Ch- Rural Development
NOTES
Rural Development refers to the overall development of rural areas to improve the
quality of life and economic well-being of people living in villages.
It includes agriculture, infrastructure, education, healthcare, sanitation, and
employment opportunities.
Nearly 65-70% of India’s population lives in rural areas, hence rural development
is crucial for national progress.
2. Key Elements of Rural Development
Improving Agricultural Productivity
Use of modern technology, irrigation, high-yielding variety (HYV) seeds,
fertilizers.
Creation of Productive Employment
Rural employment programs like MGNREGA (Mahatma Gandhi National Rural Employment
Guarantee Act).
Development of Infrastructure
Roads, electricity, irrigation, transport, storage, and communication.
Provision of Credit and Marketing Facilities
Development of Human Resources
Literacy, health, skill training.
Empowerment of Women and Marginalized Groups
Through SHGs and education.
3. Agricultural Credit in Rural India
Farmers need credit for seeds, fertilizers, equipment, irrigation, etc.
Sources of Credit:
Institutional Sources: Commercial Banks, Regional Rural Banks (RRBs), Cooperatives.
Non-Institutional Sources: Moneylenders, traders, landlords (often charge high
interest).
Problems:
High dependency on non-institutional credit.
Lack of financial literacy and bank reach in some areas.
4. Role of NABARD
NABARD: National Bank for Agriculture and Rural Development (established in 1982).
Apex bank for rural credit and development.
Functions:
Provides refinance to RRBs, cooperatives.
Promotes rural development programs.
Supports SHGs and microfinance.
5. Rural Banking and Financial Inclusion
Expansion of Rural Bank Branches after bank nationalization in 1969.
Problems:
Regional imbalances in bank penetration.
Cumbersome procedures discourage small and marginal farmers.
Self-Help Groups (SHGs):
Small groups (usually of women) who save money and lend within the group.
Linked to banks under the SHG-Bank Linkage Programme.
Empower women and promote microenterprise.
6. Agricultural Marketing
Involves assembling, storage, processing, transportation, packaging, grading, and
selling of agricultural produce.
Problems in Agricultural Marketing:
Lack of proper storage facilities.
Poor transportation infrastructure.
Exploitation by middlemen.
Lack of market information and standardization.
Government Initiatives:
Regulated Markets (APMCs).
Co-operative marketing.
Minimum Support Price (MSP).
Grading and standardization (AGMARK).
E-NAM (National Agriculture Market) online trading platform.
7. Diversification of Rural Economy
Need for Diversification:
Reduce dependence on agriculture.
Generate alternative employment opportunities.
Types of Diversification:
Diversification within agriculture:
Allied activities like horticulture, floriculture, fisheries, poultry, dairy
farming.
Diversification into non-agricultural sectors:
Handicrafts, cottage industries, rural manufacturing, construction, and services.
Benefits:
Stable income.
Employment generation.
Reduces rural-urban migration.
8. Organic Farming
A method of farming that uses natural inputs (manure, compost) instead of
chemicals.
Advantages:
Eco-friendly and sustainable.
Preserves soil fertility.
Healthier food.
Challenges:
Initially low productivity.
Requires training and awareness.
Expensive certification process.
9. Sustainable Development and Rural Development
Sustainable development means development without harming the environment.
In rural areas, this involves:
Efficient water use.
Renewable energy (solar, wind).
Crop rotation and organic practices.
Afforestation and soil conservation.
Objective: Ensure long-term livelihood and ecological balance.
10. Government Schemes for Rural Development
MGNREGA – Guarantees 100 days of employment.
PMGSY – Rural road development.
NRLM (National Rural Livelihood Mission) – Promotes self-employment and SHGs.
PMAY-G (Housing Scheme) – Affordable housing in rural areas.
Rural Skill Development Programs – To boost employability.
