Rural Development - Indian Economics PDF

**[RURAL DEVELOPMENT- UNIT II INDIAN ECONOMICS]** 1. \-\-\-\-\-\-\-\-\-- Proportion of the Indian population depends on the agriculture sector as a source of livelihood? 2/3^rd^ 2. When did India adopt social banking and multi-agency approach to provide rural credit facilities? After 1969 3....

**[RURAL DEVELOPMENT- UNIT II INDIAN ECONOMICS]** 1. \-\-\-\-\-\-\-\-\-- Proportion of the Indian population depends on the agriculture sector as a source of livelihood? 2/3^rd^ 2. When did India adopt social banking and multi-agency approach to provide rural credit facilities? After 1969 3. What is the expansion of NABARD? When was it started? National Bank for Agriculture and Rural Development- it was established 1982 4. Which is the Apex Institution to co- ordinate the activities of rural financial system. NABARD 5. \-\-\-\-\-\-\-\-\-\-\-- is the harbinger of changes in the rural credit system of the country toward production oriented lending Green Revolution 6. RRB stands for\-\-\-\-\-\-\-\-\-\--? Regional Rural Bank ( Established 1975) 7. \-\-\-\-\-\-\-\-- fill the gap in the formal credit delivery system in the rural areas. SHGs. 8. The women oriented community based poverty reduction programme implemented in Kerala is called? Kudumbashree 9. When did the Kudumbashree programme start? 1995 10. What is micro- credit programme? Lending activities of SHGs by promoting thrift in small proportion by minimum contribution from each member of the SHGs. 11. Milk production in the country has increased by more than four times between\-\-\-\-\-\-\-\-\-\-\-\-- 1960-2002 12. What is operation flood? It is the system whereby all diary famers can pool in their milk produce according to different grade based on quality, which in turn will be processed and market to urban centers through milk co-operative societies *(Started in 1966)* 13. What is Horticulture? Horticulture has been defined as the cultivation of plants, mainly for food, materials, comfort and beauty. According to American horticulturist [Liberty Hyde Bailey](https://en.wikipedia.org/wiki/Liberty_Hyde_Bailey), \"Horticulture is the growing of flowers, fruits and vegetables, and plants for ornament and fancy. 14. The term Golden Revolution is associated with\-\-\-\-\--? Horticulture 15. Which period in India is hailed as Golden Revolution? 1991-2003 15. Kharif crops refer to \-\-\-\-\-\-\-\-\-\-\-- Crops cultivated during Rainy season (Rice, maize and cotton are major kharif crops in India.) 16. Rabi crops refer to\-\-\-\-\-\-\-\-\-- Crops cultivated during dry season especially the winter and spring season. (The major rabi crop in India is [wheat](https://en.wikipedia.org/wiki/Wheat),  [barley](https://en.wikipedia.org/wiki/Barley), [mustard](https://en.wikipedia.org/wiki/Mustard_seed), [sesame](https://en.wikipedia.org/wiki/Sesame) and [peas](https://en.wikipedia.org/wiki/Peas)) **[WHAT IS RURAL DEVELOPMENT AND HOW IS IT POSSIBLE? WHY IS IT NEEDED? ]** Rural development is a comprehensive term that focuses on the action plan for the development of those areas that are lagging behind in overall socio- economic development. *[RURAL DEVELOPMENT CAN BE INITIATED IN THE FOLLOWING WAYS; ]* a. Development of human capital through education with special emphasis on women education, skill formation and provision of heath care and sanitation facilities. b. Land reforms and development of productive resources in each locality c. Infrastructure development in terms of providing electricity, irrigation, credit and marketing facilities, transport facilities, agriculture research etc. d. Abolition of poverty, improvement of the standard of living of the poor people, and provision of adequate alternate job opportunities apart from agriculture. e. Provision of technical and financial support to help farmers raise the productivity of grains, cereals, vegetables and fruits. f. Facilities to find alternative job opportunities in non- farm activities like animal husbandry, fisheries etc. ***[WHY IS IT NEEDED?]*** ***Mahatma Gandhi once remarked the real progress of India did not mean the growth and expansion of industrial urban centers but mainly the development of villages.*** a. This is because majority of the poor people live in rural areas where they are deprived of even basic necessities of life. b. Agriculture is the main source of livelihood in rural areas and more than 2/3^rd^ of India's population still depend on agriculture which is not productive enough to provide for even subsistence living. c. 1/3^rd^ of the rural India still lives in acute poverty. Therefore, development of the rural areas is fundamental to the economic development of the nation. d. Though the share of the agriculture sector to the GDP is declining year after year, still the dependency rate on the agriculture sector has not reduced. e. After the introduction of the economic reform policies in 1991 and subsequent fall in the public sector investment in the agriculture infrastructure, the growth rate of the agriculture sector has declined to 2.3% per annum in the subsequent years. f. More over inadequate infrastructure, lack of alternative employment opportunities, increasing casualization of employment etc. are burning issues in the rural areas which require immediate attention of the Govt. and policy makers. **[RELEVANCE OF THE RURAL CREDIT FACILITIES IN THE RURAL DEVELOPMENT]** a. The growth of the rural economy depends on the availability of rural credit facilities. b. Availability of capital at an affordable rate is essential for higher productivity in the agriculture and non- agriculture sectors c. Farmers borrow from various sources to meet expenses on the purchase of seeds, fertilizers, tools & implements as well as for other family expenses of marriage, religious ceremonies etc. d. Money lenders and traders often exploit the farmers and agriculture laborers in the absence of formal rural credit facilities by; lending at high rates of interest Manipulating accounts to keep them always in debt trap e. Therefore, availability of a well-developed rural credit facilities is inevitable to cater to the financial requirements of rural people and to save them from exploitation of the money lenders and traders. [EXPLAIN THE STRUCTURE OF THE RURAL CREDIT SYSTEM ] a. After the year 1969 India has adopted social banking and multi-agency approach to facilitate the rural credit. b. In 1982 NABARD was set up an apex institution to co-ordinate the activities of the institutions involved in the rural financing system. c. Since the introduction of the Green Revolution production --oriented credit facilities have been given emphasis. d. The multi -- agency institutional structure of the rural banking consists of commercial banks, RRBs, Co-operatives and Land development banks. e. SHGs have been incorporated into the formal rural credit system, as social banking, for the overall social and community development of rural areas. f. Micro- credit programmes have been encouraged (the credit provisions through SHGs) - ***SHGs promote thrift in small proportion by a minimum contribution by each member and from the pooled in money, credit is given to the needy members to be repayable in installments at reasonable rates of interest.*** g. SHGs play a crucial role in the women empowerment at rural level. [GIVE A CRITICAL ASSESSMENT OF THE RURAL BANKING] **[Pros]** a. Development of the rural banking system has positive impact on the farm and non- farm output, employment and income of the people b. It enabled the farmers in the rural areas to avail various credit facilities at affordable rate c. Famine became event of the past and the country is able to generate abundant buffer stock of food grains due to the spread of rural credit facilities **[Cons]** a. There is chronic underperformance of the rural banking system b. There is frequent occurrence of overdue installment by the borrowers c. The formal rural credit institutions have failed to develop a culture of deposit mobilization d. These institutions have failed in lending money to worthy customers and failed to initiate an effective loan recovery e. The number of willful loan defaulters is very high [SUGGESTIONS TO IMPROVE RURAL BANKING] a. Banks need to focus on the development of relationship baking with the customers to rectify the issues associated with deposit mobilization and repayment of loans b. Banks should promote the habit of thrift among the rural people through innovative methods c. Awareness regarding the efficient utilization of financial resources must be spread among the customers [WHAT IS AGRICULTURE MARKETING SYSTEM? WHAT IS THE NEED FOR A WELL -DEVELOPED AGRICULTURE MARKETING SYSTEM IN THE COUNTRY? EXPLAIN] It is the process of assembling, storage, processing, grading, packing, transportation and distribution of agriculture commodities across the country 1. Farmers suffered exploitation from faulty weights and measures and manipulation of accounts by the traders and merchants 2. Farmers were often forced to sell their produce at a lower price to traders and merchants 3. There was absence of proper storage facilities for agriculture produced 4. A significant amount of the goods produced by the farmers are wasted even today due to the lack of storage facilities. Hence the development of the agriculture marketing facilities is important. **[WHAT WERE THE MEASURES ADOPTED TO DEVELOP THE AGRICULTURE MARKETING IN THE COUNTRY? EXPLAIN ]** 1. Regulation of the agriculture market for orderly and transparent marketing conditions 2. Provision of physical infrastructure facilities like roads, railways, warehouses, go downs, cold stores and processing units. 3. Promoting co- operative marketing to ensure a fair price for the produce of the farmers as well as to save them from the exploitation of traders and middlemen. 4. Policy initiatives like; a. Assurance of Minimum Support Price for agriculture products b. Maintenance of Buffer stock of wheat and rice c. Distribution of food grains through PDS to the poor people at a subsidized rate. [WHAT IS AGRICULTURE DIVERSIFICATION? EXPLAIN ] Agriculture diversification refers to; 1. Diversification of crop production & 2. Shifting of the surplus work force from the agriculture to other related activities like livestock farming, fisheries etc. *[NEED FOR AGRICULTURE DIVERSIFICATION]* 1. To reduce the risks of disguised unemployment and overdependence on the agriculture sector by the rural population as a primary source of livelihood 2. To rectify the difficulties caused to the farmers, due to the inadequate irrigation facilities especially during the summer season 3. To provide a supplementary gainful employment to the rural people other than agriculture. 4. To enable the rural people to earn a higher income, to enjoy a better standard of living and to recover them from acute poverty. 5. To provide a sustainable livelihood to rural people. 6. To provide alternative employment opportunities to the rural people in the dynamic sub sectors of agriculture like agro- processing industries, food processing industries, leather industry, farm tourism etc. 7. To encourage the increased participation of women in rural areas in non-farm activities. [WHAT IS ANIMAL HUSBANDRY? WHAT IS ITS RELEVANCE?] 1. **Animal husbandry** is the branch of [agriculture](https://en.wikipedia.org/wiki/Agriculture) concerned with raising of animals for [meat](https://en.wikipedia.org/wiki/Meat), [fiber](https://en.wikipedia.org/wiki/Animal_fiber) or other products. It includes day-to-day care, [selective breeding](https://en.wikipedia.org/wiki/Selective_breeding) and the raising of [livestock](https://en.wikipedia.org/wiki/Livestock). 2. **It provides increased stability in income, food security, transport, fuel and nutrition to the rural people** 3. **It provides livelihood to about 70 million small and marginal farmers and it provides employment to large number of women in a rural area.** 4. Poultry farming occupies the largest share of the total livestock farming in India (about 42% of the tot al livestock) 5. Milk production in the country has increased by more than four times between 1960-2002 due to the successful implementation of the Operation Flood, which was associated with dairy farming. 6. The efficient implementation of the milk co-operative societies ensured a fair price and income for the supply of milk to the farmers and has improves the standard of living of the dairy farmers. [WHAT IS RELEVANCE OF FISHERIES AS AN ALTERNATE EMPLOYMENT OPPORTUNITY FOR RURAL PEOPLE?] 1. It is a significant contributor to the GDP of the country 2. It is a source of livelihood to large number of people especially women. 3. About 60% of the workforce in internal marketing and 40% of the workforce in the export marketing form women. 4. About 49% of the fish production is from the inland water bodies like lakes, rivers etc. and the balance 51% of the fish produce is from the marine sources. Therefore, progressive increase in the budgetary allocation and introduction of new technologies in fisheries is very important. 5. The overall socio- economic status of the fishermen is deplorable compared to other backward sections of the society 6. Underemployment, illiteracy, low per capita income and standard of living and indebtedness are common features of the fishermen community. Therefore long-term development policies with reference to the particular community are need of the time. [WHAT IS RELEVANCE OF HORTICULTURE AS AN ALTERNATE EMPLOYMENT OPPORTUNITY FOR RURAL PEOPLE?] 1. Horticulture can be defined as the art of cultivation of flowers, fruits, vegetables and plants mainly for food, materials, comfort and decoration. Horticulturists are agriculturists who grow flowers, fruits and nuts, vegetables and herbs, as well as ornamental trees and lawns. 2. It also includes [plant conservation](https://en.wikipedia.org/wiki/Conservation_biology),  [soil management](https://en.wikipedia.org/wiki/Soil_management), [landscape](https://en.wikipedia.org/wiki/Landscape_design) and [garden](https://en.wikipedia.org/wiki/Garden_design) design, construction and maintenance, and [arboriculture](https://en.wikipedia.org/wiki/Arboriculture) (arboriculture refers to science and technique of selection, planting, [fertilization](https://en.wikipedia.org/wiki/Fertilizer), pest control and  [pruning](https://en.wikipedia.org/wiki/Pruning) of trees and plants) 3. In contrast to [agriculture](https://en.wikipedia.org/wiki/Agriculture), horticulture does not include [large-scale crop production](https://en.wikipedia.org/wiki/Intensive_crop_farming) or [animal husbandry](https://en.wikipedia.org/wiki/Animal_husbandry)- instead it  is divided into several categories which focus on the cultivation and processing of different types of plants and food items for specific purposes.  4. The climate and soil conditions of India are suitable for growing of diverse horticulture crops such as fruits, vegetables, tuber crops, flowers medicinal and aromatic plants that can provide a sustainable alternate source of livelihood, food and nutrition to millions of people especially in rural areas 5. The period 1991-2003 is associated with the Golden Revolution due to the emergence of the horticulture as a sustainable source of livelihood to around 19% of the total workforce, due to the planned development strategies implemented to promote horticulture. 6. India has emerged as the second largest producer of fruits and vegetables in the world. 7. Flower harvesting, nursery maintenance, hybrid seed production, breeding of fruits and flowers, food processing etc. associated with horticulture are highly remunerative employment opportunities for rural people. [WHAT ARE THE ISSUES ASSOCIATED WITH THE ALTERNATIVE SOURCE OF LIVELIHOOD? EXPLAIN] 1. Low productivity of livestock farming while compared to other countries 2. Lack of improved technology and good breed of animals to enhance productivity 3. Lack of improved veterinary care and inadequate credit facilities to small and marginal farmers to adopt better means of livestock farming. 4. Prevalence of the problems associated with overfishing and pollution of waterbodies *[SOLUTIONS]* 1. Introduction of welfare programmes for the fishing community in such a manner that can provide long term gains and sustainable livelihood to the people 2. Programmes to encourage horticulture and livestock farming through adequate investments in the required infrastructure like, electricity, cold storage system, marketing linkages, processing units and technology improvement. [WHAT ROLE DOES THE IT SECTOR CAN PLAY IN RURAL DEVELOPMENT? EXPLAIN] 1. IT can play a crucial role in achieving sustainable livelihood and food security. 2. Effective use of the IT and software to predict areas of food insecurity and vulnerability to take appropriate actions to prevent occurrence of famine. 3. It can help in spreading awareness regarding emerging technologies and its applications in the agriculture sector to raise its productivity 4. It can be used to gather information regarding the weather and soil conditions of an areas to adopt selective cultivation for enhanced productivity 5. It can be used to disclose the creative potential and knowledge of the people to promote the growth of various sectors of the economy. 6. It can generate additional employment opportunities even in rural areas ***Hence, though IT by itself is not a catalyst of change but it can act as tool for achieving greater productivity and efficiency of an economy.*** [WHAT IS ORGANIC FARMING? HOW DOES IT LEAD TO SUSTAINABLE DEVELOPMENT? WHAT ARE ITS MERITS AND DEMERITS? ] 1. It is the whole system of farming that restores, maintains and enhances the ecological balance and soil fertility. 2. At present the awareness regarding the harmful effects the use of chemical fertilizers, pesticides and insecticides is increasing globally and organic farming is widely accepted as a solution for it as it promotes sustainable development. 3. Conventional farming depends heavily on the use of chemical fertilizers and toxic pesticides that enter the food supply chain, penetrates deep into the soil and even the underground water, pollutes the air and causes devastation to the entire eco- system. 4. Since organic farming is based on eco- friendly method and techniques it leads to sustainable development. [BENEFITS OF ORGANIC FARMING] 1. It does not require costlier agriculture inputs like HYV seeds, chemical fertilizers and pesticides etc. 2. It can make use of locally produced organic inputs and hence is a less expensive method of cultivation. 3. It generates increased source of income to the farmers from the export of organic products as they have wide market in foreign countries. 4. Organically grown food items have more nutritional value than the conventionally cultivated products. 5. Organic farming is labour intensive so it gives increased employment opportunities to the people especially in rural areas. 6. Organic products are pesticides free; therefore, it leads to sustainable development. [DEMERITS OF ORGANIC FARMING.] 1. The creation of awareness and willingness among the farmers about the benefits of the organic farming is a major difficulty. 2. Inadequate infrastructure and marketing facilities for the organic products are difficulties confronted in the organic farming 3. The yield from organic products is less compared to the conventional farming which is a discouraging factor. 4. Organic products have shorter shelf life as they are free from preservatives and pesticides. 5. The choice of off --seasons crops is limited in organic farming which is another concern. [ECONOMIC SURVEY 2020-2021 --AGRICULTURE SECTOR PERFORMANCE] The share of agriculture in gross domestic product (GDP) has reached almost 20 per cent for the first time in the last 17 years, making it the sole bright spot in GDP performance during 2020-21, according to the Economic Survey 2020-2021. The resilience of the farming community in the face of adversities made agriculture the only sector to have clocked a positive growth of 3.4 per cent at constant prices in 2020-21, when other sectors slid. The share of agriculture in GDP increased to 19.9 per cent in 2020-21 from 17.8 per cent in 2019-20. The last time the contribution of the agriculture sector in GDP was at 20 per cent was in 2003-04. This was also the year when the sector clocked 9.5 per cent GDP growth, after the severe drought of 2002 when the growth rate was negative. Following 2003-04, the share has remained between 17 and 19 per cent. "The growth in GVA (gross value added) of agriculture and allied sectors has been fluctuating over time. However, during 2020-21, while the GVA for the entire economy contracted by 7.2 per cent, growth in GVA for agriculture maintained a positive growth of 3.4 per cent," according to the survey. The continuous supply of agricultural commodities, especially staples like rice, wheat, pulses and vegetables, also enabled food security. In 2019-20 (according to fourth advance estimates), total food grain production (296.65 million tonnes) in the country was higher by 11.44 million tonnes than 2018-19. It was also higher by 26.87 million tonnes than the previous five years' (2014-15 to 2018-19) average production of 269.78 million tonnes. The production also boosted allocation of food grains under the National Food Security Act (NFSA) that increased by 56 per cent in 2020-21, compared to 2019-20. The government allocated 943.53 lakh tonnes of food grains to states / Union territories till December 2020. The survey also termed the new farm laws as a "remedy" and "not a malady" in a message to the farmer community opposing the laws. "The three agricultural reform legislations are designed and intended primarily for the benefit of small and marginal farmers who constitute around 85 per cent of the total number of farmers and are the biggest sufferers of the regressive Agricultural Produce Market Committee regulated market regime. The newly introduced farm laws herald a new era of market freedom that can go a long way in the improvement of farmer welfare in India," it said.  The survey gave a note of various consultations and reports on the need for agricultural reforms. "The reforms in the agricultural sector were more overdue than even the labour reforms as the existing laws kept the Indian farmer enslaved to the local Mandi (wholesale market) and their rent-seeking intermediaries," it said. It called for a paradigm shift in how agriculture was viewed, "from a rural livelihood sector to a modern business enterprise". **\"[Pradhan Mantri Jan-Dhan Yojana (PMJDY)\"]**  Objective of** \"Pradhan Mantri Jan-Dhan Yojana (PMJDY)\"** is ensuring access to various financial services like availability of basic savings bank account, access to need based credit, remittances facility, insurance and pension to the excluded sections i.e. weaker sections & low income groups. This deep penetration at affordable cost is possible only with effective use of technology **PMJDY** is a National Mission on Financial Inclusion encompassing an integrated approach to bring about comprehensive financial inclusion of all the households in the country. The plan envisages universal access to banking facilities with at least one basic banking account for every household, financial literacy, access to credit, insurance and pension facility. In addition, the beneficiaries would get RuPay Debit card having inbuilt accident insurance cover of र 1 lakh. The plan also envisages channeling all Government benefits (from Centre / State / Local Body) to the beneficiaries' accounts and pushing the Direct Benefits Transfer (DBT) scheme of the Union Government. The technological issues like poor connectivity, on-line transactions will be addressed. Mobile transactions through telecom operators and their established centers as Cash Out Points are also planned to be used for Financial Inclusion under the Scheme. Also an effort is being made to reach out to the youth of this country to participate in this Mission Mode Programme.