1. By:
Rajaram Kshetri
B. pharm, IOM
“Entrepreneurship is Cause
but
Economic development is Effect”

2. Contents:
What is Entrepreneurship?
Role of Entrepreneurship in economic
development
Problems and challenges of entrepreneurship in
Nepal
Role of government for small business and
entrepreneurship
What is EDP?

3. Entrepreneurship
• It is the act of being an
entrepreneur, which can be
defined as-
"one who undertakes innovations,
finance and business acumen in an
effort to transform innovations
into economic goods".

4. The entrepreneur acts as a trigger head to give
spark to economic activities by his
entrepreneurial decisions.
Entrepreneurs act as catalytic agents in the
process of industrialization and economic growth.

5. Entrepreneurs:
Explore opportunities
Convert ideas into viable business
proposition
Provide new products and services to the
society by bringing together and
combining various factors of production.
Change life style of the people.

6. WHAT ENTREPRENEURS DO?
EMPLOYMENT & INCOME GENERATION
ENTERPRISES
ENTREPRENEURS
Taxes/Govt.
Revenues
Poverty
Alleviation
Higher Productivity &
Innovations
Output &
Exports
Wealth

7. Role of Entrepreneurship in economic
development
(1) Promotes Capital Formation
(2) Creates Large-Scale Employment Opportunities
(3) Contributed towards innovation and R & D
(4) Promotes Balanced Regional Development
(5) Reduces Concentration of Economic Power
(6) Wealth Creation and Distribution
(7) Increasing Gross National Product and Per Capita
Income
(8)Improvement in the Standard of Living
(9)Use of Local Resources
(10) Preventing Industrial Slums

8. (1) Promotes Capital Formation
Entrepreneurs promote capital formation by
mobilising the idle savings of public.
They employ their own as well as borrowed
resources for setting up their enterprises.
Such type of entrepreneurial activities lead to
value addition and creation of wealth, which is
very essential for the industrial and economic
development of the country.

9. (2) Creates Large-Scale
Employment Opportunities
Entrepreneurs provide immediate large-scale
employment to the unemployed which is a
chronic problem of underdeveloped nations.
In a global scenario, 34 millions of fresh
employment opportunities created by
entrepreneurs from the period of 1980.
Entrepreneurs play an effective role in
reducing the problem of unemployment in the
country which in turn clears the path towards
economic development of the nation.

10. 3) Contributed towards
innovations and R & DAlmost 2/3 % of all innovations
are due to the entrepreneurs.
Technological progress alone
cannot lead to economic
development unless
technological breakthroughs are
put to economic use by
entrepreneurs.
It is the entrepreneur who
organizes and puts to use capital,
labour and technology in the
best possible manner for the
setting up of his enterprise.

11. Eg:- on march 15, 2011 , the market
cap ofApple company was $547.17
bn (now topped $600 bn) which is
more than the GDP of Poland
(merely $ 531.8 bn).
CNN point out that Belgium,
Sweden, SaudiArabia &Taiwan are
each worth less thanApple’s market
cap.

12. (4) Promotes Balanced Regional
Development
Entrepreneurs help in promoting a country's
export-trade, which is an important ingredient of
economic development.
They produce goods and services in large scale for
the purpose earning huge amount of foreign
exchange from export in order to combat the import
dues requirement.
Hence import substitution and export promotion
ensure economic independence and development.

13. (5) Reduces Concentration of
Economic Power
Industrial development normally lead to concentration of
economic power in the hands of a few individuals which
results in the growth of monopolies.
In order to address this problem, a large number of
entrepreneurs need to be developed, which will help
reduce the concentration of economic power amongst the
population.

14. (6) Wealth Creation and
Distribution
It stimulates equitable redistribution of wealth
and income in the interest of the country to more
people and geographic areas, thus giving benefit
to larger sections of the society.
Entrepreneurial activities also generate more
activities and give a multiplier effect in the
economy.

15. (7) Increasing Gross National
Product and Per Capita Income
 Entrepreneurship help increasing gross national product
as well as per capita income of the people in a country.
Increase in gross national product and per capita income of
the people in a country, is a sign of economic growth.

16. (8) Improvement in the Standard
of Living
Entrepreneurship play a key role in increasing the standard
of living of the people by adopting latest innovations in the
production of wide variety of goods and services in large
scale at a lower cost.
This enables the people to avail better quality goods at
lower prices which results in the improvement of their
standard of living.

17. (9) Use of Local Resources
Entrepreneurs proper use the resources which can
result in the progress or development of that area
and creating the local employment too.

18. (10) Preventing Industrial Slums

19. Industrially developed areas are faced with problem of
industrial slums, which result in over burdening of civic
amenities and adverse impact on the health of people.
Dispersal of industries can help in the overcoming of this
grave problem.
Support to entrepreneurs for setting up their enterprises
in industrially backward areas. This will also help in
reducing pollution and overtaxing of civic amenities.

20. Problems and challenges of
entrepreneurship in Nepal

21. Because…….
Limited financial resources
Lack of proper entrepreneurial education and
training facilities
Low rate of return from industrial investment
Conservative lending policy of banks and financial
institutions
Lack of adequate protection to investors
Unstable and unsuitable economic and industrial
policies of the government

22. Wide-spread corruption in the public sector and
the aspiration of many people in the private
sector to be rich overnight instead of putting
efforts to the industrial development
Political instability
[Dr. Fatta Bahadur K.C( Reader, Nepal Commerce Campus,
Tribhuvan University, Kathmandu.) , 1989 & 2003].

23. Role of government for small
business and entrepreneurship
Creation of investment-friendly climate
Provision of Adequate Capital:-
It is essential to provide adequate financial facilities especially to meet the fixed
and working capital requirements of the concerned industries. So, the lending
policy of Development banks, Commercial banks and other financial
institutions should follow more liberal and practical policies. Similarly,
procedural simplification is required while investing in productive sector.
Protection to the Investors :-
It is especially important to provide adequate protection to the industrial
investors. Most industries have failed to protect their industry from the
competition of foreign products. Now Government should adopt an
appropriate and realistic policy to protect and develop industries within the
country.

24. Suitable Government Policy:-
Only clear and consistent economic and industrial policy can help to
induce entrepreneurs. Government should formulate clear, liberal and
attractive economic and industrial policies.
Expansion of Institutional Services :-
The adequate institutional services are required to encourage
entrepreneurs. The concerned agencies, both the financial and
development institutions should be directly involved to encourage
potential investors for investing their funds in productive sectors.
NPEDC (National Productivity and Economic Development Centre)
should launch appropriate Entrepreneurship development
program (EDP).

25. What is EDP?????
Starting a small business can be challenging. So, Entrepreneurs and small
business owners are faced with many hurdles and sometimes don’t have
the resources they need to help them make tough decisions. Thus this
program prove to be effective for small business owners in such
situations.
An Entrepreneurship Development Program (EDP), of 6-8 weeks
duration, aims at training the Graduates and the Diploma holders in the
essentials of conceiving, planning, initiating and launching an economic
activity or an enterprise successfully.
The program content includes class room training on essentials of
entrepreneurship survey of the prevalent socio - economic scenario,
identification of business opportunities, role and function as well as
schemes of assistance offered by various constituents of the support
system.