You are on page 1of 10

Meaning of Rural Entrepreneurship

Entrepreneurship emerging in rural areas is


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

All rural industries have been classified into


the following six categories:-
1.Mineral-based industries.
2.Forest-based industries.
3.Agro-based industries.
4.Engineering and non-conventional industries.
5.Textile industry (including Khadi), and
6.Service industry.
Need for Rural Entrepreneurship
The need for developing rural entrepreneurship
is to promote rural development in the country.
This is justified as follows :
Rural industries being labor intensive serve as an
antedote to the widespread problems of rural
unemployment.
It helps in reducing disparities in income
between rural and urban areas.
These industries promote balanced regional
development by dispersing industries to rural
areas.
Need for Rural Entrepreneurship contd.
Development of rural industries serves as an
effective means to build up village republics.
Rural industries also help preserve the old rich
heritage of the country by protecting and
promoting art and creativity.
Rural industrialization fosters economic
development in rural areas.
Rural industries also lead to development
without destruction.
Problems of Rural Entrepreneurship

Developing rural entrepreneurship is important but


not so easy. The general bottlenecks in the
development of village industries are :
Financial constraints.
Lack of technical know-how.
Lack of training and extension services.
Management problems.
Problems of Rural Entrepreneurship contd.

Lack of quality control.


High cost of production due to high input cost.
Lack of communication and market
information.
Poor quality of raw materials.
Lack of storage and warehouses.
Obsolete and primitive technology.
Lack of promotional strategy.
How to Develop Rural Entrepreneurship
The following measures may prove effective instruments for
developing entrepreneurship in rural areas of country :
A policy formulation for strengthening the raw material base
in rural areas in the country.
Finance for running an industry, needs to be made available
at soft and easy terms and conditions to the prospective
entrepreneurs.
Measures like common production-cum-marketing centres be
taken to solve the marketing problem faced rural industries.
Inculcate and develop entrepreneurial aptitude among
entrepreneurs to make them successful in their ventures.
How to Develop Rural Entrepreneurship
contd.
Imparting entrepreneurial education at the school,
college and University may be one of the effective
ways to inculcate the entrepreneurial attitude among
the prospective entrepreneurs in rural areas of the
country.
Disseminating information about various facilities
available for prospective entrepreneurs to set up
industries in rural areas.
The NGOs should be encouraged to contribute to
development of rural industries in the country.

You might also like