This gutsy entrepreneur is an advertisement for affirmative action
Leelabai keeps a licensed 12-bore gun and is not afraid to use it. She is a building contractor and needs it to protect her business from hostile rivals. She once stood guard and fired five-six rounds to scare away hoodlums while her workers rebuilt a wall torn down by rivals.
That was six years ago, just after she started her business. Until then, she made a living crushing stones in Rajgarh district of Madhya Pradesh (MP), just one among India’s 25 crore scheduled caste and tribe (SC and ST) people. Today, she is a reasonably successful entrepreneur who employs 50-60 people, mostly SC workers. She drives a Bolero and carries a mobile phone. She cannot read but can recall about 60 10-digit telephone numbers from memory.
A Halting Progress
However, despite a promising start and obvious political benefits, the scheme began to flounder after the first year. An official in the state’s industries department blames lax monitoring and wayward implementation. Data suggests that it worked well as long as district administrations were sympathetic. But after the government changed, social welfare schemes of the previous administration got short shrift. The supplier diversity programme was diluted by making only manufacturers eligible to participate in some departmental contracts. Reservation in PWD contracts was scrapped.
Now many entrepreneurs who are registered as suppliers are merely fronting for other, more experienced players. Dalit suppliers accounted for two-thirds of the Rs. 3.21 crore worth of departmental purchases in Bhopal in 2007-08. Yet, some Dalit entrepreneurs whom Forbes India spoke to had registered under the scheme but never got a supply contract. Two of them admitted that they had fronted for others for commission.
WHAT?
(This story appears in the 05 June, 2009 issue of Forbes India. To visit our Archives, click here.)