YOUTH ENTERPRENEURSHIP 

Today, many more Indian entrepreneurs are emerging in the business world. Astonishingly enough, they are quite different from when they first appeared over twenty years ago. In the 1980s, the Indian economy was greatly bogged down by an atrocious socialistic ideology, whereby a rigid license raj and corrupt bureaucratic control was how businesses were conducted.

It began when Jawaharlal Nehru, India's first Prime Minister, wanted to tailor the Indian economy after the Soviet Union's socialistic economic structure. In his mind, he strongly believed that the state should control every aspect of the Indian economy, and thus, a planned economic growth could be achieved. His idea revolved around issuing licenses to a worthy few who were selected based on their credentials and the existing market economies of operation. Although Nehru had good intentions, the way he executed his plan proved to be counterproductive.

Nehru strongly believed that entrepreneurs should focus their efforts on nation building rather than selling products or competing with each other, because he felt that it did not directly contribute to this cause. To ensure that the concept of nation building was properly enforced by all business owners, Nehru made sure that every entrepreneur received a "certified nation building" license from the relevant license officer. He also put forth a rule stating that only two to three companies could be granted a license within the same industry, greatly limiting the possibility of establishing competition.

In addition, Nehru wanted industries to be located all over India, rather than be positioned at select industrial hubs, a strategy which he theorized would ensure a balanced industrial growth. Therefore, he passed laws requiring entrepreneurs to obtain a location permit (license) prior to the start of their company. In order to avoid capitalistic monopolies, Nehru stated that companies should obtain licenses to expand their production capacity. To prevent money laundering within companies, another major issue, Nehru made it mandatory for the excise and licensing officials to visit and audit every company each year in order to ensure quality assurance. All of these strict regulations had their problems as well. Not only did every entrepreneur need to obtain multiple licenses but the government officers who were in charge of overseeing all licensing aspects were underpaid and eventually resorted to bribery and corruption. This led to entrepreneurs paying bribes in order to acquire the necessary licenses.

Situations got so precarious that even business owners had to obtain a government license just to meet with foreign business delegates in other countries. During those times, entrepreneurs flocked around ideas that mostly involved cornering manufacturing or importing licenses. This sort of business environment offered absolutely no incentive to invest time in technical innovation to reduce manufacturing costs or even offer better quality products and services since one could get far higher results by influencing the customs or excise officer to classify a product under a category that attracted a lower rate of duty.

During this license raj, most highly qualified young Indian graduates had no family connections nor were interested in influencing excise officers. Therefore, many of them immigrated to the United States to avoid such red tape and to gain economic freedom. Realizing that the existing economy was in dire crisis, Indian business practices began changing for the better in 1991 after extensive economic reforms. By ridding the old socialistic license raj system, Indian entrepreneurs no longer needed to worry about excise officers in order to achieve their business goals. This encouraged them to start focusing on expanding their markets and acquiring more customers

Rapid economic growth has resulted since the removal of the license raj. For instance, the Indian economy has sustained an average growth rate of over 6% annually, with the gross domestic product or GDP being around 9.2 % between 2006 and 2007. In the past decade, India's GDP has also arisen from 21 % to 33 %, and India's foreign exchange reserves have reached over $200 billion. Domestic markets have also grown substantially to support innovation. Worldwide, India's vast economic success is recognized by many national and international corporations who have not only taken advantage of its pool of high-quality scientific talent but have also established many research and development facilities (R&D) throughout India.

Today's promising market conditions have been very encouraging to many young engineering graduates who strongly believe that they have the technical knowledge and skills to attract new customers. These young Indian entrepreneurs are not the typical and conventional business entrepreneur. They are the children of many business professionals. As elite graduates of IITs, National Institutes of Technology, Indian Institute of Science, and the IIMs, this new young breed of worthy entrepreneurs have targeted their efforts on innovative ways to technologically address the genuine needs of millions of people.