According to a report in the Business Standard (Sep 12, 2003), the AP Govt has come up with a pro-active approach to help youth who are less well off to get a foothold in the ITeS industry. Companies like NIIT, Aptech and Hero Mindmine are of course offering ITeS training courses to help youth by training them for ITeS jobs. But their course fees are beyond the reach of the majority of youth in AP in terms of price. The AP Govt has mandated the Andhra Pradesh State Council of Higher Education to offer courses at about Rs. 5,000/- for 11 weeks of training and help the students by placing them in various ITeS companies. The first month's salary would easily pay for the cost of the course.
Though the ITeS Companies apparently had some initial reservations about the quality of the youth who took the course, those have been overcome and the ITeS companies are happy to have a steady stream of employees coming in. This will encourage more ITeS companies to move to set up base in AP.
It is good to see the Govt. step in to address a felt need of the youth, at a reasonable cost. The AP Govt. also seems to be making a conscious effort to expand ITeS activity in the state from Hyderabad to other towns across AP. It is aggressively wooing corporates to set up their back-end operations in towns like Vishakapatnam. HSBC recently announced plans to invest 50 crores towards setting up a back end operation in Vishakapatnam, in addition to its existing operation in Hyderabad. This should help to stem the migration into Hyderabad and boost the economies of the other towns. Can this be further extended to the small towns in the rural areas? That will be worthwhile attempting a la President Kalam's concept of PURA (Providing Urban Amenities in Rural Areas). Other states like Karnataka, Tamil Nadu and West Bengal are apparently studying AP's model to try and replicate it. Chandrababu Naidu must be lauded for thinking like a good businessman.
Can similar initiatives by the Govt. help to train youth to become self-employed entrepreneurs and get them started? Along with training, the youth would also need to be given a helping hand to
- create the business plan
- source the necessary capital (through loans)
- get started in setting up and running the business
- advice and help in growing the business.
A micro level venture capital outfit set up by the Govt. could do this quite well I think. No VC one in the private sector would want to do this, since its not something that will result in a huge payoff for the investor. They real pay off will be in using state funding to kick start many small businesses and as a result many jobs.