Introduction: The Unseen Struggles of Business Expansion
Entrepreneurs face many forms of glamorization, but very few people pay attention to the unseen struggles when one attempts to cross international frontiers. I wanted to take Things a notch higher in 2023, so I decided to set up a company India to try and expand my business operations. The initial investment process turned out to be much more complicated than I had anticipated and untangled a number of challenges for entrepreneurs in Sri Lanka.
That said, each one of us has a story in their life that is waiting to be told. In my case, the inflection point triggered by the obstacles that need to be highlighted—the international expansion and growth barriers posed by outdated policies for entrepreneurs like myself.
The Journey Begins: Setting Up a Business in India
As part of my 2023 goals, I decided to register a company in India. This appeared to be the next step in my growth journey. My initial investment required was around 600 USD (close to 50,000 INR). The amount certainly isn’t huge, but it was a good investment to get started. It was still on the lower end for what I was trying to achieve in the Indian market.
But the challenge arose when I tried to transfer the funds. As per Indian regulations, foreign investors are required to transfer their investment directly from their personal accounts. This meant for me that I needed to remit money from my Sri Lankan account to India. While I was excited at getting the funds going, I had no idea of how challenging the rest of the journey was going to be.
The Roadblock: Dealing with Banking Regulations in Sri Lanka
I started with some meetings and consultations with Sri Lankan institutions like Sampath Bank , NDB Bank , and Commercial Bank. I even applied with the Central Bank of Sri Lanka, expecting that they would allow the necessary permission for the transfer. Surprisingly, all Institutions had the exact same response as, “Funds cannot be sent for investment purposes due to current Central Bank policy.”
This was unbelievably maddening. Here I seek to make a business investment, not a big one at that, only for mere $600 and I am being told policies are preventing me from doing it. Government policy permits overseas transfers for other purposes but refuses to allow investment expansions.
The Irony: How Restrictions Hold Back Entrepreneurs
To put my situation into context, Sri Lanka has policies that allow people to support sending money for education and medicare. However, policies like these tend to stifle entrepreneurs. In my case, I could have invested in the country which would have led to a business expansion and creation of jobs, but my investment was turned down. In my case, I handy offered dollars which would have smoothened the transaction, but the rules were not so flexible. For the bank, it was painfully rigid policy, but for the Central Bank it was a matter of ‘policy’.
What compelled us to persist was the fact that, before us, only twenty companies from Sri Lanka had been registered in India. My company would have been the twenty first. The reality more so illustrates the hindering venture for small and medium entrepreneurs in Sri Lanka. Regulators are stuck in a century where global entrepreneurship was not an established concept and therefore make expansion initiatives difficult, hindering rest of us from cross border growth.
The Larger Picture: The Struggles of Small Entrepreneurs
Despite knowing that my business would have been only the 21st to make this particular investment as a Sri Lankan in Sri Lanka, India brought to my mind the image of how many small and medium business owners are there in the world who are using their full potential but are not getting the desired results because of such constraints. The truth is, a lot of entrepreneurs in Sri Lanka, them particularly without any substantial capital support, are unable to grow because of these restraints.
The gulf between large multi-national sponsors and small businesses seeking to establish themselves is very much pronounced in Sri Lanka. Big capital inflows and international deals transaction often face little to no obstacles while small businesses have to contend with mounds of red tape, bureaucratic policies which lack empathy to the realities of small entrepreneurs.
This is not only my problem, there is still an ocean of untapped potential in small Sri Lankan firms and businesses wishing to expand their operations and access international markets. These companies are blocked by policies which neither support growth nor provide critical resources for entrepreneurs to thrive internationally.
The Need for Change: Supporting Sri Lankan Entrepreneurs
The highlighted information reveals a serious systemic gap. There is a policy gap that does not only focus on massive international investments but also on small scale business proprietors trying to establish themselves internationally.
The bottom line is that it is a globalized world, and countries have to do more to help their entrepreneurs if they want to improve economically. Other countries like India, USA and UK auxilary small businesses to invest overseas, there is a need for similar policies to be adopted in Sri Lanka not only for large international investments, but for all businesses, regardless of size.
This is an issue that does not affect only large corporations and ultra high net individuals—it does involve all entrepreneurs. Sri Lanka has an opportunity to position itself as a world leader by actively helping its small businesses support its entrepreneurs expand their reach into the global economy.
The Way Forward: Advocating for Change
Realign your vision of Sri Lanka fosters an entrepreneurial ecosystem as a small business owner. Sri Lanka has a multitude of prospects, but certain restrictions on foreign investments stall progress. To develop a thriving business culture and ecosystem, policies must shift to be more relaxed for everyone.
Observe the following elements as simple approaches towards achieving them:
- Establish local policies that simplify payment and money transfers at a micro level.
- Design comprehensive legal frameworks specifically for emergent entrepreneurs, enabling effortless capital outflows for investment purposes.
- Open subsidiaries or develop relationships with foreign banks to facilitate crossborder servicing for micro business unit self employed individuals.
- Establish clear organizational support and investment strategies for emerging entrepreneurs willing to invest in foreign markets.
It has the potential to carve out a unique position as a country that fosters emerging entrepreneurs, enabling them to make a difference internationally on through with these policies stretch them out as guides.
My Opinion | The Importance of Supporting Small Businesses
From my experience attempting to set up businesses in both India and Sri Lanka, I have learned that as an entrepreneur, expanding internationally comes with a range of international socio-political challenges. Entrepreneurs need to overcome challenges like the social and political red tape which makes international business travel difficult.
Removing social and political restrictions for small business owners will help provide better avenues for local entrepreneurs. Political move-ment towards creating easier traveling restrictions for local entrepreneurs looking to expand internationally is a tremendous way of boosting the local economy.
In conclusion, working towards removing hurdles can not only energize and support those who are striving to change the world, but it will also inspire a new wave of entrepreneurship in Sri Lanka.
