The document discusses India's National Rural Livelihoods Mission (NRLM) which aims to reduce rural poverty through self-employment and wage employment opportunities. Key points: 1) NRLM seeks to address gaps in the previous Swarnajayanti Gram Swarozgar Yojana (SGSY) program such as uneven formation of self-help groups, lack of capacity building and training, and inadequate access to credit. 2) NRLM's strategy includes universal mobilization of below poverty line households into self-help groups, formation of group federations, capacity building and training, and providing pro-poor financial services. 3) The document argues that NRLM's strategy could

1. Promotion of micro Enterprises in India
and
National Rural Livelihoods Mission
(NRLM)
Jitesh Panda
Vrutti Livelihoods Resource Centre
8th Sep 09

2. Based on review
of
Draft Background Material
on
National Rural Livelihoods Mission (NRLM)
Ministry of Rural Development (MORD)
Government of India (GoI)

3. SGSY focuses on….
Formation of SHGs of rural poor households
Capacity building training for managing the SHGs and skill
training to take up micro-enterprises
Strengthening thrift and credit in SHGs by providing revolving
fund support
Credit linkage with banks/other financial institutions and back
ended subsidy for eligible SHGs/members to take up micro
enterprises
Provision of support for marketing and infrastructure creation to
strengthen the forward and backward linkages
Technology inputs for micro Enterprises
Focus on BDS

4. Past Success of SGSY relates to…
Success of SGSY relates to
systematic mobilization of the poor into SHGs,
their capacity building and skill development
in a
process intensive manner
Realization of importance of BDS in process mode

5. Experience so far…
Only 22 percent of the SHGs are able to access bank
credit for income generating activities including micro
Enterprises
Need for augmenting credit absorption capacity of
SHGs through
systematic capacity in skill building and
sustained technical, marketing and placement support
Also streamlining the credit delivery system for
making available adequate and timely credit at
reasonable rates.
However, BDS not reflected as a challenge
(only refers to Credit)

6. Changing Scenario…
Indian Economy experienced a robust growth
National Rural Employment Guarantee
Scheme (NREGS) emerged as a major
programme to provide additional income to
the rural poor
Initiatives taken under the National Skill
Development Mission (NSDM).

7. Strategy of MORD to attack
Poverty….
Generation of Self Employment in
Credit linked micro Enterprises and
Salaried employment through demand driven skill
development
Wage employment under National Rural Employment
Guarantee Scheme
Payment of pension to elderly and vulnerable
sections under National Social Assistance
Programme
Income generation and social security programmes
of other Ministries of Government of India.
Although,
experience of promotion of micro Enterprises relates to BDS;
Overall strategy do not relate to BDS

8. Restructuring of SGSY
as
National Rural Livelihood Mission (NRLM)
conceived as a cornerstone of
National poverty reduction strategy

9. Current Gaps in SGSY…
Uneven spread in formation of SHGs
Less proportion of SHGs in BPL dominated North and
Eastern region
Only 23% of total SHGs formed are entering in the
micro Enterprise level – beyond Grade II
Issues concerning access to credit
Lack of capacity building & training
Lack of SHG Federation at various levels

10. Current Gaps in SGSY…
Inadequate Risk Mitigation
Unavailability of dedicated implementation structure
Lack of Convergence
Lack of Grievance Redressal Mechanism
Lack of Transparency and Accountability

11. Lack of Capacity Building & Training
relates to….
Inadequate institutional infrastructure
Need for mEFC
Lack of trainers
Need for BDS Providers
Limited capacity of existing institution
Need for mEFC Promoting Organization, BDS
Facilitating Organizations
Limited access to existing institutions due to entry
level barriers, high costs and distant locations
Need for Village based BDS; Facilitation at Block level
Need for Livelihood Resource Centres focusing on
BDS
Lack of umbrella organization for implementation

12. Mission of NRLM….
To reduce poverty among rural BPL
through
promotion of diversified and gainful
self-employment and wage employment opportunities
to provide appreciable increase in income
on
sustainable basis

13. NRLM Structure…
NRLM at National Level
Focus on Policy
Supported by Mission Management Unit
State Level Mission
Focus on State Action Plan
Supported by State Management Team
District/Block Level Units
Focus on Implementation

14. Output of NRLM focuses on…
Formation of BPL SHGs
Revolving Fund support to SHGs
Capital and Interest Subsidy to SHGs
Skill Development training to BPL Youth
Inadequate focus on Individual micro Enterprises and monitoring of BDS

15. Strategy of NRLM…
Universal mobilization of BPL HHs through SHGs
Experience shows Individual micro Enterprises are more successful
than group based micro Enterprises
micro Enterprises can best be promoted by involving all the HHs in
a village THAN exclusively focusing on BPL HHs
Formation of Federation of SHGs at village, block and district level
Federation may support Social Mobilization BUT would find it
difficult to support micro Enterprises
Capacity Building and Training
Need for BDS and promoting cadre of BDS providers at Village
level
Pro Poor Financial Services
Focus on Interest Subsidy
Experience of micro Finance shows access to Finance is more
important than subsidy; Poor needs Risk Fund (like Venture
Capital) to start new micro Enterprises

16. Strategy of NRLM…
Marketing and Infrastructure Support
Through professionals & Private/NGO Partnership
Marketing support can best be provided as part of BDS in
handholding mode; Linkage with private sector is desirable;
NGOs would be able to facilitate the process
Convergence
Need to go beyond District
Can best be facilitated by GP at Village Level
Umbrella Organizations at different Levels
Need to move beyond NRLM Structure;
Need for promotion of Value Chain and Theme based (like
BDS) Livelihoods Resource Centres

17. Strategy of NRLM….
Support for up-scaling Skill Development, Placement and Innovative
Projects
Involvement of reputed NGOs and Corporations
Could focus also on promoting New Micro Enterprises (besides skill
based employment)
Demand driven approach for allocation of funds across components
Typically, poor people feel/express the need for BDS, BUT in practice
demand credit;
As it is relatively easier to deliver credit; there would be more demand
for Credit related funds
Based on experience of IRDP and SGSY; there is need for special
allocation for BDS
Transparent System
Focus on Social Audit, MIS, Concurrent Evaluation
Concurrent Evaluation is a quite relevant

18. Strategy relating Capacity Building
and Training….
Public Private Partnerships with NGOs, Voluntary Organisations etc
Besides promoting partnership; need to promote dedicated Resource
Centres; Difficult to promote Resource Centres in partnership mode
Training of large number of trainers who would further train people
down below
May largely focus on Vocational Training; Need for focus on BDS and
Entrepreneurship training
Creating a cadre of Service Providers, Community Resource Persons
(CRPs) and Master Craftsmen
Quite relevant but need back up support for sustenance like through
block level micro Enterprise Facilitation Centres.
Desirable to promoting Cadre of Udyog Sathi as promoted by Vrutti

19. Strategy relating Capacity Building
and Training….
Optimal use of the existing infrastructure like KVKs, JSS, KVIB,
SIRD, ETC and other Deptt. Facilities
People need facility at block level; Most of these facilities are
at State/District Level
Setting up of dedicated training institutes for rural poor i.e. 500
Rural Self Employment Training Institutes (RSETIs) one in each
district of the country by 2012
A relevant initiative; In due course need to be set up at block
level
Dedicated NRLM Institutional Structure – at District and State
Level
Mandate relates to policy, planning and implementation; May
not find time for capacity building

20. Emphasis on the
need for cadre of Personnel in last tier of implementation
Rojgar / Aajivika Mitra
(Section 27.2)
Strategy and Implementation Plan need clarity

21. Thank you