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An Upswing in Rural Entrepreneurship


The vast potential for rural entrepreneurship in sectors like business, industry, and agriculture can propel development.


GS Paper-3: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment

Mains Question

Talk about the difficulties rural young entrepreneurs face in expanding their businesses and offer a comprehensive strategy that combines policy support, infrastructure development, capacity building, and the promotion of indigenous skills to increase their productivity. (250 words)

Key Takeaways

  • Rural entrepreneurship has the potential to drive development in a variety of sectors, including agriculture, business, and industry.
  • The Indian government has launched a number of flagship programmes to promote and support rural entrepreneurship, including the National Rural Livelihoods Mission (NRLM), Make in India, Skill India, Startup India, and Mudra Yojana.
  • Rural entrepreneurship still faces many obstacles despite these initiatives.

Principal Projects Promoting Rural Entrepreneurship

  1. NRLM and DDU-GKY: Since the NRLM program’s 2011 launch, millions of rural entrepreneurs have had access to funding, training, and market connections.
    1. The establishment of India’s extensive network of Self Help Groups (SHGs), which enables people to band together into small groups to save and borrow money while encouraging self-employment and entrepreneurship, was made possible in large part by NRLM.
  2. Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY), an organised programme run by NRLM, helps rural youth find employment through Public-Private Partnerships (PPPs).
  3. RSETI: The Rural Self Employment and Training Institutes (RSETI) programme, which encourages entrepreneurship, is another promising initiative.
    1. It was established in 2013 with the goal of assisting community members with microenterprise development and skill-building, resulting in better employment and entrepreneurship outcomes.
  4. Startup India: The 2016 launch of the Startup India initiative aims to encourage entrepreneurship among Indian youth.
    1. It offers a variety of incentives to startups and business owners, including free mentorship programmes, tax credits, and simpler patent registration.
  5. Deen Dayal Antyodaya Yojana (DDAY): Introduced in 2014, DDAY is a comparable programme that assists rural entrepreneurs with funding, training, and market connections.
    1. The programme focuses on providing the rural poor with sustainable means of subsistence through a variety of interventions that address supply- and demand-side barriers to livelihood promotion.
  6. ODOP: The One District One Product (ODOP) initiative also identifies products particular districts are known for and encourages their production and marketing.
    1. The initiative gives local business owners a platform to advertise their goods and facilitates job creation by utilising available resources.

Obstacles to Rural Entrepreneurship

  • Rural entrepreneurship continues to face a number of obstacles despite the existence of several flagship programmes.
  • The biggest challenges are limited financial access, poor infrastructure, and a lack of education and training.
    • According to the Periodic Labour Force Survey (PLFS) 2020–21, the share of self-employed workers in rural areas is higher than that in urban areas (61.3%), but most of them (43.48%) are own-account workers who work in small, family-based, own-account units with low investment and technical knowledge. o Rural entrepreneurs create jobs more often than they create jobs in urban areas. Most people who work for themselves are Own account employees, not employers.
    • The PLFS 2020-21 report also reveals that only 12% of independent contractors sell their entire product. A little more than 13% of self-employed people consume all of their own output.

The Way Ahead

  • To address these issues, a comprehensive strategy that combines infrastructure development, policy support, and capacity building for rural youth entrepreneurs is required.
    • In order to expand operations, support for promoting indigenous/hereditary skills is also necessary.
  • Additionally, rural entrepreneurs need to receive vocational/technical training.
  • Finally, collaborating with private entities, NGOs, and other stakeholders in shaping potential entrepreneurs’ business models, marketing strategies, and product development could help ensure rural entrepreneurship success. For instance, 69.73 percent of workers out of all rural manufacturing workers have not received any training, indicating the need for comprehensive training programmes.


  • Rural entrepreneurship has the potential to spur growth in a number of industries and business sectors, including agriculture.
  • Rural entrepreneurship has the potential to boost innovation in rural areas, reduce poverty, and empower women with the help of the public and private sectors.
  • To unleash the full potential of rural entrepreneurship, it is necessary to provide access to finance, infrastructure development, thorough training programmes, and supportive policy.In order to provide access, resources, and training for rural entrepreneurs to succeed, all stakeholders must collaborate and approach rural entrepreneurship holistically.

February 2024