rural welfare oriented programmes

According to the 2011 Population Census, there are 6,40,867 villages in India and 68.84 % of the 121 crore total population live in rural areas.

Their development and contributions are very much supportive for the nation building activities.

Features of Rural Economy

1. Village is an Institution : The rural people have a feeling of belongingness and a sense of unity towards each other.
2. Dependence on Agriculture : Agriculture and allied activities are the main occupation in rural areas.
3. Life of Rural People : Rural sector is extremely backward and weak. In recent years, the incidence of alcohol drinking has gone up.
4. Population Density: Population density is very low and houses are scattered in the entire villages.

5. Employment:

• There exists unemployment, seasonal unemployment and underemployment in rural areas.

==Peter Diamond, Dale Mortensen and Christopher Pissarides shared 2010 Economics Nobel prize for jobs study.Their model, called DMP model, helps us understand how regulation and economic policies affect unemployment, job vacancies and wages.==

• As on 4th October 2016, rural unemployment was 7.8 per cent which is less than urban unemployment (10.1 per cent) and all India unemployment rate (8.5 per cent).
• Open Unemployment : unemployed persons are identified as they remain without work.
• Concealed Unemployment or Under employment : Many are employed below their productive capacity and even if they are withdrawn from work the output will not diminish.
• Seasonal Unemployment : employment occurs only on a particular season supported by natural circumstances. It is pathetic to note that a farmer who usually goes without a job for almost 5 to 7 months and ultimately commit suicide.
• Causes for Rural Unemployment :
  • Absence of skill development and employment generation
  • Seasonal Nature of Agriculture
  • Lack of Subsidiary Occupation4. Mechanization of Agriculture
  • Capital-Intensive Technology
  • Defective System of Education
• Remedies for Rural Unemployment
  • Subsidiary Occupation
  • Rural Works Programme
  • Irrigation Facilities
  • Rural Industrialization
  • Technical Education

6. Poverty

• According to the 2011-12 estimates, About 22 crores of people in rural areas are poor and live below the poverty line.
• Persons consuming less than 2,400 calories per day in rural areas are treated as they are under rural poverty.
• As per the Planning Commission estimates, the percentage of people living below poverty in rural areas was 54.10 which accounted for 33.80 per cent during 2009-10.
• Poverty is deepest among members of scheduled castes and tribes in the rural areas.
• In 2005 these groups accounted for 80 per cent of rural poor, although their share in the total rural population is much smaller.
• In 2015, more than 80 crores of India’s people lived in villages. One quarter of village population (22 crores people) list below the poverty line.
• India is the home to 22 per cent of the world’s poor.
• Causes for Rural Poverty
  • The distribution of land
  • Lack of Non-farm Employment
  • Lack of Public Sector Investment
  • Inflation
  • Low Productivity
  • Unequal Benefit of Growth
  • Low Rate of Economic Growth
  • More Emphasis on Large Industries
  • Social Evils : vera yaru god than

Poverty Eradication Schemes

1. 1975 - 20 Point Programme
2. 1977 - Food for Work Programme (FWP)
3. 1978 - Integrated Rural development Programme(IRDP)
4. 1979 - Training Rural Youths for Self Employment (TRYSEM)
5. 1980 - National Rural Employment Programme (NREP)
6. 1983 - Rural Landless Employment Guarantee Programme(RLEGP)
7. 1985 - Indira Awas Yojana
8. 1989 - Jawahar Rozgar Yojana(JRY)
9. 2005 - Bharat Nirman Yojana
10. 2005 - National Rural Health Mission
11. 2005 - Jawaharlal Nehru National Urban Renewal Mission (JNNURM)
12. 2006 - Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)
13. 2009 - Rajiv Awas Yojan (RAY)
14. 2010 - Pradhan Mantri Adarsh Gram Sadak Yojana (PMAGSY)
15. 2011 - National Rural Livelihood Mission
16. 2013 - National Food Security Scheme

7. Indebtedness

A famous British writer Sir Malcolm Darling (1925) stated that ‘An Indian farmer is born in debt, lives in debt, dies in debt and bequeaths debt’

Rural indebtedness refers to the situation of the rural people unable to repay the loan accumulated over a period.

According to the Government of India’s Socio Economic and Caste Census (SECC), 2015, around 73% of households in India are rural. Of these, 18.5% are scheduled caste households and 11% belong to the scheduled tribe category.

The data of the National Sample Survey Organisation (NSSO, 2002-03) reveals that only about 30% of the poor borrowers get credit from the formal banks.

According to the All India Debt and Investment Survey (AIDIS) 2002, the share of institutional credit has declined from 66.3 per cent in 1991 to 57.1 percent in 2002, with a corresponding increase in informal channels of credit (RBI, 2006).

• Nearly three fourth of rural families in the country are in debt.
• The amount of debt is heavier in the case of small farmers.
• Cultivators are more indebted than the non-cultivators.
• Most of the debts taken are short term and of unproductive nature.
• The proportion of debts having higher rates of interest is relatively high.
• Most of the villagers are indebted to private agencies particularly money lenders.

Causes for Rural Indebtedness

1. Poverty of Farmers
2. Failure of Monsoon
3. Litigation
4. Money Lenders and High Rate of Interest

Measures to Remove Rural Indebtedness
Several remedial measures have been introduced to reduce rural indebtedness. It includes

• Regulation of money lenders
• Development of rural banks
• Primary Cooperative Banks and Land Development Banks
• Crop Loan Schemes
• Lead Bank Schemes
• Promotion of subsidiary occupation
• Off farm employment opportunities
• Skill development programmes and so on.
• However, the interest rate charged plus transaction cost for poor people and Self Help Groups are much higher as compared to that for rich people.
• For instance, education loan is costlier than car loans.
• Regional Rural Banks (RRBs)
  • Regional Rural Banks came into existence based on the recommendation made by a working group on rural banks appointed by the Government of India in 1975.
  • RRBs are recommended with a view to developing rural economy by providing credit and other facilities particularly to the small and marginal farmers, agricultural labourers, artisans and small entrepreneurs.
  • RRBs are set up by the joint efforts of the Centre and State Governments and commercial banks.
  • At present, there are 64 Regional Rural Banks in India.
  • The RRBs confine their lending’s only to the weaker sections and their lending rates are at par with the prevailing rate of cooperative societies.
• Micro Finance
  • Micro finance, also known as micro credit, is a financial service that offers loans, savings and insurance to entrepreneurs and small business owners who do not have access to traditional sources of capital, like banks or investors.
  • In India, Non Government Organizations (NGOs) play a pivotal role in the development of micro finance service.
  • Microfinance industry in India have grown vastly in the last two decades.
  • In 2009, the total number of micro finance institutions in India was around 150 (Tripathi, 2014).
• Formation of Self Help Groups (SHGs)
  • Self Help Groups are informal voluntary association of poor people, from the similar socio-economic background, up to 20 women (average size is 14).
  • The SHG promotes small savings among its members. They save small amounts ₹10 to ₹50 a month. The savings are kept with a bank. After saving regularly for a minimum of 6 months, they lend small amounts to their members for interest. Based on their performance, they are linked with the bank for further assistance under SHG Bank Linked Programme (SBLP) started in 1992.
  • NABARD estimates that there are 2.2 million SHGs in India, representing 33 million members that have taken loans from banks under its linkage program to date.
  • The SHG Banking Linkage Programme since its beginning has been predominant in certain states, showing spatial preferences especially for the southern regions like Andhra Pradesh, Tamil Nadu, Kerala and Karnataka. ==These SHGs have helped the Banks to accumulate more funds==. ==Actually the banks charge higher interest for the SHGs than car owners.==
  • Under NABARD SHG Linkage Programme, SHGs can borrow credit from bank on showing their successful track record of regular repayments of their borrowers. It has been successful in the states like Andhra Pradesh, Tamil Nadu, Kerala and Karnataka during 2005-06. These States received approximately 60 per cent of SHG linkage credit (Taruna and Yadav, 2016).
• Micro Units Development and Refinance Agency Bank (MUDRA)
  • It is a public sector financial institution which provides loans at low rates to microfinance institutions and non-banking financial institutions which then provide credit to Micro, Small and Medium Enterprises (MSMEs). It was launched on 8th April 2015.

1. Rural Income: Large proportion of labourers and skilled persons are underemployed and the scope for increasing their income is limited.
2. Dependency: Rural households are largely dependent on social grants and remittances from family members working in urban areas and cities.
3. Dualism: Dualism means the co-existence of two exteremely different features like developed and underdeveloped, organised and unorganised, traditional and modern, regulated and unregulated, poor and rich, skilled and unskilled and similar contradicting situations in a region. These characteristics are very common in rural areas.
4. Inequality: The distributions of income, wealth and assets are highly skewed among rural people. Landlords and landowners dominate the rural activities.
5. Migration: Rural people are forced to migrate from villages to urban areas in order to seek gainful employment for their livelihood. This is called ‘double poisoning’ by Schumacher, one side villages are empty, on the other side towns are congested. His book ‘’ Small is Beautiful “describes the dangers of the present kind of development.

Need for Rural Development

1. India cannot be developed by retaining rural as backward.
2. The rural economy supports the urban sectors by way of supplying drinking water, milk, food and raw materials.
3. Development of agriculture and allied activities are necessary for providing gainful employment in rural areas and improving overall food production.
4. The evils of brain-drain and rural urban migration can be reduced if rural areas are developed.
5. In order to better utilise the unused and under-utilised resources, there is a need to develop the rural economy.
6. Rural development should minimise the gap between rural and urban areas in terms of the provision of infrastructural facilities. It was called as PURA by former President Abdul Kalam.
7. In order to improve the nation’s status in the global arena in terms of the economic indicators like Human Development Index (HDI), Women Empowerment Index (WEI), Gender Disparity Index (GDI), Physical Quality of Life Index (PQLI) and Gross National Happiness Index (GNHI) rural economy should be given due attention.

Problems of Rural Economy

1. People Related Problems

• The problems related to individuals and their standard of living consist of illiteracy, lack of technical knowhow, low level of confidence, dependence on sentiments and beliefs etc.

1. Agriculture Related Problems

• Lack of expected awareness, knowledge, skill and attitude
• Unavailability of inputs
• Poor marketing facility
• Insufficient extension staff and services
• Multidimensional tasks to extension personnel
• Small size of land holding
• Sub-division and fragmentation of landholdings
• Absence of infrastructure to work and stay in rural areas
• Primitive technology and low adoption of modern technologies
• Reduced public investment and absence of role for farmers in fixing the prices for their own products.

1. Economics related Problems

• The economic problems related to rural areas are: inability to adopt high cost technology, high cost of inputs under privileged rural industries, low income, indebtedness and existence of inequality in land holdings and assets.
• In fertile areas, a few absentee landlords own large area and they do not evince greater Interest in improving the performance of agriculture.

1. Social and Cultural Problems

• Caste system makes villages almost rigid.
• Dominant Caste in village holds all land holdings so they will be the superior class too.
• Both class and caste exploitation will be at their peaks. Poverty, mal – nourishment, illiteracy, child marriages and many more can be seen in Indian villages.
• Inter caste/ Religion marriage will leads to assassination in rural areas.
• Child marriage leads to lots of unethical issues. Female feticide leads to gender related issues in rural areas.

1. Leadership Related Problems

• The specific leadership related problems found in rural areas are: Leadership among the hands of inactive and incompetent people, self-interest of leaders, biased political will, less bargaining power and negation skills and dominance of political leaders.

1. Administrative Problems

• The rural administrative problems consist of political interference, lack of motivation and interest, low wages in villages, improper utilization of budget, and absence of monitoring and implementation of rural development programme.

Since rural unemployment and rural poverty are interrelated.

However, unemployment, begging, rag picking and slumming continues. Unless employment is given to all the people, poverty cannot be eliminated.

Rural Industries

1. cottage industries
2. village industries
3. Small Industries : SSIs are also known as Micro, Small & Medium Enterprises (MSMEs). They are defined and categorized by the Micro, Small & Medium Enterprises Development Act, 2006.
4. tiny industries
5. agro-based industries.

Rural Health, Nutrition and Sanitation

• Indian rural people are suffering with various epidemics such as small pox, cholera, malaria, typhoid, dengue, chicken guniya, etc. Indian Constitution clearly lays down that “States shall regard the rising of the level of nutrition and standard of living of its people and improvement of public health as among its primary duties”.
• These include Supplementary Feeding Programmes including Mid Term Meal Programme, Nutrition Education through Printed Media and Television and Compulsory Fortification of Common Salt with Iodine.
• Still in terms of health standard, ==Sri Lanka is better than India==, and in india, ==Kerala is better than Tamil Nadu.==

National Rural Health Mission

• The National Rural Health Mission (NRHM) was launched on 12th April 2005, to provide accessible, affordable and quality health care to the rural population, especially the vulnerable groups.
• NRHM focuses on Reproductive, Maternal, Newborn, Child Health and Adolescent (RMNCH+A) Services.

Rural Infrastructure

As per the NSSO data, 38 per cent of the households lived in with one room while another 36 per cent lived with two rooms.

Poor infrastructure facilities like, water, electricity, transport, educational institutions, communication, health, employment, storage facility, banking and insurance are found in rural areas.

Rural Market

The rural marketing is still defective as farmers lack bargaining power, long chain of middlemen, lack of organisation, insufficient storage facilities, poor transport facilities, absence of grading, inadequate information and poor marketing arrangements.

Rural Road

• Rural roads in India constitute 26.50 lakh kms, of which 13.5 percent of the roads are surfaced.
• India’s road network is one of the world’s largest. The road length of India increased from about 4 lakh kms in 1950-51 to 34 lakh kms at present (2018).

Rural Electrification

• In India 99.25% of villages were electrified at the end of March 2017.
• As on 31.03.2017, 100 percent electrification was achieved in villages of 20 States/UTs namely, Chandigarh, Delhi, Haryana, Himachal Pradesh, Punjab, Rajasthan, Daman & Diu, D & N Haveli, Goa, Gujarat, Maharashtra, Andhra Pradesh, Kerala, Lakshadweep, Puducherry, Tamil Nadu, Telangana, Andaman & Nicobar Island, Sikkim and Tripura.

Slater Villages: Gilbert Slater, the first professor of economics at Madras University, published his book, Some South Indian Villages, in 1918 following a survey of some villages like Vadamalaipuram (Ramnad), Gangaikondan (Tirunelveli), Palakkuurichi (Tanjore) and Dusi (North Arcot) in Tamil Nadu by his students. It was subsequently done by different groups of researchers in the 1930s, 1950s, 1960s, and two of the villages only in the early 21st century. T he resurveys became an important historical record. They provided a baseline for several later revisits to his villages, and have inspired many successors. Much of our knowledge of rural change depends on these studies.