Magazine

Nurturing START-UPS

Views: 70

The Small Industries Development Bank of India (SIDBI) will pursue the strategy of not becoming the competitor of the existing financial players, but instead act as a centripetal force to strengthen the entire gamut of financial institutions and thereby the financial ecosystem itself, shares Dr K Shivaji , Chairman & Managing Director, SIDBI, with Kartik Sharma and Akanki Sharma of Elets News Network (ENN)

 Dr K ShivajiChairman & Managing Director, SIDBI

Dr K Shivaji
Chairman & Managing Director, SIDBI

In the past one year, SIDBI has worked a lot towards skill development and strengthening the small and medium scale enterprises. Can you elaborate on that?

In India, we need another 10-15 million jobs for the aspiring youth. But, the job creation is almost negligible, which is surely an imbalance. So, there is an urgent need for intervention. The youth today is willing to undertake entrepreneurial initiatives for good, attractive and lucrative jobs. We need to capitalise and leverage this kind of zeal seen across the country by encouraging the start-up movement.

It is important to emerge fast in a competitive market, and entrepreneurs should be smart in their business plans, business models and day-to-day operations. At SIDBI, we have taken up the credit-plus approach, which means not only providing the capital, but also coming up with a holistic approach in terms of fiscal and non-fiscal hand-holding.

Make in India, which is one of the prime projects of the Government of India, has already started yielding results. On that front, SIDBI has also come out with a dedicated front cor pus of Rs.1,000 crore to push the manufacturing sector. This Rs. 1,000 crore credit has been earmarked to take care of not only manufacturing, but also associated manufacturing activities, so as to give a holistic push to the sector. SIDBI will pursue the strategy of not becoming the competitor of the existing financial players, but to strengthen the entire gamut of financial institutions and financial players, which will help in improving the entrepreneur ecosystem.

Is it not challenging to provide security to these start- ups? If these fail, will the government be there to provide support?

We may be able to provide at least some support. However, an entrepreneur needs to put in his best. Rigour, conviction, commitment and energy need to be pulled together. However, security from safety net necessitates fulfilling certain requirements, and may come in various forms, like guarantee, hand-holding or mentoring. However, giving a guarantee that a venture would succeed and in case of failure, somebody else will take care would make people lethargic. Probably, doing it partially could be thought of to avoid disinterest.

Nurturing START-UPSSIDBI is also doing a lot of work in the field of financial inclusion, for which government agencies have launched various campaigns. In this scenario, how does SIDBI view the need to push financial inclusion in the country?

A large number of enterprises are unable to mobilise adequate finances in time, and sufficient funding for the unemployed is still largely amiss. Only Rs. 17,000 is available as loan for around 5.57 crore of entrepreneurial units each; as a result, the huge potential of the talented people, who are unserved and unemployed, remains locked. There is a need to unlock that potential, so that they can also contribute to and participate in the journey of the nation’s growth.

However, the various forms of financial inclusion drive, which is now emerging as a complete set of initiatives undertaken by the government agencies, regulators and financial institutions together, is a step in the right direction. The Government of India, along with various State Governments, institutions like SIDBI and banking regulator Reserve Bank of India (RBI), is coming up with a number of multi-dimensional initiatives to strengthen the drive. I believe that we should also push social inclusion and economic inclusion, so that the ultimate objectives go hand-in-hand.

Moreover, various new banks, which were issued licences by the central bank recently, are also going to play a very important role in this context. SIDBI, in a very coherent way, is ensuring maximum focus on that segment by devising new instruments. Apart from this, we are also getting a good help on account of availability of Aadhaar, and Jan-Dhan accounts. It makes it very easy for financial players to move forward and implement their strategy.

The government’s initiatives, like Digital India, Skill India Mission and Make in India, are together galvanising the start-up movement

The technological sector is home to the major chunk of start-ups in India. They are also the backbone of the Digital India initiative. By backing these start-ups, do you also see SIDBI contributing to the initiative?

The government’s initiatives, like Digital India, Skill India Mission and Make in India, are together galvanising the start-up movement. Entrepreneurs need various kinds of constituents to work in tandem, which will finally culminate into a larger start-up movement as a result of strengthening of the overall technology ecosystem.

Digital India is certainly one of the most desired initiatives of the day, which will help enhance the country’s growth potential with the process gaining momentum. Besides, increasing the efficiency, it will also make the country more competitive vis-a-vis the global players.

Any message for the start-up representatives attending the eIndia summit? How do you think this summit can further illuminate their path?

This type of meets is an opportune time for a large number of entrepreneurs, who can look forward to future guidance and mutually beneficial tie-ups that could help them leverage their potential. Individual entrepreneurs have their ambitions for growth and development. Although bubbling with enthusiasm, they need to be oriented towards the shortest and the most-efficient way of going about it.

A platform like eIndia will definitely help all these entrepreneurs translate their energy and enthusiasm into growth and success.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Latest News

To Top