Fig. 1.4: Inter-related Problems of Rural India

Fig. 1.5: Major Drivers of Rural Development in India

A large majority of Indian poor lives in rural areas. Urban poverty is only an outgrowth of rural poverty which is due to rural-urban migration for employment purpose. The urban poor are those with irregular unemployment and at very low wages. The job opportunities in urban areas also depend on the development activities in rural areas. About 35% of the Indians are extreme poor; half of the Indian children are malnourished and the proportion of underweight children is nearly double that of Sub-Saharan Africa. However, India has not had any major famines since Independence yet on poverty India has a long way to go.

Education plays a pivotal role in achieving development and sustainable livelihoods. But in the rural India the surplus of a child earning over his consumption adds to family income and thus contributes to uplift the standard of living of his family. The sentiments and feelings regarding education/ future of the child droop before the agony of unsatisfied basic needs due to privation. Therefore a child in a poor family is proved an asset rather than a liability. Unemployment- Employment is a fundamental pre-requisite to raise the per capita income and eradicate poverty. Poor employment opportunity is one of the key reasons for the endurance of poverty in India. After independence and particularly from the 5th Five Year Plan onwards, Indian government has initiated several programmes for raising rural employment e.g. MGNREGA.

Note : *as percent of labour force, US: Usual status, CWS: Current weekly status, CDS: Current daily status.

Many a social evil by and large spread through the unemployment such as frustration, drug-addiction and even suicides. Better designed labour regulations can attract more labor-intensive investment and create jobs for India’s unemployed millions and those trapped in poor quality jobs. India cannot advance economically, politically, or socially, unless the problem of inequality and inadequacy of education system, which is the obstacle in providing the benefits of increased employment opportunities to all the sectors of society, is solved.

Poor Rural Infrastructure- The link between infrastructure and development is not a once for all affair. It is a continuous process; and progress in development has to be preceded, accompanied and followed by progress in infrastructure. But unfortunately Indian farmers' access to markets is still hampered by poor roads, rudimentary market infrastructure, and excessive regulations. Major problems of rural infrastructure are related with; water and sanitary conditions, electricity, roads and telecommunications. The condition is so severe that half of our society guzzles aerated beverages while the other has to make do with palm full of muddied water. Our three-way fast lane of LPG must provide safe pedestrian crossing for the unempowered India. (K.R. Narayanan)

Some of the initiatives taken by the Indian Government in this regard include the PMGSY, Bharat Nirman, Total Sanitation Campaign, NRHM etc. Although the Government has accorded highest priority to building rural infrastructure for facilitating a higher degree of rural-urban integration and for benefitting the poor and disadvantaged sections of society yet 82% of Indian rural households do not have common necessities of life like drinking water, electricity connection and sanitation. (NSSO)

Nearly 57% of the rural households have to travel up to 5km/day to fetch drinking water as compared to just 20% in urban areas. Just 30% of households in rural India have access to tap drinking water as compared to 74% in urban areas. As a result majority of village households are dependent on tube wells/ unprotected wells for drinking water. About 65% of rural households are without toilets whereas it is 11% in urban areas. 58% of rural households are without proper drainage and sanitation services whereas it is 15% for the urban households.

Poor access to finance- One of the principal problems for rural households and individuals wishing to start a business, whether related to the farm or non-farm sector, is access to capital or credit. Without start-up funds or with little cash available for investment, households are limited to a small number of activities which yield poor returns, partly because of the proliferation of similar low entry barrier enterprise. It is the root of rural indebtness in rural India.

Dr Ahluwalia, the Chairperson of ICRIER, said, “Our farmers need initiatives to compete at international levels.” India is one of the most under-banked major markets in the world with only 6 bank branches /1,000 sq kms (World Bank). According to India’s apex development agency (NABARD), around 60% Indians still are not having access to financial institutions.