Coconut Based Small Enterprises for Rural Development: A Case Study of Virgin Coconut Oil in Karnataka

Abstract

Small enterprises play a significant role in economic development by contributing to employment, personal income, and the standard of living. The growing demand for coconut-based value-added products is encouraging entrepreneurs to start small businesses in coconut farming areas, both rural and semi-urban. This study, using a descriptive case study methodology, explored three small businesses producing virgin coconut oil in the state of Karnataka, India. Both qualitative and quantitative perspectives from the three cases provide evidence of the significant contribution of small enterprises to the socio-economic transformation of rural lives. Small enterprises located in rural areas have helped reduce gender inequality, lower unemployment, alleviate poverty, ensure regular income, and curb migration from rural to urban areas. Enterprises located in urban areas contribute to addressing unemployment and providing regular income to employees, while indirectly benefiting farmers through sustained demand for inputs. Therefore, the study finds that small enterprises situated in rural areas are more effective in facilitating socio-economic transformation for farmers and the rural workforce compared to those located in urban areas. This paper also recommends that policymakers formulate appropriate policies to attract entrepreneurs to establish coconut-based small enterprises in rural areas, to stabilise and accelerate economic growth.

Keywords: Coconut, Farmers, Rural Economy, Small Enterprise, Socio-Economic

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