An Analysis on Financial Problems of Tamil Nadu Handicraft Sector

Abstract

India is a country where millions of people still retain traditional skills and expertise for handicraft production. Indian handicrafts are a highly labour-intensive, cottage-based, and decentralised business. This industry provides the second-highest level of employment after agriculture, employing approximately six million craftspeople, including the whole population of the poorer portion of society, including women. This industry is equally critical to the economy, and it spans the country, from rural to metropolitan locations. The sector faces financial difficulties, including difficulty obtaining an adequate loan from financial agencies, accessing loans only at a high-interest rate, reliance on informal money lenders due to the inadequacy of formal financial institutions' loans, inability of businesses to expand due to high-interest rates, and a lack of knowledge regarding accounting procedures and maintaining a set of records. This study paper identifies many financial difficulties faced by artisans engaged in producing handicrafts in Tamil Nadu.