Entrepreneurship Development and Its Role on Economic Growth

In Nepal: An Appraisal
-Kabi Prasasd Pokhrel, PhD (BHU)

Associate Professor, CERID, TU

Email: drkabipokhrel@gmail.com Cell. No: 9849301741

Abstract

This paper tries to point out the conceptual issues, practices and options related to
entrepreneurship development in Nepal where both of effects and impacts are to be discussed.
Using secondary information that available at global and national context, the paper discusses it
as the right path of sustainable development in Nepalese context where indigenous skills and
location-specific resources base prove that it is possible to make socio-economic transformation
by promoting location-specific entrepreneurship development. The paper, further points out the
need of action plan with implementing processes of entrepreneurship culture in different
geographical locations in order to adopt the new and innovative measures on the road to
sustainable development of the country.

The Context

Entrepreneurship Development is potentially a key factor in reducing the incidence of poverty, rising
over all productivity and economic growth and improving the quality of life through empowering the
population to take informed decisions across a wide range of activities. There is a strong correspondence
between entrepreneurship skill development and individual and household earnings and between their
social beings. In this context, an effective entrepreneurship development strategy needs to give high
priority to programs and policies which both raise the productivity of the labor force and improve the
quality of life of the community people by the enhancement of indigenous knowledge and skills for the
overall progress and change. Economic and educational programs and policies have a central role in
achieving goals, objectives and mission of entrepreneurs on the road to peace, prosperity, social harmony.

Compared to several other areas of development policy in Nepal, entrepreneur skill development has had
no space. The economic growth and rural transformation remain far behind in low income communities;
consequently two thirds population of the country is in the problem of sustainable livelihood
improvement. Thus, it seems that some extent, however, the simplest part of national economy is in
progress but the harder part will be in enticing the remaining third to develop a drive force for growing
market of employment which are currently in a state of flux. The socio-economic system receives the
largest allocation of Government expenditure. But, it is doubtful that the returns are currently very high.
With Government having recently announced several broad intended changes to the economic sector, this

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is an opportune time to systematically consider the implications of these in a comprehensive manner and
to determine a road to reform in order to access the skills and enterprises development for comprehensive
development of the country.

Nepal’s wide range of biophysical and socio-cultural diversity including its marked spatial variation in
resources has created the perpetuated the differences in living conditions of its population. The richness of
these biophysical and socio-cultural dimensions reflects the potentiality of the comprehensive
development of the every section of society by the process of social transformation using inclusive
approach to foster indigenous skills and techniques for opening the way to achieve the long lasting
prosperity and to move ahead to use available cultural and natural resources effectively. It requires ,thus
to review the present status of entrepreneurship development practices, policy provision and potential to
address the issue of social harmony, social justice and livelihood improvement for the transformation of
society into economic prosperity and human well being. It is equally important to make active
participation of right holders of the development and change and turned into driving force for the
multidimensional development of the society. To exercise this, the full complement of peoples’ rights like
political, civil, social and economic rights can be secured through useful, innovative, scientific as well as
productive employment economic scheme that ensure the local resources and skill based
entrepreneurship development and creation of job market by achievers themselves . Skill development
scheme with the nature of inclusiveness is being the fundamental human rights and the prime factors of
right- based approach to promote local level planning and development capacity. This offers
multidisciplinary skill development educational system considering the diverse needs of geographical
location.

The overall development of Nepalese society is possible to make skill development programs more
relevant in terms of economic development and social change using indigenous knowledge and modern
technology mixed approach to development and social transformation that secure grassroots people’s
economic rights effectively. Thus, the present condition of entrepreneurship in Nepal inevitably needs to
be reviewed and reformation modality to provide a broad spectrum of socio-cultural changes, economic
growth, capacity building, and for sustainable life journey of all the strata of the society. Entrepreneurship
could be the engine of economic growth and social change on the road to peace, prosperity and
sustainable development in low income countries like Nepal in twenty first century.

Regarding these issues and options, productive schemes of entrepreneurship development demands the
policy assessment through wide range of collaborative as well as national working mechanism to build
the efficiency, equity, empowerment and sustainability of the progress in every section of the society.
This could direct and flourish the innovative practices in the line of social transformation in terms of
positive social change and sustainable livelihood improvement. It can also provide the policy output to all
sections or society access to opportunities (equity), enable people to make their choices they wish
(empowerment) and do economic activities without reducing the opportunities of future generation
(sustainability).

Global Trends : an Over View

It has long been recognized that investments in social sector can contribute to the common good,
enhance national prosperity, and support stable families, neighborhoods, and communities. In the face of
economic, environmental, and social challenges, entrepreneurship is even more critical today than it has

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been in the past. Today’s generation can meet future challenges if they have opportunities to prepare for
their future roles as entrepreneurs. To achieve the full potential of young people needs to learn a full
range of skills and knowledge that facilitate to use and application of skills and knowledge in real life
with proper transformation of knowledge into practice Thus, national policies programs and practices
require to update by incorporating the state-of-art to transfer knowledge and skills into entrepreneurship .
There may be many innovative practices to make more useful for common people life and to fully
develop the available natural as well as cultural resources and to enhance economic productivity through
entrepreneurship development. Kasaju(1975) has clearly stated that it is the crux for the transformation
and reconstruction of a nation as the major agent that injects desired changes in value, structures,
attitudinal dimensions and social changes. In this context, the need for a closer link between educational
institutions, policy makers, investors community people who have specific knowledge, skills and practice
in using local resources as their social and economic values. An increasing tendency of isolation between
skill transfer philosophies and practices and growing human needs is what presently becomes a major
concern for most academicians, development experts, and social scientists in low income countries.
Traditionally, national political systems seem to have failed to consider the skill needs in the context of
aspirations, social needs and values, intra-structural constraints, geopolitical as well as spatial make-up
and priority need of society. Thus, a search for new and innovative method and modalities enterprises
development is essential in terms of varied economic programs for gaining field experience suited to the
diverse needs and location specific suitability in the different parts of the country. It is indicative the
national economic policy emphasis should on an effective link between community people capacity and
institutions roles whereby both can play a vital role in social change and economic development. Sharma
(1983) also said that entrepreneurship is essentially preparation for life which is important for man to live
and more importantly to live well. Thus, the main purpose of the matter therefore consists in helping man
to earn his daily bread and butter and by and large, to be related work where respect for work and the joy
of working have to be associated closely with livelihood.nap. PDF is available from The2222222233333

8Americans have long recognized that investments in public sector contribute to the common good,
enhancing national prosperity and supporting stable families, neighborhoods, and communities.
Entrepreneurship is even more critical today, in the face of economic, environmental, and social
challenges. At the same time, business and political leaders are increasingly asking to develop skills such
as problem solving, critical thinking, communication, collaboration, and self-management often referred
to as“21st century skills. Policymakers and organizations use a variety of names for the lists of broad
skills seen as valuable in life style of the community people. (National Academy, 2012).

World Development (2014) stated that the sustainable livelihood can be secured by creating job markets
and supporting innovative entrepreneurship development. Because job is a primary concern for most
people in developing countries worry a great deal about being unemployed. Having a job is indeed
valuable: it produces income to support consumption and to help meet important goals, such as providing
education, health care, and assets for family members. A job also contributes to self-esteem, a sense of
personal security, and even social cohesion. These benefits are pillars of resilience and prosperity for
households and communities alike. From the perspective of workers, jobs that provide secure and
increasing income and a safe working environment are preferable to jobs that do not carry those benefits.
Moreover, jobs that produce goods and services that consumers want and can rely on and jobs that respect
and conserve the environment are better from society’s perspective. Where can these good jobs are
found? It argues that a vibrant enterprise sector is best situated to provide such jobs through its potential

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to mitigate the risk of unemployment, reallocate resources to create opportunities, and contribute to
worker, consumer, and environmental protection. Two characteristics flexibility (the capacity to adapt to
changes to the potential mutual benefits of workers and firm owners) and, gradually, formality (abiding
by sensible laws and regulations) can greatly help enterprises support people’s risk management.

UNESCO (2004) mentioned that quality of life has seen in light of how societies define their needs and
how their earned skills help to acquire values and attitudes. So quality most square the equity for reaching
a wide set of development goals and individual identities policies areas that directly impact on economic
achievements. Extensive researches indicate that there is clear cut links between good education and wide
range of economic and social development benefits. Thus, the better education affects directly
development outcomes. Opinions regarding life useful education are unified three principles tend to be
broadly shared as the need for more relevance for greater equity of access and outcomes, and for proper
observance of individual rights. These principles guide and inform entrepreneurship development content,
processes and approaches and represent more general social goals to which effort it has to be contributed.

Bajracharya (2014) viewed that entrepreneurship development national policy plays a key role in
economic and social development and it has greater role as to assist countries to become knowledge
economies. Developing countries need to produce, seek and adapt knowledge to overcome developmental
challenges and to promote the entrepreneurship based society in order to induce change and progress in
society. Hence, all aspects of development, a balance need to be struck between ensuring the relevance of
change direction to socio-cultural realities of the common people with their aspirations and to the well-
being of the nation.

The modern concept of development, however, stressed that the relationship between measured labor
force quality and economic growth is more important than the impact of human capital on individual
productivity and income level. It is imperative that the level of national and quality of each individual has
the possibilities of making others better off. An advanced society who equipped with life skills may easily
translate their skills and resources into higher rates of innovation, productivity, ability to introduce new
and better production and faster introduction of new technology.

Issues and Options

There are several possible reasons for the general perception that the returns to social investment are low.
First, economic growth rates have been slowing down over the decade as investment levels have been
stationary and policies have not yet been put into place to adequately stimulate the economy. Second, skill
development coverage does not yet appear to be at the level which is high enough for increasing
economic returns to occur as behavioral changes become widespread. Third, there is the possibility that
the national political- economy system itself is neither providing the skills nor encouraging the behavior
needed to increase labor productivity and entrepreneurship development. Finally, there is lack of link
between earned skills and daily economic life order of Nepalese youth who are migrating in and out of the
country in search of livelihood every year. Further efforts are not seen to make collaborative mechanism
between development partners like I/NGOs, local authority, civil society, emerging cooperatives and
community based organizations and educational institutions as well as educated youth to make changes in
the overall economic environment. The options and strategies for expanding and improving the
entrepreneurship seem to be high. It is because the modem political system in Nepal is young and
operates within a peoples’ democracy that was reestablished in 1991. Not surprisingly, while parts of the

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system have been well designed and are implemented effectively, others remain in an embryonic stage
and are only partly effective. Over the past five decades, there have been considerable quantitative
achievements. The next issue is mobilization of youth and community level development organization in
favor of social change and economic development as an effective mechanism. Since long, Nepal has
mobilized national and international organizations as development partners and actors, channeling their
contributions to socio-economic development. But their program framing as well as making transparent,
and fostering effective coordination have not seen accordingly. To address the effective regulation of their
operation and management an appropriate administrative structure needs to be made to ensure their roles
as development partners effectively through entrepreneurship development.

Need and Importance of Entrepreneurship Development

Improvement of rural life and social changes are the twin responsibilities of the millennium development
goals. But the thousand of rural men, women, children and disabled people are not benefited from the
development efforts in Nepal where social dimensions, social issues, poor economic base, geo-political
reality and home –grown nature of the conflicts render the pace of social change and sustainable
improvement of livelihood very slow. Universally, people-based and people-oriented economic policy
becomes a proven weapon in the fight against poverty, opening up access to knowledge and skills, and
helping to break down barriers that exclude poor disables and marginalized from their full development.
Access to life skill is necessary before the concrete social changes, improved health care and full poverty
reduction. However, the progress has not appeared as expected level due to the reflections of the gap
between legal provisions of the state and day to day real life journey of common people. Existing
economic hardship, inequality, social injustice and powerlessness subject the poor and marginalized
people to further exploitation, discrimination and marginalization circumstances in the country.
Misunderstand regarding rights to deprived and disadvantaged people in the country are due to decade’s
political, financial, and administrative weakness. Thus, the socio-economic and cultural realities clearly
demand the new modality of economic policy that makes them success to build their capacity to develop
entrepreneurship, to create job market and to attend the position of mainstream of development. The
existing situation further clicks for the need of a strategic intervention in social development processes,
power relations and capacity development in order to reinvigorate the life useful skills for all. In this
context, more important are changes in the modality of development cooperation and policy assessment to
better harness the energies and capacities of the people. For this, promotion of livelihood methods and
modalities in relation to direct the path for entrepreneurship and effective use in real life in a
cooperative, collaborative and coexisting line of life philosophy through effective management system.
Current situation of the Nepalese life style and life standard show that the management of development
activities and livelihood improvement initiatives in collaborating ways by sharing both costs and decision
making with local authority, civil society, cooperative, I/NGOs, and community people are essential. To
address above mentioned issues, the basic building block of entrepreneurship development are policy
assessment and strategic measures that link to the broader objectives of social justice, poverty reduction,
securing and sustaining high quality skill based life style and efficient work force for economic
diversification in the journey of peace, prosperity and sustainability of the country. The path and process
framework for entrepreneurship development is presented in figure-1.

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 Methodological Framework for Innovative Practices in Entrepreneurship
Development

Review of Existing Policy

and Structure
Need Assessment at
Explore the Reform Location-specific
Options and Resource Based
Opportunities
Entrepreneurship
Development

Strategy Steps and
Practice to Partnership
and Cooperative
Development
Innovative Practice
and Action on
Entrepreneurship
through Integrated
Approach
Way out the Link Path
of Socio Economic
Relevancy of
Entrepreneurship skill
development

Policy, program and Process

Management System and Cycle of
Action

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Conclusion

The proposed concept of entrepreneurship development is new, innovative and novel in relation to the
economic development and social transformation in Nepal. Because Nepal’s’ diversity in natural and
cultural resources and youth dominates population structure are providing many options and
opportunities. National policy effort is required to dig out and capitalize them to transform into social-
economic development. Similarly, there is high potentiality to flourish the micro-business and micro-
enterprises in the different parts of the country. Based on biophysical, as well as socio-cultural richness of
the country, the available room for creating new knowledge in the areas of economic development as the
means of change, enterprises development and social transformation for stability and rights will great.
Thus, the paper could be a time relevant guideline for the cost effective and multidimensional
development journey of Nepal with aview to create new and innovative knowledge, skills and practice in
the field of livelihood improvement and positive social change.

Reference

Sharma, S.R.(1983).Education for work. Kathmandu; Research Centre for educational Innovation and
Development.

National Academy (2012). Education for life and work: Developing transferable knowledge and skills in
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Kasaju,P.(1975). Relevance in education and national development .In Mohsim, M,7 Kasju ,P edited
Education and Development . Kathmandu: National Education Committee

Bajracharya,P.(2014) An assessment of contribution of SHEP to TU: Fallacies or achievements. TU

BULLETIN SPECIAL2014-15:97-108

UNESCO.(2004). Education for all the quality imperative. Bangkok: UNESCO

World Bank(2014). World development report: Risk and opportunity managing Risk for development.
Washington DC: The World Bank