Financial experts are again discussing strategies to venture into the rural economies, with suitable products for emerging borrowers from the bottom of the pyramid. They have been actively studying the recent phenomenon of reverse migrants, and the emerging micro economies and ecosystems around them.
As a researcher, I believe that excessive reverse migration has already taken place and that number could be in millions. A majority of these reverse-migrant youngsters had never seen or visited their native village before. Their parents had migrated decades ago for livelihood, not a career, but are back now, having suffered serious distress.
Well-known economists and financial advisors argue that these reverse migrants are here to stay and will also establish their own enterprises in their new homes. The fitness of such theories, however, will only be tested over time, but presently there is a fresh business opportunity for organised microlenders. Subtly, the experts point out that perhaps the time has come to rebuild the country’s rural economy.
The lenders are ready to lend, but still remain unclear about whom or where to lend? Borrowers, however, have enough reasons to enter into a crisis-led debt trap. They will borrow money for buying food, but may find it difficult to return the money. For the lenders, however, these prospective borrowers can still be deemed as a hypothetical emerging clientele, who had migrated to the cities.
They have entered into an ecosystem of wages decades ago, stayed there for a while, and adapted to it fully with their children growing up with them. Suddenly, without any preparation they are forced to return to their homes and start afresh. Whether these people are ready to start new entrepreneurial ventures rooted in a different ecosystem and succeed, is the real question? After all, it takes decades to change behavioural patterns for individuals and societies.
The Paradigm of Quick Strategies forged
In this era of free online events, winning ideas are never guaranteed to succeed in the last mile; “morsel to mouth” business activities. Moreover, learnt external knowledge can sometimes become a hostage to conflicting global theories. Hence, a grassroot level understanding triggers a question: Whether it is time to go back to the basics, start thinking about circularity and create sustainability within?
While the pandemic has been a major setback for sustainable development, there is already a move globally, for “building forward better”. We are worried about a prolonged reversal in the progress in the Sustainable Development Goals (SDG) compared to the professed transformative actions and investments. Thus, there seems to be a window of opportunity to foster a green, digital, and inclusive recovery for the Indian hinterland-based enterprises.
Irrespective of the structure of typical micro enterprises within the policy framework, an emphasis on identifying the most distinctive process and features of the regional and local forms based on regular interaction with the local people, could sustain the enterprise.
The new normal ecosystem and its subsystems has led to growing mechanisation and the advent of customised information-technology has resulted in new innovations, introduction of new techniques and push towards technical education. Every day, we are confronted with the opening of new ways of operations, which are smarter, virtual and online.
One of the important side effects of such transformation is a behavioural shift that is evolving into a permanent theory. Such a change calls for cluster-level governance, sharing of amenities, substantial investments in products both for the domestic and international markets.
The concept of sustainability will sustain if we focus on two things: reflect on what we have gone through and prepare for what’s ahead. Small and micro businesses face a major challenge in completing a project. In a bid to accommodate everything, it stretches itself so thin that it snaps and has a hard landing.
The SDGs are public investment in core infrastructure, human capital and the environment. However, to achieve the SDG goals, the ecosystems will have to scale up public investment outlays by another 10–15 percent of GDP per year in the coming decade. The required funding should come from higher revenues from the bottom of the pyramid; especially in low-income countries like India. The focus in India, therefore should be on ending extreme poverty and providing access for all basic services and infrastructure.
Instead of investing in short- term direct credit portfolios, it is time for long- term investments in the behavioural patterns. In India, it would call for sustainable management, sustainable infrastructure and a significant scaling-up of investments in socio-cultural activities, going beyond just achieving the sustainable development goals.
There should be greater emphasis on preserving local forms of businesses to maintain its uniqueness. A roadmap for creating a distinct identity of the enterprise and preserving its identity, including tracing the heritage, needs to be aligned with its exotic appeals.
Identifying greener luxury within the micro enterprise-based products is the need of the hour. We can also identify the softer aspects of a community. The point is to identify the contemporary angle within the existing traditions and sort out all the challenges faced by these players.
A prescription backed by statistical data analysis and challenges pertaining to design, innovation, upgraded technology and inadequate finance, should be viewed through a lens of sustainability management. Such a strategy is critical because an entrepreneur does not get paid for employment, but for solving a problem. Thus, an equilibrium needs to be arrived at between the minimum price that the person needs to survive, and the maximum price to sustain himself.
Thus, innovations are required at the scheme management level and the involvement of sectoral expertise aligned with local- level Cluster Action Plans (CAP) along with a sustainability roadmap.
(The author has more than two decades of experience and exposure in Project Management, Strategic Business development & Operations, majorly impacting livelihoods, non-mainstream rural/ urban transformations and development initiatives.}