TNPSC Indian Economy – Rural welfare oriented programs:

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Features of Rural Economy:

The main characteristics of rural economy are:

1. Village is an Institution:

• The village is a primary institution and it satisfies almost all the needs of the rural community. The rural people have a feeling of belongingness and a sense of unity towards each other.

2. Dependence on Agriculture:

• The rural economy depends much on nature and agricultural activities. Agriculture and allied activities are the main occupation in rural areas.

3. Life of Rural People:

• Lifestyles in villages are very simple. Public services like education, housing, health and sanitation, transport and communication, banking, roads, and markets are limited and unavailable.
• Rural people rely much on faith, superstitions, and traditional cultural practices.
• The standards of living of the majority of rural people are poor and pitiable.
• In terms of methods of production, social organization, and political mobilization, the rural sector is extremely backward and weak. In recent years, the incidence of alcohol drinking has gone up.

4. Population Density:

• Population density, measured by the number of persons living per sq. km is very low and houses are scattered in the entire villages.

5. Employment:

• There exists unemployment, seasonal unemployment, and underemployment in rural areas.
• Unemployment refers to the situation of people with willingness and ability to work but is not getting employed.
• Underemployment also called disguised unemployment is the situation of people employed in excess, over and above the requirement.
• Disguised unemployment is a situation Where people work but no increase in production. Both the
  situations are common in rural areas.

6. Poverty:

• Poverty is a condition where the basic needs of the people like food, clothing and shelter are not being met. According to 2011-12 estimates, About 22 crores of people in rural areas are poor and live below the poverty line.

7. Indebtedness:

• People in rural areas are highly indebted owing to poverty and underemployment, lack of farm and non-farm employment opportunities, low wage employment, seasonality in production, poor marketing network etc.
• 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’.
• Since formal loan facilities are not available to the villagers, they depend on local money lenders who, like a parasite, squeeze the villagers. Hence the villagers commit suicide frequently.

8. Rural Income:

• The income of the rural people is constrained as the rural economy is not sufficiently vibrant to provide them with jobs or self – employment opportunities. Large proportion of labourers and skilled persons are underemployed and the scope for increasing their income is limited.

9. Dependency:

• Rural households are largely dependent on social grants and remittances from family membersworking in urban areas and cities.

10. 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.

11. Inequality:

• The distributions of income, wealth, and assets are highly skewed among rural people.
• There are number of historical, social, economic and political reasons behind the existence of inequality.
• Landlords and landowners dominate the rural activities. Land, livestock and other assets are owned by a few people.

12. Migration:

• Rural people are forced to migrate from villages to urban areas in order to seek gainful employment
  for their livelihood.
• This character of the development gives rise to the formation of cities.
• Enmity and Lack of basic amenities in rural areas also push the people to migrate to urban areas.
• 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:

Rural development is very urgent in the context of the overall growth and development of the Indian economy due to
the following reasons.

1. A major share of the population lives in rural areas, and their development and contributions are very much supportive for the nation building activities. 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.
Hence, the backwardness of the rural sector would be a major impediment
to the overall progress of the economy.

3. Improvements in education, health, and sanitation in villages can help avoid many urban problems namely, begging, rack picking, and roadside slumming.

4. Development of agriculture and allied activities are necessary for providing gainful employment in
rural areas and improving overall food production.

5. The evils of brain-drain and rural- urban migration can be reduced if rural areas are developed.

6. In order to better utilise the unused and under-utilised resources, there is a need to develop the rural economy.

7. Rural development should minimize 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.

8. 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.