Attracting Seed Capital

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One of the biggest road blocks before the task of culturing entrepreneurship and consequently successful enterprises in the northeast is weak capital base apart from the usually cited bottlenecks of poor infrastructural support etc. Developing these infrastructures is solely the responsibility of the government, and will have to remain as such for at least all of the foreseeable future, making the lack of it a justified scale against which to measure the success or failure of policy makers as well as implementers. Unlike infrastructure, developing a culture of entrepreneurship will have to be the result of a sustained coordinated effort of the government, all putative entrepreneurs and the regional intelligentsia. Entrepreneurship is by and large nascent in the northeast region, businesses thus far being largely restricted to retailing, a necessary subsidiary of entrepreneurship, but lacking the creativity and regenerative qualities generally attributed to the latter. Hence, what the mission of bringing in a culture of entrepreneurship would need most are expertise and experience alongside of the seed capital so vital in giving wings to ideas.

These drawbacks in mind, the government must draw up policies aimed basically at removing these hurdles. It can do this through entrepreneur friendly credit facilities through its banks and other lending agencies and by providing expert and experienced consultation services on setting up and running of enterprises, providing information and links with agents in possible market areas of these products and services etc, using its imagination to gauge what area these entrepreneurial proposals are likely to come up from. It can also introduce tax incentives to attract investments from capital rich regions. One caution in any such move is that those attracted to come and invest would be driven solely by the motive of profit. While nobody can be expected to come out of any individual, social, or even national commitment to uplift the northeast, the northeastern states will be soundly advised to conceive beforehand some regulatory measures in anticipation of undesirable backlashes. If money earned from venture capital invested in the region leaves no tangible benefit to the place, it will need no expert to predict that there will be social unrest in the long run. Care must be taken to ensure wealth, in cash or kind, is generated not just for the investors, but also for the place. One way of ensuring this would be to encourage these investors to find local partners. This would mean there are permanent stakes in these investments, and there would be little chances of the investors not spending any of the money earned at the places they made the money, or of winding up the enterprises at the end of the tax holidays and other liberal industrial incentives the government may be compelled initially to introduce.

In Guwahati, the manner in which a British firm had once tied up with a local travel agent to introduce a luxury steamer on River Brahmaputra for a seven day river cruise from Guwahati to Dibrugarh for a 200 dollar a ticket package is a model to emulate. It is a small beginning, but if the success of this project opens a floodgate of similar entrepreneurial partnerships in the northeast region, including Manipur, we have no doubt miles would have been gained in the direction. The importance of local involvement in such ventures is with a view to give them a permanence and not just fly-by-night overtures to take advantage of tax and other advantages. This would be one of giving local entrepreneurs the confidence to join the hustle bustle competitive world of business enterprises around the country and the globe. Moreover, whatever may be said, local entrepreneurs, regardless of which community they belong to, will ultimately be spending a good part of their earnings, if not a majority of it, in their home region.

Leader Writer: Pradip Phanjoubam

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