Rural Development
Class 11 Economics · Indian Economic Development · Chapter 5
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Summary
Since more than two-thirds of India's people depend on agriculture and a large part of rural India remains poor, rural development — the all-round growth of village economies — is central to the nation's progress. It covers developing human resources (literacy, especially female literacy, and health), land reforms, productive resources, rural infrastructure such as electricity, irrigation, credit, marketing and roads, and measures to remove poverty. Agriculture growth decelerated after 1991, partly because public investment fell. Rural credit is vital: at independence moneylenders exploited farmers through high interest and debt traps, so India adopted social banking and a multi-agency approach in 1969, set up NABARD as the apex body in 1982, and built a network of commercial banks, regional rural banks, cooperatives and land development banks, supported by self-help groups that promote thrift and micro-credit. Agricultural marketing — assembling, storing, grading and distributing produce — is improved through regulation of markets, better infrastructure, cooperative marketing, and policy instruments like minimum support prices, buffer stocks held by the Food Corporation of India and the public distribution system, along with channels such as Apni Mandi and Rythu Bazars and the e-NAM portal. Diversification of crops and of livelihoods into allied activities — animal husbandry, fisheries and horticulture — and into non-farm work spreads risk and raises incomes; Operation Flood greatly expanded milk output. Organic farming offers an eco-friendly, sustainable alternative that avoids costly chemical inputs, though its early yields are lower.
Rural Development
Key terms
Rural development
The all-round development of village economies, covering human resources, infrastructure, credit, marketing and poverty removal.
NABARD
The National Bank for Agriculture and Rural Development, set up in 1982 as the apex body for rural credit.
Agricultural marketing
The process of assembling, storing, grading, processing and distributing farm produce to consumers.
Minimum support price
A price fixed by the government to assure farmers a minimum return and protect them from price falls.
Diversification
Spreading farming into different crops and shifting workers into allied and non-farm activities to reduce risk.
Organic farming
An eco-friendly system using local organic inputs instead of costly chemical fertilisers and pesticides.
Extra questions & answers
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Rural development refers to the all-round development of: