Small enterprises need other forms of support to play their vital role in increasing employment and incomes at the bottom of the pyramid. Discuss (200 Words)
Refer - The Hindu
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
· In India, which currently faces an unemployment problem, the informal sector provides the vast majority of opportunities both for its youth and for people coming off the farm to earn incomes.
· Small entrepreneurs gain from forming effective associations with their peers. They also benefit greatly from ‘mentoring’. And, skills of small entrepreneurs and their employees are best developed on-the-job.
Reorienting policies
· The government and its policy advisers must stop denigrating the informal sector and trying to reduce its size. Informal enterprises provide the transition space for people who have insufficient skills and assets to join the formal sector.
· Policymakers must learn to support informal enterprises on their own terms. And they should not impose their own versions of formality on them for their own convenience.
· Therefore, voices of tiny entrepreneurs in the rural heartlands and on the fringes of Indian cities must be listened to while developing policies for ‘ease of doing business’.
· Policymakers must learn how to speed up the process of learning within informal enterprises by developing their ‘soft’ skills.
· Raising of the size of enterprises (in terms of numbers of employees), hire and fire laws are already not applicable to the small sector, where the vast majority of enterprises employ less than 10 persons. Hence, there is an urgent need for labour reforms in other ways.
· The social security framework for all citizens must be strengthened, especially for those who have to scramble for work in the informal sector. Health insurance and availability of health services must be improved, and disability benefits and old-age pensions must be enhanced.
HB 5 years
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IAS Parliament 5 years
Good answer. Keep Writing.
MURALIDHARAN 5 years
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IAS Parliament 5 years
Try to explain the flowchart and include government schemes to support your answer. Keep Writing.
Shivangi 5 years
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IAS Parliament 5 years
Good answer. Keep Writing.
