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Issue of Rural Development in India: Problems and Prospects

ECONOMICS II

Submitted by-

Yash Goyal

UID- SM0118062

2nd year & 4th Semester

National Law University and Judicial Academy ,


Assam

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Table of content

Abstract…………………………………………………………………………………..1

1. Introduction…………………………………………………………….………………2
1.1 Literature review……………………………………………….………………….3
1.2 Research Questions……………………………………..…………………………..4
1.3 Scope and Objective…………………………………….…………………………..4
1.4 Research Methodology…………………………….………………………………..4
2. Rural development: concept and need…………………………………………..……..5
3. Problems in rural development……………………………………………………….9
4. Strategies for rural development…………………………………..…………….……14
5. Modern government efforts and prospects in Rural development………….………16
6. Conclusion………………………….…………………………………………..………19
Bibliography………………………….…………………………………………………20

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Abstract

Economic development in any country to a greater extent depends on rural development and it
assists the economy to grow and sustain. In the rural areas agriculture is the main source of
livelihood to the people. There is a direct relationship between agriculture production, income
and the demand for industrial goods. People living in the rural areas have to struggle to earn
wages or are forced to migrate to urban areas. The migration pattern varies with the region,
opportunities and socio-economic status of the families. The poorest families, particularly the
landless and marginal holders owning poor quality land tend to migrate with the entire family.
Such migrations severely affect the quality of life, due to poor health, lack of education and
social pressures leading to erosion of moral values. The objectives of the paper is to anlayse the
challenges facing the rural areas and suggest ways to overcome these challenges and to create
opportunities of gainful self-employment for the rural families, especially disadvantaged sections,
ensuring sustainable livelihood, enriched environment, improved quality of life and good human
values. This is being achieved through development research, effective use of local resources,
extension of appropriate technologies and up gradation of skills and capabilities with community
participation.

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Chapter-1

Introduction

Introduction-

Rural economy of India is so dominant a fact of the country that almost all the activities of the
Indian people bear its stamp

The India Vs Bharat debate -The Urban –Rural divide has been debated for years together. There
seems to be little progress made over the last seven decades in bridging this gap. The gap only
seems to be widening by the day. Here is a look at some of the important socio-economic
indicators in Urban & Rural India.

“India lives in villages” were the golden words of Mahatma Gandhi many decades ago.
Ironically after almost 50 years the data does not seem to disagree. Today a majority of the
Indian population still live in the villages. Though there is substantial migration from rural to
urban areas in India, still almost 68% of India continues to live in rural areas.

The most important thing about the rural economy is that it is very large, almost co-terminus
with the Indian Economy. This is so because it is massive in magnitude in many respects, and is
related to the ways of the economy in many ways. Rural India is two-thirds of a country of
billion people, living in 638,365 villages and earn one-third of the national income. It epitomizes
diversity that cuts across geographic conditions to agro-economic, cultural and social contexts.

This adage which emphasizes the agrarian character of the Indian economy continues to be true
to this day in spite of industrial development that has taken place in the last six and half decades
since independence. The 2011census estimates about 69% of the country’s total population
continues to live in rural India that neither have adequate land holdings nor alternate service
opportunities to produce or procure essential commodities. In the absence of adequate
employment opportunities, the rural people are unable to generate enough wages to sustain their
livelihood. As a result, 40% families, who earn less than Rs.11, 000 per annum are classified as
poor even though government estimates is only 22%. Apart from lower income, rural people also

4
suffer from shortage of clean drinking water, poor health care and illiteracy which adversely
affect the quality of life.

1.1 Literature review-

 Ugra Mohan Jha , Rural Development in India: Problems and Prospects, Anmol
Publications(2000)
Balanced regional development has been one of the major objectives of planning in India. Its
desirability, rather indispensability, has been emphasised in each successive plan document right
from the first plan. The emphasis became more pronounced since the Third Plan which stressed
continuous strides in regional development. The differential strategy for backward area was put
in operation since Third Plan for according special care and treatment to the development of
backward regions (which led to techniques of area planning and sub-plan for backward areas) as
distinct from the integrated strategy adopted till then. In spite of the pronounced and pious
objective of reduction in regional disparity, the area of planned development presents a picture of
uneven growth in India. Thus, both the economic feature and the economic future of the region
are intimately linked to Rural Development. The question of rural poverty can be effectively
tackled by the sustained growth of agriculture. Poverty eradication programmes, in terms of
wage and self-employment schemes hitherto launched, were ill-conceived and clumsily
implemented.

 Indira Nair, Challenges Of Rural Development and Opportunities for Providing


Sustainable Livelihood
(file:///C:/Users/hp/Downloads/214139970361913.%20AppliedCHALLENGES%20OF%20
RURAL%20DEVELOPMENT%20AND%20OPPORTUNITIES-Indira%20Nair%20(6).pdf)

The objectives of the paper is to anlayse the challenges facing the rural areas and suggest ways to
overcome these challenges and to create opportunities of gainful self-employment for the rural
families, especially disadvantaged sections, ensuring sustainable livelihood, enriched
environment, improved quality of life and good human values. This is being achieved through
development research, effective use of local resources, extension of appropriate technologies and
up gradation of skills and capabilities with community participation.

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1.2 Research Questions-

The key questions behind the research are-

 How rural development is exteremely important for development of the nation?


 What are the reasons which makes rural development an important issue in modern
economics?
 What are the major problems obstructing the development and how?

1.3 Scope and Objectives-

The objectives behind the research are-

 To describe the concept of rural development and an obvious need of it.


 To analyze the challenges facing the rural areas and suggest ways to overcome these
challenges.
 To describe the steps taken by the government in this direction and prospects behind
them.

1.4 Research Methodology- The methodology adopted for the project topic is the doctrinal
method of research. Books from the library and articles from various journals have been referred
to for the collection of data.

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Chapter-2

Rural development: concept and need

Although policy makers and the development community have widely used the phrase “rural
development”, what constitutes rural development seems to have changed significantly
overtimes.

The concept of rural development has changed significantly during the last three decades. Until
the 1970s, rural development was synonymous with agricultural development and hence focused
on increasing agricultural production. This focus seems to have been driven primarily by the
interest of industrialization to extract surpluses from the agriculture sector to reinforce
industrialization.

Rural development has attracted the attention of the economists right from the Mercantilist era
and Adam Smith down to Marse and Keynes, yet they were mainly interested in the problems
which were essentially static in nature and largely related to a western European framework of
social and cultural institutions. Their interest in the economics of development has been
stimulated by the wave of political resurgence that swept the Asian and African nations after
Second World War and thought to promote rapid economic development coupled with the
realization on the part of the developed nations that ‘poverty anywhere is a treat to prosperity
everywhere’. As Meier and Baldwin have remarked : “A study of the poverty of nations has even
more urgency than a study of the wealth of Nations.’’ The Economists differ on its definition as
some one says increase in the economy’s real national income over a long period and some says
about the increase in the per capita real income of the economy which are not convincing as it
lacks of human welfare.1

The establishment of the Millennium Development Goals has significantly reinforced the
concerns about non-income poverty. With the parading shifts in economic development from
1
Ugra Mohan Jha , Rural Development in India: Problems and Prospects, Anmol Publications(2000),
page no. 24
7
“growth” to broadly defined “development”, the concept of rural development has begun to be
used in a broader sense.

In more recent years increased concerns on the environmental’ aspects of economic growth have
also influenced the changes. Today’s concept of rural development is fundamentally different
from that used about three or four decades ago.

The concept now encompasses “concerns that go well beyond improvements in growth, income
and output. The concern include an assessment of changes in the quality of life, broadly defined
to include improvement in health and nutrition, education, environmentally safe living conditions
and reduction in gender and Income inequalities.

Today, there seems to be a universal consensus that the ultimate objective of rural development
is to improve the quality of life of rural people. This makes it essential to go beyond the income-
related factors such as prices, production, and productivity to a range of non- income factors that
influence quality of life and hence inclusiveness of rural development.”

NEED FOR RURAL DEVELOPMENT

It is important for a country like India to empower its population both rural and urban with the
right skills, competencies, infrastructure, IT platforms, schemes, financial and other resources,
science & technology advancements, and agriculture among other necessary things to generate
the reliable, competent, proficient, and available human capital to become a supreme power in
the world.

Since as compared with the population in urban cities, the rural population is more backward
education-wise, health-wise and skills-wise, rural development programme in India serves as the
right instrument to help make them forward and equipped.

 To raises the quality of life & environment in rural areas2 – the main reason behind the idea
of rural development is that there is a great need to improve the quality of life of the people
living in those areas. A deeper look at the Socio-Economic Census (2011) data regarding

2
A.Chandra sekhara reddy, Effective Rural Development Strategies for the Improvement of Indian
Economy, page no. 74
http://www.estij.org/papers/vol1no12011/13vol1no1.pdf
8
rural livelihood and employment is scary. The chart below summarises some of the major
findings of the SECC 2011. Almost three fourths of the rural households live with a monthly
income of less than Rs 5000. More than half the rural households do not own land and more
than half of them are casual labour.
In all the development programmes conservation of the natural resources and protection of
the environment are essential, as these are critical for sustainable development. This is
particularly important, while dealing with the poor as their primary objective is to earn their
livelihood and the development organisations have the obligation to carefully design the
programme to ensure environmental protection with income generation activities.

(1)

II. To reduce urbanization3- Finally, rural development is needed to reduce the migration of
people from villages to cities. Small farmers have work only for 100-120 days for growing one
crop in a year, which is not adequate to sustain their livelihood. Hence, they have to struggle to
earn additional wages by working in irrigated areas or migrate to urban areas. The migration
pattern varies with the region, opportunities and socio-economic status of the families. The
poorest families, particularly the landless and marginal holders owning poor quality land tend to
migrate with the entire family. Many tribal families migrate to cities as construction workers and
return at the onset of the rains. Such migrations severely affect the quality of life, due to poor
health, lack of education and social pressures leading to erosion of moral values. The current rate
of rural-to-urban migration in India is unsustainable. It is much more than the rate at which
industrial jobs and urban infrastructure are growing. So rural development is a must to slow
down the rural-to-urban migration.

3
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III. For the improvement of Indian economy4- this is the essence of idea of rural development, to
improve the economy of whole nation. It is noted that the agriculture and allied
services contribution to the GDP of the nation has reduced considerably from 51.88% in 1950 to
13.94% in 2013. The World Bank data on value added by agriculture (% of GDP) data does not
seem to disagree. From a 42.56 in 1960 it has dropped to a meager 16.95 in 2014. Given that
almost 70% of the population lives in rural areas and about 50% of the overall labour force is
still dependant on agriculture, this situation is definitely not sustainable. So there is an immense
need of this.

IV. For the proper management of natural resources like land, water for agricultural production-
Improving agriculture is a must for industrialization. Agriculture is carried on in villages, so rural
development is needed to improve agriculture.

Apart from these objectives there is an immence need of rural development in order, To produce

variety of food products through agriculture, To improve profits for farmers, To Increase

productivity in rural areas and reduce poverty, To involve people in planning and development

through their participation in decision making and through centralization of administration, To

ensure distributive Justice and equalization of opportunities in the society.

4
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Chapter-3

Problems in Rural development

Population & Poverty-

Growth of population is the principal cause of rural unemployment. Every year population
increases by nearly 50 lakh in India. According to Gopalaswami, the annual increase is to the
tune of staggering 80 lakh. As the industrial growth of the country does not keep pace with the
stupendous rise in population, industrial sector fails to absorb the increasing labour population.
As a result a vast number of people, almost 67.7% of the population, depend on agriculture. This
leads to rural unemployment.

With the increasing population, even that is not possible because with the increasing number of
people, we have to share our resources with even more people. Resources of all types are limited,
even employment, especially in India. India, being a developing country, has a limited number of
jobs available. Due to the increasing number of people, the competition for the most menial jobs
is also tremendous. In 1972-73, unemployment rates in rural areas were 1.2 for males and 0.5 for
females, and in urban areas, it was 4.8 for males and 6.0 for females. This unemployment rate
rose to 2.3 for males and 1.5 for females in rural areas and 4.9 for males and 8.2 for females in
urban areas in 1998-99.5 With the increasing population, unemployment rates are bound to rise
even further. Several highly educated people with Bachelors and Masters degrees in India sit at
home, because they cannot find jobs.

Poverty and unemployment are interlinked. Because of poverty the ruralites have no resource for
investment. Consequently they remain unemployed. India currently faces approximately 33
births a minute, 2,000 an hour, 48,000 a day, which calculates to nearly 12 million a year.
Unfortunately, the resources do not increase as the population increases. Instead the resources
keep decreasing, leading to making survival for a human being more and more competitive even
for the basic necessities of life like food, clothing and shelter.
India currently faces a vicious cycle of population explosion and poverty. One of the most

5
http://www1bpt.bridgeport.edu/~darmri/population_explosion.html
11
important reasons for this population increase in India is poverty. More than 300 million Indians
earn less than US $1 everyday and about 130 million people are jobless. The people, who have to
struggle to make two ends meet produce more children because more children mean more
earning hands. Also, due to poverty, the infant mortality rate among such families is higher due
to the lack of facilities like food and medical resources. Thus, they produce more children
assuming that not all of them would be able to survive. The end result is a mounting increase in
the population size of India. Due to the increase in population, the problems of scarce resources,
jobs, and poverty increases. Thus the cycle continues leading to an ever-increasing population
that we see today. This cycle in fact might be considered as a positive feedback, in that the
increase in one results in the increase of the other factor. As the poverty and the population both
increase, the development of the country and the society seems even more far-fetched.

Livlihood- A deeper look at the Socio-Economic Census (2011) data regarding rural livelihood
and employment is scary. The chart (1) summarises some of the major findings of the SECC
2011. Almost three fourths of the rural households live with a monthly income of less than Rs
5000.6 More than half the rural households do not own land and more than half of them are
casual labour. Small farmers have work only for 100-120 days for growing one crop in a year,
which is not adequate to sustain their livelihood.

Excessive dependence on agriculture-


In India, although the contribution of agriculture to the Gross Domestic Product (GDP) is around
19%, in the absence of employment opportunities in industrial and service sectors, over 85% of
the rural income is generated from agriculture, who spend about 75% - 80% of their earnings on
food. Agriculture is the major source of livelihood but most of the illiterate farmers have not
been successful in cultivating their land economically. They have been treating agriculture as a
family tradition. Over 12-15% of the rural families are landless and among the land holders, 69%
are marginal farmers with less than 1 ha holding (17% of the total land) and about 21% are small

6 ATHREYA MUKUNTHAN, Rural India is far behind Urban India in every Indicator of Progress

https://factly.in/rural-india-behind-urban-india-in-progress-indicators/

12
farmers with 1-2 ha holdings (34% of the land). Thus about 90% families own less than 51%
lands, with a per capita holding of 0.19 ha. Out of the 147 million ha agricultural lands, about 60
million ha are located in arid zones, which are mostly owned by the poor families.7 As the
chances of crop failure on these lands is very high, the farmers generally do not invest in external
inputs like improved seeds, fertilisers and plant protection measures and end up with poor crop
yields, even during normal years.

Ruralites depend largely on agriculture for their livelihood. But cultivable land is limited in
supply. Whatever measures are taken to make uncultivable land arable, it is not possible to cater
to the needs of the growing demand on land in rural areas. As a result unemployment prevails in
rural areas

Infrastructure: Poor infrastructure for receiving timely information on development


opportunities, market demand and prices for agricultural commodities, new technologies,
forward and backward linkages, credit facilities and development policies of the government. For
ex. Traditional method of cultivation adopted by the Indian farmer is unscientific and obsolete.
Lack of improved methods of farming as well as absence of skilled labour hampers agricultural
output. Aversion to the use of fertiliser, lack of adequate irrigation facilities and lack of capital to
procure modern agricultural tools, seeds and manures affect agricultural produce. As a result
rural agriculture loses employment potentiality.

Many of the poor communities are isolated by distance, bad road conditions, lack of or broken
bridges and inadequate transport. These conditions make it difficult for people to get their goods
to market and themselves to place of work, to handle health emergencies, to send children to
school, and to obtain public services

Education: Poor access to education, resulting in low literacy and unemployment of the youth.
While the average literacy rate in rural areas is around 50-65%, it is as low as 20-25% among
women in backward areas. Education of girls was felt to be unnecessary in the past and this has

7
D. Gangopadhyay, A.K. Mukhopadhyay & Pushpa Sing, Rural Development: A strategy for poverty
alleviation in India
http://www.nistads.res.in/indiasnt2008/t6rural/t6rur3.htm
13
seriously affected their quality of life. Illiteracy has also hindered their development due to lack
of communication with the outside world. They are slow in adopting new practices, which are
essential with the changing times Low literacy rate, particularly among women having adverse
effect on their skills development, employment productivity, family welfare and education of
their children.
A look at the literacy levels in India over last 3 decades from the same rural urban lens gives us
more or less similar numbers. Rural literacy rate is much lower than the urban literacy rate. The
point to be noted is the gender disparity in this area, where the urban female literacy rate is
almost higher by 20% than the rural female.
Acc. to 1991 census male literacy rate at that time was 57.87% while female literacy rate was
30.62%. which increased to 77.15% and 57.93% respectively till 2011. However it is still much
lower than urban literacy rate.8

Electricity

As per latest data, about 19,909 villages are yet to be electrified (Progress report of village
electrification as on 31-01-2015). However, not all electrified villages are getting quality power
and it is estimated that nearly 33% of the population maybe facing under-electrification,
accessing less than 50kWh of electricity per month/household.

Health-

Health is said to be the wealth of a society. Good health and adequate nutrition are the best
indicators of the overall well-being of population and human resources development. They also
form an important component of human capability.

Rural India lags behind Urban India in all the indicators; Infant Mortality Rate, Percentage
of Anemic Population, Various Health Indicators and Access to Basic Services (as of 2006).9

8
ATHREYA MUKUNTHAN, Rural India is far behind Urban India in every Indicator of Progress

https://factly.in/rural-india-behind-urban-india-in-progress-indicators/
9
Indira Nair, Challenges Of Rural Development and Opportunities for Providing Sustainable Livelihood

14
The health burden of poor water quality is enormous. It is estimated that around 37.7 million
Indians are affected by water borne diseases annually, 1.5 million children are estimated to die of
diarrhoea alone and 73 million working days are lost due to waterborne disease each year. The
resulting economic burden is estimated at $600 million a year. The problems of chemical
contamination is also prevalent in India with 1,95,813 habitations in the country are affected by
poor water quality. The major chemical parameters of concern are fluoride and arsenic. Iron is
also emerging as a major problem with many habitations showing excess iron in the water
samples. Most of these problems Prevailed in rural India.

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Chapter-4

Strategies for rural development-

The effective rural development strategies can be followed are

1. Provision of support to the farmers Groups, and Associations in order to build their
capacity and supporting farmer unions.
2. By adopting localized way of distributing agricultural products so that it can be easily
accessible to all.
3. Water management for agricultural production by the Usage of sprinklers and drips. And
Use of private companies for processing & marketing.
4. Infrastructure Development: Development of physical as well as social infrastructure
plays an important in the overall advance of the rural economy by directly contributing to
employment generation and asset creation. Improved network of physical infrastructure
facilities such as well-built roads, irrigation, rail links, power and telecommunications,
information technology, food storage, cold chains, market-growth centres, processing of
produce and social infrastructure support, viz., health and education, water and sanitation,
and veterinary services and co-operatives are essential for the development of the rural
economy, especially in the era of liberalization, privatization and globalization (LPG)
5. Enhancing Rural Micro finance services & provision of subsidies for crops.
6. Strategy for provision of technology inputs to the farmers.
7. Better economic utilization of agricultural residues, byproducts & Recycling of wastes by
the establishment of separate plants at the village levels by the support of government.
8. Pests and disease control with the usage of improved seeds, Bio Fertilizers, Herbicides,
and Bio Pesticides.
9. Usage of advanced equipment and machinery that constitutes the technology for the
plantation and harvesting of the crops that leads to decrease the labor cost.
10. Research & Development for agro processing technologies. Analysis of complete
Agricultural trade statistics includes Tree crops, Consumption data, Diseases and disease
10
control data, Statistics on agricultural products processing & marketing, Fisheries

A.Chandra sekhara reddy, Effective Rural Development Strategies for the Improvement of Indian
10

Economy, page no. 70


16
statistics etc.
11. Formation of a Globalized or Model Village- a model village is perceived as a village
having all modern physical and social infrastructure facilities. A model village will
facilitate human resource development through better education, health and training and
generate employment avenues both in secondary and tertiary sectors. Initially funds for
infrastructure building will have to be mobilized from government as well as non-
government sources, such as non-government organizations, international funding
agencies, non-resident Indians (NRIs), religious Institutions and other sources besides the
village’s income from its own sources.
12. Increasing the organic farming. Because of high utilization of pesticides and fertilizers by
the farmers, scientists are advising the organic products. The agricultural products, that
produced through organic farming termed as organic products. In the world market these
organic products having high demand day to date. So, there is a great need to follow the
organic farming by the Indian farmers and produce the organic foods and export to other
countries for the propitiation. Worldwide the organic farming land increased 11% - 40%
from 1990 to 2010.
13. Women Empowerment: Involvement of women in all the development programmes right
from the stage of project planning is essential. Although women represent 50% of the
population, they also have the major responsibility of grooming children and procuring
the basic needs required for food, fuel and fodder securities. Active participation of
women in development programmes will help to identify their problems and reduce their
drudgery.

http://www.estij.org/papers/vol1no12011/13vol1no1.pdf
17
Chapter-5

Government efforts and Prospects in rural development

Government Initiatives for Rural Development in India:

The various programmes launched by the government of India for developing the rural India in a
holistic manner are:

MAHATMA GANDHI NATIONAL RURAL EMPLOYMENT GUARANTEE ACT


(MGNREGA)11- NREGA Launched on 2nd February 2006 as a momentous initiative towards
pro-poor growth. For the first time, rural communities have been given not just a development
programme but also a regime of rights. The National Rural Employment Guarantee Act, 2005
(NREGA) guarantees 100 days of employment in a financial year to any rural household whose
adult members are willing to do unskilled manual work. This work guarantee also serve other
objectives: generating productive assets and skills thereby boosting the rural economy, protecting
the environment, empowering rural women, reducing rural urban migration and fostering social
equity, among others. The Act offers an opportunity to strengthen our democratic processes by
entrusting principle role to Panchayats at all levels in its implementation and promises
transparency through involvement of community at planning and monitoring stages.

PRADHAN MANTRI GRAM SADAK YOJANA12: Rural Road Connectivity is not only a key
component of Rural Development by promoting access to economic and social services and
thereby generating increased agricultural incomes and productive employment opportunities in
India, it is also as a result, a key ingredient in ensuring sustainable poverty reduction.
Notwithstanding the efforts made, over the years, at the State and Central levels, through
different Programmes, about 40% of the Habitations in the country are still not connected by All-

11
Ministry of Rural Development, Government of India annual report (2008-09)

http://rural.nic.in/sites/downloads/annual-report/anualreport0809_eng.pdf
12
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weather roads. It is well known that even where connectivity has been provided, the roads
constructed are of such quality (due to poor construction or maintenance) that they cannot always
be categorized as All-weather roads. With a view to redressing the situation, Government has
launched the Pradhan Mantri Gram Sadak Yojana on 25th December, 2000 to provide all-
weather access to unconnected habitations. The Pradhan Mantri Gram Sadak Yojana (PMGSY)
is a 100% Centrally Sponsored Scheme. 50% of the Cess on High Speed Diesel (HSD) is
earmarked for this Programme.

INDIRA AWAAS YOJANA-The genesis of the Indira Awas Yojana can be traced to the
programmes of rural employment which began in the early 1980s. Construction of houses was
one of the major activities under the National Rural Employment Programme (NREP) which
began in 1980 and the Rural Landless Employment Guarantee Programme (RLEGP) which
began in 1983. There was, however, no uniform policy for rural housing in the states. For
instance some states permitted only part of the construction cost to be borne from NREP/
RLEGP funds and the balance was to be met by beneficiaries from their savings or loans
obtained by them. The objective of Indira Awaas Yojana is primarily to help construction of
dwelling units by members of Scheduled Castes/ Schedule Tribes, freed bonded labourers and
also non- SC/ST rural poor below the poverty line by providing them with grant-in-aid. The
target group for houses under Indira Awaas Yojana is people below poverty line living in rural
areas belonging to Scheduled Castes/ Scheduled Tribes, freed bonded labourers and non- SC/ST
Categories.13

COUNCIL FOR ADVANCEMENT OF PEOPLE’S ACTION & RURAL TECHNOLOGY


(CAPART)- The main objectives of the CAPART are to encourage, promote and assist voluntary
action for the implementation of projects intending enhancement of rural prosperity, To
Strengthen and promote voluntary efforts in rural development with focus on injecting new
technological input and To act as a catalyst for the development of technology appropriate for
rural areas. CAPART made useful contribution towards the implementation of the programmes
or schemes like Jawahar Rozgar Yojana (JGSY), Development of Women & Children in Rural
Areas (DWCRA), Integrated Rural Development Programme (IRDP) Accelerated Rural Water

13
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Supply Programme (ARWSP), Central Rural Sanitation Programme (CRSP). Indira Awas
Yojana (IAY), Panchayati Raj (PR) etc.

NABARD (National Bank for Agriculture and Rural Development)- NABARD is set up as an
apex Development Bank with a mandate for facilitating credit flow for promotion and
development of agriculture, small-scale industries, cottage and village industries, handicrafts and
other rural crafts. It also has the mandate to support all other allied economic activities in rural
areas, promote integrated and sustainable rural development and secure prosperity of rural
areas.14 In discharging its role as a facilitator for rural prosperity NABARD is entrusted with -
Providing refinance to lending institutions in rural areas, Bringing about or promoting
institutional development and, Evaluating, monitoring and inspecting the client banks

These are some of the programmes launched by the Govt. of India in order to develop the rural
India.

14
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Chapter-6

Conclusion

Development of India’s Rural Economy is Vital for Growth. However finance is still the biggest
problem for development of rural economy despite it being innovative. People in the rural areas
have no money and often tend to go for high-cost borrowings. No venture capitalists or funders
have ever come forward to help those communities with social obligations in mind. Who lends
the money to those poor people without collateral securities despite having the entrepreneurial
capabilities, innovativeness, creativeness and hard working abilities? It is a pity to say that even
to this day villagers happen to be bonded laborers to big money launderers due to high cost
borrowings which has never been a easy task to repay. There are NGOs and grameen
representatives, who have powerful micro-financing model with a business principle in mind and
market competitiveness. Venture capital funds for BPL families, to create livelihoods
opportunities from them will be a very good idea. If it happens in a more systematic way it will
be probably the single largest revolution after the Green Revolution of 1960 in India. The need
of the hour is therefore to boost the rural economy so that it can contribute to the nation’s
development. One way of achieving it is by adhering to the Millennium Development Goals. The
eight Millennium Development Goals (MDGs) – which range from halving extreme poverty to
halting the spread of HIV/AIDS and providing universal primary education, all by the target date
of 2015 – form a blueprint agreed to by all the world’s countries and the entire world’s leading
development institutions. They have galvanized unprecedented efforts to meet the needs of the
worlds poorest. Also, we can develop a cluster-based approach to rural development. All villages
should be grouped in clusters and every cluster should be given a fund of Rs.2 billion. To
achieve rapid and sustainable economic growth the rural economy needs to be revamped, the
road ahead is challenging but efforts have to be consistent!

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Bibliography-

Books-

 Ugra Mohan Jha , Rural Development in India: Problems and Prospects, Anmol
Publications(2000)

 S. N. Mishra, Kushal Sharma, Problems and Prospects of Rural Development in India, Uppal
Publishing House

Articles

 Indira Nair, Challenges Of Rural Development and Opportunities for Providing Sustainable
Livelihood
 ATHREYA MUKUNTHAN, Rural India is far behind Urban India in every Indicator of
Progress
https://factly.in/rural-india-behind-urban-india-in-progress-indicators/(pdf)

 Ministry of Rural Development, Government of India annual report (2008-09)

http://rural.nic.in/sites/downloads/annual-report/anualreport0809_eng.pdf

 A.Chandra sekhara reddy, Effective Rural Development Strategies for the Improvement of
Indian Economy
http://www.estij.org/papers/vol1no12011/13vol1no1.pdf
 D. Gangopadhyay, A.K. Mukhopadhyay & Pushpa Sing, Rural Development: A strategy for
poverty alleviation in India
http://www.nistads.res.in/indiasnt2008/t6rural/t6rur3.htm

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