns etc. The talukas in Sindhudurg include Dodamarg,

Sawantwadi, Vengurla, Kudal, Malvan, Kankavali, Devgad and

Vaibhavwadi. The total population is 8,61,672. The main crops in this

region includes rice, vari, nagli, groundnut, mango, cashew, jackfruit,

coconut, beetle nut, spices.

3. Pune is well known as the ‘Queen of Deccan’ due to its scenic

beauty and rich natural resources. Pune is well known on the world

map because of its educational, research and development institutions.

The district also has an importance for its military base. The district has

geographical area of 15.642 sq.km. Pune district is bound by

Ahmadnagar district on North East, Solapur district on the South East,

SAtara district on South, Raigad district on the West and Thane district

on the North West. It is the second largest district and covers 5.10% of

the total geographical area of the state. The western region of Pune

district has talukas of Junnar, Ambegaon, Khed, Maval, Mulshi and

Velhal and the eastern part consists of talukas Shirur, Daund, Baramati

and Indapur, Bhor, Haveli, Poona City, Purandar. The total population

of Pune district is 7,232,555. The main crops of Pune district are rice,

jawar, bajra, Sugar cane, ground nut and sunflower are the main

crops.

4. Kolhapur is a district newly formed after the merger of Kolhapur

and other Indian states with the State of Bombay. It consists of 956

villages of the former Kolhapur state, five villages of the former

Kurundwad state, one village of the former Miraj Senior state and

seven villages that were formerly in the Belgaum district. It has total

area of 7692 sq.kms and sub-divisions of Karveer, Gadhinglaj,

Radhanagri, Ichalkaranji. There 12 talukas in Kolhapur they are

Karveer, Kagal, Panhala, Shahuwadi, Hatkalangale, Shirol,

Radhanagri, Bhudargad, Gadhinglaj, Gaganbawda, Aajra,

Chandangad. The total population of Kolhapur district is 35,15,413.

The main crops of Kolhapur include Sugar cane, rice, Soyabean,

ground nut. Kolhapur is also famous for certain places such as

Panhala, Jyotiba, Khidrapur, Dajipur Vishalgad, Nrusinhwadi,

Maunimath Bahubali.

5. Latur district has an ancient historical background. The King

‘Amoghvarsha’ of Rashtrakutas developed the Latur city, originally the

native place of the Rashtrakutas. Latur District is the South Eastern

part of the Maharahstra state. The distrit is situated on the

Maharashtra Karnataka boundary. On the eastern side of the Latur is

Bidar district of Karnataka whereas Nanded is on the north east,

Parbhani on the northern side, Beed on the Northwest and

Osmanabad on the western and southern side. Manjara this is the

main river. The area of Latur district is 7372 sq.kms. The total

population of the district was 2,080,285. Latur is divided into 3 sub

divisions namely Latur, Nilanga and Udgir and into 10 talukas and 10

panchayat samitis. These are Latur, Udgir, Ahmedpur, Ausa, Nilanga,

Renapur, Chakur, Deoni, Shirur Anantpal and Jalkot. The main

produce of Latur is pulses especially Toor Dal, Arhar dal or Pigeon

Peas. Latur is also a major trading center for Urad, Moon and Chana

along with Tur. There is also produce of oil seeds mainly sun flower

and soya bean, nut crackers, locks, brassware milk powder, ginning

and pressing. Some of the main attraction of Latur districts are Wadwal

Nagnath, Sai Nandanwan, it has mango plantations, water park and

amusement park, Udgir and Ausa have forts which are famous. Latur

also has good tourist attraction like Siddheshwar temple, Viraat

Hanuman, Nana Nani park etc.

6. Osmanabad district lies in the Southern part of state. It lies on

the Deccan plateau and lies in the Marathwada region. The total area

of Osmanabad is 7,512.4 sq.km (2900.6 sq.) The population of

Osmanabad is 14,86,586. The talukas of Osmanabad is Osmanabad,

Tuljapur, Omerga, Lohara, Kallamb, Bhoom, Paranda and Vashi.

Osmanabad is also famous for the Tubjapur temple of goddess

Tuljabhavani. The produce of Osmanabad are Tur dal, lemon,

sunflower oil seeds and soya bean.

7. Gadchiroli is among the most densely forested districts of India

with a forest cover of 86 percent. The protected forest “vanvaibhav”,

with 41 metres tall, 200 years old teak wood trees and bamboo forests

of Bhamragad, Etapalli are the places of pride of the district. Tender

leaves, which are used for beedi making bring in substantial revenue to

government. Fine ancient sculptures of Markanda attract researchers

from around the world. A recent finding in the district, claimed to be

eggs of dinosaur, has attracted the world’s attention. The area is

14477 sq.kms. The sub divisions are Gadchiroli, Vadsa Aheri. The

talukas are Gadchiroli, Armori, Vadsa, Kurkheda, Korchi, Dhanura,

Chamorshi, Aheri, mulchera Bhamragad, Etapalli, Sironcha. The

language spoken are Marathi, Hindi, Bengali, Telugu, Gondimali,

Chattisgadhi. The total population is 9,69,960. The main crops include

rice, maize, jowar, jawas, sesame and tur. The educational institution

scenario is not progressive with only 192 secondary schools and 15

colleges.

8. Bhandara is known as district of Ponds. Famous for bumper

crop of rice and bamboo plantations, its traditional craft of

manufacturing metal utensils and the thriving mining industry are its

principal activities. The area of Bhandara is 3890 sq;kms and the sub-

division are Bhandara, Sakoli. The talukas include Bhandara, Mohadi,

Tumsar, Sakoli, Lakhani Lakhandur, Pavani.The total population is

11,35,835. The main crops of Bhandara include rice, wheat,

sugarcane, Soyabean jowar, tur, moong, udad, chillies, seasame,

mustard. Some of the most important places Bhandara are Gaymukh,

Chandrapur, Korambhi, Nagzeera Sanctury andmemorial to first

Marathi poet Mukundraj at Pavni are some of the tourist place.

9. Nasik is bounded on the north west by the Dangs and Surat

districts of Gujarat state, on the north by the Dhulia district, on the east

by the Jalgaon and Aurangabad districts, on the South by the

Ahmednagar district and towards the South west by the Thana district.

The district derives its name from that of its headquarters town of

Nasik for the origin of which two interpretations are given. The town is

sited on the nine peaks or Navashikara and hence it has its name. The

other relates to the incident in the Ramayana where at this place

Lakshmana is said to have cut off the nose (Nasika) of Shurpanakha.

The total area being 15,582 sq.km) (6,015 sq.miles) which has a

population of 99,14,438. Nasik is primarily agrarian region. Agriculture

is still approximately 74 percen tof the total population. The main crops

include grape, onion, sugar cane, jowar, cotton, banana, chillies, wheat

rice, nagli and pomegranate. Nasik has some tourist places such as

Trimbkeshwar, Saptashringi Hill, Ram Mandir,Gangapur Vaitarana etc.

10. Ahmednagar is Maharashtra’s most advanced district in many

ways. It has the maximum number of sugar factories, perhaps to

spread the message across of ‘Rural Prosperity through Co-operation;.

The first cooperative sugar factory in Asia was established at

Pravanagar. The area of Ahmadnagar being 17034 sq.kms. The Sub-

Divisions being Shrirampur, Sangamner, Karjat Nagar. The talukas

include Nagar, Parner, Pathardi, Shewagaon, Karjat, Shreegonda,

Jamshed, Shrirampur, Nevasa, Akoli, Sangamner, Kopergaon, Rahuri,

Rahta. The total population of Ahmednagar is 40,88,077. The main

crops include sugarcane, bajra, jowar. The great tourist destinations

include the Shri Saibaba’s Shirdi, one of Ashtavinayakas at Siddhatek

and the famous Kanifnath temple, the Maldhok (Indian Bustard)

sanctuary and the Rehkuri Sanctuary.

Source : Maharashtra Gazetter and respective Dist. Gazetter, Government of Maharashtra.