Friday, January 13, 2017

Entrepreneurs and their pain

Yesterday I had a very interesting conversation with a budding Marwadi Entrepreneur from Chattisgarh. He has opened a new steel manufacturing unit. We were discussing about Indian economy and it's future, when suddenly he started mentioning about his personal experience.
He has set up a medium scale steel manufacturing unit in Chattisgarh which basically serves the purpose of mining companies by providing equipment for crushing of mining output. I was under the impression that after the BJP government came into power, things were much easier for the young entrepreneurs specially in the MSME section. I also used to think that the red tape has decreased. But he gave me certain facts which made me rethink what was actually happening on the ground.
According to him, to get a finance for his project he has to first get a certificate from the government for diversion of his land from agriculture to manufacturing. The Chattisgarh government had provided this facility for free and the owner of the land has to just give a written information that he is diverting his land. But our Marwadi friend had to run after the officials and ultimately pay "under-the-table" to get the certificate.
To get the finance he has to also get an electric connection to his site. Before some years the Chattisgarh government used to provide subsidy to get the connection. But now the cost was very high. As if this was not enough, the officials again had to be "fed" to get the connection. On a whole he told that about 30% of his cost was for the "expenditures" of the beaurocrats. I was shocked to know that even the Collector asked for something.
When I told him that now everything will stop (because of demonitisation), he told that its still there and the problems of the entrepreneur has increased. The officials still ask the black amount in cash and the entrepreneur has to get the amount from  multiple accounts and in the process come in notice of the IT department.
This experience of mine cleared my misconception that this government has changed things for the entrepreneurs. Our youth have to depend on jobs created outside the country. With people like Trump, our country has to start creating jobs and to do that it has to create an environment where entrepreneurs are not afraid or exploited.
I hope that Modiji starts complementing systemic reforms with beaurocratic reforms, so that our entrepreneurs (specially MSME entrepreneurs) start growing.

1 comment:

  1. Sir,
    If u r thinking everything is going to change after demonetisation, then I don't know how you are relating demonetisation with corruption. And don't u think u r hoping extra ordinary from Modiji...as per my opinion, this so called under-the-table culture or corruption cannot be destroyed unless or until it comes from your inner soul.

    ReplyDelete