For a very long period in the history of development planning, empowerment and how to do it remained a big question mark. The issues were all agreed upon. Poverty alleviation needed capital infusion in the hands of the poor. This would empower them to ride out of the poverty trap and climb into the prosperity cycle. The issue was how? Would it be the subsidy route or some other way?

Jeffrey Sachs in his celebrated book, The End of Poverty, traces the malaise of poverty to capital deprivation. His thesis, quoted by the Nobel laureate Abhijit Banerjee in his Poor Economics, emphasises the importance of empowering the poor with capital.

He argues that the curse of poverty worsens with time. The government of a poor country is poor because its people are poor. Without a remedial intervention, the state of poverty keeps getting worse. This is so because without an intervention mechanism per capita capital availability goes down across generations due to the rise in the population number. This is simple arithmetic with devastating consequence.

Now, will a huge infusion of capital by way of dole help? Apparently not, because a dole is never appreciated in a productive way and tends to be frittered away through the current consumption route. So, he urges the aid agencies to act more like venture capitalists in giving out aids.

However, at the operational level, the issue has serious ramifications. The basic premise of the argument draws its strength from the fact that if funding is purposive, whoever is getting funded must be made responsible both for the fund and the use of it for the purpose the fund is taken.

The issue of collateral for a country loan is different from that of an individual. If a loan is given there has to be a guarantee to cover the risk of failure. For someone with no asset to pledge, access to capital under the conventional structure is completely blocked. In fact, when it’s argued that capital deficiency is the root cause of poverty, this is the reality that it stems from.

So, the challenge was to create a structure wherein the poor can also be provided with access to fund or capital. Because the issue of poverty can only be fought in a sustainable manner through the creation of access to capital while ensuring that they can easily avail themselves of the route created for them.

What if a loan is given to a group of poor who will be jointly responsible for the loan to individual members? The revolutionary idea to tackle the issue was the creation of joint liability groups. The logic here is, if the fund is treated to have been given to the group for productive use and made responsible for it together, the group members would ensure that each uses the fund for productive use and the repayment contribution also keeps flowing. The idea of social collateral brought about this concept and is being implemented globally. The concept has revolutionised the fight against poverty and is fast spreading.




To do or not to do is a classic dilemma that characterizes an entrepreneur. Starting with the business proposition down to marketing and recruitment an entrepreneur has myriad dilemmas to sort out. While a decision taken right spells success, a decision gone wrong means another decision tree to work on.

There is, however, a difference between an entrepreneur with no issues with regard to capital flow and a small entrepreneur with limited access to funding to leverage on. Therefore, the consequences of risk for a person with substantive funds to test the feasibility of an idea are entirely different from those of a start-up. In the case of the former, tasting the market water may not be a make or break situation for his survival. In the case of the latter, however, should an idea fail, he may not have anything left to test another idea and grow.

With the country now focused on small businesses to drive growth, let us look into the issues of enterprise at the start-up level. For a start-up entrepreneur, the dilemma arises from the risk of losing a flow of steady income.

He has to weigh the option of sacrificing a source of steady income against embracing an uncertain income flow. By getting into the business he would be exposing his family to the uncertainty as well. Will his family be up to it? Will they be ready to cut down on the lifestyle? A grave decision fork that faces an aspiring entrepreneur right at the beginning!

Once he sorts this out and trudges on, the next one is whether to do it alone or do it with a partner? In most cases, businesses fold not so much because of lack of opportunities but due to differences between partners. Business by itself tends to keep one on the edges. If at the top of that the partners are at loggerheads, the business as an entity starts suffering.

And then of course comes the staffing and infrastructure issue. And it keeps rolling. Once the business is on the go, the decisions become much more complicated. Because if the break-even gets delayed, the initial risk of planning for a beating in income gets compromised. There is then the risk of failure and embracing an alternative.

In short, the decisions, though, may appear disjointed, are not. Every single decision has feedback on the past. And all past ones have an impact on the future. Enterprise is exciting precisely because of challenges and the risks involved in them. It’s a field that needs creative thinking and out of the box decisions. The rewards, therefore, are commensurately higher.




What do you recruit? This is a question that tends to crop up time and again at various interactions. The question actually tends to verify my recruiting attitude. Do I recruit attitude or skill? I must confess that this question had set me thinking and I found that I had indeed struggled with this question for a long time as I presume do many others.

When a vacancy happens and the ad to fill that space goes out, our mailbox fills up with CVs written with various degrees of appropriate pitch about the respective candidates’ skill sets. Everybody goes all out proving why she or he is the most suitable candidate for the job. Invariably, the applications are all about their competence.

For a recruiter, however, the challenge is to lay out, from his of her point of view, the constituting elements of competence. In order to do that most of us scale the CVs on skill and experience. Suitability boils down to choosing the one who ranks the highest on that scale.

In doing so, do we open ourselves to a very high degree of disappointment later? If we look back and see how many times we have been disappointed with our recruitment choices, we would realise the faults in such a process. Despite our reluctance to accept our own gaps in the attitude toward recruitment, we must admit that a disproportionately higher weight is placed on skill over attitude.

What does it lead to? When skill is the only criterion in any process of recruitment, it tends to relegate the team to the backburner and creates the possibility of killing the team itself. Let us ponder about it a bit.

When someone joins a team, he is not only assumed to have the requisite skillsets to take up the job – that’s what we have already checked through an elaborate process of recruitment tests. But on joining if it’s found that while he is a greatly skilled one, yet finds it extremely difficult to gel with the team, what do you think will happen to productivity? It doesn’t require a great deal of understanding to guess that the teamwork would suffer.

Furthermore, in the fast changing nature of today’s business, skills need constant upgradation or can be trained. Training attitude to a candidate who is lacking seems a more uphill task.

So if asked the question, what is it that I recruit, my clear answer is, “why attitude of course. That’s the top most criterion.”




What Bengal thinks today, India thinks tomorrow. This confidence in the intellectual and enterprising abilities of the citizens of the then Bengal was reposed by Gopal Krishna Gokhale. Subsequently, this became the tagline for everything that is Bengali.

He couldn’t have been far off the mark. Think about all the achievements in science, mathematics, literature and enterprise. Accepting challenges and leading from the front was the hall mark of the Bengali ethos. This was the part of the nation that challenged ‘sati’, rose against the British, sacrificed lives to win freedom for the country.

This was also the land and language that won the first Nobel prize for Asia. And there were later. In science, the contributions of Satyendra Nath Bose, the great theoretical physicist, are still paying rich dividends in frontier technologies. Meghnad Saha, an astrophysicist known for saha ionisation equation, and a polymath of the stature of Jagadish Chandra Bose reflected the adventurous spirit of Bengalis.

The hallmark of the entire spirit was to accept challenge and continuously keep raising the bar. That is how enterprise is defined. The same spirit found reflections in industry and also in technologies. In pharmaceuticals, steel, shipping – you name it, Bengalis were there ahead or in tandem with others.

Things apparently started changing from the seventies. From an eager embracer of change, Bengal went into a cocoon and refused to stay in step with time. Case in point is computerisation. A Bengal that took pride in being a pioneer in technical education and change pushed back a frontier technology with the result that new enterprises that would one day spawn millions of jobs and wealth got seeded in other states. We refused to accept pioneering work in invitro fertilisation forcing the innovator – Subhash Mukhopadhyay — to commit suicide. And the accolades were won by Robert G Edwards. Much later the world community accepted Subhash Mukhopadhyay’s pioneering contribution in the field. But he wasn’t around to bask in it.

The same thing happened with industry. Calcutta was the headquarters for almost all the blue chip companies in the country. They were here mainly because of the local educated skill. West Bengal was the state that attracted talent and was the breeding ground for all round enterprise. But the same state that found pride in meritocracy slid into mediocracy from the seventies. The corporates shifted as did talents leaving West Bengal to bask in the glory of what it was and not in what it would be.

We therefore need restoration of the same spirit of adventure that marked our glory days. Enterprising spirit needs a collective confidence that we can. We need to accept merit and its supremacy. Without that there can be no achievement, be that in intellectual pursuits or in commercial ventures of substance. We need to change and raise our bars.




Have you heard of Srabani Bera? I will not be surprised if your response were, “Srabani who!” So let’s hear Srabani’s story first. Like many other families like hers, Srabani’s husband had to migrate to distant Bengaluru to earn a living.

Such migration always tends to be fraught with pain, pain of separation from immediate family. More often than not, the families suffer more due to the absence of an able male support. Kids miss their fathers, wives their husbands.

Why did Srabani’s husband migrate? This is a non-starter as we all know what does poverty and lack of opportunities to escape the vicious grip of penury do.

Srabani was artistically inclined and she wanted her husband back home but she didn’t know how. Could she have done something with her natural inclination and monetise it?

The help came in the form of microloans. Srabani has set up her own artefacts making unit. She is expecting to scale it up big enough to support the entire family so that her husband will not need to work away from home.

Srabani is an example of what grit and right kind of help may achieve for the person concerned. Everybody has some skill. How one puts that to use differentiates that person from the rest. Srabani by turning her artistic inclination into an earning source for the family is showing others how to ride over the economic bumps.

Srabanis of this world are the actual influencers in the nation’s quest for rural uplift. This is a dynamics that needs reiteration. Why do the poor remain poor? That’s the question that keeps dodging us and has been dodging us ever since we won our freedom.

Subsidy, in the initial days of struggle with development, was thought of as a way of helping the poor out of their predicament. But for decades, the subsidy route failed to yield sustainable gains. The key word in development is sustainable. But the subsidy route proved to be non-sustainable. The idea of empowerment by providing micro capital through the microfinance route started catching up from the seventies.

The foundation of the idea lay in accepting the natural entrepreneurial spirit that is inhered in the poor. Life for them means innovating to survive on a daily basis. What if this spirit was harnessed as the springboard for putting the poor on prosperity cycle? By turning into micro entrepreneurs, Srabanis of this world not only defines a route for self-transformation, they also act as the model for others to follow. They are the real heroes of new India by paving a sustainable development path.




Not all persons are equal. Neither are our financial needs. Yet all of us need banking services – from the very basic to the more complicated commercial needs.

For a migrant labour living outside there is a need to send money back home to his family. He needs a bank to keep his money and send across to his family. The family also needs an account to receive the money. The basic purpose here is send and receive money.

Previously, the same service used to be delivered through the postal department. The instrument of transfer then was money order. With the evolution of the banking services and with the availability of modern technology this mode though exists has transmuted into eMO or electronic money order. One can still send money orders but they have to be between Rs1000 and Rs50000. But it cannot be sent from any post to any post office unlike previously.

However, for those with remittance needs, a savings account ought to be the preferred route, be that in bank or post offices for the simple reason that one doesn’t need to keep cash at home in excess of need anymore. The same account can also serve the needs of a piggy bank and to deposit and transfer there is no need to visit banks anymore as all the basic needs can be satisfied by pushing a few buttons on the mobile.

But banks cannot survive on the remittances alone. And as we start going up the ladder our financial needs also expand. Loans, the primary earning instrument for the banks – they take money from us as savings and lend the same out against higher interest with the difference remaining as their primary source of income, are our second most important needs with the growth in income.

As we climb the ladder of prosperity we need to own houses, cars or even loans for other consumptions. This society survives on credit. We spend now only to make it up from our expected future stream of income. We also save alongside to cover the needs that may arise in future and may need to be covered not through loans but with own assets. The banks are the primary destination for our rising and spreading financial needs.

We need to remember that the bouquet of services that we now get from banks has not been there always. For example, banks are now selling insurance. But this was something that we couldn’t even imagine a few years back. Neither could we think of buying mutual funds, which incidentally are also of very recent (recent as in few decades of existence if we discount UTI products) origin, directly online within a specific bank’s online operational environment.

The same is true for banks’ engagement spectrum with businesses of various hues. From basic current account related operations, overdrafts or LCs to consortium lending and many other services, banks engagement spectrum with the business entities is no longer just a handful. It’s a huge spread.

While the banks have grown in response to the ever spreading needs of the customers, the regulators have also been facing challenges to anticipate the needs and place control mechanism in place lest events should overbear the legal bounds of operations.

It has long been in discussion whether banks can have similar focus for all types of customers or different formats of banks catering to different needs of the pyramid. But this is a different discussion.




The huge rural spread of Indian market has always remained a dream research area for corporates as well as academic researchers. Ever since Professor Prahlad theorised on base of the pyramid – that largely refers to the rural segment of India given the characteristics – rural market has remained the buzz. The corporates have also played with different marketing strategy to penetrate the market to grab the share. However, the reverse, i.e. marketing the rural products in the urban and global market has yet to take the spurt that it so deserves.

The major struggle for the corporate marketing teams has been to overcome the local logistics support. Various innovative ways have already been developed to address the issue. The result has been a phenomenal growth in the rural consumer expenditure.

All the consumer dipsticks are pointing out the trading up of the rural consumers. The organised consumer spend in the rural sector is projected to reach a whopping $100 billion by 2025 or even before – a figure that one could never think of even a few years back.

A Credit Suisse study looked into the reasons behind this transformed consumer preference for branded products in the rural market. The likely reason for such a trading up, the study finds, is the increasing industrialisation in rural areas. It finds 75 per cent of the new factories located in the rural areas.

Such industry proximity tends to spurt a transformation in the consumer behaviour as it brings in its wake an urban connect that the areas lacked hitherto. Penetration of televisions also plays its role through saturated marketing through ads and at the same time providing access to the products through innovative sales and marketing strategies. The growth has been so huge as to have already eclipsed the growth rate of urban consumer demand for branded products.

Unfortunately, however, the reverse has yet to show an inspirational growth rate. Rural products are not getting upscaled to the desired extent. Processing of local products keeping global quality standard remains an issue. As a result, the agrarian and the local artefacts, despite having a huge potential for being a craze on the global market are failing to realise the potential.

The authorities are now aware of it. The tag of food safety authority’s certification is becoming popular and people are demanding products with FSSA tag before putting their money into it. Unfortunately in the global market our products have repeatedly shown up in bad lights due to the presence of various contaminants. Being aware of the issue, the regulatory authorities have sharpened their vigil. It would take time to reverse the trend but it will happen with the awareness about quality also percolating down to the base of the pyramid.

Seized of the issues, the Centre has initiated steps to better organise, market and awareness programmes to create a demand for our rural products that could upscale the entire base of the Indian market. It is expected that by 2025, the rural market will not only surpass our expectations about consumer demand, it will also provide a similarly encouraging trend in marketing its products.

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