The Tamil Nadu government has launched a rural transformation project in collaboration with the World Bank to assist rural entrepreneurs in the farm, off-farm, and non-farm sectors. The World Bank contributes 70% of the funding, with the government contributing the remainder.
In addition to poverty alleviation, the Tamil Nadu Rural Transformation Project (TNRTP) now has an official brand name: VazhndhuKattuvom. It seeks to create a business ecosystem that enriches skills and encourages entrepreneurship among self-help groups (SHGs) and their households.
In total, 3,994 village panchayats in 120 blocks in 31 districts are part of the project. “The project is a paradigm shift from concentrating on poverty alleviation to enlisting entrepreneurs and those who want to relocate beyond livelihood strategies to envision entrepreneurial ventures, attempting to create more job opportunities in rural areas, and also supporting migrants who’ve already returned to their villages during the COVID-19 period,” a senior government official said.
To realize Chief Minister M.K. Stalin’s vision of establishing Tamil Nadu a trillion-dollar economy by 2030, enterprise groups and a business-driven ecosystem at different levels would need to expand. According to the official, the project aims to make women a crucial stakeholder in the development and growth trajectory. It focuses on enterprise promotion at the individual and collective levels through numerous subsets.
The Enterprise Group (EG) is one subgroup — a group with common ownership and control over company operations, a shared profit and loss, and the goal of lowering the cost of production, improving quality, and boosting revenues. At the village level, each EG will have 10-30 members and will be established as a Micro Small Medium Enterprise (MSME) Registration/Partnership Firm/Limited Liability Firm.
Producers of a certain commodity in a village come together for aggregation, productivity enhancement, and collective activities to boost revenue in the Producer Group (PG) model. A PG is established by mobilizing between 30 and 150 members. Based on their business proposals, each PG receives a start-up grant of up to Rs 75,000 in financing.
The Producer Collective is yet another entrepreneurship model. It brings together a large number of producers for aggregation, value addition, advertising, and service providing to achieve economies of scale, and membership is typically between 300 and 3,000 producers.
For certain commodities especially in sparsely populated tribal areas, the size of a PC can vary between 150 and 300 producers, with eligibility to a start-up grant of up to 30 lakh to address problems in commencing commercial operations and covering operating expenditures.
According to the official, the current enterprise project builds on key learnings from the previous project, such as participatory identification of the target group, decentralizing training to the habitation level for mobilizing members, making sure participation of women in decision-making, and increasing women’s involvement in Gram sabha meetings.