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Rural Development Strategies Overview

Rural development aims to enhance the economic conditions of lagging rural areas through increased agricultural productivity, alternative livelihoods, and improved education and health facilities. Key issues include establishing a robust rural credit system, effective agricultural marketing, and promoting diversification in farming and production activities. The document also discusses organic farming, its advantages and limitations, and the significance of initiatives like Operation Flood in boosting rural economies.

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27 views3 pages

Rural Development Strategies Overview

Rural development aims to enhance the economic conditions of lagging rural areas through increased agricultural productivity, alternative livelihoods, and improved education and health facilities. Key issues include establishing a robust rural credit system, effective agricultural marketing, and promoting diversification in farming and production activities. The document also discusses organic farming, its advantages and limitations, and the significance of initiatives like Operation Flood in boosting rural economies.

Uploaded by

Shaaswathi
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd

CHAPTER 5 – RURAL DEVELOPMENT NOTES

Rural development is a comprehensive term which essentially focuses on action for the
development of area which is lagging behind in overall development of village economy.
Objectives of rural development:
1. Increasing productivity of agricultural sector.
2. Generating alternative means of livelihood in rural sector.
3. Promoting education and health facilities in the rural areas.
Key issues in rural development.
(i) A robust system of rural credit.
(ii) A system of marketing that ensures remunerative price to the farmer for his produce.
(iii) Diversification of crops that reduce risks of production and induces commercialisation
of farming.
(iv) Diversification of production activity with a view to find alternative means of
sustainable living other than crop-cultivation.
(v) Promotion of organic farming with a view to make crop cultivation environmental
friendly as well as a sustainable process over a long period of time.
(vi) Honest system of land reforms.
(vii) Development of human resource like health, addressing both sanitation and public
health.
(viii) Development of human resource including literacy, education and skill development.
(ix) Development of Infrastructure like electricity, irrigation, transport facility, etc.
Rural credit means credit for the farming communities. Farmers require credit for various
purposes like purchasing agricultural tools and machines, digging wells and tube wells,
purchasing seeds, fertilizers, pesticides, etc.
The gestation period between sowing and harvesting is high. so, farmers have to borrow to
fulfill their needs during this period.
Sources of rural credit in India.
1. Non-institutional sources are money lenders, traders and commission agents, landlord,
relatives and friends.
2. Institutional sources are as follow:
(i) Co-operative credit societies.
(ii) Commercial Banks
(iii) Regional Rural Banks
(iv) NABARD (National Bank for Agriculture and Rural Development.) (established in 1982)
(v) Self Help Groups (SHGs)
The above institutional structure of rural banking which is called multi-agency system which
has initiated by govt. in 1969.
Agricultural marketing means all those activities which includes-gathering the produce
after harvesting, processing the produce, grading the produce according to its quality,
packaging the produce according to preferences of buyers, storing the produce for future
sale and selling the produce when price is lucrative.
In other words, Agricultural marketing covers the services involved in moving an
agricultural product from the farm to the consumer.
Defects of agricultural marketing
(i) Inadequate warehouses
(ii) Multiplicity of middlemen
(iii) Malpractice in unregulated markets.
(iv) Lack of Adequate finance
(v) Inadequate means of transport and communication.
Measures adopted by the government to improve marketing system.
(i) Regulation of markets.
(ii) Co-operative agricultural marketing societies.
(iii) Provision of warehousing facilities.
(iv) Subsidised transport.
(v) Dissemination of marketing information.
(vi) Buffer stocks and minimum support price (MSP)
(vii) Public Distribution System (PDS)
(viii) Alternative marketing channels
(ix) Improvement of physical Infrastructure
Diversification in agriculture activities-It has the two aspects.
1. Diversification of crop production refers to a system of multiple cropping rather than
mono cropping. It may also mean a shift from subsistence farming to commercial farming.
It has the three advantages:
(i) It lowers the risk of farmer on account of failure of monsoon.
(ii) It enhances the scope for commercialisation of farming.
(iii) Minimise the market risk arising due to price fluctuation.
2. Diversification of productive activities imply a shift from crop farming to non-farming
areas of employment. Non-farm areas of employment include.
(i) Animal husbandry.
(ii) Fisheries.
(iii) Horticulture.
(iv) Cottage and household industry.
(v) Information technology-every village a knowledge Centre
It has following advantages:
1. Reduce the risk from agriculture sector.
2. Provide ecological balance.
3. Provide sustainable livelihood option to people living in village.
Organic farming is a system of farming that maintains, enhances and restores the ecological
balance. It helps in sustainable development of the agricultural sector, In organic forming,
farmers use organic manure, bio fertilizers and organic pesticides.
Advantages of organic farming:
(i) Inexpensive process.
(ii) Generates income.
(iii) Healthier and tastier food.
(iv) Solves unemployment problem.
(v) Environment friendly.
Limitation of Organic farming:
(i) Yields from organic farming is less than modern agricultural farming in initial years.
(ii) Organic produce have shorter shelf life than sprayed produce.
(iii) Choice in production of off-season crops is quite limited in organic farming.
Organic farming involves labour-intensive process of production of labour so India has
comparative advantage in organic farming.
Operation Flood
It is a system of milk co-operatives, launched in 1966. This system emphasised the pooling
of milk by farmers through co-operatives societies.
This increased the quantum of sale as well the market value of product. The production
in milk increased four-fold. This system if commonly called operation flood.
Labour force: It refers to actual member of people available for work.
Non-farm sector: It refers to jobs in govt. manufacturing, services, construction, mining,
retail, etc.
Labour intensive Process: It refers to the process or industry that requires a large amount
of labour to produce its goods.

Common questions

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Improving physical infrastructure significantly affects rural development by enhancing connectivity and access to resources, thus facilitating economic activities and quality of life improvements . Infrastructure such as electricity, irrigation, and transportation enables farmers to increase productivity and market reach . Better infrastructure also supports diversification into non-farm activities by providing necessary facilities for industries like information technology and cottage industries . These developments are essential for fostering sustainable rural growth and reducing disparities .

Diversification of agricultural activities lowers the risk for farmers by reducing their dependency on a single type of crop, thus minimizing the impact of adverse climatic conditions such as monsoon failures . Additionally, it broadens the scope for commercialization, providing farmers with various market opportunities, and minimizes market risk resulting from price fluctuations of a specific crop . Diversification into non-farm activities, such as animal husbandry and fisheries, offers additional income sources, further hedging against agricultural volatility .

The government has implemented several measures to enhance agricultural marketing, including market regulation, establishing cooperative marketing societies, providing warehousing facilities, subsidizing transport, and disseminating marketing information . Additionally, mechanisms like buffer stocks, a minimum support price (MSP), and the Public Distribution System (PDS) aim to stabilize farmer income and market conditions . While these measures have effectively improved market structure and farmer support, challenges remain in execution, accessibility, and ensuring timely interventions to maximize their impact .

The multi-agency system, initiated by the government in 1969, enhances rural banking by integrating various institutional credit sources like Cooperative Credit Societies, Commercial Banks, Regional Rural Banks, NABARD, and Self Help Groups . This approach widens access to affordable and timely credit, reducing reliance on non-institutional lenders and their exploitative practices . By catering to diverse needs and stages of farming operations, the system fosters financial inclusion and improves credit delivery effectiveness to rural sections . Continued strengthening and synergy among these agencies are necessary to address remaining challenges .

The main objectives of rural development include increasing agricultural productivity, generating alternative livelihoods, promoting education and healthcare, and developing infrastructure like electricity and transport . Key challenges entail establishing a robust rural credit system, improving marketing to ensure fair prices for farmers, diversifying crops, and promoting organic farming . Furthermore, overcoming issues such as inadequate infrastructure and market-related inefficiencies are critical challenges faced in rural development .

Diversification plays a vital role in providing sustainable livelihood options by allowing rural populations to shift from traditional crop farming to various non-farm employment areas, such as animal husbandry, fisheries, and cottage industries . This transition reduces dependence on farming, mitigates climatic and market risks, and utilizes local resources effectively, supporting ecological balance . Information technology and other industries serve as knowledge centers, enhancing skills and economic diversity . This multifaceted approach strengthens economic resilience and personal well-being in rural communities .

Rural credit plays a crucial role in agricultural development by providing necessary financial resources for activities like purchasing inputs, machinery, and adopting new technologies . It supports farmers during the gestation period between sowing and harvesting by covering various expenses . Institutional sources like cooperative societies and commercial banks help reduce reliance on exploitative non-institutional lenders, fostering healthier financial growth and risk management for farmers . However, gaps in access and the effectiveness of credit delivery need continued improvement to fully support agricultural advancement .

Organic farming offers several advantages, including being environmentally friendly, providing healthier and tastier food, generating income, and reducing unemployment due to its labor-intensive nature . It also helps maintain ecological balance and promotes sustainable agricultural development . However, organic farming has limitations such as lower initial yields compared to conventional methods, shorter shelf life of produce, and limited choices for off-season crop production . Overcoming these limitations requires transitioning strategies and supportive market structures .

Operation Flood, launched in 1966, revolutionized India's dairy sector by organizing dairy farmers into cooperatives, which pooled milk resources for increased production and market value . This initiative quadrupled milk production, ensuring higher farmer income and better market pricing . By creating a structure for effective dairy marketing, it improved rural livelihoods and played a crucial role in turning India into the world's largest milk producer. The cooperative model provided a replicable framework for empowering rural communities and ensuring sustainable income growth .

Defects in agricultural marketing, such as inadequate warehousing, the presence of multiple middlemen, malpractices in unregulated markets, and inadequate finance, hinder rural development by reducing farmers' income potential and market efficiency . These issues can lead to increased post-harvest losses and reduced motivation for productivity improvements . Furthermore, inadequate transport and communication infrastructure can limit market access, negatively impacting farmers' ability to receive fair prices and reinvest in better technologies or inputs . Addressing these defects is vital for rural economic progress .

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