WIKEPEDIA

A social enterprise is an organization that applies commercial strategies to maximize improvements

in human and environmental well-being, rather than maximizing proits or external shareholders!
"ocial enterprises can be structured as a or-proit or non-proit, and ma# ta$e the orm o a co-
operative, mutual organization, a disregarded entit#,
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a social business, or a charit# organization!
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)an# commercial enterprises would consider themselves to have social ob*ectives, but commitment to
these ob*ectives is motivated b# the perception that such commitment will ultimatel# ma$e the
enterprise more inanciall# valuable! "ocial enterprises dier in that, inversel#, the# do not aim to oer
an# beneit to their investors, except where the# believe that doing so will ultimatel# urther their
capacit# to realize their social and environmental goals!
+he term has a mixed and contested heritage due to its philanthropic roots in the ,nited "tates, and
cooperative roots in the ,nited Kingdom, European ,nion and Asia!
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In the ,", the term is associated
with .doing charit# b# doing trade., rather than .doing charit# while doing trade.! In other countries, there
is a much stronger emphasis on communit# organizing, democratic control o capital and mutual
principles, rather than philanthrop#!
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In recent #ears, there has been a rise in the concept o social
purpose businesses which pursue social responsibilit# directl#, or raise unds or charitable pro*ects!
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ndia[edit]
In India, a social enterprise ma# be a non-proit 1on-governmental organization 21345, oten
registered as a "ociet# under Indian "ocieties 6egistration Act, &789, a +rust registered under various
Indian "tate +rust Acts or a "ection (0 :ompan# registered under Indian :ompanies Act, &;08! India
has around &-( million 134s, including a number o religious organizations and religious trusts, li$e
+emples, )os<ue and 3urudwara associations etc!, who are not deemed as social enterprises!
134s in India raise unds through some services 2oten und raising events and communit# activities5
and occasionall# products! Despite this, in India the term ="ocial Enterprise= is not widel# used,
instead terms li$e 134s and 1P4s 2non-proit organizations5 are used, where these $ind o
organizations are legall# allowed to raise und or non-business activities! :hild 6ights and
>ou and >outh ,nited are examples o social enterprise, who raise unds through their services, und-
raising activities 2organizing events, donations, and grants5 or sometimes products, to urther their
social and environmental goals!
?owever, there are social businesses with an aim or ma$ing proit, although the primar# aim is to
alleviate povert# through a sustainablebusiness model! An example is Pipal +ree @entures Private
Aimited, which trains rural #outh in various construction and inrastructure-related s$ills and has ound
a wa# or rural #outh to get out o povert#! +he compan# also provides placements to the trained
manpower to various inrastructure industries in India, thereb# creating an end-to-end sustainable
business model!
Another example o a social enterprise would be )ilaap "ocial @entures Pvt Atd based out o
Bangalore and head<uartered in "ingapore! +he# are a mission driven compan# changing the wa#
people und and impact communities in need! Ever# da#, the# connect hundreds o hardwor$ing
borrowers loo$ing to start a small business, pa# or education, install better acilities in their
households, and more C with people around the world willing to lend and rall# their riends and amil#
with as little as 6s! 099 2D(05!
In the agriculture sector, International Development Enterprises has helped pull millions o small
armers out o povert# in India!
Another area o social enterprise in India and the developing world are bottom o the p#ramid 2B4P5
businesses which were identiied and anal#zed b# :! K! Prahalad in =Eortune at the Base o the
P#ramid=! +his seminal wor$ has been a springboard or a robust area o both innovation and
academic research!
Need
Economic criteria:
:ontinuous activit# o the production andFor sale o goods and services 2rather than
predominantl# advisor# or grant-giving unctions5!
A high level o autonomyG social enterprises are created voluntaril# b# groups o citizens and
are managed b# them, and not directl# or indirectl# b# public authorities or private companies,
even i the# ma# beneit rom grants and donations! +heir members have the right to participate
2.voice.5 and to leave the organisation 2.exit.5!
A signiicant economic riskG the inancial viabilit# o social enterprises depends on the eorts
o their members, who have the responsibilit# o ensuring ade<uate inancial resources, unli$e
most public institutions!
"ocial enterprises. activities re<uire a minimum number o paid workers, although, li$e
traditional non-proit organisations, social enterprises ma# combine inancial and non-inancial
resources, voluntar# and paid wor$!
Social criteria:
An explicit aim o community benefitG one o the principal aims o social enterprises is to
serve the communit# or a speciic group o people! +o the same end, the# also promote a sense o
social responsibilit# at local level!
Citizen initiativeG social enterprises are the result o collective d#namics involving people
belonging to a communit# or to a group that shares a certain need or aim! +he# must maintain this
dimension in one orm or another!
Decision ma$ing not based on capital ownershipG this generall# means the principle o .one
member, one vote., or at least a voting power not based on capital shares! Although capital
owners in social enterprises pla# an important role, decision-ma$ing rights are shared with
other sta$eholders!
Participatory character, involving those aected b# the activit#G the users o social
enterprises. services are represented and participate in their structures! In man# cases one o the
ob*ectives is to strengthen democrac# at local level through economic activit#!
Limited distribution of profitG social enterprises include organisations that totall# prohibit
proit distribution as well as organisations such as co-operatives, which ma# distribute their proit
onl# to a limited degree, thus avoiding proit maximising behaviour!
4ngoing research wor$ characterises social enterprises as oten having multiple ob*ectives, multiple
sta$eholders and multiple sources o unding! ?owever their ob*ectives tend to all into three
categoriesG
integration o disadvantaged people through wor$ 2work integration social
enterprises or WISEs5
provision o social, communit# and environmental services
ethical trading such as air trade
Despite, and sometimes in contradiction to, such academic wor$, the term social enterprise is being
pic$ed up and used in dierent wa#s in various European countriesG
Source 9: Advantages and Barriers of Social
Entrepreneurship
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Advantages
Provides unrestricted earned income
Reduces reliance on traditional funding sources
Allows for financial self-sufficiency
Provides a better understanding of community needs
Offers more freedom to respond to community needs
Provides more flexibility in providing existing services
roadens support for your organi!ation
Expands your services to a larger constituency
Empowers clients to insist on better services" giving t#em a sense of dignity
Allows for increased and better use of financial resources
En#ances coordination between staff and board
En#ances credibility wit# ot#er funders" clients" and caregivers
S#arpens organi!ational focus
$ncreases community impact
$mproves researc#" planning" and mar%eting s%ills
Expands your most effective services
Stops or transfers wea% or duplicative services
Adds new services t#at meet emerging or growing needs
Promotes continuous learning and improvement
Barriers
Ris% of losing your nonprofit status
Possibility t#at board" staff" volunteers" clients" and ot#er sta%e#olders will oppose efforts to generate profit
and&or c#arge for services
'ime and money to start a new venture(bot# limited commodities for many nonprofits
)nreali!ed fear t#at generating revenue will reduce funding&contributions from ot#er sources
*ac% of financial support&discretionary funds for critical researc# and planning
*ac% of business s%ills among current staff and limited resources to #ire new staff
+o ,uic% return for t#e investment of money" time" and energy
-ear of financial disaster" damaged reputation" and compromised mission
.#allenge of managing t#e possibility of rapid growt#
- See more at: #ttp:&&www/ncoa/org&get-involved&funding-sustainability&01-sources-articles&source-
2-advantages-and-barriers-social-entrepreneurs#ip/#tml3st#as#/,A%!v4-v/dpuf
BENEFITS
Social enterprise can provide a range of benefits to organisations loo%ing to address social"
cultural or environmental c#allenges/
)nderta%ing social enterprise can #elp organisations ac#ieve financial independence" grow
t#eir activities" improve t#eir ability to ac#ieve t#eir aims and ma%e t#emselves a more
attractive prospect for donations/ '#ese benefits #ave t#e potential to allow t#e organisation
in ,uestion to use traditional sources of funding" suc# as c#aritable donations or government
grants" in a muc# more effective way/ 5Weisbrod, 19986/
enefits of settin! up a social enterprise
"ocial enterprises need to generate revenue or sustainabilit#, but the# also have important social
andFor environmental aims! +he re<uirement to manage this .multiple bottom line. - inancial,
social and environmental - can result in uni<ue challenges! ?owever, the abilit# to bring about
positive change to people and communities can be enormousl# rewarding and used to #our
advantage!
"ome o the beneits includeG
Emplo#ment or local people
+he long-term unemplo#ed
People loo$ing or a career change
People with learning disabilities
Disabled people
People with mental health issues
Ex-oenders
)inorit# ethnic groups
Women
>oung people - man# schools now have pupil-run social enterprises
I #ou set up a social enterprise in #our local communit#, #ou are li$el# to witness the social
beneits irst hand! "ocial enterprises need to be competitive in an# environment in which the#
operate! Attracting customers is vital to success! ?ighlighting the social andFor environmental
credentials o #our serviceFproduct, could give #ou the edge over #our competitors!
Social entrepreneurship is the process o pursuing innovative solutions to social problems! )ore
speciicall#, social entrepreneurs adopt a mission to create and sustain social value! +he# draw upon
appropriate thin$ing in both the business and nonproit worlds and operate in a variet# o
organizationsG large and smallH new and oldH religious and secularH nonproit, or-proit, and h#brid!
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Business entrepreneurs t#picall# measure perormance in proit and return, but social entrepreneurs
also ta$e into account a positive return to societ#! "ocial entrepreneurship t#picall# urthers broad
social, cultural, and environmental goals and is commonl# associated with the voluntar# and not-or-
proit sectors!
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Proit can at times also be a consideration or certain companies or other social
enterprises!
"ocial entrepreneurship practiced in a world or international context is called international social
entrepreneurship
There are continuing arguments over precisely who counts as a social entrepreneur. Thus
far, there has been no consensus on the definition of social entrepreneurship, so many
different sorts of fields and disciplines are associated with social entrepreneurship.
Philanthropists, social activists, environmentalists, and other socially-oriented
practitioners are referred to as social entrepreneurs. For a clearer definition of what social
entrepreneurship entails, it is necessary to set the function of social entrepreneurship
apart from other socially oriented activities and identify the boundaries within which
social entrepreneurs operate.[4 !ome have advocated restricting the term to founders of
organi"ations that primarily rely on earned income # meaning income earned directly
from paying consumers. $thers have e%tended this to include contracted wor& for public
authorities, while still others include grants and donations.
'uhammad (unus, founder of )rameen *an&.
!ocial entrepreneurship in modern society offers an altruistic form of entrepreneurship
that focuses on the benefits that society may reap.[+ !imply put, entrepreneurship
becomes a social endeavor when it transforms social capital in a way that effects society
positively.[, -t is viewed as advantageous because the success of social entrepreneurship
depends on many factors related to social impact that traditional corporate businesses do
not prioriti"e. !ocial entrepreneurs recogni"e immediate social problems, but also see& to
understand the broader conte%t of an issue that crosses disciplines, fields, and theories.[,
)aining a larger understanding of how an issue relates to society allows social
entrepreneurs to develop innovative solutions and mobili"e available resources to impact
the greater global society. .nli&e traditional corporate businesses, social entrepreneurship
ventures focus on ma%imi"ing gains in social satisfaction, rather than ma%imi"ing profit
gains.[/ *oth private and public agencies worldwide have had billion-dollar initiatives to
empower deprived communities and individuals.[, !uch support from organi"ations in
society, such as government-aid agencies or private firms, can cataly"e innovative ideas
to reach a larger audience.
Prominent innovators associated with the term include Pa&istani 0&hter 1ameed 2han
and *angladeshi 'uhammad (unus. (unus was the founder of )rameen *an& which
pioneered the concept of microcredit for supporting innovators in multiple developing
countries in 0sia, 0frica and 3atin 0merica.[4 1e received a Nobel Peace Pri"e for his
efforts, and also inspired programs such as the -nfolady !ocial 5ntrepreneurship
Programme.[6[78[77 $thers, such as !tephen )oldsmith, former -ndianapolis mayor,
focused social efforts on a more local level, engaging the private sector in providing
many city services.[79[7:
History[edit]
"ocial entrepreneurship is distinct rom the concept o entrepreneurship itsel, #et still shares several
similarities with the classic concept! Iean-Baptiste "a#, a Erench economist, deined an entrepreneur
as a person who Junderta$esK an idea and shits perspectives in a wa# that it alters the eect that an
idea has on societ#!
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?owever, the dierence between JentrepreneurshipK and Jsocial
entrepreneurshipK stems rom the purpose o a creation! "ocial entrepreneurs see$ to transorm
societies at large, rather than transorming their proit margin li$e classic entrepreneurs t#picall# see$
to do!
+he concept o Jsocial entrepreneurshipK is not a novel idea, but it has recentl# become more popular
among societ# and academic research, notabl# ater the publication o J+he 6ise o the "ocial
EntrepreneurK b# :harles Aeadbeater!
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)an# activities related to communit# development and higher
social purpose all within the modern deinition o social entrepreneurship! Despite the established
deinition nowada#s, social entrepreneurship is a diicult concept to deine, since it can be maniested
in multiple orms!
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A broad deinition o the concept allows interdisciplinar# research eorts to urther
understand and constantl# challenge the notion behind social entrepreneurship! 1o matter which
sector o societ# certain organizations are in 2i!e! corporations or unincorporated associations and
societies5, social entrepreneurship ocuses on the social impact that an endeavor carries!
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Whether
social entrepreneurship is altruistic or not is less important than the eect it has on societ#!
+he terms social entrepreneur and social entrepreneurship were used irst in the literature on social
change in the &;89s and &;L9s!
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+he terms came into widespread use in the &;79s and &;;9s,
promoted b# Bill Dra#ton the ounder o Asho$aG Innovators or the Public,
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and others such as
:harles Aeadbeater!
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Erom the &;09s to the &;;9s )ichael >oung was a leading promoter o social
entrepreneurship and in the &;79s was described b# Proessor Daniel Bell at ?arvard as .the world.s
most successul entrepreneur o social enterprises. because o his role in creating more than sixt# new
organizations worldwide, including the "chool or "ocial Entrepreneurs 2""E5 which exists in the ,K,
Australia and :anada and which supports individuals to realize their potential and to establish, scale
and sustain, social enterprises and social businesses! Another notable British social entrepreneur
is Andrew )awson 4BE, who was given a peerage in (99L because o his regenerationwor$ including
the Bromle# b# Bow :entre in East Aondon!
Although the terms are relativel# new, social entrepreneurs and social entrepreneurship can be ound
throughout histor#! A list o a ew noteworth# people whose wor$ exempliies the modern deinition o
=social entrepreneurship= includes Elorence 1ightingale, ounder o the irst nursing school and
developer o modern nursing practicesH 6obert 4wen, ounder o the cooperative movementH
and @inoba Bhave, ounder o India.s Aand 3it )ovement! During the nineteenth and twentieth
centuries some o the most successul social entrepreneurs eectivel# straddled the civic,
governmental, and business worlds! "uch pioneers promoted ideas that were ta$en up b# mainstream
public services in welare, schools, and health care!
"ypes of social entrepreneurship[edit]
At the heart o social entrepreneurship is the innovation o novel social capital to create more
communit#-based agenc# or obtaining assets in individual lives!
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Private corporations ocused solel#
on proit and nonproit organizations 2134s5 that are ocused solel# on social impact are two extremes
in the nuanced spectrum o social entrepreneurship, but other t#pes o social entrepreneurs with
dierent visions or their enterprises exist!
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+his can range rom individuals see$ing to allow solel# or
societ# to proit even at a proit loss, to individuals that ocus on simultaneousl# proiting both
themselves and societ#! In either case, individuals are at ris$ or personal proit loss! +here is a trend
in organizations, especiall# private organizations that combine traditional interest in
corporate proit gain with a desire to create social enterprises that have meaningul social impacts that
are innovative in societ#! +he complexit# o deining the t#pe o social entrepreneurship can also
increase when boundaries cross! Eor example, certain non-proit organizations ma# have initiatives
that generate revenue but onl# or the purpose o their social enterprise! Additionall#, or-proit
organizations ma# be ocused primaril# on gaining proit, but arrange some o their proits or sociall#
impactul activities!
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Case studies[edit]
"he #lobal Social enefit $nsitute %#S$&'[edit]
+he 3"BI empowers social entrepreneurs b# pairing them with "ilicon @alle# executive mentors to
reine their business models and identi# growth opportunities! It is one o the pioneer accelerators and
social entrepreneur ecos#stem builders, dedicated to empowering social enterprises li$e World Wide
?earing, Komaza, "an$ara E#e :are, Kiva, all 3"BI alumni!
(orld (ide )earin![edit]
When we thin$ o hearing loss, we ma# thin$ o it as a problem that aects onl# the aging population!
?owever, over &79 million children worldwide are born with hearing loss and have ew resources to
better their condition !Audra 6e#ni, Executive Director o World Wide ?earing, explains that, JWhen
children are born with hearing loss, the# are born into silence! ?earing can be the dierence o having
a chance at lie, or having missed opportunities!K
World Wide ?earing provides access to aordable, high <ualit# hearing aids or low-income children
with hearing loss in developing countries! +he# do this b# training local emale entrepreneurs to
provide the hearing aids and services! +he# are currentl# active in Iordan and are optimistic o where
the uture can ta$e them! Audra participated in the 3lobal "ocial Beneit Institute 23"BI5 Accelerator
program and viewed it as a huge push at a crucial time! 3"BI has provided strategic advice at a time
when World Wide ?earing has the capabilit# to scale in a big wa#!
*omaza[edit]
+evis ?oward, a Ba# Area native, too$ a gap #ear and went to Ken#a to do )alaria research! During
about a #ear and a hal o living there, he saw <uite a bit o povert# and transitioned rom science to
social entrepreneurship! +evis had the uni<ue idea o planting trees in order to help dr#land armers
out o extreme povert#! +his spar$ed the beginnings o Komaza!
Komaza, a 3"BI social enterprise graduate, oers a partnership that motivates armers to plant trees
and short-term crops that, in turn, provide decades o lie-changing income! Dr#land armers are the
poorest people on earth, and the# are struggling to grow crops on bad soil with no rain! East Arica is
currentl# acing a multibillion dollar wood mar$et ailure, there are tens o millions o amilies on dr#
lands living in extreme povert#!JDeorestation is intrinsicall# lin$ed with povert#,K +evis shared! JWeMre
tr#ing to brea$ that c#cle b# doing the obvious thingG b# planting trees!K
Sankara Eye Care[edit]
JWhen someone is in dar$ness, the# arenMt able to move, the# arenMt able to do their dail# chores, the#
become dependent!K 4ne-ourth o the worldMs blind population is in India and 79N o this blindness is
curable! Bharath Balasubramaniam, President o :ommunit# 4utreach at"an$ara E#e :are, explained
what "an$ara E#e :are is doing to tr# to end curable blindness!
+he# have outreach camps and bring e#e care services to those in the rural areas! I necessar#, the#
will bring the patients bac$ to their ull hospitals and the patients receive ever#thingCsurger#, ood,
roomC completel# ree o charge, and then are ta$en bac$ into their village! When the# are bac$ in
their village, "an$ara also goes bac$ or post-op care! +here is no cutting corners or s$imping on
<ualit# in order to $eep the services ree!
"an$ara E#e :areMs mission is to eliminate curable blindness across India b# scaling to (9 "an$ara
:ommunit# E#e ?ospitals, serving over a million rural poor ever# #ear! +he 3lobal "ocial Beneit has
been able to aid in this mission b# providing "ilicon @alle# executives as mentors or Bharath! ?is
mentors have helped him understand the variable options that are available or unding and identi#
which opportunities are plausible! Another wa# the program helped Bharath was distinguishing the
dierences between mar$eting and sales! JIt was a little conusing or us! We were blending and
mixing the two, so now I have better clarit# o which is which and what I need to loo$ at once I get
bac$,K ?e said! +he program was ver# educational and now he has a better idea o what needs to be
done in order or his vision to become a realit#!
+shoka: $nnovators for the Public[edit]
Asho$a is an example o a non-proit organization ocused on building social entrepreneurs through its
s#stem o social venture capital!
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Asho$a was ounded b# Bill Dra#ton in &;7& in Arlington, @A!
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Asho$a.s motto is =Ever#one a :hangema$er,= and lies at the heart o all o the wor$ the
organization! Essentiall#, Asho$a.s primar# mission is to simultaneousl# empower individuals with the
capacit# to become social innovators and to solve societal problems in such a wa# that all members o
societ# can have a voice - even previousl# marginalized populations! With a strong international
presence in over L9 countries, the organization see$s to identi# entrepreneurs through various
iniatives at various ages and stages in lie, deeming them =Asho$a Eellows!= 4ne o Asho$a.s iniatives,
the :hangema$ers program, hosts collaborative competitions that challenges budding entrepreneurs
to come up with innovative solutions to global issues!
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Additionall#, Asho$a also operates on a
universit#-level through its Asho$a , initiative, wor$ing with universit# oicials and administrators to
develop programs that encourage and nurture students that are interested in social entrepreneurship!
In targeting various age groups, Asho$a see$s to identi# and empower social entrepreneurs to
promote positive change in societ#!
#loira de Souza: first +shoka ,ellow[edit]
According to Bill Dra#ton, the individuals Jwho %possess' the creativit#, savv#, and determination to
realize their ideas on a large scaleK are the social entrepreneurs who will have the most impact in their
world
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+he irst Asho$a ellow chosen whom he believed displa#ed these characteristics was 3loria
de "ouza, a ort#-ive-#ear-old Indian elementar# school teacher whose vision brought positive
changes to her communit# and to her countr# as a whole!
It all began ater De "ouza attended a conerence on experiential education and environmental
education! Ater internalizing what she had learned and realizing the impact this dierent wa# o
teaching could have on the teachers and children o India, she started to incorporate the techni<ues
she had learned in her own classroom C with stunningl# positive results! Enthusiastic over her
success, she began sharing her indings with colleagues onl# to be met with criticism, s$epticism, and
resistance! ,ndaunted b# the lac$ o support, de "ouza embar$ed upon what would become a ight to
reorm IndiaMs education s#stem and help students gain the most out o their learning experience! Ater
being discovered and supported b# Asho$a in &;7&, de "ouza resigned rom teaching and ounded
Paisar Asha, an organization devoted to her cause! Aess than ten #ears later, what started as an idea
in one teacherMs head had grown to become the oicial curriculum or grades &-- in India, a s#stem
used b# almost a million students
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3loria de "ouzaMs was a maveric$ whose determination and
persistence and dream or change made her a trul# successul social entrepreneur!
,-bio .osa[edit]
Brazilian social entrepreneur EObio 6osa was instrumental in improving Brazilian armersM <ualit# o lie
through rural electriication initiatives! ?is incredible creativit#, unwavering pragmatism, and
indeatigable perseverance enabled him to succeed in the ace o enormous obstacles!
When 6osa encountered a problem, he insightull# identiied and attac$ed the root cause rather than
the s#mptoms! Eor example, when he observed the povert# o rural rice armers in the municipalit#
o Palmares do "ul, he realized that the# were orced to bu# water at exorbitantl# high rates rom the
landowners who controlled it! According to 6osa, JWithout water there was no production! And without
production there was no wealth!K
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Artesian wells were a possibilit#, but rural arms did not have the
electricit# necessar# to operate the pumps! ,ndaunted, 6osa developed a s#stem or economicall#
carr#ing electricit# to rural arms b# using simple monophase current and cheap components! Access
to aordable electricit# gave poor, rural armers access to cheap irrigation as well, dramaticall# raising
their standard o living!
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6osaMs pragmatic approach motivated him to not onl# bring electricit# to
armers at reasonable rates, but also to ma$e it a worthwhile investment or them b# coupling it with
the beneit o inexpensive irrigation!
Aater, 6osa sought to provide rural Brazilian armers with solar energ#! +o oset the high installation
costs, he integrated the electricit# generation s#stem with relativel# cheap electric ences! Access to
cheap encing empowered armers to prevent their cattle rom overgrazing, thereb# increasing their
landMs productivit#!
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Again, b# combining two seemingl# dissimilar #et mutuall# s#nergizing products
into a single, mar$etable solution, EObio 6osa multiplied his abilit# to positivel# change the lives o
Brazilian armers! ?is success must be attributed at least in part to his perceptive abilit# to ta$e two
seemingl# uneasible and unrelated ideas and merge them into a single, viable solution capable o
bringing great good to the underserved!
http;<<www.floorit.info<inde%.php<human-resource<humar-resource<entrepreneurship<44/-
rural-entrepreneurship
=ural 5ntrepreneurship
Print 5mail >etails ?ritten by 2annan 1its; 76//

-n simple words, rural entrepreneurship implies entrepreneurship emerging in rural areas.
@orA rural entrepreneurship means rural industrialisation. -ndustrialisation cannBt originate
@orA sustain without entrepreneurship whether rural @orA urban.
Thus we can say, entrepreneurship precedes industrialisatio. =ural entrepreneurship is
the only soluction to rural poverty and bac&wardness.
=ural industries are generally associated with agriculture. 0ccording to &hadi and village
industries commission @2C-DA, Evillage industry @orA a rural industry means industry
located in rural areas, population of which doesnBt e%ceed 78888 @orA such figure which
produces any goods @orA renders any services with @orA without use of power and in which
the fi%ed capital investment perhead of an artisan @orA a wor&er doesnBt e%ceed 7888
rupeesB. 0s per the modified definition, an industry located in rural area, village @orA town
with a population of 98888 and below and an investment of =!.: crores in @plant and
machinery, land and buildingA is classified as village industry.
Features of rural industry;
0griculture and rural development are the main stay growth strategy. 0s far as meaning
of rural industrialisation is concerned, there are conceptual difficulties in defining it as
such. 1owever, it is generally ta&en as a group of traditional industries li&e handloom,
&hadi, handicraft, sericulture and coir. 0ll these are classified as rural industries although
some of them li&e handloom, handicrafts, coir etc. are located in urban areas as well. 0
rural industry has following features;
Cery low investment.
3ow gestation period.
.se of traditional s&ills.
>ecentralised production system.
Products are rither essential mass consumer goods @orA handicrafts.
.se of locally available raw-material @in a few casesA.
Dater to limited mar&ets.
Products are becoming popular in foreign mar&ets for their unFue nature and aesthetic
nature.
What are the different types of rural
entrepreneurs?
India is a country of villages. About three-fourth of India's population are living in rural areas out of
which 75% of the labour force is still earning its livelihood from agriculture and its allied activities.
Land being limited is unable to absorb the labour force in agriculture. herefore! there is a need to
develop rural industries to solve rural unemployment and rural migration to cities. "rowth and
development of rural economy is an essential pre-condition to development of the nation as a whole.
he gap between rural urban disparities should be lessened.
he standard of living of the rural people should be increased. #ntrepreneurship in rural sector
provides an answer to the above problems. Indian rural sector is no longer primitive and isolated.
herefore! entrepreneurship in the rural and tribal areas looms large to solve the problems of poverty!
unemployment and bac$wardness of Indian economy. %ural industrialisation is viewed as an effective
means of accelerating the process of rural development. "overnment of India has been continuously
assigning increasing importance and support for the promotion and growth of rural entrepreneurship.
&eaning'
%ural entrepreneurs are those who carry out entrepreneurial activities by establishing industrial and
business units in the rural sector of the economy. In other words! establishing industrial and business
units in the rural areas refers to rural entrepreneurship. In simple words! rural entrepreneurship
implies entrepreneurship emerging in rural areas. (r! say! rural entrepreneurship implies rural
industrialisation. hus! we can say! entrepreneurship precedes industriali)ation.
*efinition'
%ural industries and business organisations in rural areas generally associated with agriculture and
allied activities to agriculture. According to +,I- .+hadi and ,illage Industry -ommission/! 0village
industries or %ural industry means any industry located in rural areas! population of which does not
e1ceed 23!333 or such other figure which produces any goods or renders any services with or without
use of power and in which the fi1ed capital investment per head of an artisan or a wor$er does not
e1ceed a thousand rupees0.
he modified definition of rural industries has been given by "overnment of India in order to enlarge
its scope. According to "overnment of India! 0Any industry located in rural area! village or town with a
population of 43!333 and below and an investment of %s. 5 crores in plant and machinery is classified
as a village industry.0
ypes of %ural Industries'
All the village industries come under the following broad categories '
Agro Based Industries: li$e sugar industries! 6aggery! oil processing from oil seeds! pic$les! fruit
6uice! spices! diary products etc.
Forest Based Industries: li$e wood products! bamboo products! honey! coir industry! ma$ing
eating plates from leaves.
Mineral based industry: li$e stone crushing! cement industries! red o1ide ma$ing! wall coating
powders etc.
Textile Industry: li$e spinning! weaving! colouring! bleaching.
Engineering and Servies: li$e agriculture e7uipments! tractors and pumpsets repairs etc.