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Unfolding Entrepreneurial Potential in Millions of Villages: Can Digital Networks Help?

The asymmetry in access to resources, institutions and technologies between urban and rural areas is enormous. Therefore, many creative people in the rural areas are unable to fully exploit their potential, not because they don’t have ideas or the persistence to pursue them, but because they lack an appreciative peer group. The idea of setting up one lac (0.1 million) Common Service Centres in as many villages proposed by Government of India can have revolutionary implications, if its full potential is realized. Let me share some of the possibilities that can make this effort truly transformative.8-8-16-grassroot

Information and Communication Technology (ICT) applications can definitely reduce the digital divide, provided the institutional contexts in which knowledge evolves is properly appreciated. Three barriers often impede learning: language, literacy and localism. SRISTI and IIMA had developed perhaps the first multi language, multi media database of innovations in 1997 to overcome these barriers, but not much has happened after that. High transaction costs impede the access to digital knowledge, innovation and opportunity base. A culturally sensitive interface can overcome some of the inhibitions that people may have in accessing them. The major challenge is to create an institutional structure around the Village Level Entrepreneur (VLE), who will run the Common Service Centers so as to generate social capital. VLEs can contribute to this cause by taking several initiatives (a) build a database of social enterprises like voluntary blood donors which can be linked with services like (b) create a database of skills of different kinds in the village including cultural strengths to promote networking for commercial and non-commercial purposes (c) mobilizing collective action for management of common property resources (d) make a database of people from the village working outside who can act as mentors to budding entrepreneurs, knowledge holders and students (e) create a platform for barter exchange of various kinds of products and services in order to generate horizontal village to village network (f) develop a pool of tutors who can provide tuitions to the children who are first generation learners and (g) provide opportunities for voluntary work within the village for people from any where in the world who would like to contribute towards societal upliftment processes.


Many of these activities will reduce asymmetrical opportunities which often arise when new technololgies are used. Generally when new opportunities appear, the people who are able to take advantage of it are not always the neediest ones. The gulf between the haves and have-nots may reduce in the above framework of the social capital.In terms of economic initiatives which a Village Level Entrepreneur can take, the availability of the public information and government records in itself is unlikely to provide any substantial financial income to the VLE. Some incentives which may motivate an entrepreneur to create social capital as a prelude to creating financial capital are I) Cross-subsidization: VLE can generate more revenue through other activities, or for every service delivered in low paying or non-paying activity, she also gets incentives for taking up some more paying activities or availability of the former give her a legitimacy which generates demand for other services. II) Access to a large data base of green grassroots innovations, which not only provides information about innovations but can also serve as a trigger for ideas and innovations. The database can trigger demand for goods and services offered by grassroots innovators and traditional knowledge holders. There is also an oportunity for lateral learning and pooling of best practices and building value chain across villages or sectors. III) Social capital built through provision of socially useful but less paying activities may motivate people to try out the other more paying services. Innovations can also help in pulling other people to the kiosk.
In addition, the livelihood prospects for these VLEs can be improved in the following ways : i) providing link with major e-commerce platforms to auction their goods and services, ii) encouraging major retail chains to use these kiosks as distributed retail points, iii) helping major procurers of rural produce procure their raw material and value added products through CSC. For instance, linkage with courier services which carry suitable packaging boxes might generate demand for locally processed foods, nutraceuticals and a whole range of organically produced materials, or hand made things. iv) innovators could get orders for their products and might be able to compete better against providers with vast distribution network. Special recognition can be given to those who promote sales of decentralized knowledge based products and services; v) market research companies can develop panels of respondents at CSCs to gauge changing perceptions, attitudes, preferences and purchase decisions; vi) VLEs may provide bundling and dissemination facilities for workers and artisans to help them in mobility and pooling of services vii) insurance, tele-medicine, bulk-repair service providers, etc., will also get new opportunities of reaching rural masses. These CSC could generate incentives for people to seek what President Kalam says Urban facilities in Rural areas (though I hope he does not want urban pollution, chaos, self-centeredness and lack of respect for common properties to come into rural areas).


These initiatives can go a long way in empowering village level entrepreneurship. Creativity in business processes need to match creativity in technological innovations. For grassroots innovators, the one lac Common Service Centres offer enormous opportunity for scaling up their businesses. Linkage with auction platforms like E-bay will provide global opportunities. The next frontier in the innovation movement is broad-basing market access and improving the income earning opportunities for innovators and other stakeholders. Only when rural products are bought by all of us will income flow from our hands to them. The collaborative model will have to be developed so that rural producers compete not among themselves as much as with others entrenched interests. ICTs have the potential to invert the metaphor of Gandhiji’s three monkeys. They can bring the unseen and unheard into public focus and give voice to the disempowered. I hope that the readers will suggest many more ideas for using ICTs for empowering knowledge rich, economically poor people with particular emphasis on knowledge based value chain development. (Honey Bee, 16(4):3, 2005).


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