Tariq Aziz Choudhary
This article will examine the prospects and challenges faced by entrepreneurship development in Jammu and Kashmir State and will delineate how the schemes like start-up India, Make in India and digital India can develop the entrepreneurship development environment in the State. The Jammu and Kashmir is economically backward state as the State and Central Government are not keen to attract the investments in different sectors due to various issues like bullish attitudes of investors, lack of financial literacy, easy access to finance, political instability and rugged geographical terrain are among others prevailing circumstances which are main hurdle in this regard. Nevertheless, despite of all bad conditions the state is on the path of economic development. In this scenario entrepreneurship which is globally considered as an essential and most important source for employment generation, thereby providing way for economic development. As global economies are facing the challenge of unemployment and the solution to this problem is entrepreneurship development. The state of Jammu and Kashmir is facing an alarming growth of unemployment according to a survey recently. Jammu and Kashmir State is on the top of the list in terms of unemployment among others States in the country. In this dilemma the trust is on employment generation in the state through different means and one of them is entrepreneurship development by taking the benefits of schemes like Start Up India, Make in India, Digital India among various others.
Since India is striving for a great nation in scientific research and innovation, it can be seen that the growing development of start-ups has significant influences in Jammu and Kashmir State. This article figures out solutions for Jammu and Kashmir start-ups and entrepreneurship development related financing problems which can encourage entrepreneurship and support for the development of start-ups in the state. These all exert a bullish impact on the economic development of state in the long term.
If we will look at the literal meaning of the start-up it is actually to provide a basic structure to the functioning of economic assets of a state or region, give an idea about a real image. So, by giving an idea a real shape is itself a step towards making contribution in the welfare of the state. As Jammu and Kashmir is having abundant unutilised resources there is huge potential for the start-ups to prosper and survive in the market competition. For the development it is not only the resources that can make the state self-reliant but in order to utilise the resources labour and capital is also needed. We all well understand that a startup is always about an idea of how to impact a customer. But, this is just where it all begins. What we don’t always give credit to is how startups have a far-reaching ripple effect on the socio-economic fabric of the demography in which they operate. It is interested to explore this ripple effect and all the changes that some startups have brought in the cities, in their industries, in the global markets they operate in. And the changes have they brought in the socio-economic fabric of the societies in which they operate – the impact that they have created beyond their customers. The questions to ponder around policy and progressive government to encourage startups are not discussed enough. J&K should have this on its agenda and perhaps venture capitalists who fund startups should measure their success also by the greater impact metrics beyond returns but unfortunately the role of venture capitalists has not been seen anywhere in the state.Apart from delivering value to their customers, startups have a direct impact on the cities they make their homes. Infosys has impacted Bangalore and Alibaba has changed Hangzhou. What Google has done to Mountain View and how Microsoft transformed Redmond are case studies in themselves, when these startups grew they directly impacted growth of their cities as well. Employment opportunities for youth increased and new employment patterns came into picture. Demand and employment opportunities for engineers saw a steep rise. Local youth had new opportunities to pursue and experienced talent started moving to these cities in pursuit of a challenging and high-growth career. Similarly in the context of Jammu and Kashmir state same thing is going to happen because when we talk about the unemployment in state it is huge so by making the cordial environment for startups in state not only the unemployment ratio will decrease but also it is an alternate method for the govt. to release the people of the state from the distress of being unemployed. Also it is not that only the big projects can change the economic landscape of the state but small ventures are going to pay more because when start-ups will start at the micro level the first thing is that the concept of entrepreneurship and self-employment will develop in the minds of people and the second thing is the total GDP of the state will increase thereby per-capita income will increase and most important thing is there will be positive impact on the capital formation in the state.
Problems faced by startups in Jammu and Kashmir : Apart from knowing how start-ups can participate in the socio economic development of the state and also the Government providing various facilities to entrepreneurs through JKEDI, J&K Bank and others sources still there are lot of problem that need to be handled with utmost care, so that more and youth will start thinking and getting motivated to set their units. That various hurdles that an entrepreneur of a start-up faces during the different stages are as under:
Ease if doing business: As per the said report, J&K ranks 29th among 32 states assessed, with an overall score of 0.30 percent, thus making it figure among ‘worst states to do business with’. Only Meghalaya and Nagaland are behind J&K.
Lack of venture capitalists: Mere an idea cannot generate revenue on its own for making it possible success story finance and other infrastructure is needed. So when we talk of venture capital in context with J&K it is present only in papers not in the real markets. As we know that venture capitalists provide funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth. But the Government of the state has failed to make a conducive environment for the venture capitalists, so that they can help those who don’t have much access to funds provided by various other institutions.
Lack of infrastructure: The other problem is of infrastructure which is equally important for survival for the start-up. In the state of J&K most of the areas in the villages or people in hilly regions lack the basic infrastructure like electricity, road connectivity with the cities. People living there are reluctant to setup units in these areas, because of various problems involved which make their output costlier. So there is the need for the Government to intervene and provide these basic facilities.
Problem of political stability: The biggest hurdle for the start-ups in the state, mainly in the valley is the political instability. People prefer to stay in government jobs irrespective of the other good opportunities available, because of the uncertain political environment which has a direct impact on economic environment. People who can do great in other fields like in business, small ventures etc. try hard to get into the Government sector, as there are lots of protests, shutdowns due to political disturbances in the valley.
This articleis an open suggestion to the State Government and other policy makers that how start-ups and entrepreneurship can uplift the economy of the Jammu and Kashmir state from the shackle of economic distress. As many businesses start with a dream but it takes more than just a dream for them to grow into successful businesses including the tenacity to overcome the many challenges facing start-ups today. Start-ups take time, effort and energy. Funding is a major concern for start-ups and small businesses. When the economy tanked it made it harder to convince investors and banks alike to part with the cash that’s essential for growth in the early days of a business. Credit today is tight and it’s not clear precisely when it will become more readily available. Plus, there’s a growing trend of smaller initial investments in early stage start-up. From the facts provided by the Government and other organizations it is clear how much unemployment is there in the state. As J&k got the rank of 29th in ease of doing business ranking, in this scenario of widespread unemployment schemes like digital India, startup India, Stand up India, Make in India and others entrepreneurship development schemes can be the source which can generate aggregate employment in various sectors especially in the small scale industries. As it is very clear how start-ups and entrepreneurship development are important in transforming the state into well-economically developed state. Also on what matters Government should take note on to make the economic environment conducive for the long run survival of the enterprises. So the need of the hour is for the Government to intervene in the positive attitude to remove the barriers faced by units. Because after all the success of the economy depends the industries especially small medium industries.
(The author is PhD Research Scholar, Deptt. of Economics JamiaMilliaIslamia Central University, New Delhi.)
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