Entrepreneurship Among Women:
Problems and Prospects
Introduction
Entrepreneurship
is considered as one of the most important factors contributing to the economic
development of the society. Promotion of entrepreneurship among women is a
major step to increase women participation in economic development. Although women
constitute half of the total population in the world, their participation in economic activities
are relatively low. For centuries, women became victim of social prejudices and
discrimination. Women in traditional societies are still confined to the four
walls of their home, children, household affairs and family rituals. In several
developing countries marriage and family life is the only career for most
women. However, with the increasing empowerment of women in the world, now no
job, profession or enterprise is such which women cannot undertake. In recent
years women have made their mark in different walks of life and are competing
successfully with men despite the social, psychological and economic barriers.
This has been possible due to education, political awakening, urbanization,
legal safe-guards, social reforms, etc. Women have distinguished themselves in
many unconventional fields as Prime Minster, Chief Ministers, Governors, Vice-Chancellors,
ambassadors, scientists, pilots, administrators and also as entrepreneurs.
Entrepreneurship
is today a buzzword in the changing economy. It is a purposeful activity
initiating, promoting and maintaining economic growth. Entrepreneurship is not
new to our culture. What it needs today is to nurture this spirit and instill
it in the present and coming generations of both men and women. It is said that
if a man starts a business venture he only becomes the entrepreneur, while when
a women takes to entrepreneurship the whole family becomes entrepreneurial in
its behaviour and outlook. Therefore, if women gain economic strength, they
gain visibility and voice. With the economic restructuring and societal
acceptance in the modern days, women have started establishing and running
enterprises successfully. Though women entrepreneurship is in its infancy and
transition period, it is all set to go a long way.
Women Entrepreneurship in the Global
Environment
In
the advanced countries of the world, where the supporting conditions have been
favourable there is a phenomenal increase in the number of
self-employed women entrepreneurs. There
exists a congenial climate for women entrepreneurship in these countries which
have witnessed rapid industrial growth. In the United States women entrepreneurs
have emerged as the fastest growing group of entrepreneurs. They own 25 percent of all business in the country. In Canada , women
own one-third of small businesses and in France it is one-fifth. Women entrepreneurs
have been making a significant impact in all segments of the economy in Canada , Great Britain , Germany , Australia and
the U.S.
However, the growth rate in women owned enterprises in some of the developing
countries are higher as compared to the developed countries. The ILO statistics
shows a growth rate of 24 percent in Malaysia , 30 percent in Thailand , 36
percent in Philippines
and 42 percent in Indonesia .
The areas chosen by women are retail trade, restaurants, hotels, education,
cultural, cleaning, insurance and manufacturing. The Global Entrepreneurship
Monitor (GEM) study has estimated the highest levels and lowest levels of
entrepreneurship among women in
different countries during 2002 which can be seen from table 1.
Table 1: Levels of Women Entrepreneurship
|
Highest Levels
|
Lowest
Levels
|
|
|
Japan (0.6 percent)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
|
|
|
|
|
|
|
|
|
|
|
|
U.S (8.1 percent)
|
|
Source: The
Global Entrepreneurship Monitor Study, 2003.
Women Entrepreneurship in India
Participation
of women in entrepreneurial activities in India is comparatively a recent
phenomenon. Women participation in entrepreneurship has increased from 4
percent in 1980 to 13 percent in 2000. Figures
relating to 1990 reveal that there are around 1,54,000 women entrepreneurs claiming
9.01 percent of the total 1.70 million entrepreneurs in the country. By 1995-96
this number rose to 2,95,680 claiming 11.2 percent of the total 2.64 million
entrepreneurs in India .
Economic, social, cultural and psychological factors have not been favourable
to entrepreneurship development in India , in general and development
of women entrepreneurship in particular. Non-availability of employment
opportunities to women in the organized sector, large scale illiteracy among
women (46 percent ) compared to their male counterparts (25 percent), their
much lower work participation rates (30 percent) and nearly 70 percent of the
female population still residing in the rural areas are some of the facts and
figures confirming the comparatively disadvantageous position of the Indian
women.
In
India ,
marriage and family life have been the only career for most women. Even those
professionally involved have been confined to selected areas such as teaching,
office work, nursing, medicine etc. Rarely they entered professions like
business, industry, trade and engineering. However, the modern Indian women
especially in the cities are exposed to education and training. Over the years
the educated women have become ambitious, acquired basic skills, competency and
self-assurance. Experience has shown that women have excelled in the jobs which
were hitherto the monopoly of men. However, women entry into business is a
recent phenomenon in India
and it could be traced out as an extension to their kitchen activities. Spread
of education among women and growing awareness about business during the recent
past have led to their large scale participation in business activities and their
proven capabilities in many sectors. Due to the encouragement given by the government
as well as other positive factors, the number of women entrepreneurs is growing
but slowly. However, compared to the elite, educated and upper-middle class
women especially in the cities and towns, the number of women entrepreneurs
belonging to the rural areas is very small.
Today women entrepreneurs represent a group of
women who have broken away from the beaten track and are exploring new avenues of economic development. The number of women
entrepreneurs have grown over a period of time and it is clear that the
percentage is increasing every year. If prevailing trend continues it is not
unlikely that in another five years women will comprise about 20 percent of the
total entrepreneurial force in India .
We find women in different types of industries, traditional as well as
non-traditional such as engineering, electronics, ready-made garments, fabrics,
handicrafts, doll-making, poultry, plastics, soap, ceramics, printing,
toy-making, nurseries, crèches, drugs, textile designing, dairy, canning,
knitting, jewellery design, fancy items, beauty parlours etc. Self-motivation, social
status, dynastic compliance, natural succession, government incentives and
encouragement, fulfilling their own and spouse dreams, inspiration from other’s
success, the challenge and adventure to do something new, liking for business,
wanting to have an independent occupation and the need for additional income to
maintain high living standards are some of the attractive leverage for women to
start their own enterprises.
Successful Women Entrepreneurs:
It is interesting to note that since the
inception of the national awards to small entrepreneurs instituted in 1983, ten
women entrepreneurs have received
special recognition awards from the Government of India. The 25 leading women
entrepreneurs in India
in 2004, according to the study made by Business Today is presented in table 2.
These 25 individuals lend credence to the fact that it is not just the idea
which is required to be successful. They thrived in an environment that was
conducive to and nurturing of the entrepreneurial spirit. These women
entrepreneurs have attributed their success in their enterprise to hard work,
dedication, determination, and self-confidence. Most important factor is their
compelling urge of wanting to do something positive to prove themselves.
Table 2: The 25 Leading Women
Entrepreneurs in India
|
1
|
Amrita Patel(60)
|
Chairperson, National Dairy
Development Board
|
|
2
|
Anu Age(62)
|
Chairperson, Thermax
|
|
3
|
Chanda Kochhar(42)
|
Executive Director, ICICI Bank
|
|
4
|
Dipti Neelakantan(46)
|
Chief Operating Officer, J.M.
Morgan Stanley
|
|
5
|
Gita Piramal(50)
|
Managing Editor, Smart Manager
& Director, Corp. Comm., Blow Plast
|
|
6
|
Hema Ravichandar(43)
|
Senior Vice-President and Group
Head, HRD, Infosys Technologies
|
|
7
|
Kalpana Morparia (55)
|
Deputy Managing Director, ICICI
Bank
|
|
8
|
Kavita Hurry (42)
|
Managing Director, ING Vysya
Mutual Fund
|
|
9
|
Kiran Mazumdar-Shaw (51)
|
Chairperson and Managing
Director, Biocon
|
|
10
|
Lalita Gupta(55)
|
Joint Managing Director, ICICI
Bank
|
|
11
|
Madhabi Puri Buch(38)
|
Country Head, Operations &
Service Delivery, ICICI Bank
|
|
12
|
Mallika Srinivasan(44)
|
Director, Tractors and Farm
Equipment
|
|
13
|
Naina Lal Kidwai(47)
|
Deputy CEO, HSBC
|
|
14
|
Preetha Reddy (47)
|
Managing Director, Apollo
Hospitals Group
|
|
15
|
Priya Paul(38)
|
Chairperson, Apeejay Surrendra
Park Hotels
|
|
16
|
Renu Karnad(52)
|
Executive Director, HDFC
|
|
17
|
Renuka Ramnath(43)
|
CEO, ICICI Venture
|
|
18
|
Shobhana Bhartia(47)
|
Vice-Chairperson, The
|
|
19
|
Shikha Sharma(46)
|
CEO, ICICI Prudential Life
Insurance
|
|
20
|
SulajjaFirodia Motwani (34)
|
Joint Managing Director,
Kinetic Engineering
|
|
21
|
Sunita Narain(43)
|
Chairperson, Centre for Science
and Environment
|
|
22
|
Swati Piramal (48)
|
Head, Strategic Alliances and
Comm., Nicholas Piramal
|
|
23
|
Vedika Bhandarkar(36)
|
MD & Head, Investment
Banking, J.P. Morgan India
|
|
24
|
Vidya Chhabria(54)
|
Chairperson, Jumbo Group
|
|
25
|
Zia Mody (48)
|
Corporate Lawyer, AZB &
Partners
|
Source: Business Today,
September, 2004.
Note: Name’s are mentioned in alphabetical order
and figures in parenthesis indicates
age of women entrepreneurs.
Problems of Women Entrepreneurs
The
basic problem or difficulty of a women entrepreneur is that she is a woman. This
pertains to her responsibility towards family, society and work. The attitude
of society towards her and constraints in which she has to live and work are
not very conducive. The attitude of men is not only tradition-bound but even of those
who are responsible for decision making is not of equity. This attitude of reservation creates
difficulties and problems to women entrepreneurs at all levels, i.e., family support, training, banking, licensing
and marketing. Research investigation states women’s experiences of starting
and running business that although their motivations are very similar to those
of male entrepreneurs, many of the barriers and constraints that they
experience are gender specific.
Women
entrepreneurs encounter two types of problems in setting-up and running their
enterprises. Firstly, they face the general problems, faced by all
entrepreneurs and secondly, the problems specific to women. The general
problems relate to raw materials, operations, marketing, finance,
infrastructure, manpower, promotional procedures, difficulties in availing government
concessions and subsidies etc. Problems specific to women are lack of economic
independence and autonomy, family ties and responsibilities, social attitudes,
less risk-bearing capacity, low access to government support, feeling of
insecurity, poor managing ability, lack of education, lack of technical skills, lack of sufficient business
training, lack of business information and experience etc. Some of the problems
have been overcome by women entrepreneurs due to the technological advancement
and information technology explosion. However, along with the technological and
IT revolution, mental revolution of the society is required to provide a democratic
platform for women entrepreneurship.
Prospects of Women Entrepreneurs
The
women entrepreneurship movement has taken-off the ground and it is felt that
the movement has crossed the stage of transition. It is only during the last 15
years, women have started becoming entrepreneurs and started industries and
business and they are yet to go a long way to be on par with men. The new
industrial policy of Government of India has stressed the need for conducting
special entrepreneurship programmes for women. Product and process-oriented
courses are to be conducted to enable women to start small scale industries.
The policy further adds that the objective of such courses should be to give representation to women in the
field. So, small industry development is a step to uplift women entrepreneurs
status in the economic and social fields. The new industrial policy concedes
that merely making large resources allocation for women within the prevailing
pattern and structure of development would not yield the desired results. The
policy has the strategy for the holistic development of women.
In
India ,
several institutional arrangements have been made to protect and develop women entrepreneurship. The
nationalized banks and State Financial Corporations advance loans to women
entrepreneurs on preferential basis. State Industrial Development Corporations
and District Industrial Centres provide loans, subsidies and grants to small
scale women entrepreneurs. State level agencies assist women entrepreneurs in
preparing project reports, purchasing machinery, hiring of buildings and
training staff. The Ministry of Industry has taken the initiative to train one
lakh women entrepreneurs to take up trade related activities in six selected
project lines such as processed food, forest produce collection, leather, ready
made garments and coir.
With the growth of women entrepreneurs a few
associations of women entrepreneurs have been set-up both at international and
national levels to create a congenial environment for developing women
entrepreneurship in rural and urban areas. Some of the associations of
women entrepreneurs in India are Women
Entrepreneurs Wing of NAYE, Indian Council of Women Entrepreneurs, FICCI Ladies
Organization (FLO), National Commission
on Self-Employed Women in the Informal Sector, World Association of Women
Entrepreneurs (WAWE) and Associated Country Women of the World (ACWW). In
addition to the above, there are State level associations of women
entrepreneurs.
Government Initiatives
The
Government of India has been encouraging self-employment and has started
several schemes to promote entrepreneurship among women. Various income
generating schemes like Support to Training and Employment Programme (STEP),
Swavalambana Socio-Economic Programme, Pradhan Mantri Gram Swarozgar Yojana,
Pradhan Mantri Shahri Swarozgar Yojana, Jana Shikshan Sansthan (JSS) etc. have
been launched to this end. Women are encouraged to organize and form Self Help
Groups (SHGs) and Cooperatives which undertake activities to generate income
for the most vulnerable groups of women. Rastriya Mahila Kosh (RMK) was set up
to provide loans to these women who could then become self employed by
establishing their own business or small scale enterprises. Women’s Development Corporations, operating in a few States in India are
promoting entrepreneurship among women at the gross root level. In this way,
women at the gross roots and other levels, who are managing small-scale
industries and enterprises are becoming economically empowered.
Government Policy since 2004 is giving more emphasis to
SSI units and many easy and innovative schemes are launched through commercial
banks / financial institutions to promote women entrepreneurship.
Ø
Promoter’s equity / margin are reduced for women
Ø
Concession in rate of interest is provided
Ø
Seed capital schemes like National Equity Fund
Scheme, wherein interest free equity type of assistance upto 25 percent of
project cost is provided.
Ø
Self Help Groups special schemes are available for
women to start SSI units, with public sector banks extending concessional rate
of interest and low margin and longer repayment period.
Ø
The Small Industries Development Bank of India (SIDBI)
has special schemes for financial and managerial assistance for women entrepreneurs
which are opened through State Financial Corporations(SFC’s), State Industrial
Development Corporations (SIDC’s), Commercial Banks, State Cooperative Banks
and Regional Rural Banks. SIDBI
refinances these institutions to the extent of the assistance they provide.
SIDBI’s Mahila Udyan Nidhi (MUN) is
operated through commercial banks exclusively for women to set up SSI units and
to start service activities.
Ø
Bank of India’s Priyadarshini Yojana provides
long term and working capital assistance to the women entrepreneurs.
Ø
Industrial Development Bank of India ’s (IDBI) Mahila Vikas Nidhi (MVN) Scheme provides seed
capital assistance to women entrepreneurs intending to set up projects in SSI
sector.
Ø
State Bank of India ’s Stree Shakti package to develop
entrepreneurship among women, conducting Entrepreneurial Development Programmes
(EDP) for women and providing financial assistance to them.
Ø
Women entrepreneurs are also eligible for
finance under the government and non-government organizations sponsored
programmes such as Prime Minster’s
Rozgar Yojana (PMRY), Self Employment Programme for Urban Poor (SEPUP),
Integrated Rural Development Programme (IRDP), Federation of Societies of Women
Entrepreneurs (FSWE), Development of Women and Children in Rural Areas (DWCRA),
Training of Rural Youth for Self Employment (TRYSEM) etc.
Conclusions
Today there is a
greater awakening among women. They have become more achievement-oriented and
career-minded. Given an opportunity, they will deliver the results. In
education, they have not only excelled but also became the top rankers. In
office and industry, they have shown brilliant results. The need of the hour is
to provide an opportunity for women entrepreneurs, free from gender
differences. On their own, Indian women entrepreneurs with a determined effort
should overcome their physical and psychological shortcomings and then they can
fight with the social taboos imposed upon them. They must be ready to take-up
new ventures and new responsibilities. Infact, by nature women are gifted with
super qualities like good communication skills, generosity, commitment to work,
stress-bearing capacity and adaptation to the changing environment. They have
the potential and the will to establish and manage enterprises of their own.
What they need to excel in their role as an entrepreneur is encouragement and
support.
Promotion
of women entrepreneurs requires a multi-pronged approach. Women should be
motivated to come out of their traditional occupation for accepting more
challenging economic activities. Concurrently, an environment should be
prepared by the government and non-government agencies to enable their
participation. The elaborate procedure of licensing and government sanction for
establishing a new business enterprise should be dispensed with, in case of
women entrepreneurs. The promotional and regulatory agencies should also be
motivated to be considerate, understanding and helpful to women entrepreneurs.
In more explicit terms, banks and other financial institutions must provide
credit to women entrepreneurs on both priority basis and concessional terms. Appropriate training, tax concessions,
market subsidies, low interest rates
etc., are some of the push factors which help women to reach the mainstream of
national economy. These suggestions, if
implemented in right earnest will certainly contribute for the development of
entrepreneurship among Indian women.
With
corporates eager to associate and work with women-owned businesses and a host
of banks and non-governmental organisations (NGOs) keen to help them get going,
this is a very good time for women with zeal and creativity to start their own
business. While some of the women
entrepreneurs have demonstrated their potential, the fact remains that they are
capable of contributing much more than what they already are. In order to
harness their potential and for their continued growth and development, it is
necessary to formulate appropriate strategies for stimulating, supporting and
sustaining their efforts in this direction. Such a strategy needs to be in
congruence with field realities and should especially take cognizance of the
problems women entrepreneurs face within the current system. If family members,
government and non-government agencies assist and encourage women in this
mission there is no doubt to affirm that today’s Indian women entrepreneurs
will play dominant role in making India number one globally tomorrow.
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