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India's Invisible Entrepreneurs – What the State Can Do to Help Local Economies

The Wire
By Professor  

Sahana Bibi, a 45-year-old woman, resides in the sub-urban parts of Kolkata. She wakes up around 4 am every morning to buy fresh flowers from Kolaghat and Ranaghat for her flower shop in Mullick Ghat Bazaar: one of India’s busiest and largest flower markets.

Sahana has been working in the Mullick Ghat flower market area for over 35 years, ever since she was child helping her parents procure and sell flowers for temple offerings then. Working an average 18 hours a day, sometimes Sahana needs to stay overnight for days to sell out her existing stock of flowers. Most of her usual business clientele buy flowers for either decoration purposes or temple offerings.

With no formal education, Sahana Bibi is an entrepreneur with great business clarity, explaining in detail about the diversity of flower baskets sold in Mullick Ghat and some of the challenges faced by her (and other women) selling flowers in an extremely competitive market space (seen from the image below).

In spite of a high demand for flower products in the market area, she is often puzzled by how little the state (and agencies) have done for the area in improving the market conditions for business or attracting more people to the area, especially tourists visiting Kolkata, for whom, a view of the largest flower market at the ghats of Hooghly offer some pristine shades and historical memories.

As an entrepreneur, Sahana longer term vision is to see an ‘increase in her profit margins’ beyond a thin, seasonal profit range of 6-10% (i.e. over the average costs incurred in procuring, transporting and packaging decoration flowers). To realise this goal, she is keen in receiving more capital (via loan) in setting up a separate shop with access to internet and then get some training through private or public agencies on utilising technological support to have a digital presence online, and thereby increase expand her consumer base across the city.  It was fascinating to observe the extent to which she was aware about the benefits of using internet through mobile and other platforms in growing her business.

Uncertain prospects

Driving ten kilometers from Mullick Ghat area, one can find another indigenous, local market for sculptures and idols in narrow, criss-crossing lanes of Kumartuli. Here, one can meet Oishik Das, owning a sculpting shop where he works day and night to prepare idols of Goddess Durga (for Durga Puja times) and of other political leaders (as per pre-ordered demands from political groups).

Oishik is 42 years old and has been working in the same family-owned business of sculpting for over 30 years. He started sculpting Durga idols at a young age of 12 and now creates these idols for seasonal profits during Durga Puja (the months of September, October). Having made a name for himself from his work, Oishik works mostly by himself and sells most idols and sculptures for Rs 1,50,000-2,00,000.

Additionally, he receives one-off orders for sculpting figures of political leaders like B.R. Ambedkar and Mahatma Gandhi from different political groups based across and Kolkata and even in Delhi.

Similar to Sahana, Oishik’s main concern remains on how little agencies of the state have done in developing the sculpting market of Kumartuli and those working there for decades. “The real financial returns from the craft of sculpting hardly go beyond breaking even the costs incurred from the raw materials procured and months taken on each sculpture,” he said. “It is a pity how little sculpting is valued as a craft here, in spite of so many of us being passionate about it”.  

Oishik also expressed concerns about the seasonality of profits he is able to make which makes his business income highly uncertain.

Oishik (like Sahana) has limited formal education but is an entrepreneur with profound insights on the creative craft of sculpting. It is moving to see how even in days of torrential downpour, Oishik and few others like him continue their laborious task of sculpting for almost 12 hours a day (8 am to 8 pm). With incidental support from a select group of loyal business customers, Oishik has been able to receive a few foreign orders to sculpt idols for people livig in Canada and the US.

The business narratives of Sahana and Oishik both, offer insights into the art and craft of small business enterprises that thrive across parts of urban India. Quite often, in economics and business studies, our notions of studying business case studies remain concentrated on big companies (and their operations) while isolating business stories from such invisible entrepreneurs, who shape the local economies of cities.

For states themselves, a closer understanding of business narratives (such as of Sahana and Oishik) often showcase great opportunities for realising their own comparative advantages and trading them for further benefits. To clarify, by the use of the word ‘narratives’ here, I refer to the use of humanist, contextual perspectives that can help us understand concerns on business and economics of exchange in urban spaces.

This would help in further designing better public-policies, giving agency to concerns of invisibleentrepreneurs (like Sahana, Oishik), and thereby creating a feedback loop between the entrepreneurs and the state to channelise scarce resources in developing a more creative, sustainable environment for indigenous businesses across cities.

Promoting the ‘five Ps’ of local business

Widely acknowledged in most business and economics scholarship, in any given market, it is difficult to ascertain any pre-defined dominant set of challenges faced by business (wo)men. An inclusive, narrative-based approach of invisible entrepreneurs can allow policy-makers (and agencies of the state) to closely study what we call the ‘five Ps’ of an enterprise: prices, products, position (of the product in the market), protection (security of doing business) and profitability, thereby, helping us to improve the informational basis of policy-designing across urban markets.

For example, in Sahana’s business scenario, a lack of warehousing facilities for fresh flowers (procured from parts of Kolaghat, Ranaghat and Midnapore) drastically lowers the retail price of flowers sold during the day (sometimes going down 50% by evening), and thus, the overall profitability of her enterprise gets affected.

With no state-support, poor conditions of storage and warehousing in the bazaar area was echoed by some of the other flower traders as well, who like Sahana pay around Rs 5,000 as a monthly cost of maintenance to local municipality.

For Oishik, the positioning of the sculpting market and its access (in a crowded part of Old Kolkata) restricts his ability to connect to new customers across the city, restricting his business clientele to only a few loyal customers. In his argument, the state can do a lot more by encouraging more regular street-side and other forms of local sculpting (craft) exhibitions for sculptors like himself from different parts of the city in helping them expand the product market for his work while encouraging the creative, indigenous craft of sculpting as well.

The local government’s role in creating a vibrant market of ideas in form of products remains vital in promoting what Adam Smith famously once said – the natural instincts of a person, which is to “truck, barter and exchange”. Even for Smith and others like him (say, David Hume), local business narratives collated from each trader’s experience of business help the state in designing markets for local ideas and products to flourish.

The state may perhaps do well to learn from their insights and incorporate a greater use of business narratives, as a methodological tool, not only enhance the study of economics, business at a local level but also recognising the economic value of invisible entrepreneurs by addressing their concerns, from a policy perspective.

This article is written as part of a project completed by Centre for New Economics Studies. The author would like to acknowledge the contributions of Ms. Sneha Roy, student at O.P. Jindal University, in undertaking the field work in markets of Mullick Ghat, Kumartuli and others during the project.