Factors Influencing the Growth of Rural Entrepreneurship in Nagaland: A Socioeconomic Perspective

Amrendra Kumar
Assistant Professor, Department of Commerce, Nagaland University, Kohima Campus, Meriema 797001, Nagaland, India; and is the corresponding author. E-mail: amrendra@nagalanduniversity.ac.in

Lipoktoshi
Research Scholar, Department of Commerce, Nagaland University, Kohima Campus, Meriema 797001, Nagaland, India. E-mail: lipoktoshiozukum958@gmail.com

Economic development is perceived as a multi-dimensional approach involving changes in social structures, acceleration of economic growth, and reduction of poverty and inequality. A country can achieve economic development by equal development in both urban and rural areas. But in India, developments in rural and urban areas are not equal. The State of Nagaland mostly comprises rural areas, and because of the hilly terrain and dense forest, heavy industrial setup becomes difficult. Hence, the people of Nagaland have to depend on locally available resources that provide opportunities for entrepreneurial activities. With the prospect of rural entrepreneurship, people face many challenges too. The paper examines the role of various socioeconomic factors, such as age, financial resources, equal opportunity, infrastructural facilities and political scenario, in rural entrepreneurship development in Nagaland.

Introduction
India has great potential in rural entrepreneurship, and if appropriately harnessed, it has a greater chance of becoming a leading economy in the world. Rural Entrepreneurship Development (RED) is a mechanism for improving the socioeconomic conditions of the weaker sections. The role of entrepreneurship in economic development varies across nations depending upon the industrial climate, material resources and political system. Economic development is perceived as a multi-dimensional method involving changes in social structure, acceleration of economic growth, and reduction of poverty and inequality.

RED is a vital program for the socioeconomic development of rural areas in India. The objectives are to trigger economic development and generate employment by providing necessary inputs and infrastructure for productive use in agriculture and rural industries, and improving the quality of life through entrepreneurial empowerment. This also focuses on upgrading the skill, creativity and productivity of rural entrepreneurs, and encouraging value addition and quality of their products (Aggarwal, 2018).

Entrepreneurial activities in the rural areas are promoted by setting up extension services for farmers, educating and training the workforce, establishing entrepreneurship and management schools, integrating entrepreneurship development in different streams of education and creating a congenial atmosphere for private investment (Gurjar, 2001). India is a vast country standing first in many spheres as the largest democracy, with widespread socioeconomic and linguistic disparities, religious, cultural and political thinking, economic and other exploitations, standard of living and so on. These diversities seem to be more prevalent in the rural areas where socioeconomic growth is low. Under such circumstances, there are bound to exist deviations in income, standard of living and sociocultural activities of people of different regions (Khan, 2016). So, in order to improve the standard of living of the masses, various factors play a major role in the development process. Rural areas have plenty of natural resources, livestock, forest reserve and working population. But rural areas need sustainable development with optimum utilization of local resources, which can be achieved through initiating entrepreneurial activities among rural people.

The Khadi and Village Industries Commission (KVIC) has defined rural area as:

• Any area classified as village as per the revenue record of the State/Union Territory, irrespective of population.
  


• Any area even if classified as town, provided its population does not exceed 20,000 persons (KVIC, n.d.).
  

Rural Entrepreneurship

Rural entrepreneurship also means different things to different people. Entrepreneurship whose origin lies in rural areas can be considered as rural entrepreneurship, and rural entrepreneurship implies rural industrialization. Desai (2005) defined rural entrepreneurship as "Entrepreneurship emerging at village level which can take place in a variety of fields of endeavor such as business, industry, agriculture and acts as a potent factor of economic development". The term rural entrepreneurship refers to entrepreneurial activities in the rural areas.

Literature Review

The term "entrepreneurship" comes from the French word "Entreprendre" and the German word "Unternehmen" which means to 'undertake". Entrepreneurship is the act of being an entrepreneur, and it begins with action and creation of new organization (Kumar, 2011). Raghurama and Kushalakshi (2014) examined the role of rural entrepreneurship in rural development. They suggested that rural entrepreneurship provides employment opportunities in the rural areas. It also contributes to agricultural development and is a fillip to urban industries. With the growth of rural entrepreneurship, many economic problems like poverty, migration, economic disparity and unemployment can be eradicated in the rural areas (Raghurama, 2014).

Chakraborty (2014) analyzed the socioeconomic factors affecting the process of entrepreneurship development in rural areas. The study reveals the relationship between socioeconomic conditions of rural entrepreneurs and high prospects of entrepreneurial growth.

A study on innovators and the usability of innovation and its impact on rural people in Bihar shows that maximum innovations are in the field of agriculture and rural energy and technology-based entrepreneurship as a tool for rural entrepreneurship. Patil and Patil (2016) found that rural entrepreneurs face major problems, particularly in the field of marketing of products, financial services and basic and other primary amenities. Aggarwal (2018) examined socioeconomic development and rural entrepreneurship. He focused on the emerging entrepreneurial eco-system, rural finance and creation of micro and small village enterprises.

According to Rajesh Chatterjee (2017), rural entrepreneurs are the drivers of employment generation and wealth creation in villages. The study was conducted in rural villages of Tripura, India. It is an attempt to identify the factors that influence entrepreneurship growth in rural Indian villages. The study found that entrepreneurship growth is positively influenced by motivation and sociocultural and skill factors, whereas government support and problems faced by the entrepreneurs do not affect entrepreneurship growth much.

Panchasara (2019) explained that entrepreneurship at the village level acts as a stimulus for the economic development of the country. The paper also unfolds the importance of rural entrepreneurship in view of the availability of entrepreneurial traits and skills. The paper also highlights the challenges and problems of rural entrepreneurship. It collectively tries to concentrate on the most important problems faced by entrepreneurs, notably the commercialization of products and various primary amenities like water, electricity, transport facilities, required energy and financial accessibility.

Objective
The main objective of this study is to examine the socioeconomic characteristics of rural entrepreneurs in Nagaland.

Data and Methodology
The present study is based on both primary data and secondary data. Primary data was drawn from a sample of 185 respondents from four districts of Nagaland, i.e., Kohima, Mokokchung, Wokha and Phek. The data was collected through a questionnaire (see Appendix). The secondary data was collected from published journals, books, magazines and newspapers, reports and Internet sources. To condense the data, tabulation was done and simple percentage analysis was administered.

Demographics
Age of the Rural Entrepreneurs

Age is an important demographic character; it decides the potentiality of the rural entrepreneurs and their mental maturity in tackling problems. The competencies of rural entrepreneurs vary at different phases, as the confidence level, physical durability and perceptions at a particular time vary with the passage of time. Likewise, respondents' understanding levels in running their entrepreneurial activities can be found out as per their age, both in person and in social life. The respondents were classified on the basis of their age such as less than 25 years, 26-45 years, 46-65 years, and 65 years and above, at the time of survey to know which age group had participated more dynamically in rural entrepreneurial activities.

From Table 1, it can be seen that 4.86% of rural entrepreneurs belong to the age group of less than 25 years. A majority of the rural entrepreneurs fall in the age group of 26-45 years, i.e., 51.35%, which shows that most of them are at their energetic stage and are doing well in entrepreneurial activities. 37.83% of the rural entrepreneurs belong to the age group of 46-65 years, and only 5.94% are in the age group of 65 years and above.

Gender of the Rural Entrepreneurs
Gender of the rural entrepreneurs is also an important demographic characteristic because it indicates the tendency towards entrepreneurship. Gender impacts the different types of entrepreneur in a society and the nature of business in which the entrepreneurs operate. Respondents' gender information was collected to know the proportion of male and female entrepreneurs who participated in entrepreneurial activities in Nagaland.

Table 2 shows that most of the rural entrepreneurs are male (117) and there are only 68 female rural entrepreneurs. Breaking up the numbers in the four districts covered in the study, Kohima has 27 male entrepreneurs and 21 female entrepreneurs, Mokokchung 33 males and 12 females; Wokha 29 males and 17 females; and Phek 28 males and 18 females.

Educational Qualification of the Rural Entrepreneurs
Education is the key to successful entrepreneurship and can help individuals to cope with their entrepreneurial problems more easily. Education is the top means of developing one's resourcefulness, which incorporates different dimensions of entrepreneurship. The level of efficiency and productivity of a person can be seen in his/her educational qualifications. The communication skills, technical know-how, managerial efficiency and marketing capabilities of an entrepreneur also depend on his/her education. Hence, an attempt was made to ascertain the educational qualification of the rural entrepreneurs in Nagaland.

Table 3 shows that the educational background of the selected entrepreneurs is good in Nagaland: 31.35% of rural entrepreneurs are graduates; 12.43% have completed their education up to graduation and above; 29.18% below matriculation; 15.13% High School Leaving Certificate (HSLC); and 11.89% Higher Secondary School Leaving Certificate (HSSLC).

Form of Business Table 4a shows the form of business of rural entrepreneurs in Nagaland. It was found that a majority of the rural entrepreneurs are sole proprietors, i.e., 87.56%. 10.27% of rural entrepreneurs are running their business activities under partnership. And a negligible 2.16% rural entrepreneurs are operating their business as cooperatives or a trust.

Table 4b shows how the rural entrepreneurs are running their business as per duration, i.e., whether seasonal or round the year. And it was found that 70.27% of rural entrepreneurs run their entrepreneurial activities round the year, and only a few, i.e., 29.72%, run their businesses seasonally.

Years of Running Business
Table 5 shows the number of years the rural entrepreneurs have been running their business. It is clearly indicated that 43.24% of the rural entrepreneurs ran their business for 2-5 years; 32.97% for 6-10 years; 10.81% for 11-15 years; and 12.97% for more than 15 years.

Initial Investment
Finance is the lifeblood of every organization. Financial soundness of the rural entrepreneurs stimulates the growth of entrepreneurship. Table 6 shows the initial investment made by the rural entrepreneurs to start their business.

Socioeconomic Factors Influencing Rural Entrepreneurship in Nagaland Social Factors
Table 7 depicts the social factors which affect the rural entrepreneurs in Nagaland. It is clear that 50.81%, which is 94 respondents out of 185 respondents, were able to motivate others to do the business. 47.02% of the rural entrepreneurs feel confident while interacting with the community. 54.04% of the respondents improved their quality of life after starting entrepreneurial activity, whereas 37.29% expect to provide better education to children.

Only 23.78% respondents agreed that they expect to get sound marriage proposals for them or for their children. 42.70% of the rural entrepreneurs feel confident about leading the family. Only 35.13% of the rural entrepreneur's family members are financially independent. An exceptional 44.86% of the rural entrepreneurs have equal opportunities in their business

activities. The rural entrepreneurs who are capable of providing quality medical facilities to their family members were 38.91%. 37.29% agreed and 11.35% completely agreed that there is social recognition after becoming an entrepreneur. The rural entrepreneurs who are interested in providing education to their children were 41.62%, and 45.94% were interested in sending their children for employment as well. 25.40% agreed and 19.45% strongly agreed that they could control their bad habits after starting their business.

Political Factors

The political factors affecting or contributing to entrepreneurship development are shown in Table 8. It shows that 27.56% of respondents strongly agree and 35.67% agree that they are capable of taking independent political decisions. 34.05% completely agree and 41.08% agree that they cast their vote as per their wish. 33.51% of the rural entrepreneur play a vital role in selecting a candidate for election, whereas 21.08% disagree that they influence others indirectly in all the elections conducted in their village. 27.56% completely agree and 39.45% agree that their vote is for development.

26.48% of rural entrepreneurs completely agree that they encourage others to participate during election, whereas 23.78% agree with the same. 36.75% completely agree and 27.02% agree that their family members are independent in casting their votes, while 32.43% disagree and 23.78% agree that they cast their vote based on caste and religion. 6.48% of rural entrepreneurs agree that they look for personal benefits in elections, whereas 38.91% disagree with that statement.

Economic Factors

Table 9 indicates that 35.67% of the rural entrepreneurs have grown financially after starting their entrepreneurial activities. 42.70% noticed an increase in expenditure as they can now afford many things. For 56.21% of the rural entrepreneurs, the quality of life had either changed or improved after starting their business, 47.56% of rural entrepreneurs got freedom to take financial decisions; and 37.83% got financial stability. 19.45% completely agree and 19.45% agree that rural entrepreneurs do not depend on hand loans for celebrating festivals.

It is also clear from the table that rural entrepreneurs got financial strength for conducting their marriage or for their children's marriage. 37.83% rural entrepreneurs are capable of saving for their next generation; 39.45% of the rural entrepreneurs have good and stable domicile facilities at home; 48.10% are capable of fulfilling their day-to-day requirements; and 36.75% find increase in their expenses toward maintaining living standard.

Results

• A majority of rural entrepreneurs in the four districts of Nagaland are firstgeneration entrepreneurs. They are in the age group of 26-45 years.
  


• A majority of entrepreneurs operate their business round the year, which shows their full involvement in entrepreneurial activities.
  


• Sole proprietorship is the popular form of entrepreneurial activities, and a majority of the enterprises have been existing for 2-10 years. This shows enterprises are sustaining and growing.
  


• The study shows that entrepreneurial activities improved the living standards of rural entrepreneurs. Rural entrepreneurs have gained confidence and are able to spend more on education and health facilities.
  


• Rural entrepreneurs are more independent in making political decisions. A majority of the rural entrepreneurs agree that entrepreneurial activities have boosted their confidence in the election process and vote for development.
  


• The study shows that the spending capacity of rural entrepreneurs has increased and that a majority of rural entrepreneurs are capable of fulfilling their household requirements. Entrepreneurial activities have improved the economic status of rural entrepreneurs.
  

Conclusion
Socioeconomic development has multi-dimensional facets such as social structures, acceleration of economic growth, reduction of poverty, reduction of inequality and improvement in the quality of life. The study shows that a large number of socioeconomic factors such as educational qualification, age, gender, and forms of business influence the entrepreneurial growth that contributes to RED in Nagaland. Younger generations in rural areas are more optimistic and inclined toward entrepreneurial activities, which is a positive sign for better prospects of rural entrepreneurship in Nagaland. Rural entrepreneurship has improved the socioeconomic conditions of the youth, and it has been a key factor in employment generation in rural areas. It has created the opportunity for utilization of rural resources, which has helped in making the rural society self-sustaining. But still rural entrepreneurs face problems, viz., lack of finance, less awareness of government schemes, poor supply chain, lack of training and infrastructural facilities, etc. The study suggests that the government should pay attention to these problems faced by the rural entrepreneurs. The younger generation should be encouraged to establish micro and small enterprises in the rural areas of Nagaland, which will minimize the challenges of unemployment, poverty, inequality and financial instability.

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