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Why rural India needs to widen domains for micro-enterprises

Sanjiv Phansalkar
10th Nov 2017
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The promotion of micro-enterprises in villages to meet the large demand for livelihoods will benefit from out-of-the-box ideas that move beyond making papads and pickles.

Encouraging and financing micro-enterprises among the rural poor is today seen as a major livelihood promotion method. However, conventional wisdom of promoters has thrown up a rather limited range of activities for these micro-enterprises. As one scans the country, some limited forms of enterprises seem to dominate livelihoods promotion efforts under National Rural Livelihoods Mission (NRLM) or similar schemes. These typically cover dairy, goat rearing, backyard poultry, irrigation support for small vegetable gardens, land taken on crop-share basis, the famous PPMA (papad-pickle-masala-agarbatti) enterprises, small shops, small eateries and so on.

The typical outcomes are not very gratifying. Unless the villages are close to a busy market town or have at least periodic fairs near them, most of these domains become supersaturated, leading to low incremental incomes and low viability. The animal husbandry enterprises are well poised for survival at least in the short run, but only if functional insurance services on top of accessible veterinary services are available. The rest are, in general, problematic.

So we need to think of out-of-the-box enterprises. It is of course better to stick one’s neck out and make suggestions than to merely carp. The rest of this column is devoted to offering some ideas, which may not be entirely new, but certainly have a huge untapped potential. I am attempting to marry two concerns. The first is that the output or outcome of the enterprise should be of sufficiently high social value justifying public investment. The second is that even though the micro-enterprise produces social good, it must also offer sufficient individual benefit to a user of its product or service so that the people will be willing to pay a fee. Only then will the enterprise produce a livelihood without needing recurring public expenditure.

Bathroom enterprise

The absence of private and secure bathrooms forces rural women to take a hurried bath, perennially afraid of the male gaze. The dignity issue is as strong as the health issue. Incomplete and infrequent baths lead to diseases and troubles for women, particularly those in the reproductive age group. A safe and private space to take bath with a minimum assured quantity of water offers them a definite private benefit for which they may be willing to pay a fee.

Can there be bathroom enterprises? The public agencies can create a bathroom structure, the entrepreneur arranges to bring water for bath and ensures that the bathroom is clean, etc. She could have a two-stage fee structure — so much for ordinary water, so much for warm water, etc. The viability of these enterprises would be the highest in densely populated but water-rich regions such as eastern Uttar Pradesh, north Bihar and northern West Bengal. Multi-caste societies with much fragmentation live here, leading to greater fear of infringement of dignity of women.

Weeding enterprise

Weeds and crops both take nutrients from soil and grow. Crop productivity stands to increase if farmers remove weeds from their farms. However, the high cost of labour in weeding discourages removal of weeds. The result is that either farmers do not remove weeds at all and settle for lower productivity or take to using herbicides. The latter happens in more developed areas with higher land-man ratios.

This is unnecessary and harmful to the soil health. In fact the recent spate of accidental deaths in Yeotmal district in Maharashtra has been attributed to herbicides. The spread of herbicides is also rampant in Madhya Pradesh. Can there be an enterprise that undertakes to weed farms? It will need to acquire a repertoire of different types of mechanical weeders, which would be used as appropriate on farms of those who buy the service.

Sharing of equipment makes the technology divisible and reduces the allocated capital overhead on the price. The enterprise will provide a solution to farmers’ weed problem. Weeding charges can be pegged in relation to herbicide prices.

Tree protection enterprise

Godman Jaggi Vasudev in his Rally for Rivers and before that Madhya Pradesh Chief Minister Shivraj Singh Chouhan in his Namami Devi Narmade have been popularising tree plantations on a massive scale. But in a hot and dry country like ours, unless fledgling trees are watered during dry months and protected from predators, survival rates will plunge to single digits.

Can each village have a tree protector enterprise? Their task would be to water the planted trees and to ensure that they are guarded. The eventual ecological gains should justify a piece-rated payment from private landholders (when trees are on private lands) and from village councils (where they are on public land).

SRI planter enterprise

This is not an idle idea. The grassroots organisation Professional Assistance for Development Action (PRADAN) has actually developed and grounded some groups for doing SRI (System of Rice Intensification) plantations for a fee in Gaya district of Bihar. The equipment needed for this would be simple —ropes for line sowing; plastic trays or mats for nursery; and mechanical weeders for weeding SRI plots at specified frequency. The SRI gang gets paid either on a per acre basis or as a share of the crop as per local custom.

Organic farm materials enterprise

Many civil society organisations and some public poverty alleviation programmes are promoting farming using the least possible chemical inputs. Adopters of these practices need to use inputs and plant protection measures based on locally available resources from local flora and fauna. Both the materials needed and the processes to convert them into effective plant nutrients and protection materials are known and documented.

The trouble is that they involve so much drudgery that the average farm household tends to avoid them. Organic farming materials enterprises will take the task of producing these materials as a business, offering ecologically sustainable inputs and practices at affordable prices. Again some setup costs can be met form public funds, but the enterprise can be viable on user funds.

Escort enterprise

Adolescent rural girls drop out from middle and high schools if they have to go out of their villages to attend them. The need to walk long distances and the fear of men tends to discourage their parents from sending them. Can enterprises be created to offer the service of transport cum escort to these children? The parents themselves or a public agency on their behalf can pay monthly fees while public funds can invest in a vehicle if needed.

A larger discussion on this subject is warranted.

Can we have more ideas? These will need to be locale-specific. Hopefully a large pool of ideas coming from many people who work hard on the ground will help public agencies broaden the domains in which they support micro-enterprises.

The number of people seeking work is increasing at a fast pace while the opportunities for wage or salaried employment are much fewer. This trend is only going to strengthen as automation and technology rather than low wages drive economic growth in the country. The problem of mismatch between supply and demand of jobs is even more acute in rural India.

Livelihoods and poverty alleviation programs have therefore taken to promoting micro-enterprises of rural and urban individuals. These programs are being scaled up massively, through at times the clueless administrative machinery is comfortable only while dispensing doles. Promoters and beneficiaries could use more viable ideas and more incisive and practical promotional protocols to ensure that large-scale promotion of micro-enterprises will yield desirable results.


Disclaimer: This article, authored by Sanjiv Phansalkar, was first published in VillageSquare.in. The views expressed by the author are her own and do not necessarily reflect that of YourStory.

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