BUILD TOGETHER.GROW TOGETHER.

(VEDANT SHUKLA, SYBA, 181280)

SUMMARY

Rural development is the process of improving the quality of life and economic well-being of
people living in rural areas. According to 2011 Census 68.84% of population lives in villages.
The backwardness of the rural sector would be a major impediment to the overall progress of
the economy. India is predominately an agricultural country and farming is their main
occupation. According to 2011 Agricultural Census of India, an estimated 61.5% dependent
on agriculture. Technical developments in field of agriculture have increased the gap between
the rich and poor, as the better off farmers adopted modern farm technology to a greater
extent than the small farmers. The all India Rural Credit Review Committee in its report
warned “If the fruits of development continue to be denied to the large sections of rural
community, while prosperity accrues to some, the tensions social and economic may not only
upset the process of orderly and peaceful change in the rural economy but even frustrate the
national affords to set up agricultural production.’’ Report of the All India Rural Credit
Committee, New Delhi, 2003 has rightly pointed out that a purely agricultural country
remains backward even in respect of agriculture. Most of the labour force in India depends on
agriculture, not because it is remunerative but because there are no alternative employment
opportunities. This is a major cause for the backwardness of Indian agriculture. A part of the
labour force now engaged in agriculture needs to be shifted to non-agricultural occupations.
Until the 1970s, rural development was synonymous with agricultural development and
hence focused on increasing agricultural production.

Today, Inclusive rural development is more specific concept than the concept of rural
development of earlier, in broader terms, inclusive rural development is about
improving the quality of life of all rural people. More specifically, inclusive rural
development covers three different but interrelated dimensions: Economic dimension,
Social dimension and Political dimension. Economic dimension encompasses providing
both capacity and opportunities for the poor and low-income households in particular, benefit
from the economic growth. Social dimension supports social development of poor and low-
income households, promotes gender equality and women’s empowerment and provides
social safety nets for vulnerable groups. Political dimension improves the opportunities for
the poor and low-income people in rural areas to effectively and equally participate the
political processes at the village level.

SCOPE OF PROBLEM

In India, out of total population of 121 crores, 83.3 crores live in rural areas (Census of India,
2011). Thus, nearly 70 per cent of the India’s population lives in rural areas. These rural
populations can be characterised by mass poverty, low levels of literacy and income, high
level of unemployment, and poor nutrition and health status. In order to tackle these specific
problems, a number of rural development programmes are being implemented to create
opportunities for improvement of the quality of life of these rural people.

The term rural development is the overall development of rural areas to improve the quality of
life of rural people. And it is a process leading to sustainable improvement in the quality of life
of rural people, especially the poor. The rural developmental programmes intend to reduce the
poverty and unemployment, to improve the health and educational status and to fulfil the basic
needs such as food, shelter and clothing of the rural population. To improve the conditions of
rural people, Government of India launched some schemes through the planning commission
of India such as Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA),
Rastriya Sama Vikas Yojana (RSVY), Indira Awas Yojana (IAY), Sampoorna Grameen
Rozgar Yojana (SGRY), Integrated Tribal Development Project (ITDP), Pradhan Mantri Gram
Sadak Yojana (PMGSY), Integrated Child Development Services (ICDS), Development of
Women and Children in Rural Areas (DWC RA), etc. All these schemes are aimed to reduce
the gap between rural and urban people, which would help reduce imbalances and speed up the
development process.

EXISTING RURAL DEVELOPMENT SCHEMES

Pradhan Mantri Gram Sadak Yojna: Launched on 25 December 2000 by then Prime
Minister Atal Bihari Vajpayee, the scheme aims at enhancing rural road connectivity. This
scheme provides connectivity to the habitations with less or no connectivity at all and helps
in poverty reduction by promoting access to economic and social services. This ensures
sustainable poverty reduction in the long run as people get an opportunity to get connected
with the rest of the world. The scheme has been benefiting several villagers and is helping
them lead better lives. Nearly 82% of roads have been built till December 2017 which have
successfully connected several rural areas to cities. Remaining 47,000 habitations will also
get connected by all-weather roads by March 2019. Earlier, the scheme was funded only
by the central government but after the recommendation of 14th Finance Commission
report the expense is shared by both state and central government.

Deen Dayal Upadhyay Grameen Kaushalya Yojna: Is a part of National Livelihood

Mission, has the objectives of catering to the career aspirations of the rural youth and adding
diversity to the income of rural families. Launched on 25th September 2014, the scheme’s
prime focus is on the rural youth of poor families aged between 15 and 35. An amount of Rs
1500 crores has been provided for the scheme which will help in enhancing employability. The
yojana is present in 21 States and Union Territories across 568 districts and 6215 blocks
changing the lives of youth. Around 690 projects are being implemented by 300 partners. As
per the government reports, over 2.7 lakh candidates have been trained till now and nearly 1.34
lakh candidates have been placed in jobs.

Swarnjayanti Gram Swarozgar Yojana (SGSY)/ National Rural Livelihood Mission:

Swarnjayanti Gram Swarozgar Yojana which is redesigned as National Rural Livelihood
Mission was launched in 2011. Also known as Ajeevika, this scheme aims at empowering
women self-help model across the country. Under this scheme, the government provides a
loan of 3 lakh rupees at an interest rate of 7% which can be reduced to 4% at the time of
repayment. The scheme was aided by World Bank and aimed at creating efficient and also
effective institutional platforms for poor people. It also helped in increasing the household
income by improving access to financial services. NRLM also helps in harnessing the
capabilities of the poor so that they can participate in the growth of the economy of the
country.

Prime Minister Rural Development Fellows Scheme

The Prime Minister Rural Development Fellowship (PMRDF) is a scheme initiated by the
Ministry of Rural Development, implemented in collaboration with State Governments. It has
dual goals of providing short-term support to the district administration in the underdeveloped
and remote areas of the country and develop competent and committed leaders and facilitators
who can serve as a resource for a long-term.

National Rural Employment Guarantee Act (NREGA)

As per the National Rural Employment Guarantee Act (NREGA) of 2005, 100 days of
employment is guaranteed to any rural household adult who is willing to do unskilled manual
work in a financial year. The Act addresses the working people and their fundamental right to
live life with dignity. If a person does not get a job within 15 days, he is eligible for getting
unemployment allowance. National Rural Employment Guarantee Act (NREGA) also
highlights the importance of basic right to work. Amendments have been introduced to this act
to minimise corruption in the scheme.

Sampoorna Grameen Rozgar Yojana (SGRY)

The Sampoorna Grameen Rozgar Yojana (SGRY) was launched in 2001 to provide
employment to the poor. It also aimed at providing food to people in areas who live below the
poverty line and improving their nutritional levels. Other objectives of this Yojana were to
provide social and economic assets to the people living in rural areas. The scheme did not
include the employment of contractors or middlemen.

Sarv Siksha Abhiyan

Pioneered by former Prime Minister Atal Bihari Bajpayee, the Sarv Siksha Abhiyan was
launched in 2000. It is an attempt to provide an opportunity to all children between 6 and 14
years of age to get free education which is also a basic fundamental right. The state and the
central government share the expenses of this project.

Sansad Adarsh Gram Yojana (SAGY)

Sansad Adarsh Gram Yojana (SAGY) is a rural development project launched in 2014 by the
Government of India in which each Member of Parliament will take the responsibility of three
villages and look after the personal, human, social, environmental and economic development
of the villages. This would substantially improve the standard of living as well as the quality
of life in the villages. No fundings have been provided to this project as fundings can be raised
through existing schemes.

National Social Assistance Programme

National Social Assistance Programme signifies the fulfilment of Directive Principles in
Article 41 and 42 of the constitution which states that it is the duty of the state to provide
assistance to the citizens in terms of sickness, unemployment, old age in limits of the economic
capabilities. It is basically a centrally sponsored scheme of Government of India which
provides financial help to widows, elderly, people with disability in form of pensions. The
scheme was launched on August 15 in 1995.

Pradhan Mantri Awaas Yojana (Gramin)/ Indira Awas Yojana

Indira Awas Yojana revamped as Pradhan Mantri Gramin Awaas Yojana in 2016 is a welfare
programme created by the Indian Government to provide housing to rural poor people in India.
The goal of this scheme is to provide home to all citizens till 2022. The cost of constructing
the houses will be shared by the centre and the state. The scheme has been implemented in
rural areas throughout India, except in Delhi and Chandigarh. Houses developed under this
scheme will have basic amenities such as toilet, electricity connection, drinking water
connection, LPG connection etc. The alloted houses will be jointly under the name of husband
and wife.

Antyodaya Anna Yojana (AAY)

Launched by the former Prime Minister Atal Bihari Vajpayee in 2000, the Antyodaya Anna
Yojana aimed at providing food grains to around 2 crore people at subsidised rates. As per the
scheme Below Poverty Line (BPL) families were provided 35 kgs of food grains. Rice was
provided at the rate of Rs 3/kg and wheat at the rate of Rs 2/kg. The scheme was first launched
in Rajasthan but has now been implemented in all Indian states.

Provision of Urban Amenities In Rural Areas (PURA)

PURA is a strategy for Rural Development in India which was proposed by former President
APJ Abdul Kalam in his book Target 3 billion. PURA proposes that urban infrastructure and
services should be provided in rural areas to create opportunities outside the cities. This will
also prevent the migration of youth from the rural areas to urban areas. The Central Government
has been running PURA programs in various states since its launch in 2004.

POLICY ALTERNATIVES

1. Utilization of Local Resources: For example: If there are water resources like rivers and

tanks near by the villages, in summer itself, arrangements must be made to tap this

resource by removing slit in the tanks, constructing new reservoirs, bunds, canals and

simultaneously strengthening the existing ones, so that the water cannot go waste.

Similarly, if there are any mines like iron, coal and granites, they should be excavated so

that local population can be provided employment.

2. Establishment of Rural Industries: All the village industries come under the following

broad categories:

a). Agro Based Industries: Sugar industries, Jaggery, Oil processing from oil seeds,
Pickles, Fruit juice, Spices, Dairy products etc.

b). Forest Based Industries: Wood products, Bamboo products, Honey, Coir industry,

making eating plates from leaves.

c). Mineral based industry: Stone crushing, Cement industries, Red oxide making, wall

coating powders etc.

d). Textile Industry: Spinning, Weaving, Colouring and Bleaching.

e). Engineering and Services: Tractors and Pump set repairs etc. Small and medium

sized industries to produce agricultural machinery, equipment for usage in rural areas etc.

f). Handicrafts: These include making of wooden or bamboo handicrafts that are local to

that area, traditional decorative products, toys and all other forms of handicrafts typical to

the region.

4. Services: There are a wide range of services including mobile repair, agriculture

machinery servicing, etc which are being undertaken under this category.

5. Startups: They are entrepreneurial ventures, which are newly emerged businesses aims

to meet marketplace, need, want or problem by developing a viable business model

around products, services, processes or platforms. For example: Agriculture, Supply

Chain, Trading in Agricultural produce, Processing Agricultural produces, Fisheries -

Both Culture and Trading, Rural Micro Finance, Rural Health - Rural Primary Health

Cared and Rural Education etc.

6. Computer & Internet Services: Providing Computer Training and Repairing Services,

Internet based business like E-Commerce, Rail & Bus Ticket booking, Digital Marketing

Agency – Examples: Social Media Marketing, Email Marketing etc.

7. Encourage Rural Entrepreneurship: They may be of the following types: a).

Individual Entrepreneurship - It is basically single ownership of the enterprise. b). Group

Entrepreneurship - It mainly covers partnership, private limited company and public

limited company. c). Cluster Formation Entrepreneurship - It covers NGOs, VOs, CBOs,

SHGs and even networking of these groups. These also cover formal and non-formal

association of a group of individuals based on caste, occupation, income, etc. d).

Cooperative Entrepreneurship - It is an autonomous association of persons united

voluntarily for a common objective.

POLICY RECOMMENDATIONS

 Labour Intensive Techniques: As there is disguised unemployment in our agriculture

sector, labour intensive techniques should be adopted in rural industrial units.
 Educate the Rural Entrepreneurs: Government and NGOs offered various schemes and
opportunity to the rural entrepreneurs. But they are unaware of these schemes and
opportunities due to their illiteracy. So, they should to be educated by conducting
workshops and seminars related to their business.
 Offer finance with low rate of interest: Financial institutions like ICICI, SIDBI, IDBI,
IFCI, and SFC should provide finance to rural entrepreneurs with low rate of interest
and limited collateral security with liberal terms and conditions.
 Government Role: Government should take steps to provide infrastructure,
warehousing facilities, aid marketing and to export the goods of rural entrepreneurs to
foreign countries.
 Exploitation of Village resources: For example, wherever there is scope for wind and
solar energy can be fully exploited for rural electrification.
 Ancillary units: These are those, which manufacture parts and components to be used
by larger industries. Several ancillary units should be established in rural areas which
will lead to better productivity of many engineering industries.
 Micro credit schemes: Provisions should be made for micro credit system like SHGs to
the rural entrepreneurs who will boost up the economic development and employment
generation of the rural poor.
 Past experiences and other observations should be considered to develop rural
entrepreneurship.
  Market information of different products and innovative technology should be publicly
announced by the government in order to get its acceptance among the rural
entrepreneurs.
 Infrastructure facilities like land, power, raw materials and finance should be provided
to the rural entrepreneurs at concessional rates.
 Credit Information of the rural entrepreneurs must be developed so as to enable them
to get enough loan from the banks at reasonable rate of interest.
 SWOT Analysis: Strengths, Weaknesses, Opportunities, and Threats of small
businessmen must be identified and properly trained to motivate them to become
entrepreneurs.
 Innovators club should be established in villages to support the large mass of youth who
are interested in taking business as a career.
 Marketing management skills should be improved among the rural entrepreneurs to
face the problems of entrepreneurship.
 Management training is to be imparted to create awareness of innovative spirit among
the rural entrepreneurs.
 Awards should be given to those entrepreneurs who demonstrate extraordinary success.
 Special training programmes for rural entrepreneurs in particular and in general for
rural population should be arranged by the Government to improve their knowledge
and vocational skills.
 Rural youth need to be motivated to take up entrepreneurship as a career, with training
and sustaining support systems providing all necessary assistance.
 Finance for Modernization: Enough finance must be given to modernize their outdated
technology, tools and implements in order to enable them to compete with the large-
scale industries.
 Rural entrepreneur should be more competitive and efficient in the local & international
market. Successful rural entrepreneurs should show path for other rural entrepreneurs.

References:
Report of the All India Rural Credit Committee, New Delhi, 2003.
Narang Ashok (2006), “Indian Rural Problems”, Murari Lal and Sons, New Delhi.
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india/article
Keyne, J. (2000), “Rural Entrepreneurship Initiative”, Kauffman Centre for Entrepreneurial
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Kumar A. “Rural industrialization in India: a strategy for rural development” Mittal
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Delhi, 1989.
Mehta, A. (2011), “Rural Entrepreneurship – A Conceptual Understanding with Special
Reference to
Small Business in Rural India”, Elixir Marketing, Vol. 36
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April