Key Role of Entrepreneurship in the Economic Development of a Country

Entrepreneurship tremendously contributes to the economic development of a Country. Because of its potential of creating employment opportunities and introducing new products, services and processes, the role of Entrepreneurship in developing the economy is quite significant.

Since many decades now, the role of entrepreneurship has been vital in the overall growth of the economy. A major role played is by the various start-ups and small businesses across various industries. Let us find out more about these aspects of the role of entrepreneurship in increasing the economic efficiency:

1. Creation of job-opportunities:

The role of entrepreneurship in creating employment is quite evident. In line with the concept of entrepreneurship, a great initiative of the Government of India- Startup India- is focused on building a strong ecosystem for encouraging Startups to enhance continuous economic growth and to produce employment opportunities on an extensive scale. Another initiative of the Government is the Make In India programme which primarily covers 25 sectors of the Indian economy, and promotes the idea of organizations manufacturing their products in India, thereby increasing multiple job opportunities in the manufacturing sector. This programme is focused on the transformation of India into a designing and manufacturing hub on the global scene.

2. Creation of wealth along with sharing:

As a process, entrepreneurs invest resources on their own and invite capital in the form of debt, equity, etc. From the various venture capitalists or shareholders. This leads to the mobilization of public wealth and therefore the successful growth of the venture benefits people. One of the essential objectives of economic development is this kind of amalgamated capital that brings about the creation of wealth and distribution.

3. Uniformity in regional development:

This is one of the inevitable benefits of entrepreneurship in less developed and backward regions. New businesses and manufacturing setups lead to regional development by means of infrastructure enhancement in the form of better roads, railways, airports, stable power and water supply, hospitals, schools, colleges, shopping malls, and any other private or public services. Apart from this, any newly setup business in a remote or less developed region will directly create jobs, thereby boosting the regional economy. The local and regional economy experiences a tremendous positive effect due to the joint spending by employees of these new businesses. Various benefits and privileges are provided to the registered Micro, Small, and Medium Enterprises to promote regional economic development by the central and state governments both.

4. Influence on GDP and Per Capita Income:

The MSME Sector in India provides employment to more than 80 million people, and can be easily considered to account for more than 37 per cent of the overall GDP. When more new unites are added to the MSME sector, it utilizes even more resources such as land, labour and also capital for the development of products and services. This adds to the country’s income, product and also the national per capita income. Therefore, one of the principle goals of economic development is this surge in the GDP and per capita income.

5. Standard of Living:

The role of Entrepreneurs in enhancing the standard of living in a society is an important one. Not just by the creation of jobs, but the betterment in the overall standard of life of their customers, employees or partners happen by the development and endorsement of innovations.

6. Export-led development:

An export model in business is likely to result in higher economic development as compared to a domestic model. An expansion to the foreign markets provides accessibility to bigger markets. This brings forth more currency inflows and makes way for the latest innovations and techniques used in foreign markets in more developed countries. it is imperative to point out here, that such an expansion gives rise to more steady dividends especially during any unprecedented decline in the domestic economy.

7. Overall development of the community:

A community development requires financial and social support on a practical level. Entrepreneurship is an innovative and farseeing profession, which leads to innovative solutions to grow the community by improvement on public services related to education, technical expertise, healthcare, and so on.

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