Rural Development Secretary Rohit Kansal on Friday said that rural enterprises can become resilient by adopting the five ‘C’ formula: capability, connectivity (markets, logistics, digital platforms, infrastructure), capital, competitiveness (including demand, not just supply) and the confidence to take risks.
He delivered the keynote address at Sa-Dhan’s National Conference on Inclusive Growth. “A loan alone can’t create a sustainable enterprise,” Kansal said, adding that just helping households earn more is not enough; it is important to build assets and productivity that will help weather the next shock.
“A household can earn more in a year and still be vulnerable due to one illness, flood or market failure. Resilient growth should be measured by the strength of the household’s enterprise, not the quality of the lender’s loan book,” Kansal said.
He said the central government, under the National Rural Livelihood Mission (NRLM), has organised more than 100 million women into around 9.3 million self-help groups, whose key strength is not just scale, but aggregation and the trust between poor households, banks, markets and the government.
He said that nano enterprises have unique needs: some may need working capital matched to their cash cycles; some may need equipment finance, seasonal repayment, receivables-linked lending or guarantees for first-generation entrepreneurs. “We need a continuum of financial instruments, not a continuum of loan sizes,” he said. “They sit between micro credit and conventional MSME finance.”
Later, speaking at a panel discussion on ‘Enabling Quality of Life through Income and Protection: Role of Sustainable Enterprises, Investments and Social Security’ at the same event, Amit Shukla, joint secretary in the Ministry of Rural Development, cited an Indian Institutes of Management (IIM) study that said the monthly income of Lakhpati Didi households has increased by 61 per cent. “The SHG movement is active across all dimensions: old age security, water delivery, microcredit and more.”
“Enterprise success depends on the skill of the entrepreneur, technology, credit and market access, but livelihoods become sustainable only through diversification and value chains,” said Govind Narayan Goyal, chief general manager, State Bank of India.
Dr Sajid Amit, executive director, South Asia, of Water.org (a global charity working on water and sanitation issues) and another panellist, said water access helps protect enterprise income from shocks and also aids income generation.
