India Needs More Productive Businesses, Not Just More Businesses

Entrepreneurship matters, but the number of businesses alone does not determine the quality of growth. Productivity measures whether firms create more value from their people, equipment, knowledge and capital.

Small enterprises may face barriers in finance, technology, skills and reliable infrastructure. Better management practices, digital adoption, worker training and stronger links between research and industry can help firms improve quality and compete. India’s agenda should ask not only how to encourage enterprise creation, but how to help firms build capabilities.

Why it matters: Entrepreneurship matters, but the number of businesses alone does not determine the quality of growth. Productivity measures whether firms create more value from their people, equipment, knowledge and capital.