ISSUES IN MOUNTAIN |
ISSUES IN MOUNTAIN DEVELOPMENT is a series released from time to time to brief planners, development workers, researchers and donors on recent trends, findings, and issues affecting mountain development. The papers in this series can be quoted with due acknowledgements.Comments are welcome.
Development of Micro-enterprises in Mountain Areas
The Context
Mountain economies have remained predominantly self-contained in the past with most of the needs being met internally and only a limited external input. Over the years, this self sufficiency or containment has been breaking down owing to two reasons. First, with rapidly growing populations, traditional agricultural systems are proving increasingly inadequate to meet basic needs, leading to compulsions to extend cultivation on to marginal and forest lands, resulting in environmental degradation. Second, improvements in access to other areas and an increased flow of information have exposed the mountain people to the higher and different standards of living elsewhere, resulting in raised aspirations.
Rapid population growth and raised aspirations created an imperative for finding alternative employment and income-generating opportunities. | This situation has necessitated changes in economic activities of mountain areas from predominantly food-centred subsistence activities to others that are based on comparative advantages and which use limited land resources more efficiently. |
As agriculture will continue to be the main activity in most mountains areas, the first step lies in promoting those high-value activities that are also environmentally sound. The emphasis should be on those products and activities that have special advantages in mountain areas in terms of resource endowments and skills and which can also improve the livelihoods of mountain families.
Past Findings: Rural Non-farm Activities
Mountain areas should focus on those products and activities that use scarce land resources efficiently and are less land intensive, maximise the use of abundant labour resources, are environmentally friendly, are in great demand in the plains (off-season), optimise the use of available environmental resources such as micro-climatic variations, etc. | Considerable work, in terms of studies and programmes, has been undertaken on the subject of non-farm enterprises in the rural and backward areas in different countries in the region, though not specifically in the context of mountain areas. Research work, both by individuals and institutions, has been carried out on the subject under differently designated themes such as rural industrialisation, off-farm sector, non-farm sector, 'cottage and small-scale industries', 'agroprocessing activities', and informal sector. Reviews and evaluations of programmes run by governments for the promotion of rural industries and micro-enterprises have also been carried out.(See box for some important conclusions.) |
Some Important Findings (based on work by different agencies) A minimum level of agricultural development is a necessary, though not sufficient, condition for
development of non-agricultural enterprises in predominantly agricultural areas. |
ICIMODs Initiatives
To identify viable off-farm alternatives and promote practical approaches to employment generation, income enhancement, and sustainability of mountain development, ICIMOD carried out a series of studies in the mountain regions of China, Pakistan, and Nepal from 1990 to 1992. These studies revealed additional dimensions that needed to be taken into account in the development of off-farm activities, particularly in mountain areas (see box on the following page).
Proposed Thrust on Mountain-enterprises
ICIMODs new programme on Micro-enterprise Development in Mountain Areas aims to identify
the opportunities for and constraints to developing micro-enterprises with a view to devising
appropriate policy and programme packages; programmes for technological improvement,
including use of different types of energy; and training programmes for the development of technical
and entrepreneurial skills. Enterprise development will be approached in an integrated manner,
keeping in mind the following aspects:
scale of activities in the area,
linkages with other activities, e.g., agriculture and allied activities as sources of raw materials and
outputs,
infrastructure - general as well as specific to the activity,
skill availability and need for improvement,
technology, including the possibility of improvements in order to raise productivity,
energy flow and use patterns,
access to services and inputs, particularly credit,
marketing, including access to market towns,
government policies and programmes, specifically for the promotion of micro-enterprises in
mountain areas,
environmental implications of enterprises in different activity sectors, and
the role of women as participants and entrepreneurs in micro-enterprises.
As an initial step, ICIMOD will be undertaking studies in the mountain areas of the HKH Region
relating to the topics listed below to develop a closer understanding of the nature and status of
micro-enterprises.
Enterprises of all types in a selected area
Enterprises in a selected, important activity
Specific aspects such as credit, marketing, technology, energy use, and training
Policies and programmes relating to micro-enterprises with a specific focus on their relevance for
mountain areas
Off-Farm Employment in Mountain Areas: Findings from ICIMOD's Past Work Availability of food at affordable prices is a necessary condition for diversification from food-centred
subsistence production to enterprise-based commercial production. |
Future Research Issues
Substantial work has already been carried out on the problems of development of the non-farm sector in rural areas and, to a certain extent, in mountain regions. Therefore, the thrust of further studies should be on enterprises, the pr-o--cess of their origin and growth, and the constraints they face as individual mi-cro-enterprises, with a view to devising appropriate policy, programme, and training packages. Some important aspects requiring focus are given below.
Characteristics and Types of Mountain Micro-enterprises and Their Products
Information on the types of mountain enterprise products and their various characteristics is generally lacking. Therefore, documentation of this information for the HKH Region will in itself be a good starting point for further research and analysis for policy and programme formulation. It would be useful to examine the characteristics of the enterprises and entrepreneurs in this perspective, on the basis of micro-level case studies, as a background for evolving programmes and training packages.
Women Entrepreneurs
Studies need to be undertaken to especially assess the role and status of women, the nature of enterprises run by them, and the special problems they face, in order to devise ways of facilitating their development as successful entrepreneurs. A review of programmes particularly meant for women entrepreneurs would also be a useful undertaking.
Factors in Development of Mountain Enterprises
Micro-enterprises face problems everywhere because of limitations in size and lack of resources. What are these problems specifically in the mountain areas? How do mountain entrepreneurs cope with these problems in order to succeed? Are appropriate mechanisms evolved by themselves or others? These aspects will form the central components of the studies, along with a detailed account of successful cases and failed attempts.
Policies and Programmes for Micro-enterprise Development in Mountain Areas
Studies undertaken should closely review the performance and effectiveness of the existing policies and programmes, particularly in respect to appropriateness and relative effectiveness of various alternatives and their combinations - infrastructure to improve access, human resource development through training, provision of appropriate forms of energy to improve production and productivity, dissemination of technological and marketing information through demonstration and extension, access to institutional credit with or without subsidised rates of interest, tax incentives, and marketing support and marketing organisations.
September 1996 | Contact: Dr. T. S. Papola email : papola@icimod.org.np |