9

Institutions Supporting Business Enterprises

INTRODUCTION

Many enterprises start small and many entrepreneurs in MSME need an institutional support
system for guidance, support, and mentoring at different stages of business development. Most
of the enterprises need support at the pre-start up, start-up, development, and growth phase. An
entrepreneur should be aware of governmental and non-governmental support systems
available for his enterprise. This chapter deals with these organizations, which play a
supportive role for the development of enterprises in India.

A number of support institutions set up by the central and state governments and various
other agencies help entrepreneurial development in various ways. The activities of support
institutions cover a wide range of services such as financing, equipment support, technical
assistance, training, marketing, and providing subsidy and grants. The various institutions
supporting entrepreneurial activities in India (also shown in Figure 9.1) are given below:

1. Central-level institutions: Central-level institutions for supporting entrepreneurial

activities are set up by the Central Government. These are: National Board for
Micro, Small, and Medium Enterprises (NBMSME); Khadi and Village Industries
Commission (KVIC); Coir Board; Micro Small Medium Enterprises Development
Organisation (MSME–DO
2. State-level institutions: The state-level institutions for supporting entrepreneurial
activities are set up by the various state governments in India. These are: State
Directorate of Industries; District Industries Centres (DIC); State Financial
Corporations (SFC
3. Other institutions: Apart from central and state-level institutions, there are
various other institutions supporting entrepreneurial activities in India. These are:
National Bank for Agriculture and Rural Development (NABARD); Housing and
Urban Development Corporation (HUDCO); Technical Consultancy
Organizations (TCOs)
Figure 9.1 Institutional Support for Enterprises
 CENTRAL-LEVEL INSTITUTIONS

National Board for Micro, Small, and Medium Enterprises (NBMSME)

The National Board for Micro, Small, and Medium Enterprises (NBMSME) 1 was constituted
in 2007 in pursuance of the MSME Development Act, 2006, to facilitate the coordination and
inter-institutional linkages for the development of MSME. The Board has a statutory backing
and is an apex advisory body constituted to render advice to the government on all issues
pertaining to the MSME sector.

The Office of the Development Commissioner (MSME) serves as the secretariat for the
Board. The Union Minister of Commerce and Industry is the chairman of the Board. The
NBMSME comprises 50 members including state industry ministers; select members of
Parliament; secretaries of various departments of the Central Government; financial
institutions; public-sector undertakings; industry associations; and eminent experts in the field
as members.

The Board examines the factors affecting the promotion and development of MSME and
advises the Central Government to facilitate their promotion and development in order to
enhance competitiveness. The Board broadly operates in areas such as policies and
programmes; the development of industries in a specific region such as the North East;
ancillary development; quality improvement and marketing assistance; credit facilities,
taxation and modernization; and industrial sickness.

The Khadi and Village Industries Commission (KVIC)

The Khadi and Village Industries Commission (KVIC)2 is a statutory body established by an
Act of Parliament (No. 61 of 1956). KVIC functions under the administrative control of the
Ministry of Micro, Small, and Medium Enterprises, Government of India. The primary
objective of KVIC is to provide employment to rural artisans through production of saleable
products and to create self-reliance in order to build a strong rural community spirit.

Mahatma Gandhi started khadi and village industries to rejuvenate the rural economy as part
of the freedom struggle. Khadi products are hand-spun and hand-woven. The spinning and
weaving process creates opportunities for employment for a large number of spinners and
weavers in rural India. More than 80 per cent among them are women. KVIC has been
promoting the use of eco-friendly organic cotton and natural dyes. It deals with traditional rural
industries such as pottery, leather, hand-made paper, non-edible oil, soap, and the processing
of cereals and soaps. Due to the rigorous efforts of KVIC, khadi, which was seen as a cloth
worn by the common man, has become glamorous.

The KVIC is entrusted with the task of planning, organizing, implementing, and promoting
various programmes for the development of khadi and other village industries in rural areas.
The Commission provides financial assistance to institutions and individuals for the
development of these industries and for guiding them through the supply of designs, prototypes,
and other technical information. It also creates common service facilities for the processing of
raw materials and facilitates the marketing of the products through cooperative efforts.
 The Government of India has taken a number of steps to promote exports of khadi and village
industries products. The designs are being improved upon in collaboration with premier
institutions like the National Institute of Design (NID) and the National Institute of Fashion
Technology (NIFT). In September 2010, KVIC received a funding of $1,500 lakh from the
Asian Development Bank (ADB) under a three-year ADB programme. Under this programme,
300 institutions will be provided INR. 1.19 crore each to undertake reforms at all levels. KVIC
has promoted cluster development to meet market demands and the taste of all classes of
consumers within and outside the country. During the Eleventh Five-Year Plan, ending 31
March 2012, KVIC has granted funds to selected clusters for the regeneration of village
industries.

KVIC has embarked on various initiatives to promote khadi and village industries in rural
India. Some of these are the Prime Minister’s Employment Generation Programme (PMEGP);
Rural Employment Generation Programme (REGP); Scheme of Fund for Regeneration of
Traditional Industries (SFURTI); Rural Industry Service Centres (RISC); the export incentive
scheme; and the interest subsidy scheme. KVIC also has taken various steps towards the
welfare of artisans. The Khadi Karigar Janashree Bima Yojana (JBY), a group insurance
scheme, aims at enhancing the productivity and competitiveness of the khadi industry and
artisans. The Workshed Scheme for Khadi Artisans is an attempt to facilitate the development
of khadi artisans by providing them financial assistance on a pilot basis for the construction of
worksheds.

The Coir Board

The Coir Board is a statutory body established by the Government of India for the promotion
and development of the coir industry under the Coir Industry Act 3, 1953, enacted by the
Parliament. This is one of the oldest traditional industries. It generates value out of waste by
providing eco-friendly products that generate large-scale employment and contribute to around
INR. 600 crore worth of exports annually. The Coir Board has constituted various committees
for implementing various functions such as the executive committee; the research and
development committee; the export promotion committee; the marketing and publicity
committee; the brown fibre development committee; and the Hindustan advisory committee.

The Central Coir Research Institute, established in 1959, is the prime research centre of the
Coir Board. It is recognized by the Department of Science and Technology, Government of
India. The Central Institute of Coir Technology is a research institute of the Coir Board
established in 1979. It is an autonomous body, which undertakes research in the utilization of
brown coir fibre. These research institutes formulate Indian standards for coir products and
provide extension services and technical assistance to coir entrepreneurs. The Coir Board
established the National Coir Training and Design Centre in 1965 for developing skilled
manpower for the coir industry. The Coir Board also established Hindustan Coir in 1968.
Hindustan Coir promotes the mechanization of the coir industry on modern lines.

The Government of India has embarked upon various initiatives for the rejuvenation,
modernization, and technological upgradation of the coir industry. These are: Scheme of Fund
for Regeneration of Traditional Industries (SFURTI); skill upgradation and quality
improvement scheme; science and technology scheme; export market promotion scheme;
domestic market promotion scheme; trade and industry related functional support services
scheme; and welfare measures scheme. In order to promote market development and the
welfare of coir artisans, the Coir Board has promoted schemes such as the marketing
development assistance scheme and personal accident insurance scheme for coir workers.

MSME–DO

The Office of the Development Commissioner, Ministry of Micro, Small, and Medium
Enterprises,4 Government of India (DC–MSME) is a nodal agency for formulating,
coordinating, and monitoring the policies and programmes for the promotion and development
of MSME in the country. Micro, Small, and Medium Enterprises–Development Organization
(MSME–DO) is the apex body for assisting the government in formulating, coordinating,
implementing, and monitoring policies and programmes for the promotion and development of
MSME in the country. MSMEDO provides a comprehensive range of common facilities,
technology and support services, marketing assistance, and entrepreneurial development
support to MSME.

MSME–DO has over 60 offices and 21 autonomous bodies under its management. The
autonomous bodies include tool rooms, training institutions, and project-cum-process
development centres. The MSME–DO offers advice to the Central Government in policy
formulation and provides liaison services between different institutions for the promotion and
development of the MSME sector.

MSME–DO has a network of 30 MSME development institutes, 28 branch MSME

development institutes, four MSME testing centres, and seven MSME field-testing stations.
There are also two MSME departmental training institutes and one departmental MSME hand-
tools development centre. These institutes conduct consultancy, training, and provide common
facility services to MSME.

MSME has initiated various schemes for the promotion of the MSME sector in India. These
are: Small Enterprise Information and Resource Network; entrepreneurship development
programmes; management training programmes; WTO cells; motivation campaigns; skill-
development programmes; and initiatives for environmental control. MSME–DO has a library
at its headquarters at Nirman Bhawan, New Delhi, and at all its field institutes in the country.
These libraries are valuable repositories of information and are maintained with the objective
of providing information for entrepreneurs so that they might get to know about new
developments taking place in the industrial and business environment.

National Small Industries Corporation (NSIC)

This is a Government of India enterprise under the Ministry of Micro, Small, and Medium
Enterprises (MSME). The NSIC5 work towards the growth of micro, small, and medium
enterprises in the country. The NSIC has obtained ISO 9001–2008 certification and operates
through a countrywide network of offices and technical centres. In order to manage its
operations in African countries it has set up an office at Johannesburg in South Africa. The
NSIC provides a package of services and various schemes to support MSME in the country.
These schemes comprise facilitating market support, credit support, technology support, and
other support services.
 The NSIC has devised a number of schemes such as consortia and tender marketing; single-
point registration for government purchase; B2B web portal for marketing; marketing
intelligence; exhibition and technology fairs; export; and buyer–seller meets to support MSME
in their marketing efforts. The NSIC facilitates the credit requirements of MSME by providing
financial assistance for the procurement of raw materials for up to 90 days; finance through
syndication with banks; and facilitating import of scarce raw materials. In order to evaluate the
strengths and weaknesses of existing operations and to take corrective and preventive actions,
the NSIC has started operating a performance and credit rating scheme through empanelled
agencies such as ICRA, ONICRA, CRISIL, Fitch, CARE, Brickwork Ratings, and SMERA.
The NSIC offers various support services through its technical services centres and extension
centres located at various places in India.

Due to its consistent good performance, the NSIC has received various accolades and
awards. The Government of India has accorded it the “Mini Ratna” status, which will give the
NSIC a higher degree of autonomy to provide greater service through its innovative schemes
for the growth and development of the MSME sector in the country. Other awards received by
the NSIC are Icon of the Year, Meri Dilli, Small Business Mentor of the Year, and the FSIA–
V. B. Gulati Award.

National Science and Technology Entrepreneurship Development Board (NSTEDB)

This is a Government of India enterprise under the Ministry of the Department of Science and
Technology. The NSTEDB6 was established in the year 1982 with the primary objective of
promoting self-employment among the science and technology (S&T) manpower in the
country and to set up knowledge-based and innovation-driven enterprises. The NSTEDB has
representation from socioeconomic and scientific departments, ministries, premier
entrepreneurship development institutions, and all-India financial institutions.

The NSTEDB promotes and develops technology entrepreneurs, and facilitates and conducts
various informational services relating to the promotion of entrepreneurship. The NSTEDB
networks with various central and state government agencies for S&T-based entrepreneurship
development. The Board acts as a policy advisory body with regard to entrepreneurship. The
NSTEDB aims to convert “job-seekers” into “job-creators” and “job-providers” through S&T
interventions.

The NSTEDB has instituted various initiatives to promote knowledge-based and innovation-
driven enterprises. It generates employment through technical skill development using the
science and technology infrastructure. Some of the main initiatives are the institutional
mechanism for promoting entrepreneurship, training programmes, and information
dissemination. Institutional support is provided through the Innovation and Entrepreneurship
Development Centre (IEDC); the Science and Technology Entrepreneurship Development
(STED) project; the Science and Technology Entrepreneurs Park (STEP); and the Technology
Business Incubator (TBI).

The NSTEDB conducts various training programmes through Entrepreneurship

Development Cells. The various training programmes conducted by the Board are
Entrepreneurship Awareness Camp (EAC), Entrepreneurship Development Programme
(EDP), and Faculty Development Programme (FDP) focusing on the entrepreneurship domain,
and the Technology-based Entrepreneurship Development Programme (TEDP). The Board
publishes a magazine titled Science Tech Entrepreneur and has hosted a Web portal named
“TIME IS” for the dissemination of information for promoting entrepreneurs. Some of the
major activities undertaken by NSTEDB are elaborated on this Web portal.

National Productivity Council (NPC)

The National Productivity Council (NPC) is a national-level organization established as a

registered society in 1958 by the Government of India. NPC7 is an autonomous, tri-partite, non-
profit organization, which aims to promote a culture of productivity in India. The NPC has
equal representation from the government, employers, workers’ organizations, and technical
and professional institutions. The NPC provides training, consultancy services, and undertakes
research in the area of productivity. The NPC also implements productivity promotion plans
and programmes of the Asian Productivity Organization (APO) based in Tokyo, Japan.

The NPC acts as a change agent to assist the central and state governments, local bodies, and
other organizations in improving the quality and efficiency of public services. The NPC aims
at promoting productivity as an evolving concept, which includes paying attention to special
issues, quality, environment, energy, women workers, and integrated rural and community
development. The NPC’s head office is based in New Delhi and regional offices are spread
acros India at Chandigarh, Kanpur, Gandhinagar, Bhopal, Mumbai, Patna, Kolkata, Guwahati,
Hyderabad, Bangalore, Chennai, Jaipur, and Bhubaneshwar.

The NPC has its own training institute, the Dr Ambedkar Institute of Productivity (AIP) in
Chennai. The Institute is situated in an industrial environment in the industrial estate of Small
Industry Development Corporation (SIDCO) of Tamil Nadu, Ambattur, Chennai. The Institute
prepares and develops consultants in managerial and technical areas to cater to the needs of the
NPC. It trains consultants for absorption into the NPC and also the industry on a sponsored or
self-financing basis.

The AIP conducts a two-year post-graduate diploma programme in industrial engineering,

plant engineering, industrial pollution prevention and control, energy management, human
resources management, productivity research, inter-firm comparison, total quality
management, total productivity management, and agricultural productivity.

The NPC provides consultancy services to enhance the quality and productivity of Indian
industries such as agri-business services, economic services, energy management, environment
management, human resource management, information technology, process management, and
technology management. Productivity is the principal journal published quarterly by the NPC
in India. The journal disseminates information on concepts, techniques, and data in the area of
productivity and its growth in India and abroad. The articles in the journal are written and the
issues addressed by top-level and senior-management technologists, policy makers,
educationists, and researchers.

Entrepreneurship Development Institute of India (EDII)

The Entrepreneurship Development Institute of India (EDII) is an autonomous and not-for-

profit institute established in 1983. The Institute is registered under the Societies Registration
Act, 1860 and the Public Trust Act, 1950. The Institute is sponsored by apex financial
institutions such as the Industrial Development Bank of India (IDBI), the Industrial Finance
Corporation of India (IFCI), the Industrial Credit and Investment Corporation of India (ICICI)
Ltd, and the State Bank of India (SBI).

The EDII8 has been spearheading the entrepreneurship movement throughout the nation and
developing entrepreneurs through well-conceived and well-directed activities. The EDII is
committed to entrepreneurship education, training, and research. The Institute strives to
provide innovative training techniques, competent faculty support, consultancy and quality
teaching, and training material. The EDII aims to inculcate the spirit of entrepreneurship in the
youth, create a multiplier effect on opportunities for self-employment, and sensitize the support
system to facilitate potential and existing entrepreneurs to establish and manage their
enterprises and develop and disseminate new knowledge and insights in entrepreneurial theory
and practice through research.

The EDII campus is located in a rural area amidst verdant surroundings spread over 23 acres
of land in Gandhinagar district, Gujarat, India. It is one of the best maintained educational
campuses in the world and the campus has state-of-the-art conference halls, seminar halls, and
lecture halls. Hostel and dining facilities are provided to students and residential blocks to
faculty members. The recreation facilities in the campus include a music room, satellite
television, and a range of competitive sporting activities. The campus has an inviting
environment for work, interaction, and repose. The campus was awarded the prestigious “Aga
Khan Award for the Best Architecture” in 1992.

The EDII has been selected as a member of the Economic and Social Commission for Asia
and the Pacific (ESCAP) network of centres of excellence for HRD research and training. As
a member of the network, the EDII will have interactive access to information on the other 123
member institutions via the Internet. In order to address the need for developing new committed
entrepreneurs on a large scale, the EDII has launched several programmes. Some of them are
the Post Graduate Diploma in Management–Business Entrepreneurship (PGDM–BE); the Post
Graduate Diploma in Management–Development Studies (PGDM–DS); and the Diploma in
Entrepreneurship and Business Management. The Institute also conducts international
programmes sponsored by the Ministry of External Affairs, Government of India.

The Open Learning Programme in Entrepreneurship (OLPE) cell of the EDII conducts open
learning programmes through correspondence and personal counselling. The programmes
offered are Diploma in Entrepreneurship and Business Management and Diploma in Social
Entrepreneurship. The Diploma in Entrepreneurship and Business Management is an online
course and is recognized by the Distance Education Council, IGNOU, New Delhi. The
Diploma in Social Entrepreneurship is a six-month programme providing a unique opportunity
to learn about and start a social enterprise and to contribute towards the social development of
our country.

In order to promote entrepreneurship at the school and college level, the EDII conducts
summer camps and entrepreneurship awareness programmes for children and the youth. To
promote entrepreneurial education and training in India, the EDII conducts a faculty
development programme in entrepreneurship. The Institute organizes national seminars on
approaches to entrepreneurship education and deliberates on the establishment of
entrepreneurship and business development centres (EBDCs) in educational institutions.
 SNAPSHOT

• The NBMSME is an apex advisory body constituted to advise the government on

all issues pertaining to the MSME sector.
• The primary objective of KVIC is to provide employment to rural artisans through
the production of saleable products and to create self-reliance in order to build a
strong rural community spirit.
• The Coir Board is a statutory body established by the Government of India for the
promotion and development of the coir industry in the country.
• MSME–DO is the apex body for assisting the government in formulating,
coordinating, implementing, and monitoring policies and programmes for the
promotion and development of MSME in the country.
• The NSIC provides a package of services and various schemes to support MSME
in the country.
• The NSTEDB was established with the primary objective of promoting self-
employment among the Science and Technology (S&T) manpower in the country
and to set up knowledge-based and innovation-driven enterprises.
• NPC is an autonomous, tri-partite, non-profit organization, which aims to promote
a culture of productivity in India.
• The EDII has been spearheading the entrepreneurship movement throughout the
nation and developing entrepreneurs through well-conceived and well-directed
activities. The EDII is committed to entrepreneurship education, training, and
research.
National Research Development Corporation of India (NRDCI)

The National Research Development Corporation of India (NRDCI) was established in 1953
as a Government of India enterprise. It is presently working under the Department of Scientific
and Industrial Research, Ministry of Science and Technology. The Corporation aims to
develop, promote, and transfer technologies emanating from various national research and
development institutions. The Institute has facilitated the supply of technologies and services
to entrepreneurs both in the developing and developed countries. The Corporation has exported
technologies to countries such as the United States, Germany, Malaysia, Brazil, Bangladesh,
Burma, Nepal, Senegal, Madagascar, Indonesia, the Philippines, Vietnam, Sri Lanka, Kenya,
and Egypt.

The vision of the NRDCI9 is to be a provider of world-class business services that nurture
technological ideas in Indian minds, to ensure their propagation in world markets, and to satisfy
human needs. The Corporation makes a profit by enabling new technologies to transit smoothly
from their source points, through the corporate world into global businesses. The NRDCI also
acts on behalf of large enterprises that develop technologies in their R&D laboratories and
chooses to license them out for commercialization. The main programmes of the NRDCI are
invention promotion, technology promotion, and the commercialization of invention. The
NRDCI has strong networking links with scientific and industrial agencies in India and abroad
for the commercialization of the know-how developed in their laboratories.

The NRDCI, on behalf of the Department of Scientific and Industrial Research (DSIR),
provides tax-free cash awards to stimulate the spirit of inventiveness among technicians,
artisans, craftsmen, and students in order to recognize the creative talent which could be
harnessed to benefit enterprises. The cash awards are given in three categories: the NRDC
Innovation Award (maximum two awards of INR. 5 lakh each); the NRDC Societal Innovation
Award in the agriculture, environment, and rural energy sectors (maximum three awards of
INR. 3 lakh each); the NRDC Budding Innovators Award for students registered for bachelors
or masters courses in academic or research institutions, and universities or affiliated colleges
with a maximum age limit of 28 years at the time of applying (maximum five awards of INR.
1 lakh each).

An important activity of the Corporation is to disseminate information on new processes to

enterprises for the promotion and commercialization of technologies. There are many Indian
technologies commercialized by the industry under license from the NRDC. These are, to name
a few: infant food, Swaraj Tractor, indelible ink for election purposes, Cinema ARC Carbon,
soft ferrite, titanium substrate insoluble anodes, silver impregnated graphite (SIG) contacts,
beta naphthol, phosphamidon, mini cement plants, water filter candles, artificial heart valves,
fly ash bricks, thrombinase, invert sugar, spirulina algae, liquid biofertilizers, high draught
continuous kilns, FRC manhole covers, mini climbing cranes, spice oleo resins, gene delivery
systems, glycol-based antifreeze coolants, rice husk particle board, 777 oil, and anti-corrosive
treatments of steel reinforcing rods in RCC construction.

National Entrepreneurship Development Institutes

There are three national-level institutes for promoting entrepreneurship set up by the Ministry
of Industry. These are:

• National Institute for Micro, Small, and Medium Enterprises (NI-MSME),

Hyderabad
• National Institute of Entrepreneurship and Small Business Development
(NIESBUD), New Delhi
• Indian Institute of Entrepreneurship (IIE), Guwahati
National Institute for Micro, Small, and Medium Enterprises (NI-MSME) The Institute
was formerly known as the National Institute for Small Industry Extension and Training
(NISIET). The NI-MSME was registered under the Public Societies Registration Act effective
from 1 July 1962 and is located at Hyderabad in Andhra Pradesh. It is a premier institute in
India for the promotion, development, and modernization of the MSME sector. It is an
autonomous institute, which functions under the Ministry of Micro, Small, and Medium
Enterprises. The Institute is managed by a governing council constituted by the Government
of India. The secretary to the Government of India, the Ministry of MSME, is the chairman of
the governing council.

The NI-MSME10 was conferred the status of a National Institute by the Government of India
with a charter of assisting in the promotion of MSME by creating a pro-business environment.
The UNIDO recognized the NI-MSME as an institute of meritorious performance under its
Centres of Excellence scheme in 1984. The Institute is providing support to MSME in the area
of research, consultancy, information, training, and extension. The Institute has extended its
expertise and services to other developing and developed nations. The Small Enterprises
Development, Management, Extension (SEDME) is a quarterly journal published by the
Institute. The contributors to SEDME include policy makers, researchers, academicians,
financiers, executives, and other officials associated with MSME activities from India and
other developing as well as developed countries.
 The infrastructure and facilities at the NI-MSME campus are at par with international
standards. The Institute is now being recognized as among the best training, research, and
extension facilities in the world. The NI-MSME has an interface with several international
agencies such as the Commonwealth Fund for Technical Cooperation (CFTC), the United
Nations Educational Scientific and Cultural Organization (UNESCO), the United Nations
Development Programme (UNDP), the United States Agency for International Development
(USAID), the International Labour Organization (ILO), the Ford Foundation, and GTZ of
Germany.

National Institute for Entrepreneurship and Small Business Development (NIES-

BUD) The NIESBUD was founded in 1983 by the Ministry of MSME, Government of India.
The Institute was registered as a society under the Government of India Societies Registration
Act, 1860. The Institute is presently functioning from its integrated campus in Noida, Delhi. It
is an apex body for coordinating and overseeing the activities of various institutions and
agencies engaged in the development of entrepreneurship in the MSME sector. The
NIESBUD11 serves as the secretariat for the National Entrepreneurship Development Board
(NEDB), the apex body which determines policy for entrepreneurship development in the
country.

The Institute is managed by a governing council, constituted by the Government of India.

The chairman of the governing council is the honourable minister of MSME and the vice-
chairman is the Secretary of MSME to the Government of India. The executive committee
consists of nine members and includes the Secretary (MSME) as chairman, the Additional
Secretary and Development Commissioner (MSME) as its vice-chairman, and the executive
director of the Institute as its member secretary. The policies and decisions of the governing
council are executed through the executive committee. The NIESBUD has joined hands and
signed a Memorandum of Understanding (MoU) with the International Finance Corporation
(IFC), a member of the World Bank group, for jointly undertaking different projects relating
to entrepreneurship development in India. The NIESBUD will collaborate with the IFC in
conducting the training of trainers (TOT) programme for reinforcing the training skills of
MSME trainers. The objective is to create a cadre of master trainers who would, in turn,
replicate the model to impart training for the MSME sector in a much bigger way.

The NIESBUD mission is to promote, support, and sustain entrepreneurship and MSME
through training, education, research, consultancy, and other interventions throughout the
globe. The Institute offers information and support to trainers, promoters, and entrepreneurs by
providing research, consultancy, and documentary services relevant to entrepreneurship
development. The major activities of the Institute include evolving model syllabi for training
various target groups; providing effective training strategies, methodology, manuals, and tools;
facilitating and supporting central/state government institutions and other agencies in executing
programmes for entrepreneurship development; maximizing benefits and accelerating the
process of entrepreneurship development; conducting programmes for motivators; and training
entrepreneurs and organizing activities.

Indian Institute of Entrepreneurship (IIE) The Indian Institute of Entrepreneurship (IIE)

was established in 1993 as an autonomous national institute by the Ministry of MSME with its
headquarters at Guwahati. The aim of the Institute is to undertake training, research, and
consultancy services for entrepreneurship development with a focus on the MSME sector. The
Institute has a board of management whose chairman is the secretary to the Government of
India, Ministry of MSME. The board provides the policy framework and guidance for its
functioning. The Institute has a governing council headed by the chairman of the North East
Council (NEC) and the executive committee is headed by the Secretary, Ministry of MSME,
Government of India.

The IIE12 was specially developed to address the needs of the north-eastern hill states with a
view to market and develop traditional and handicraft industries. The Institute acts as a catalyst
for entrepreneurship development by creating an eco-system. It undertakes research on
entrepreneurship development, documenting, and disseminating information for policy
formulation and implementation of entrepreneurship and self-employment. The Institute
promotes entrepreneurship education and training by evolving strategies and methodologies
for different target groups and locations and conducts field tests. It organizes seminars,
workshops, and conferences for providing a forum for interaction and exchange of views by
various agencies and entrepreneurs.

SNAPSHOT

• The NRDCI facilitates the supply of technologies and services to entrepreneurs in

both developing and developed countries.
• There are three national entrepreneurship development institutes set up by the
Ministry of Industries. These are NI-MSME at Hyderabad, NIESBUD at New
Delhi, and IIE at Guwahati.
9.1 PROMOTERS

The Industrial Development Bank of India (IDBI Bank Ltd.), a public-sector apex financial
institution which had evinced keen interest in the Gujarat experiment, was joined by the
Industrial Credit and Investment Corporation of India (ICICI Bank Ltd.), Industrial Finance
Corporation of India (IFCI Ltd.), and the State Bank of India (SBI) to sponsor an institution of
this kind, and the Government of Gujarat expressed its willingness to support the same. While
the four financial institutions agreed to provide capital and create a corpus fund sufficient to
generate adequate interest-income to meet the minimum requirements of the proposed institute
during its gestation period, the Gujarat Government pledged a 23-acre land for its physical
facilities on the outskirts of Ahmedabad city. The sponsoring agencies were, however,
absolutely clear that an institution committed to creativity and innovation must have a culture
of creativity and hence, must enjoy maximum freedom in its internal functioning, conducive to
exploration and experimentation. EDII was, therefore, set up as a wholly autonomous body
under the Societies Registration Act on April 20, 1983. Since its inception, EDII has functioned
under its own independent Board.

In order to promote entrepreneurship education, the Institute offers post-graduate diploma

courses in the area of entrepreneurship and management. Prominent among them are the post-
graduate diploma in management and entrepreneurship with agri-business management; the
post-graduate diploma in management and entrepreneurship with service-sector management,
and the post-graduate diploma in management and entrepreneurship with small and medium
enterprises management. The IIE has been working in association with the South Asia
Enterprise Development Facility, an organization of the World Bank group based in Dhaka,
Bangladesh, for increasing the availability of need-based services useful for the MSME sector
of the north-east region.
 STATE-LEVEL INSTITUTIONS

The state-level institutions for supporting entrepreneurial activities are set up by the various
state governments in India. They are State Directorate of Industries and Commerce; District
Industries Centres (DIC); State Financial Corporations (SFC); State Industrial Development
Corporations (SIDC); and State Industrial Area Development Boards (SIADB). This section
provides information on state-level institutions supporting entrepreneurial activities, which
have been set up by the various state governments in India.

State Directorate of Industries and Commerce

At the state level, the State Directorate of Industries and Commerce acts as a catalyst for the
overall development of the industrial sector through effective implementation of policies. The
policies developed by the Central Government serve as guidelines but each state evolves its
own policy and package schemes. The Directorate develops growth centres, industrial parks,
export zones, special economic zones, industrial clusters, and infrastructure required for
industrial development.

The main function of the Directorate is to carry out industrial development in the state. It
also implements policies and schemes of the Government of India and the state government.
The Commissioner/Director of Industries and Commerce is the head of the institution and is
assisted by additional directors, joint directors, deputy directors, assistant directors, and other
support staff. In all the states and union territories the Directorate oversees the industrial
activities of the state and the District Industries Centres (DIC) at the district level.

District Industries Centres (DIC)

The concept of DIC was announced by the Government of India during the new industrial
policy formulated on 23 December 1977. DIC are the main focus agencies for promoting
MSME at the district level. DIC were established with the aim of generating greater
employment opportunities especially in the rural and backward areas of the country. The
functions and activities of DIC are monitored by the Directorate of Industries and Commerce.

DIC are district-level institutions set up by the government, which provide all services and
facilities to entrepreneurs in one place to set up MSME. These services and facilities include
identification of a suitable scheme, preparation of a project feasibility report, arrangements for
the supply of plant, machinery, and equipment, provision of raw materials, credit facilities and
input for marketing and extension services, quality control, and research and entrepreneurial
training.
 DIC are headed by a joint director. The joint director is assisted by the deputy
director/assistant director, industrial promotion officer, and industrial extension officer at
the taluk level. The functions of DIC are registration of MSME; providing infrastructure
assistance to entrepreneurs; formulating employment generation programmes; implementing
incentive schemes; and conducting entrepreneurship development and awareness programmes
at village, taluk, and district levels. The functions also include arranging buyer–seller meets;
organizing industrial exhibitions; creating cluster development and sensitizing programmes;
recovering departmental loans; and following up industrial approvals.

SNAPSHOT

• The state-level institutions for supporting entrepreneurial activities are set up by

the various state governments in India. They are State Directorate of Industries
and Commerce; District Industries Centres (DIC); State Financial Corporation
(SFC); State Industrial Development Corporation (SIDC); and State Industrial
Area Development Board (SIADB).
• DIC are district-level institutions set up by the government, which provide all
services and facilities to entrepreneurs in one place to set up MSME.
State Financial Corporation (SFC)

The State Financial Corporation is established in each state under the State Financial
Corporations Act, 1951. The SFC plays an important role in the development of MSME at the
state level. They aim to finance and promote MSME in their respective states for achieving
balanced industrial growth. They act as catalysts to generate employment and widen the
industrial base. SFCs promote the development of MSME by providing various services. The
important services provided by SFCs are infrastructure development, financial services, and
term loans.

SFCs are managed by a board of directors, an executive committee, an audit committee, and
principal officers. Branch managers manage operations at the district level. SFCs have a
decentralized system of working. SFCs operate through a wide network with branch offices,
circle offices, field offices, and internal audit cell. Financial services to MSME are provided
by term loans, direct subscription to equity/debentures, guarantees, discounting of bills of
exchange, and seed capital assistance. SFCs operate a number of schemes for refinance of IDBI
and SIDBI. SFCs have tailor-made schemes for women, artisans, ex-servicemen, disabled
people, and special target groups such as the SC/ST.

State Industrial Development Corporation (SIDC)

SIDCs are wholly-owned undertakings of the state governments set up under The Companies
Act, 1956. SIDCs act as catalysts for industrial development in their respective states. They
develop land for providing industrial infrastructural facilities in the form of industrial estates
by developing industrial land and readymade industrial sheds. They also provide facilities such
as roads, power, water supply, drainage, and other amenities required for industrial
development.

State Industrial Area Development Board (SIADB)

The SIADB is a statutory board constituted under the Industrial Areas Development Act, of
the respective state governments in India, for example, the Karnataka Industrial Areas
Development Act, 1966, in Karnataka. The SIADB’s primary objective is to promote and assist
in the rapid growth and development of enterprises in industrial areas. The SIADB acquires
and provides developed land suited for industries. It prepares industrial plots of various sizes
to suit different industries along with the requisite infrastructural facilities.

The basic facilities developed by the SIADB in industrial areas include roads, drainage,
water supply, and power supply. The SIADB also provides various common amenities in
industrial areas such as banks, post offices, telephone exchanges, telecommunications, fire
stations, police outposts, canteens, ESI dispensaries, bus depots, and petrol bunks. It also makes
provision for technical training centres, research and development centres, and common
effluent treatment plants.

SNAPSHOT

• The important services provided by SFC to MSME are infrastructure

development, financial services, and term loans.
• SIDC provide infrastructural facilities to MSME in the form of industrial land,
industrial shed, roads, power, water supply, drainage, and other amenities required
for industrial development.
• The SIADB acquires and provides developed land suited for industries.

OTHER INSTITUTIONS

Apart from central and state-level institutions, there are various other institutions supporting
entrepreneurial activities in India. These are the National Bank for Agriculture and Rural
Development (NABARD); the Housing and Urban Development Corporation (HUDCO);
Technical Consultancy Organizations (TCOs); the Small Industries Development Bank of
India (SIDBI); the Export Promotion Council (EPC); Industry Associations; Non-
Governmental Organizations (NGOs); and Business Incubators.

National Bank for Agriculture and Rural Development (NABARD)

NABARD was established by an Act of Parliament in July 1982 to provide focused attention
to the development of rural India by facilitating credit flow for the promotion of agriculture
and the rural non-farming sector. It provides refinance assistance to State Cooperative Banks,
Regional Rural Banks, and other approved institutions for all kinds of production and
investment credit to industries, artisans, cottage and village industries, handicrafts, and other
allied activities. NABARD also helps entrepreneurs to procure loans for setting up industries
in any part of the country.

NABARD’s primary goal is to promote sustainable and equitable agriculture and rural
prosperity through effective credit support, related services, institution development, and other
innovative initiatives.13 NABARD’s functions can be classified into four major categories:
credit planning; financial services; promotion and development; and supervision. NABARD
has effectively brought in a number of innovations in the rural credit domain. Some of them
are the formation and linkage of self-help groups; farmers’ clubs; rural infrastructure
development funds; watershed development; the Kisan Credit Card; the district rural industries
project; women and development; the Rural Entrepreneurship Development Programme
(REDP); rural marketing; NABARD Consultancy Services (NABCONS); co-financing; cluster
development programmes; and the Rural Innovation Fund.

NABARD is governed by a board of directors and assisted by approximately 25 departments

working for the improvement of the rural economy. It has regional offices, training
establishments, and district development offices for implementing policies and various
initiatives. NABARD extends assistance to the government, the Reserve Bank of India (RBI),
and other organizations in matters relating to rural development. It acts as a regulator for
cooperative banks and Regional Rural Banks (RRB). It is a refinancing agency for financial
institutions, offering production credit and investment credit for promoting agriculture and
developmental activities in rural areas.

NABARD recorded high levels of performance in purveying rural credit during 2011–12.
The aggregate assets held by NABARD rose to INR. 182,300 crore as on 31 March 2012, an
increase of INR. 235,000 crore compared to the position as on 31 March 2011. NABARD is
implementing subsidy schemes for various sectors on behalf of the Government of India. The
subsidy schemes cover sectors such as animal husbandry and poultry development including
poultry venture capital fund; cold storages; rural godowns; and solar lighting and photovoltaic
cells schemes. In 2011–12, NABARD released an amount of INR. 486.55 crore as subsidy to
the beneficiaries of various banks.

SNAPSHOT

• NABARD’s primary goal is to promote sustainable and equitable agriculture and

rural prosperity through effective credit support, related services, institution
development, and other innovative initiatives.
• NABARD’s functions can be classified into four major categories: credit
planning; financial services; promotion and development; and supervision.
Housing and Urban Development Corporation (HUDCO)

HUDCO is a public-sector company wholly owned by the Government of India. It was

incorporated in April 1970 as a private-limited company and, subsequently, converted into a
public-limited company in 1986. HUDCO’s primary focus is to provide assistance for urban,
social-sector infrastructure, and the creation of housing facilities. Of late, the Corporation has
also undertaken activities to create infrastructure for the industrial sector. HUDCO also extends
assistance to the promotion of building material industries, besides imparting consultancy,
training, and technical assistance in related matters.

HUDCO14 aims to promote sustainable habitat development to enhance the quality of life. It
is governed by a board of directors and has established regional offices at the operations level.
HUDCO was established with an equity base of INR. 2 crore. Over the years, the government
has expanded the equity base. The net worth of HUDCO as on 31 March 2011 is INR. 5,520.97
crore. HUDCO’s services and product portfolio can be classified into five main categories:
housing, urban infrastructure, building technology promotion, research and training, and
consultancy.
 HUDCO is an ISO 9001:2008 certified institution and has received many accolades and
awards for its sustained performance. In 1991, HUDCO received the Habitat Council of
Honour Award in recognition of its innovation in the development, and promotion of building
materials; design and construction of affordable housing for the poor and training in
construction skills. In 1998–99, HUDCO received the prime minister’s MoU Award for
Excellence in Performance for being among the top ten public-sector institutions in
performance.

HUDCO was awarded the status of Mini Ratna in 2004–05 by the Central Government for
its sustained outstanding performance and profitability. It received the Enterprise Excellence
Award by the Indian Institute of Industrial Engineering in 2007. The Building Industry
Leadership Award was conferred on HUDCO by the building information bureau in 2008.

Technical Consultancy Organization (TCO)

A TCO is a premier professional, industrial, technical, and management consultancy

organization. A network of Technical Consultancy Organizations (TCOs) was established by
the all-India financial institutions in the seventies and the eighties in collaboration with state-
level financial/development institutions and commercial banks to cater to the consultancy
needs of MSME and new entrepreneurs. At present, there are 18 TCOs operating in various
states, some of them covering more than one state. These 18 TCOs are listed in Table 9.1.

TCOs provide a total package of consultancy services to enterprises, government

departments, commercial banks, and other institutions for activities relating to industrial
development and financing. Initially, the functions of TCOs were focused on pre-investment
studies for enterprises. Over the years, they have diversified their functions to include the
following:

• To prepare project profiles and feasibility profiles.

• To undertake industrial potential surveys.
• To identify potential entrepreneurs and provide them with technical and
management assistance.
• To undertake market research and surveys for specific products.
• To supervise the project and where necessary, render technical and administrative
assistance.
• To undertake export consultancy for export-oriented projects based on modern
technology.
• To conduct entrepreneurship development programmes.
• To offer merchant banking services.
Table 9.1. Technical Consultancy Organizations in India
 Small Industries Development Bank of India (SIDBI)

SIDBI was founded in 1990 under an Act of Parliament. It is the principal financial institution
for the promotion, financing, and development of the MSME sector and other institutions
engaged in similar activities. SIDBI facilitates the timely flow of credit for term loans and
working capital to MSME in collaboration with commercial banks. In addition to refinancing
and discounting of bills, SIDBI participates in equity loans, term loans, working capital,
venture capital support, and various forms of resource support to banks and other institutions.

SIDBI15 seeks to empower the MSME sector with a view to contribute to the process of
economic growth, employment generation, and balanced regional development. The four main
functions set by SIDBI for the development of MSME sector are financing, promotion,
development, and coordination. SIDBI finances technology transfer and upgradation, quality
improvement programmes, export promotion, environmental care, and rural industrialization.
It uses the services of consultants and NGOs at national and international levels for various
improvement programmes on a need basis.

SIDBI as an apex institution makes use of the existing network of banks and state-level
financial institutions to convey financial assistance to the MSME sector. It has entered into a
memorandum of understanding with many banks, governmental agencies, international
agencies, research and development institutions, and industry agencies in India and abroad to
reach out to and facilitate the development of the MSME sector in the country.

Export Promotion Councils (EPCs)

In order to overcome problems in the marketing of MSME products in the overseas markets, it
is considered desirable to adopt a consortium approach. The export promotion councils for
different industries make efforts to promote the exports of their member units through direct
marketing, developing vendor relations, opening respective sales outlets abroad, and so on, as
a collective export marketing strategy. The activities of different councils are targeted to
increase the exports from the sector.

MSME get access to export-related services from the councils. Some of the councils obtain
bulk purchase orders from foreign buyers and distribute these among member units for supply
to the council for onward export. This process ensures export orders to every member unit and
thereby facilitates the timely delivery of goods abroad. For such a service, the councils charge
a nominal fee from member units. EPCs also offer a package of other services to existing as
well as new members by providing information about the developments taking place in the
international arena. They keep the members informed of the changes with regard to export–
import policies and procedures, customs and excise duty rules, and so on. Besides trade
enquiries, tender notices are circulated among members in order to assist them to avail the
business opportunities for augmenting overall exports.

SNAPSHOT

• NABARD’s primary goal is to promote sustainable and equitable agriculture and

rural prosperity through effective credit support, related services, institution
development, and other innovative initiatives.
• HUDCO’s primary objective is to provide assistance for urban, social-sector
infrastructure, creation of housing facilities, and infrastructure for the industrial
sector.
• A TCO is a premier professional, industrial, technical, and management
consultancy organization. TCOs provide a total package of consultancy services to
enterprises, government departments, commercial banks, and other institutions for
activities relating to industrial development and financing.
• The four main functions set by SIDBI for the development of the MSME sector
are financing, promotion, development, and coordination.
• EPCs make efforts to promote exports for MSME.
Industry Associations

In addition to the central and state government agencies, industry associations also impart
institutional support to the MSME sector. Industry associations provide MSME with a common
platform to raise industry-related issues and to initiate cooperative efforts for promoting the
sector. The government’s policies, in recent years, have stressed the increasing role of industry
associations in setting up common facilities and other cooperative ventures in the areas of
technology, marketing, and other support services. Some of the major associations and the
services provided by them are given below:

Confederation of Indian Industry (CII) In 1895, five British engineering firms formed the
Engineering and Iron Trade Association (EITA). EITA was renamed the Indian Engineering
Association (IEA) in 1912. With the swadeshi movement gaining momentum, the Engineering
Association of India (EAI) was formed in 1942 by a group of indigenous entrepreneurs. IEA
and EAI were merged in 1974 to form the Association of Indian Engineering Industry (AIEI).
The 1980s ushered in an era of competiveness and liberalization, and the AIEI was renamed
the Confederation of Engineering Industry (CEI). In 1992, the name was again changed to the
Confederation of Indian Industry (CII), which reflected the extension of the confederation’s
coverage.

The main objectives of the CII are to provide information, advisory, consultative, and
representative services to industry and the government. The CII is represented on major policy-
making bodies concerned with the industry. It also organizes industry exhibitions, specialized
sectoral trade fairs, and the India Engineering Trade Fair. Apart from these, the CII also plays
an important role in promoting international industrial cooperation.

The CII has taken up the agenda of “Business for Livelihood” for the year 2011–12. This
conflates the fundamental themes of spreading growth to disadvantaged sections of society,
building skills for meeting emerging economic compulsions, and fostering a climate of good
governance. In line with this, the CII is placing increased focus on affirmative action, skills
development, and governance during the year.

World Association for Small and Medium Enterprises (WASME) The World Association
for Small and Medium Enterprises (WASME), founded in 1980, has emerged as the largest
professionally- managed global non-governmental organization with members and associates
including national governments, chambers of commerce and industry, small business
authorities and associations, banks and financial institutions, and training and consultancy
agencies in 120 countries serving micro, small, and medium enterprises.

It has a governing body comprising representatives drawn from chambers of commerce,

banks and financial institutions, small business development corporations, the Department of
Small Industries in various governments, and so on. WASME organizes the international
MSME convention annually. Among other activities, WASME’s focus is on ensuring business
cooperation among enterprises of the developing countries by facilitating technology transfer,
training, and marketing. The facilities provided by WASME include (i) information on
promotion of SME in member countries, (ii) providing opportunities for the marketing of
products, (iii) facilitating contacts with sources offering latest technologies, equipment, and
services for MSME, and (iv) identification of facilities for the training of entrepreneurs,
managers, and production personnel.

Some of the thrust areas of WASME activities include technology transfer, training,
maintaining a roster of expert consultants, organizing or sponsoring seminars/ workshops/
conferences, acting as a clearing house of information relating to MSME, undertaking special
studies and research on areas of relevance to MSME, and strengthening or assisting in the
setting up of associations of MSME and/or women entrepreneurs.

Federation of Associations of Small Industries of India (FASII) The Federation of

Associations of Small Industries of India, set up in 1959, represents associations of small
industries and individual SSI units. The main objectives of FASII are: (i) to promote the
development of MSME and cottage industries; (ii) to cooperate with industrial, business,
educational, and research institutions in collecting and exchanging information pertaining to
MSME; (iii) to undertake professional, technical, and management consultation services; (iv)
to undertake studies, surveys, and research assignments; (v) to further the cause of MSME by
interacting with union and state governments and other bodies; (vi) to establish and operate
trade centres, display centres, sub-contract exchanges, and other promotional institutions for
the benefit of the MSME sector; and (vii) to establish test centres, laboratories, and common
facility centres for the MSME sector.

In this direction, the federation offers services such as organizing meetings/conferences,

liaising with policy makers, analysing and interpreting policies, and taking up members’
difficulties with the concerned department/organization for redressal.

Laghu Udyog Bharati (LUB) Laghu Udyog Bharati was established in 1995. The main
objective of the organization is to promote and safeguard the interests of the small-scale
industry. Entrepreneurial training, support for technology upgradation, and marketing are
within the extended scope of its activities. Laghu Udyog Bharati has its representation in the
national and state-level government bodies connected with MSME.

Indian Council of Small Industries (ICSI) The Indian Council of Small Industries, founded
in 1979, represents around 1,500 associations of the decentralized sector. The major objectives
of the council include extending help to MSME, cottage enterprises, and artisans. In the
process, the ICSI aims at enhancing the contribution of the MSME sector in the overall growth
of the Indian economy. The major functions of the ICSI are consultancy, information
dissemination, entrepreneurship development, training, research, and so on. The ICSI
represents the cause of its member enterprises by giving suggestions for appropriate policy
making. The council follows the consortium approach to provide market-related services and
extends facilities relating to testing centres and quality control outlets.

Council of Scientific and Industrial Research (CSIR) The CSIR has set up a large number
of Regional Research Laboratories all over the country, which are developing new processes
for the manufacture of industrial products on a commercial scale. These agencies act as pillars
of support for the promotion and growth of MSME in India.

Non-Governmental Organizations (NGOs)

Besides the central and state governments and autonomous bodies, there has been an
emergence of NGOs in different states to provide financial assistance, information, training,
marketing support, legal advice, and so on to MSME. The 1991 SSI policy of the Government
of India favoured assistance to MSME through NGOs. A few training programmes for
unemployed youth to help set up industries under the PMRY have been assigned by state
governments to some NGOs. In the present scenario, the role of NGOs is assuming increasing
importance for assistance to entrepreneurs, particularly under microfinancing activities. Many
NGOs have set up Sub-Contracting Exchanges (SCXs) to promote entrepreneurship by
developing and strengthening linkages between buyers and sellers.

DISCUSSION FORUM

• Discuss the role of SIDBI in supporting MSME in India.

• Explain the various functions of NABARD.
• Discuss the role of HUDCO, TCO, and EPC in promoting MSME in India.
• Name the industry associations that promote MSME in India.
SNAPSHOT
 • Industry associations provide MSME a common platform to raise industry- related
issues and to initiate cooperative efforts for promoting the sector.
• The main objectives of CII are to provide information, advisory, consultative, and
representative services to the industry and the government.
Business Incubators

A business incubator is an organization designed to accelerate the growth and success of

entrepreneurial companies through an array of business support resources and services that
could include physical space, capital, coaching, common services, and networking
connections. It plays the role of an accelerator to start-up ventures. Business incubators are
shared office-space facilities that incubate with a strategic, value-adding intervention system
through mentoring, business assistance, and monitoring. Thus, new venture development
processes are facilitated while simultaneously making ventures aware of major risks and
minimizing the cost of potential failures.

Business incubators play a key role in providing assistance to nascent entrepreneurs,

particularly in the initial phases of their life cycle. University-based incubators are a special
type of business incubators that are located in universities. These business incubators are useful
not only in developed countries but also in emerging economies. They play a significant role
in job creation and economic development. They provide a unique opportunity to nascent
entrepreneurs to benefit from the talent and resources located in the university.

9.2 ENTREPRENEURSHIP EDUCATION

The EDII has been selected as a member of the Economic and Social Commission for Asia and
the Pacific (ESCAP) network of centres of excellence for HRD research and training. As a
member of the network, the EDII will have interactive access to information on the other 123
member institutions via the Internet. In order to address the need for developing new committed
entrepreneurs on a large scale, the EDII has launched several programmes. Some of them are
Fellow programme in management,Post Graduate Diploma in Management–Business
Entrepreneurship (PGDM–BE), the Post Graduate Diploma in Management–Development
Studies (PGDM–DS), and the Diploma in Entrepreneurship and Business Management.

EDII offers Open Learning Programme in Entrepreneurship through correspondence and

personal counselling. EDII also offers summer camps and entrepreneurship awareness
programmes for children and the youth to inculcate the spirit of entrepreneurship. To promote
entrepreneurial education and training in India, the EDII conducts a Faculty Development
Programme in Entrepreneurship. The Institute organises national seminars on Approaches to
Entrepreneurship Education and deliberates on the establishment of entrepreneurship and
business development centres (EBDCs) in educational institutions.

A non-business-organization incubator or an academic institution incubator is not for profit.

They have an objective of promoting an enterprise and facilitating the implementation of the
process of creating an enterprise. The role of these incubators has been to create some kind of
a forum whereby science and technology researchers as well as students and entrepreneurs
come together to create an enterprise or create value out of their own efforts.
 The other model of incubators comprises those supported by organizations such as
Microsoft, Infosys, Wipro, and Intel. They promote their own employees to spin-off an idea,
do the proofing, and go and attack the market. If the idea is successful, the company goes ahead
and acquires it, giving the founders a return on their innovation. There are certain venture
capitalists that run incubators themselves. The major benefit of being a part of an incubator is
that it insulates the entrepreneur from the impact of the macro and micro business environment.

DISCUSSION FORUM

• Name some of the prominent NGOs in the country set up to promote

entrepreneurial development in the country.
• Explain the role of SCXs in promoting entrepreneurship development.
• Name at least five business incubators in India.
9.3 ENTREPRENEURSHIP RESEARCH

In order to broaden the frontiers of Entrepreneurship Research, EDII has established a Centre
for Research in Entrepreneurship Education and Development (CREED), to investigate into a
range of issues surrounding small and medium enterprise sector and establish a network of
researchers and trainers by conducting a biennial seminar on entrepreneurship education and
research. The major activities to promote research are:

Journal of Entrepreneurship

The Journal of Entrepreneurship is a reputed academic publication of the Centre and has
established its credibility among scholars in India and abroad as a unique forum to disseminate
their research findings, both theoretical and empirical. The Journal incorporates insights gained
through research and innovative experiments, with a particular focus on countries like India,
which has mounted a wide range of programmes to develop the latent entrepreneurial
capabilities of its people. It focuses on the changing contours of entrepreneurial research and
training, thus acquainting the readers with the latest trends and developments in
Entrepreneurship. In addition to book reviews, the Journal also publishes original papers of a
high standard, to expand the frontiers of knowledge.

In-house Research Projects: In its pursuit to extend the frontiers of knowledge on

Entrepreneurship, the Institute encourages and undertakes in-house research activities by
making use of intellectual and other resources of the Centre.

Fellowships: Through these short-term research fellowship programmes, EDII envisages to

promote collaborative research endeavours with institutions and individuals outside the
Institute. It encourages young researchers to contribute to the field of entrepreneurship.

Visiting Fellowships: These fellowships are for senior researchers whom the Institute invites
to write papers or conduct research in the area of entrepreneurship and delve into a range of
issues surrounding small and medium enterprise sector.
Biennial Conferences: These conferences are organised to provide a platform to researchers,
academicians, planners, and policy-makers to come together to share their research findings
and experiences that are of contemporary relevance and interest.

Working Paper Series: The Institute has launched a working paper series wherein researchers
are encouraged to make a notable contribution to entrepreneurship and take up issues
concerning the area.

9.4 INTERNATIONAL CENTRES

In the international arena, efforts to develop entrepreneurship by way of sharing resources and
organising training programmes, have helped EDII earn accolades and support from the World
Bank, Commonwealth Secretariat, UNIDO, ILO, FNSt, British Council, Ford Foundation,
European Union, ASEAN Secretariat, and several other renowned agencies.

EDII vision also advocates the strategy of institution-building for forging entrepreneurship as
an International Movement. In order to, therefore, replicate its success story of promoting first
generation entrepreneurs through training and counselling interventions, the Ministry of
External Affairs, Government of India had assigned to it the prestigious task of setting up EDII-
like Entrepreneurship Development Centres (EDCs) in Lao PDR, Cambodia, Vietnam, and
Myanmar (CLMV nations). The Centres have successfully been yielding appreciable results.
Following this success, the Ministry has now assigned EDII the task of setting up such Centres
in Uzbekistan and five African countries. Beginning with the need assessment study and
identification of viable business opportunities, leading to planned interventions, such as,
evolving an appropriate policy framework for promotion of SMEs, undertaking advocacy for
implementation of entrepreneur-friendly policies, conducting appropriate training programmes
for potential and existing entrepreneurs, setting up incubators and developing SME Clusters
under an umbrella ED organisation in the target countries. The objective is to create a sound
economic structure and promote healthy bilateral relations. These countries have the potential
to evolve from traditional, less productive economies to industrially prosperous economies.
The transition, of course, is being supported by several economic and policy adjustments,
which have made the need for entrepreneurial initiatives blatant than ever before. Indigenous,
competent entrepreneurs can only get them assimilated into mainstream markets. Hence,
globally competitive entrepreneurs who can exploit and manage resources for the benefit of the
economy, besides creating jobs for others and of course, benefiting themselves are a pressing
need.

9.5 EDII FACILITATING ENTREPRENEURSHIP DEVELOPMENT

In order to promote entrepreneurship development EDII has set up several departments. They
are Entrepreneurship Education, Business development services and National outreach, Policy
advocacy, knowledge & research, developing economy engagement, and project development.

Empresario Start-up Summit is the annual flagship event organised by Entrepreneurship

Development Institute of India, Gandhinagar. It is an exclusive platform for Start-ups, new age
Entrepreneurs, Industry Mentors, Investors and the Student Community to come up at one
place, sharetheir entrepreneurial endeavours and experiences, gain amazing new insights, and
pledge to become an invaluable part of the ever-flourishing start-up ecosystem in India. Since
its inception in 2012, Empresariowent on to emerge as one of the largest entrepreneurship fests
celebrated in India. The fest witnesses start-ups of all sector and participants from every niche
of the country.

The Institute bagged the Excellence Award for University at the National Student Start-up &
Innovation Summit–Gujarat, held at Ahmedabad. The award was bestowed upon the institute
for its notable contribution to the field of entrepreneurship education and promotion.EDII, is a
nodal agency for key government policies related to start-ups and hence is attuned to incentives
and initiatives of the start-up ecosystem in India.

EDII, promoted incubator named ‘Centre for Advancing & Launching Enterprises (CrAdLE)’
under the aegis of National Science and Technology Entrepreneurship Development Board
(NSTEDB) & The Department of Science & Technology (DST), Government of India, aims to
support start-ups in the fields of manufacturing, food and agribusiness, renewable energy, and
healthcare.

SNAPSHOT

• NGOs provide assistance to entrepreneurs under microfinancing activities. Many

NGOs have set up SCXs to promote entrepreneurship by developing and
strengthening linkages between buyers and sellers.
• Business incubators play a key role in providing assistance to nascent
entrepreneurs, particularly in the initial phases of their life cycle.
SUMMARY

A number of support institutions set up by the central and state governments of the country and
various other agencies help entrepreneurial development in various ways. The activities of
support institutions cover a wide range of services such as financing, equipment support,
technical assistance, training, marketing, and providing subsidy and grants. The various
institutions supporting entrepreneurial activities in India are divided into central level, state
level and other institutions.

The central-level institutions for supporting entrepreneurial activities are set up by the
Central Government. They are: National Board for Micro, Small, and Medium Enterprises
(NBMSME); Khadi and Village Industries Commission (KVIC); Coir Board; Micro, Small,
and Medium Enterprises Development Organization (MSME–DO); National Small Industries
Corporation (NSIC); National Science and Technology Entrepreneurship Development Board
(NSTEDB); National Productivity Council (NPC); Entrepreneurship Development Institutes
of India (EDII); National Research Development Corporation of India (NRDCI); and National
Entrepreneurship Development Institutes.

The state-level institutions for supporting entrepreneurial activities are set up by the various
state governments in India. They are: State Directorate of Industries; District Industries Centres
(DIC); State Financial Corporations (SFC); State Industrial Development Corporation (SIDC);
and State Industrial Area Development Board (SIADB).

Apart from central- and state-level institutions, there are various other institutions supporting
entrepreneurial activities in India. They are: National Bank for Agriculture and Rural
Development (NABARD); Housing and Urban Development Corporation (HUDCO);
Technical Consultancy Organizations (TCOs); Small Industries Development Bank of India
(SIDBI), Export Promotion Council (EPC); Industry Associations; Non-Governmental
Organizations (NGOs); and Business Incubators.

KEY TERMS

Business Incubator: A business incubator is an organization designed to accelerate the growth

and success of entrepreneurial companies through an array of business support resources and
services that could include physical space, capital, coaching, common services, and networking
connections.

Export Promotion Zone/Export Processing Zone (EPZ): An EPZ or Export Processing

Zone is one or more special areas of a country where some normal trade barriers such as tariffs
and quotas are eliminated and bureaucratic requirements are lowered in the hopes of attracting
new business and foreign investments. It is an industrial estate that specializes in manufacturing
for export and offers firms free trade conditions and a liberal regulatory environment.

Industrial Estate: An industrial estate can be defined as a method of organizing, housing, and
servicing industry, a planned clustering of industrial enterprises offering standard factory
building erected in advance of demand and providing a variety of services and facilities to the
occupants.

Special Economic Zone (SEZ): An SEZ or Special Economic Zone is a geographical region,
which has economic laws that are more liberal than a country’s typical economic laws.
Moreover, these regulations tend to contain measures that are conducive to foreign direct
investment. Conducting business in a SEZ usually means that a company will receive tax
incentives and the opportunity to pay lower tariffs.

Sub-Contracting Exchanges (SCX): Subcontracting Exchanges, also called Sub-contracting

and Partnership Exchanges, are centres for technical information, promotion, and matchmaking
for industrial subcontracting between large and small enterprises.

Venture Capital: The money provided by investors to start firms and small businesses with
perceived long-term growth potential is termed as venture captial. This is a very important
source of funding for start-ups that do not have access to capital markets. It typically involves
a high risk for the investor, but it has the potential for above-average returns.