NCERT Class 11 Economics Chapter 6: Rural Development YouTube Lecture Handouts
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- Majority of poor live in rural areas
- Rural area β Agriculture is main livelihood (2 β 3rd population depends on it)
- Development of villages is development of nation β MK Gandhi
Rural Development
- Development of area lagging behind in overall development of village economy
- Literacy, education and skill development
- Health and public health
- Land reforms
- Productive resources of locality
- Infrastructure development
- Alleviate poverty β uplift weaker sections of society
- Engage people in farm and non-farm activities
- Share of agriculture to GDP was on decline but population related to this sector didnΥt show any change
- Inadequate infrastructure, lack of alternate employment opportunities in industry or service sector, increasing casualization of employment etc. impede rural development
Credit
- Growth of economy is governed by infusion of capital & higher productivity
- As gestation time between sowing and real income is high β farmers borrow for initial investment on seeds, fertilizers, implements and religious ceremonies
- At independence, money lenders and traders exploited small and marginal farmers and landless labourers by high interest rate and debt trap
- After 1969, social banking & multiagency approach for rural credit β NABARD (National Bank for Agriculture and Rural Development) was set in 1982 to coordinate rural financing system
- Green revolution β led to diversification of credit towards production oriented lending
- Now, RRB (Regional Rural Banks) , cooperatives and land development banks β dispense credit at cheap rate
- SHGs β fill the gap in formal credit system because formal credit delivery mechanism has not only proven inadequate β for loans collateral is required and SHG promotes thrift in small proportions by minimum contribution from each member β credit is given from the pooled money (repayable in small installments at reasonable interest rate) β micro credit programs
- βKudumbashreeβ : Women-oriented community-based poverty reduction program implemented in Kerala. In 1995, a thrift and credit society was started as a small savings bank for poor women with the objective to encourage savings.
- Thrift and credit society mobilized βΉ 1 crore as thrift savings. These societies have been acclaimed as the largest informal banks in Asia in terms of participation and savings mobilized.
Rural Banking
- Positive impact on output, income, employment to avail services and credit
- Food security as buffer stocks
- Except commercial banks, other formal institutions failed to develop deposit mobilization (lending to worthwhile borrowers and effective loan recovery)
- Agriculture loan default rate is high
Agricultural Market System
- Involves the assembling, storage, processing, transportation, packaging, grading and distribution of different agricultural commodities
- Farmers who did not had idea of the existing price were forced to sell at lower price
- Lot of goods were wasted due to storage issues (so intervention of private traders became must)
Methods to Improve Marketing
- Regulating market to create orderly transparent marketing conditions (develop 27,000 rural periodic markets as regulated markets)
- Provision of physical infrastructure facilities like roads, railways, warehouses, godowns, cold storages and processing units
- Cooperative marketing for fair prices β received setback due to inadequate coverage of farmer members, lack of appropriate link between marketing and processing cooperatives and inefficient financial management
- Assurance for Minimum Support Price (MSP)
- Maintain buffer stock by FCI
- Distribution of foodgrains and sugar by PDS
Alternate Marketing Channels
- Apni Mandi (Punjab, Haryana and Rajasthan)
- Hadaspar Mandi (Pune)
- Rythu Bazars (vegetable and fruit markets in Andhra Pradesh and Telangana)
- Uzhavar Sandies (farmers markets in Tamil Nadu)
Fast food chains are entering in contract with farmers to cultivate farm products of desired quality β provide them seeds, inputs and procurement at pre-decided prices
- It reduces price risk of farmers
- Expands market for farm products
- Raise income of small farmers
Diversification into Productive Activities
- Change in cropping pattern
- Shift of workforce from agriculture to allied activities
- Provide sustainable livelihood options to rural people (gainful employment in rabi season when irrigation is inadequate)
- Non-farm activities β agro-processing industries, food processing, leather, tourism
- Meat, egg, wool
- Women in agriculture and men in non-farm activities
Animal Husbandry: mixed crop livestock farming system β provides stable income, food security, transport, fuel and nutrition requirements
- Livestock provides option to 70 million small and landless laborers (poultry accounts for 58 %)
- 2012 β India has 300 million cattle, 108 million buffaloes
- Milk production increased 8 times from 1951 to 2014 by operation flood
- Improved technology & promotion of good breeds of animals to enhance productivity
- Improved veterinary care & credit facilities
Fisheries β fishing community considers water as mother or provider. Inland fish production contribute to 64 % value and 36 % to marine sector.
- Total fish production account to 0.8 % of total GDP (major states - West Bengal, Andhra Pradesh, Kerala, Gujarat, Maharashtra and Tamil Nadu)
- 60 % workforce in export marketing & 40 % in internal marketing are women in fishery
Horticulture β fruits, vegetables, tubers, flowers, spices
- 1 β 3rd of value of agricultural output & 6 % of GDP
- India is leader in mangoes, bananas, coconuts, cashew nuts and a number of spices and is the second largest producer of fruits and vegetables
- Employment options β Flower harvesting, nursery maintenance, hybrid seed production and tissue culture, propagation of fruits and flowers and food processing
IT revolution β sustainable development and food security
Tamil Nadu Women in Agriculture (TANWA) : Project initiated in Tamil Nadu to train women in latest agricultural techniques. It induces women to actively participate in raising agricultural productivity and family income - in Thiruchirapalli run by Anthoniammal
Sustainable Development & Organic Farming
- Conventional agriculture relies heavily on chemical fertilisers and toxic pesticides β harm livestock, deplete soil and devastate natural ecosystem
- Organic farming - whole system of farming that restores, maintains and enhances the ecological balance; increasing demand for organically grown food to enhance food safety
- Saansad Adarsh Gram Yojana (SAGY) : MPs need to identify and develop one village from their constituencies. To begin with, MPs can develop one village as a model village by 2016, and two more by 2019, covering over 2,500 villages in India.
Benefits of Organic Farming
- Substitute costlier agricultural inputs with locally produced organic inputs which are cheap
- Income by exports
- More nutritional value
- Requires more labor input
- Pesticide free and environmentally sustainable way
- Awareness for new technology
- More blemishes and a shorter shelf life
- Limited choice in production of off season crops
1995: Kisan Mehta of Prakruti (an NGO) first suggested that cotton, biggest user of chemical pesticides, could be grown organically. Tested by German Accredited Agency, AGRECO
β Manishika