RURAL DEVELOPMENT

INTRODUCTION

• Rural areas form the backbone of the Indian economy.
• A majority of India’s population lives in villages and depends on:
  • Agriculture
  • Allied activities
• Rural development is essential for:
  • Poverty reduction
  • Employment generation
  • Balanced regional development
• Despite economic growth, rural India faces:
  • Low income
  • Unemployment
  • Lack of infrastructure
• Rural development aims at improving the economic and social conditions of rural people.
• This chapter discusses:
  • Meaning of rural development
  • Rural credit and marketing
  • Agricultural marketing system
  • Diversification of activities
  • Sustainable development and organic farming

WHAT IS RURAL DEVELOPMENT?

Meaning of Rural Development

• Rural development refers to:
  • Continuous process of improving the quality of life of rural people.
• It includes:
  • Economic development
  • Social development
  • Institutional development
• It aims at raising:
  • Income
  • Employment
  • Living standards

Objectives of Rural Development

• Increase agricultural productivity
• Generate employment opportunities
• Reduce poverty and inequality
• Improve rural infrastructure
• Ensure sustainable use of natural resources

Need for Rural Development in India

• Majority population resides in rural areas.
• Agriculture is the main livelihood.
• High levels of:
  • Poverty
  • Disguised unemployment
• Rural-urban imbalance
• Migration to cities

Problems of Rural Areas

• Small and fragmented landholdings
• Dependence on monsoon
• Low access to credit
• Poor marketing facilities
• Lack of education and healthcare

CREDIT AND MARKETING IN RURAL AREAS

Meaning of Rural Credit

• Rural credit refers to loans provided to farmers and rural households.
• Used for:
  • Buying seeds and fertilisers
  • Purchasing machinery
  • Irrigation
  • Consumption needs

Sources of Rural Credit

1. Non-Institutional Sources

• Moneylenders
• Traders and commission agents
• Relatives and landlords

Drawbacks

• Very high interest rates
• Exploitation of farmers
• Debt trap

2. Institutional Sources

a) Cooperative Credit Societies

• Provide short-term loans.
• Operate at village level.

b) Commercial Banks

• Nationalised banks play a major role.
• Priority sector lending to agriculture.

c) Regional Rural Banks (RRBs)

• Cater to small and marginal farmers.

d) NABARD

• Apex institution for rural credit.
• Provides refinance to banks.

Problems of Rural Credit

• Insufficient availability
• Delays in credit disbursement
• Lack of collateral
• Regional disparities

Measures to Improve Rural Credit

• Expansion of institutional credit
• Kisan Credit Cards
• Self Help Groups (SHGs)
• Simplified loan procedures

AGRICULTURAL MARKET SYSTEM

Meaning of Agricultural Marketing

• Agricultural marketing involves:
  • Storage
  • Transportation
  • Grading
  • Pricing
  • Selling of agricultural produce

Problems of Agricultural Marketing

• Lack of storage facilities
• Distress sale by farmers
• Poor transportation
• Presence of middlemen
• Lack of price information

Measures to Improve Agricultural Marketing

1. Regulated Markets

• Government-regulated mandis.
• Prevent exploitation of farmers.

2. Cooperative Marketing

• Farmers sell produce collectively.
• Better bargaining power.

3. Minimum Support Price (MSP)

• Government-declared minimum price.
• Protects farmers from price fluctuations.

4. Warehousing Facilities

• Prevent spoilage.
• Enable farmers to wait for better prices.

DIVERSIFICATION INTO PRODUCTIVE ACTIVITIES

Meaning of Diversification

• Diversification refers to:
  • Shift from sole dependence on agriculture
  • Engagement in multiple income-generating activities

Need for Diversification

• Reduce risk of crop failure
• Generate employment
• Increase income
• Reduce seasonal unemployment

Types of Diversification

1. Crop Diversification

• Growing multiple crops.
• Reduces dependence on one crop.

2. Allied Activities

a) Animal Husbandry

• Dairy, poultry, fisheries.
• Provides supplementary income.

b) Fisheries

• Inland and marine fisheries.
• Generates employment.

c) Horticulture

• Fruits, vegetables, flowers.
• Higher income per hectare.

3. Non-Farm Activities

• Small-scale industries
• Handicrafts
• Transport
• Tourism

Challenges in Diversification

• Lack of capital
• Inadequate skills
• Poor infrastructure
• Limited market access

SUSTAINABLE DEVELOPMENT AND ORGANIC FARMING

Meaning of Sustainable Development

• Development that meets present needs without compromising future needs.
• Balances:
  • Economic growth
  • Environmental protection
  • Social welfare

Need for Sustainable Development in Agriculture

• Overuse of chemical fertilisers
• Soil degradation
• Water pollution
• Loss of biodiversity

Organic Farming

Meaning

• Farming without chemical fertilisers and pesticides.
• Uses:
  • Compost
  • Green manure
  • Bio-fertilisers

Advantages of Organic Farming

• Improves soil fertility
• Environment-friendly
• Produces healthy food
• Sustainable in the long run

Limitations of Organic Farming

• Lower yield initially
• High labour requirement
• Limited awareness
• Lack of marketing facilities

Government Initiatives

• Promotion of organic farming
• Training and awareness programmes
• Certification support

CONCLUSION

• Rural development is essential for:
  • Inclusive growth
  • Poverty reduction
  • Employment generation
• Challenges like:
  • Poor infrastructure
  • Credit constraints
  • Marketing issues
    still exist.
• Diversification and sustainable practices can strengthen rural economy.
• Organic farming promotes environmental sustainability.
• Balanced rural development ensures:
  • Economic stability
  • Social justice
  • National development