Gist of Kurukshetra June 2021 Issue: Sustainable and Inclusive Rural Growth

Kurukshetra Magazine is a vital source of study material for the UPSC IAS exam. It is a monthly magazine that gives information about important government schemes and programmes in various sectors. Kurukshetra is an authentic source of information for the UPSC Exam. Here, we provide the Gist of Kurukshetra, exclusively for the IAS Exam.

Gist of Kurukshetra June 2021:- Download PDF Here

TABLE OF CONTENTS

1. Drivers of Inclusive Rural Growth
2. Inclusive, Equitable and Quality Education
3. Women, Youth and Rural Transformation
4. Fostering Growth in Rural India
5. Expanding Economic Activities
6. Rural Entrepreneurship
7. Integrated Rural Development and Sustainable Development Goals
8. Sustainable Mining

Chapter 1: Drivers of Inclusive Rural Growth

Five trillion dollar economy goal:

  • Currently, India is the fifth-largest economy in the world having a net worth of 2.94 trillion dollars and the Government has set a goal to become a five trillion dollar economy by 2025.
  • To achieve this, India has set a target of one trillion dollars from agriculture, three trillion dollars from services and one trillion dollars from the manufacturing sector.

Significance of rural area in meeting the target:

  • The rural economy of India which generates about half of the national income and more than two-thirds of the total employment (NITI Aayog, 2017), will play a decisive role in meeting the five billion economy target.
  • The agriculture and allied sectors, India being a mostly rural-based economy, have contributed 17.8 per cent to the total gross value added of the country during 2020-21.
  • More than half of the value-added in the manufacturing sector is contributed by rural areas.
  • The rural markets with a significant share in the national income of India can induce a push-up to the national economy by generating demand for goods and services. Currently, there are more active internet users in rural India than in cities.
  • Hence the growth, income and consumption patterns of rural India hold the key to boost demand, revive the economy, and sustain economic growth at the national level.

Governmental interventions:

  • There have been various government-led interventions for rural growth.
  • The Government of India has developed elaborate plans and strategies to accelerate the rural economy and produce socio-economic upliftment of rural citizens through the following sectoral interventions.

Agriculture and allied sectors:

  • Agriculture and allied sectors continue to remain major drivers of the rural economy.
    • Agriculture and allied sectors are the mainstay of the rural economy as they drive demand for other sectors including retail, FMCG, and e-commerce, which are dependent on the agriculture sector for inputs.
    • The agricultural sector directly steers consumption and demand in seed, fertilizers and chemicals, agricultural machinery and implements, energy and transport sectors.

Interventions:

  • The government aims to double the income of farmers by 2022 and also increase the non-farm income in rural areas. This growth in the agriculture sector shall stimulate demand in other sectors too.
  • The government has undertaken several reform measures related to the agriculture market that aim at providing the best prices to farmers for their produce. This includes the electronic National Agriculture Market (eNAM). The eNAM has provided online trading facilities to farmers for a number of farm commodities. So far, over 1000 major wholesale agriculture markets (APMCs) across 18 States and three UTs have been integrated on eNAM to develop the concept of ‘one nation, one market’ for agriculture produce.
  • There is a massive campaign underway to aggregate small, marginal and landless farmers into Farmer Producer Organizations (FPOs) to enhance economic strength and market linkages. The formation and promotion of 10,000 new FPOs have been announced by the government.
    • Apart from increasing bargaining power, FPOs will also facilitate farmers with access to improved technology, credit, better inputs at affordable cost and more markets.
  • Trading based on electronic-Negotiable Warehouse Receipts has been introduced by eNAM. This will further support the online trading of agricultural commodities in India.
  • The government has created a dedicated Agri-market Infrastructure Fund for the development and up-gradation of marketing infrastructure at 10,000 Gramin Agricultural Markets and 585 APMCs (2018- 19). This will help modernize marketing, processing, storage and ancillary infrastructure/logistics including better assaying facilities at APMCs.
  • The new farm laws (2020) are intended to help small and marginal farmers (86 percent of total farmers) who don’t have the means to bargain for their produce to get a better price.
    • The law on agri-market allows farmers to sell their produce outside APMC ‘mandis’ to buyers of their choice. Farmers will be able to get better prices through competition and cost-cutting on transportation.
    • The new law on contract farming gives freedom to individual farmers to enter into a contract with agri-business companies or retailer chains on pre-agreed prices of their produce. This new law transfers the risk of market unpredictability from the farmer to the sponsor.
    • Another law removes some of the major agri-commodities from the list of essential commodities, thereby attracting private/foreign area investment into the agriculture sector.
  • The government has recently made MSP (Minimum Support Scheme) scheme more comprehensive and remunerative by assuring at least 50 percent margin over and above the production cost.
  • Agriculture Export Policy aims to double exports by 2022 and reach Rs 7.4 lakh crore in the next few years.
  • Kisan Credit Card scheme has eased institutional credit facilities to farmers, fisherman and livestock owners. This has helped enhance cash flow in rural markets.

Industries and Enterprises:

  • Rural industrialization will help boost the rural economy by providing job opportunities to local people, offering remunerative prices for local produce and triggering supportive logistical services in rural areas.
  • The agro-processing/food processing is a sunrise sector especially in rural areas, with huge untapped potential. Currently, the food processing industry engages around 1.93 million people in nearly 40,000 registered units.
  • Micro, Small and Medium Enterprises (MSMEs) are regarded as the growth accelerators of the Indian economy, and more so for the rural economy as more than half of the MSMEs operate in rural India.
    • MSMEs contribute about 30 percent of the national GDP, contribute about 40 percent to the overall exports and employ nearly 110 million people across the country.

Initiatives:

  • The umbrella scheme, ‘PM Kisan SAMPADA (Scheme for Agro-Marine Processing and Development of Agro-Processing Clusters) Yojana’ aims to create modern infrastructure with efficient supply chain management from farm gate to retail outlet, and link farmers to consumers in the domestic and overseas markets.
    • ‘SAMPADA’ scheme is supporting the creation of mega food parks and agro-processing clusters, especially in rural areas, to address the need of small and micro food processing enterprises by providing plug and play facilities.
    • Financial assistance is being provided for setting up integrated cold chain from the farm gate to the consumer. Government has sanctioned 37 food parks across the country for funding.
  • A novel ‘One District One Product’ scheme is designed to promote value chain and infrastructure development for the specialized indigenous products (food or otherwise) of a district so that it gets state/national exposure.
    • Under ODOP scheme, 135 district-specific unique products for 728 districts have been identified across the country for support and promotion.
  • The government of India has announced various supportive schemes for the MSME sector.
    • These mainly target ease of doing business, credit support, and marketing facilities with infrastructure development and revised financial norms for the classification of MSME units. The government has introduced a simple, online registration scheme for MSMEs, named ‘Udyam’ registration based on self-certification.
    • Government departments and public sector companies are mandated to procure 25 percent of their requirement from registered MSMEs only.
    • Collateral/guarantee free loans, interest subvention scheme and schemes for market support and export promotion have also been introduced.
    • To increase credit flow, an emergency credit line is introduced wherein special loans are sanctioned to MSMEs by banks/financial institutions without additional guarantees.
    • A novel initiative called Fund of Funds scheme is launched with a corpus of Rs. 10,000 crore for providing financial relief and funding to MSMEs with growth potential and viability.
    • A special CHAMPIONS portal for making the smaller units big by helping and hand-holding them has been announced. The portal will help support MSMEs in the relevant areas, such as finance, market access, raw permissions, technology up-gradation, skill development, etc.
      • Ministry of MSME is also implementing a ‘Scheme of Fund for Regeneration of Traditional Industries’ (SFURTI) to promote cluster of small-scale industries especially in rural areas. SFURTI is striving to organize the traditional industries and artisans in villages into clusters to make them competitive and financially sustainable.
  • Deen Dayal Upadhyaya Grameen Kaushalya Yojana is skilling and transforming rural youth into an economically relevant force. This will help meet the demand for skilled and semi-skilled workforce in the rural areas.
  • Better road connectivity, high-speed internet facility, adequate power supply, plenty of local resources, availability of skilled and unskilled workers, and improved credit facilities, have transformed rural areas into a favourite destination for setting up new enterprises and foster industrial/entrepreneurial activities in rural areas.

Fast Moving Consumer Goods (FMCGs) sector:

  • Fast Moving Consumer Goods (FMCGs) sector is the fourth largest sector in India employing over three million people.
    • Growing awareness, easier access, changing lifestyles and enhancing incomes have been the key growth drivers for the FMCG sector.
  • The FMCG market has grown at a faster pace in rural India compared to its urban counterpart. As a result, FMCG products account for nearly 50 percent of the rural spending. Major FMCG companies in the private sector are eyeing rural markets with the launch of new product series especially suited to the likes of rural consumers. FMCG companies are also focusing on strengthening their e-commerce engagement.
  • Consumer durables is another major sector influencing rural markets and rural economy. Spectacular growth in the consumer durables market is registered across the country including rural areas.

Initiatives:

  • 100 percent approval of FDI in multi-brand retail
  • Lower tax regime for FMCG products
  • Transformation of the logistics and warehousing facilities
  • Expansion of infrastructural facilities for better retail management.
  • The government investment in rural electrification and the implementation of novel initiatives to improve financial inclusion in rural areas have directly promoted and escalated demand for FMCGs and consumer durables.

Conclusion:

  • India’s rural regions are increasingly becoming key economic drivers for the national economy and necessary attention towards it is mandatory to realize the target of a five billion economy by 2025.

Chapter 2: Inclusive, Equitable and Quality Education

Introduction:

  • After independence, education was identified as a vital tool for an equitable and just society. From a literacy rate of 18 percent in 1951, we have moved up to 73 percent as of 2011.
  • Currently, the school education system in India is the largest in the world with around 15 lakh schools, 94 lakh teachers and 25 crores students.

Previous Policies and Commissions:

  • The Kothari Education Commission was formed in 1964 under the chairmanship of Dr. Daulat Singh Kothari. Based on the report and recommendations of this Education Commission (1964-1966), the government announced the first National Policy on Education in 1968, which called for a “radical restructuring” and equality of educational opportunities so that national integration and more cultural and economic development can be achieved. It promoted the adoption of a broadly uniform educational structure in all parts of the country, i.e. 10+2+3 pattern.
  • The Second National Policy on Education (NPE) was adopted in 1986. This new policy called for special emphasis on the removal of disparities and to equalise educational opportunity.
  • The National Education Policy, 2020 is the third in the series of National Education Policies (1968 and 1986 modified in 1992) in India.

Programmes/Schemes:

  • Many programmes/schemes to provide targeted interventions and implement the vision of National Education Policies have been implemented over the years.
    • Sarva Shiksha Abhiyan (SSA) is the flagship Centrally Sponsored Scheme for universal elementary education across the country.
    • In 2018, an integrated scheme for school education called ‘Samagra Shiksha’ was launched by subsuming the erstwhile schemes of Sarva Shiksha Abhiyan (SSA), Rashtriya Madhyamik Shiksha Abhiyan (RMSA) and Centrally Sponsored Scheme of Teacher Education (CSSTE). Samagra Shiksha aims to treat education holistically from pre-primary to Sr. Secondary and is aligned with SDG (4) goals.
    • The 86th Amendment in the Constitution of India inserted Article 21 A to ensure that every child has a right to full-time elementary education of satisfactory and equitable quality in a formal school that satisfies certain norms and standards. This subsequently resulted in the passage of the Right of Children to Free and Compulsory Education (RTE) Act, 2009 which gave a legal mandate to provide free and compulsory elementary education to every child in the age group of 6-14 years. The RTE Act has many provisions for ensuring quality, equity, and inclusion in the education system like the reservation of 75 percent seats in private unaided schools, improvement in learning outcomes and Continuous and Comprehensive Evaluation (CCE), non-discriminatory learning environment and holistic development of the child.

Challenges:

  • The low transition rate from elementary to secondary level, high drop-out rate at the secondary level (17.9 percent as per USISE 2018-19 {provisional}) and low learning levels of students are major challenges that have to be addressed.

Recommendations:

Emphasis on Early Years of learning:

  • Over 85 percent of a child’s cumulative brain development occurs prior to the age of 6, indicating the critical importance of appropriate care and stimulation of the brain in the early years in order to ensure healthy brain development and growth.
  • Strong investment in early education can enable young children to participate and flourish in the educational system throughout their lives.

Initiatives being taken:

  • NCERT is preparing a National Curriculum Framework for Early Childhood Children Education.
  • To ensure the universal acquisition of foundational skill by all children by grade III, a National Mission on Foundational Literacy and Numeracy is being set up by the Ministry of Education.
    • The Mission will focus on five areas — providing access and retaining children in foundational years of schooling, teacher capacity building, development of high quality and diversified student and teacher resources/learning materials, and tracking the progress of each child in achieving learning outcomes.

Focus on Learning Outcome:

  • There is the need to avoid measures that tend to promote rote learning and promote measures that lay greater emphasis on improved learning outcomes.
  • Such change in approach will bring much-desired improvement at the ground level in terms of pedagogy, assessment, and teachers’ capacity.

Initiatives being taken:

  • A National Achievement Survey (NAS) based on learning outcomes to assess the competencies of children is being conducted.
  • The learning outcomes framework developed by the NCERT has been adopted by all States and UTs.

Reforms in Teacher Education:

  • Given the critical role played by a teacher in the educational sector of any country, there is a need to focus on reforms in teacher education.

Initiatives being taken:

  • The National Council for Teacher Education (NCTE) was set up with the objective of stimulating planned and coordinated development of the teacher education system throughout the country.
  • NEP 2020 recommended various measures for teacher education like the four-year B.Ed. integrated programme to become the preferred degree for appointment of teachers, closure of sub-standard Teacher Education Institutions (TEIs), setting minimum teacher qualifications for all stages from pre-primary to Sr. Secondary, formulation of new National Curriculum Framework for Teacher Education (NCFTE) and NCTE to become part of the Higher Education Commission of India (HECI)
    • The rapid and unplanned growth of Teacher Education Institutions (TEIs) across the country has affected the quality of teacher education programmes adversely, thereby resulting in poor quality and lackadaisical attitude of teachers. NCTE confined itself only to regulatory work related to granting permission to teacher education institutes and was unfortunately negligent towards the following of norms, standards and quality of TEIs.

Building Capacities of Teachers:

  • Teachers are the core of any education system and the entire responsibility of delivering quality education and instilling values and ethics among learners rests on the shoulders of teachers.
  • The education programme and continuous professional development of in-service teacher becomes a crucial intervention for improving the learning outcomes of children.

Initiatives being taken:

  • The National Institute of Open Schooling (NIOS) conducted mandatory training for untrained in-service elementary teachers through ODL (Open Distance Learning) mode.
  • To ensure continuous professional development, a national initiative to improve learning outcomes at the Elementary level through an Integrated Teacher Training Programme called NISHTHA (National Initiative for School Heads’ and Teacher’ Holistic Advancement) has been launched.
    • NISHTHA Online for elementary teachers includes multiple approaches for interaction i.e., Text Modules along with videos, Live Sessions by National Level Resource persons on DTH Swayam Prabha TV Channel and Interactive Voice Response System.

Revamping Assessments:

  • The exam centric assessment system has promoted rote learning rather than higher-order thinking skills or critical thinking. Hence there is an urgent need to revamp the assessment framework in the educational sector. The assessment should be aligned with the learning outcomes and based on assessing competencies.
  • NEP 2020 envisions a transformation in assessment pattern by making board exams a low key affair and introducing an Artificial Intelligence (AI) based holistic progress card which will be a 360-degree, multidimensional report that reflects in great detail the progress as well as the uniqueness of each learner in the cognitive, affective, and psychomotor domains.
  • As envisioned in NEP 2020, the assessment will have to be more regular and formative, more competency-based, to promote learning and development among students, and tests higher-order skills, such as analysis, critical thinking, and conceptual clarity.

Holistic education:

  • The aim of education is not limited to cognitive capacities or academic excellence only but also to ensure that social, ethical, and emotional capacities are improved.
  • To achieve these objectives education must be more experiential, holistic, integrated, inquiry-driven, discovery-oriented, learner-centred, discussion-based, flexible, and, at the same time enjoyable.

Equity and Inclusion at all Levels:

  • Access to quality education that has equity and inclusion at its core becomes crucial in the Indian context considering the unique nature of its society divided by caste, religion, and language and a significant percentage of the population falling into Socio-Economic Disadvantageous Group (SEDGs).
  • Hence it becomes extremely important to have equity and inclusion principles as the focal point of all policy and reforms.
  • Education plays a pivotal role in the progress of individuals as well as society. The role of education becomes vital as it can be a great leveller or equaliser if we are able to provide universal access to quality education. Education is vital in creating opportunities and a level playing field for all.
  • The aim of the education system must be to provide to all students, irrespective of their place of residence, a quality education system, with a particular focus on historically marginalised, disadvantaged, and underrepresented groups; children with disabilities should also be enabled to fully participate in the regular schooling process from the foundational stage to higher education.

Initiatives being taken:

  • The provision for textbooks, uniforms, self-defence training for girls, KGBV residential school for girls.
  • The assistive devices for Children With Special Needs (CWSN).

Conclusion:

  • Education is fundamental for achieving full human potential, developing an equitable and just society, and promoting national development.
    • The Sustainable Development Goal 4 (SDG 4) seeks to “ensure inclusive and equitable quality education and promote lifelong learning opportunities for all” by 2030.
    • The NEP 2020 envisions an education system rooted in Indian ethos that contributes directly to transforming India that is Bharat, sustainably into an equitable and vibrant knowledge society, by providing high-quality education to all, and thereby making India a global knowledge superpower.
  • Providing universal access to quality education is the key to India’s continued ascent, and leadership on the global stage in terms of economic growth, social justice and equality, national integration, and cultural preservation.

Chapter 3: Women, Youth and Rural Transformation

Introduction:

  • More than 65 percent of the population live in rural areas and women and youth constitute a major share of this population. There is the need to mobilise this vast human resource of women and youth if the rural areas and the country have to progress.
  • Women play important roles in the rural economy as farmers, wage earners and entrepreneurs and also bear responsibility for the well-being of the members of their families. Thus women are key agents for rural growth and development in India. Women from indigenous and grassroots communities are often also custodians of traditional knowledge, which is the key to their communities’ livelihoods, resilience and culture.
  • The youth being enthusiastic, vibrant, innovative and dynamic in nature, is the most important section of the population. Youth shows strong passion, motivation and willpower which also make them the most valuable human resource for fostering the economic, cultural and political development of a nation.

Status of Rural Women:

  • Rural women in India are less literate than rural men. According to the 2011 census, the population of rural women who are literate are 58.8 percent.
  • Women in rural areas face constraints in engaging in economic activities because of gender-based discrimination and social norms, disproportionate involvement in unpaid work, and unequal access to education, healthcare, property, and financial and other services. They are also disproportionately vulnerable to the impacts of environmental disasters and climate change.
  • Though women work for longer hours than men and contribute substantially to family income, they are not perceived as productive workers. In rural areas, very few women have ownership over land or productive assets. This proves to be a roadblock in institutional credit.
  • The majority of the agricultural labourers are women and they are mainly assigned manual labour.

Status of Youth:

  • The total youth population increased from 168 million in 1971 to 423 million in 2011. The share of the youth population in the total population is expected to be 34.33 percent by 2020.
  • In 2013, about 225 million youth, or 20 percent of all youth in the developing world, are “idle – not in education, employment or training”.
  • In 2012, 56.6 percent of India’s rural youth in the age group 15-29 years derived their livelihood from agriculture, forestry, or fishing.

Role of Women in Rural Growth:

  • Women are playing a vital role in the economic well-being of families and society as a whole in rural India.
    • Agriculture: The rural women are extensively involved in agricultural activities. Participation of women in planting and weeding is significantly higher than that of men. Agriculture which is the mainstay of the rural Indian economy is mainly sustained by the female workforce. Women are the invisible lifeline of the agrarian rural community life. According to a recent International Labour Organisation (ILO) estimate, female employment in agriculture was 57 per cent in 2018, compared to 19 percent female employment in industry and 24 percent in services.
    • Animal Husbandry: In animal husbandry, women have played multiple roles. In livestock management, 90 percent of indoor jobs like milking, feeding, cleaning, etc. are done by women.
    • Allied Sectors: Sericulture, handloom and textile industries in the rural economy especially in the northeastern region, has huge potentiality for women employment generation. Some rural communities have basic skills and the local market for such products.
    • Small Scale Industries: Women in rural economy are directly or indirectly involved in the processing of Non-Timber Forest Product (NTFP) particularly in small-scale enterprises. Women constituted almost 51 percent of the total employed in forest-based small scale industries.
    • Other Job Opportunities: Women constitute a major share of the workforce in sectors such as education, insurance agent, company representative, NGO workers, Anganwadi workers, etc.
  • Women’s economic empowerment increases women’s access to economic resources and opportunities including jobs, financial services, property and other productive assets, skills development and market information. Women’s economic participation and empowerment are fundamental to strengthening their rights and enables them to have control over their lives and exert influence in society.
  • When women are economically and socially empowered, they become a potent force for change. They could play a catalytic role towards the achievement of transformational economic, environmental and social changes required for sustainable development. Hence, women are key agents for rural growth and development in India.

Role of Youth in Rural Growth:

  • The youth can play a critical role in the rural economy in the following ways.
    • Agriculture: Agriculture is stated to be the main occupation in rural areas. Youth, who are well-educated and possess efficient knowledge of how to implement agricultural activities, assist in the development of agricultural activities.
    • Small Scale Industries: In rural areas, besides agriculture, the setting up of small-scale industries require workers. Educated and adequately skilled youth can provide the necessary workforce for these small scale industries.
  • Young people are innovative and creative in problem-solving and in finding solutions. The youth can lead to economic development as well as the social development of their communities and society.

Challenges for Women and Youth:

  • Rural women are still facing a lot of challenges of unequal access to productive resources; limited access to services of education, extension, credit and social protection; widespread inequalities in rural labour markets, combined with the heavy burden of unpaid care work in households and communities and limited participation, voice and influence in rural organisations.
  • Rural youth have challenges of limited access to productive and gainful employment in the agricultural sector; limited access to skill development and education; exclusion from institutions that provide access to financial services, such as credit, savings and insurance and lack of curricula tailored to the labour market’s needs; face major health problems, including malnutrition, malaria and other diseases.
  • Most rural women and youth are either employed (waged and self-employed) or ‘not in the labour force’. The issue, therefore, is not so much about unemployment, but serious under-employment in low productivity, predominantly household-based activities.

Recommendations:

  • The role of women and youth in bringing growth and development in rural areas is immense, and hence measures promoting their efficient and fullest participation need to be implemented.

Women related:

  • Rural women must be continuously empowered through various skill development training and greater opportunities to acquire education.
  • Promoting and ensuring gender equality, and empowering rural women through decent work and productive employment not only contributes to inclusive and sustainable economic growth but also enhances the effectiveness of poverty reduction and food security initiatives.

Youth related:

  • A country’s ability and potential for growth is determined by the size of its youth population. This section of the population needs to be harnessed, motivated, skilled and streamlined properly to bring rapid progress to the country.
  • Youth being a demographic dividend, education and skilling are key factors to the full and effective participation of youth in the processes of social, economic and political development. Skills amongst the rural masses lead to the economic growth and development of the country.

General measures needed:

  • Rural growth and development are vital for the overall progress of the country. Hence, the following measures such as generation of jobs and employment for the rural youth, construction of houses, schools and educational institutions, medical and health care facilities, agriculture, industries, nutritional requirements, focusing upon the skill development of the youth and facilities such as electricity, energy, water, gas and cooking equipment need to be focussed upon.

Chapter 4: Fostering Growth in Rural India

Introduction:

  • The focus on the village economy attests to the shifting centres of economic activity in India, as tier-II and tier-III cities and towns take the lead in innovation and business excellence and are creating self-sustaining and inclusive models of growth.
  • The following measures may be necessary to further the growth across India’s rural areas.

Infrastructure development:

  • Improving and expanding India’s infrastructure is essential in bridging gaps between urban and rural India. It allows for better access to education, healthcare and economic success.

Initiatives taken:

  • The Pradhan Mantri Gram Sadak Yojana (PMGSY) seeks to provide all-weather access to eligible unconnected habitations. The enhanced rural connectivity increases agricultural incomes through better access to markets and ensures sustained access to productive employment opportunities and social services. PMGSY is fundamental to building robust and independent village economies.
  • The Saansad Adarsh Gram Yojana (SAGY) extends the basic amenities and opportunities to rural India and seeks to create model villages (Adarsh Gram) across the country.
  • Under the public housing system scheme, Pradhan Mantri Awaas Yojana-Gramin (PMAY-G), the government aims to provide ‘housing to all’ by 2022. The PMAY-G provides a pucca house with basic amenities to all eligible houseless persons and those households living in kutcha and dilapidated houses. The housing scheme is an element of the concerted efforts at poverty alleviation in rural India that can pave the roadmap to greater economic productivity, better education and more suitable employment opportunities.

Impetus to digitization:

  • Digitization will not only allow millions of Indians to access the infinite world of the Internet for learning, but it also extends government services to previously excluded communities and brings rural India into the folds of digital banking.
  • The digital revolution in rural India has opened the floodgates of a social and economic revolution in rural India where users have faster and better access to business opportunities, employment, services and new ideas.
    • As of January 2021, there are over 530 million rural telephone subscribers in India while the share of rural subscribers is nearly 45 percent of the total subscribers in the country.

Initiatives taken:

  • In the last five years, 1.5 lakh village panchayats have been connected with optical fibre cables and the government intends to connect all the villages via optical fibre in the coming three years. The Pradhan Mantri Digital Saksharta Abhiyan aims to bridge the digital gap observed in rural areas.

Financial inclusion:

  • While rural communities need financial services the most, they remain the largest unserved market for financial services. Ensuring their financial inclusion can unlock the considerable economic potential of rural areas, and benefit the rural poor by increasing household income and decent work.

Initiatives taken:

  • Pradhan Mantri Jan Dhan Yojana (PMJDY), the National Mission for Financial Inclusion has been a landmark initiative by the government. PMJDY envisages universal access to banking facilities with at least one basic banking account for every household, financial literacy, access to credit, insurance and pension. In 2018, the goal of reaching every household was revised to ‘every adult.’
  • The PMJDY has also been an integral platform for disbursing the benefits of social security schemes like Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY), Atal Pension Yojana (APY) and Pradhan Mantri Mudra Yojana (PMMY).

Other major initiatives:

  • Through the Svamitva Scheme, the central government aims to provide an integrated property validation solution for rural India wherein village household owners can be granted the ‘record of rights’ that will enable them to use their property as a financial asset for undertaking loans and other financial benefits from banks.
  • The Rashtriya Gram Swaraj Abhiyan (RGSA) aims to strengthen Panchayati Raj for achieving Sustainable Development Goals (SDGs).
  • The Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) is similarly dedicated to creating employment opportunities in rural India albeit with a focus on the youth population aged between 15 and 35. In conjunction with Skill India and Make in India, this employment scheme is preparing a new generation of Indians to take the reins in leading economic and social development in India’s rural hinterland.

Chapter 5: India: Expanding Economic Activities

Significance of rural economy:

  • The rural economy of India has continuously been supporting and contributing to the growth parameters of the country.
  • The rural economy continues to play a pivotal role as the prime mover of the country’s Gross Domestic Product (GDP). With the bulk of the population living in rural belts, parameters including the growth, income, and consumption trends of these residents hold the key to boost demand, revive the economy, and sustain national economic growth.

Significance of the agricultural sector:

  • The agricultural sector plays an important role in the Indian economy. It continues to be demographically the largest economic sector in India, providing direct and indirect employment to more than half of the total population. The agriculture sector provides the necessary raw materials for several industries. The agricultural sector accounts for a large share of India’s export basket.
    • The agri export from India is likely to reach the target of US$ 60 billion by the year 2022.
  • The agricultural sector is also inevitable given that it provides much-needed food security to the nation.
  • The agricultural sector provides support to other sectors of the economy in the form of rural demand, employment and agricultural inputs and supplies, including for exports.
  • According to the Economic Survey 2020-2021, the share of agriculture in the gross domestic product (GDP) has reached almost 20 percent for the first time in the last 17 years, making it a bright spot in GDP performance even during the ongoing COVID-19 pandemic. Agriculture is the only sector to have clocked a positive growth of 3.4 percent at constant prices in 2020-21.

Need for expanding economic activities:

  • As India aims for the US $5-trillion economy status by 2024-25, it needs to grow at 9 percent per year in real terms from FY20 to FY25. Rural revitalisation is a promising first step for achieving this economic target.
  • Rural revitalisation requires a transformative approach that envisions making rural areas a better place to live and work. It is necessary to take steps to boost rural economic growth and make it more sustainable in the long run.

Recommendations:

Strengthening agricultural sector:

  • There is a need to promote modern agriculture that is driven by technology and markets.
  • Rural Infrastructure Fund, Micro Irrigation Fund, e-NAM are welcome initiatives in this direction.
  • Farmer Producer Organisations should be promoted. Amul is an excellent example of collectivising farmers through Farmer Producer Organisations (FPOs). FPOs would offset disadvantages for small and marginal farmers and raise bargaining powers to enhance their incomes.
  • To sustain the demand for agricultural commodities, investments in key logistics must be enhanced. Moreover, e-commerce and delivery companies, and start-ups need to be encouraged with suitable policies and incentives.

Agricultural based industrialization:

  • Growth in rural areas should be driven by agro-based industrialisation, which may gradually shift to the non-farm sector. It will require investment in post-harvest rural activities, such as agro-processing, packaging, cold chains, cold storage and transport to stimulate private sector investment in rural areas.
  • The food processing industries must be promoted as it helps ensure remunerative prices of farm produce and higher income to farmers, and increase employment opportunities.
  • Micro food processing units in the country need to be strengthened and agro-industry clusters near the villages need to be developed to help boost village employment.

Diversifying economic activity:

  • Farming is the fabric of rural society and, in many countries of the world today it still is the key economic activity. In most economically developed countries, farming accounts for a relatively small part of a diversified rural economy, and in addition, the significance of agriculture in terms of the proportion of national wealth and employment is going down. There is a need to diversify the economic activities in rural areas.
  • A strong linkage between farm and non-farm sectors needs to be developed for augmenting income and creating jobs in rural areas. Farm-sector driven industrialisation may be evolved from production to processing and marketing. Such a linkage will help the farm sector to produce market-driven commodities, reduce transportation costs, receive remunerative prices at the farm gate, and minimise farm waste.

Promote MSMEs:

  • Another important aspect is the role of the Micro, Small & Medium Enterprises (MSMEs). They are critical in developing rural industrialisation. There is the need to make investments to create necessary infrastructure; set up effective institutions for enabling MSMEs to have access to technologies, finance and markets; provide affordable and quality vocational education and skill development in manufacturing and business planning.

Infrastructure development:

  • The role of rural-urban linkages will be a key driver in rural transformation as they benefit rural labour, production, distribution, markets, services, consumption, environmental sustainability and the new market opportunities thus created will promote local, regional and global value chains.
  • The concept of Provision of Urban Amenities in Rural Areas (PURA) needs to be relooked. PURA calls for urban infrastructure and services to be developed in rural hubs to create economic opportunities outside of urban areas. These include better road networks, education, health, drinking water, power, sanitation and social safety net.

Government’s role:

  • There is a need to identify areas for developing rural hubs based on resources, markets and infrastructure.
  • An enabling business environment needs to be created by simplifying regulatory requirements and reforming land and labour laws. Structural reforms such as land leasing, contract farming and private agricultural markets, etc. would help bring enhanced investments into the agriculture sector and push its growth.
  • The government should facilitate a conducive business environment by setting up roads, rail, air and water infrastructure; assured power supply, simplifying tax compliance; single-window clearance for construction and starting a business; easy access to credit; and stable policies.
  • In the event of the private sector not coming forward in underdeveloped and marginal areas, the government may offer incentives and launch programmes under PPP mode.

Chapter 6: Rural Entrepreneurship

Introduction:

  • A large proportion of the rural population is facing the problem of unemployment or underemployment resulting in migration to urban areas in search of employment opportunities.
  • This migration leads to undesirable consequences for both the rural as well as urban areas. This issue can be effectively addressed through entrepreneurial development in rural areas.

Rural entrepreneurship:

  • Rural entrepreneurship can be defined as the activity taken up by the individuals in the countryside that supports either manufacturing products or provides services or adoption of new technologies for an economic benefit.

Significance of rural entrepreneurship:

Counter urban migration:

  • Rural India suffers from chronic underemployment. The lack of well-paying jobs is a major push factor for the distressed migration of rural people to megacities.
  • The potential employment opportunities that can be generated through rural entrepreneurship will help tackle the out-migration issue.

Productive use of idle resources:

  • The urban migration has resulted in a scenario where the village resources remain largely unexplored.
  • Rural entrepreneurship brings value addition to rural resources engaging the large human resources of rural area. Rural entrepreneurship will also help improve the otherwise low level of productivity in rural India.

Rural development:

  • Rural entrepreneurship is synonymous with rural industrialisation. The development and growth of it help in generating self-employment, spreading industrial and economic activities.
  • Entrepreneurial activities contribute to economic development with increased rural income.

Risks and Challenges of Rural Entrepreneurship:

  • For a rural entrepreneur, a number of risks are present such as technical risks (relating to technical methods, techniques and materials, etc.), economic risks (relating to market risks, price fluctuations, etc.) and social risks (relating to environmental, cultural and belief systems).
  • The challenges for the rural entrepreneurs include financial challenges, social challenges, lack/low level of education, lack of experience and expertise, limited purchasing power, threats from urban entrepreneurs, technological challenges, the existence of middlemen, lack of logistic and infrastructure support, involvement of risk element, shortage of raw materials, lack of security, etc.

Opportunities of Rural Entrepreneurship:

  • Some of the opportunities for the rural entrepreneurs:
    • Low establishment costs
    • Availability of raw materials
    • Low cost of production compared to the urban enterprises
    • Supportive government policies and subsidies
    • Support and inspiration to native people through employment generated

MSME sector in India:

  • The Micro, Small and Medium Enterprise (MSME) sector has emerged as a highly vibrant and dynamic sector of the Indian economy.
  • MSME sector contributes nearly 29 percent of the country’s GDP, 45 percent of the manufacturing output and 48 percent of the exports (2018-19) and provides employment to a large share of the population (11.10 crore).
  • MSME sector not only plays a crucial role in providing large employment opportunities at comparatively lower capital cost than large industries, but also helps in the industrialisation of rural and backward areas; reducing regional imbalances, assuring more equitable distribution of national income and wealth. It brings significant economic and social development to the country by fostering entrepreneurship.

Initiatives for Promotion of Rural Entrepreneurship:

  • The government has implemented numerous schemes to support and develop rural industries, and to provide credit and financial assistance, skill development training, technological and quality up-gradation, infrastructure development and marketing assistance.

Scheme for credit & financial assistance to the rural enterprises:

  • Prime Minister’s Employment Generation Programme
  • Credit Linked Capital Subsidy Scheme
  • Credit Guarantee Trust Fund for MSEs
  • Interest Subvention Scheme for Incremental Credit to MSEs

Schemes for Skill Development and Training:

  • A scheme for Promotion of Innovation, Rural Industry & Entrepreneurship (ASPIRE)
  • Gramodyog Vikas Yojana

Schemes for Infrastructure Development: 

  • Scheme of Fund for Regeneration of Traditional Industries (SFURTI)

Scheme for Technology Up-gradation and Competitiveness:

  • Financial support to MSMEs in ZED certification

Empowering Rural Women through Entrepreneurship:

  • Rural entrepreneurship can create new economic opportunities for rural women. Women entrepreneurs can contribute to the economic well-being of their family, reduction in poverty, and their empowerment, achieving upward social and economic mobility as focused in the fifth Sustainable Development Goal (SDG) of the United Nations (UN).
  • Rural women entrepreneurs deal with enterprises requiring little organising skills with fewer risks under the self-help groups (SHGS)’ activities that range from making dairy products, pickles, fruit juices, pappad, jaggery, etc.
  • Women entrepreneurship is found to be less (about 14 percent of registered enterprises) as observed in the MSME sector. Development of women entrepreneurship in rural areas is low due to several challenges and problems faced by rural women like dual roles of homemakers and entrepreneurs, lack of ownership of resources, low level of knowledge, skills and entrepreneurial motivation, lack of education, low risk bearing abilities, lack of family support, socio-cultural barriers, difficulties in getting financial assistance and poor degree of financial freedom, weak bargaining positions, poor infrastructure facilities, lack of marketing abilities, etc.
  • Schemes like Support, Training and Employment Programme for Women (STEP), Mahila e-Haat, Trade Related Entrepreneurship Assistance and Development (TREAD), Stand-Up India, Rashtriya Mahila Koch (RMK) by GOI, Mahila Udyami Yojana of IDBI, SBI Stree Sakthi Package, Priyadarshini Yojana by Bank of India are efforts to empower the women entrepreneurs.
  • NITI Aayog established the Women Entrepreneurship Platform for making the women understand their entrepreneurial aspirations, scaling up innovative initiatives and formulating long-term business strategies.

Conclusion:

  • Rural entrepreneurship is an important aspect of the socio-economic development of rural areas.
  • Along with income generation, rural entrepreneurship helps in elevating the standard of living of rural communities.
  • Transformational economic and social changes through rural entrepreneurship would bring inclusive rural growth and sustainable rural development.
  • Hence, rural entrepreneurship must emerge in rural areas and sustain economic development.

Chapter 7: Integrated Rural Development and Sustainable Development Goals

Introduction:

  • The 2030 agenda for ‘Sustainable Development Goals (SDGs)’ aims at ensuring peace, prosperity and opportunity for all and for the well-being of the masses, and to end all kinds of deprivation including the socio-economic evils of poverty and inequality.
  • The SDG enlisted 17 SDGs with 169 Targets. The SDGs cover three key dimensions of sustainable development viz., economic growth, social inclusion and environmental protection.
  • Due to the COVID-19 pandemic, there has been widespread poverty, inequality and joblessness in most parts of the world. The world economy has withered by 4.4 percent, which has stalled the socio-economic development processes and become the biggest challenge in attaining SDGs by 2030.

Linkage between SDGs and rural development in India:

  • The well-being of the Indian economy certainly depends upon the living and livelihood patterns of the rural economy. In India, more than 65 percent of the total population lives in villages and, therefore, rural development itself signifies its importance in all kinds of public policymaking.
  • The accomplishment of the SDGs is mainly connected with rural India and its progress and hence ‘Integrated rural development’ can be used as a major index of sustainable development.
    • Out of 17 SDGs, 8 SDGs are highly linked with rural development, and 4 SDGs are moderately associated with rural development.
  • Rural development will not only reduce the poverty and inequality, but also will empower the community, especially the women and the underprivileged sections of society. The development of rural infrastructure like health, education, sanitation, housing, drinking water, rural banking, electricity, rural infrastructure, and rural/cottage/village/agro-based industries will play a vital role in attaining inclusive development in a sustainable manner, as per the SDGs agenda.

SDG 1-No Poverty:

  • Poverty is multidimensional and complex, and especially rural poverty is more deep-rooted and pervasive. To attain the SDG-1, eradication of rural poverty is essential and can be achieved by better infrastructure development, agricultural development, and better credit support facility.

SDG 2-Zero Hunger:

  • Hunger and food insecurity are quite prevalent in rural areas and are very much associated with an extreme form of poverty. Millions of children are living under malnutrition and suffering from various diseases in general and in the rural segment in particular.
  • Agricultural development is imperative to address this challenge.

SDG 3-Good Health and Well-Being:

  • For better health and well-being, health care facilities in rural areas are very much essential.

SDG 4-Quality Education:

  • The well-being of the nation rests on quality education. The challenges in quality education in the rural areas are more because of a lack of infrastructure.

SDG 5-Gender Equality:

  • Inclusiveness is possible only when all the segments get equal rights and equal opportunities in every aspect of life.
  • The major challenges in this respect are gender inequality and socio-economic discrimination which is rampant in the rural sector. For meaningful gender equality and empowerment of girls and women, rural development is inevitable and the need of the hour.

SDG 6-Clean Water and Sanitation:

  • For better health and rural well-being, safe and clean drinking water is very essential. Clean water, sanitation and hygiene are essential for protecting human health and human dignity.

SDG 8-Decent Work and Economic Growth:

  • Unemployment and lack of opportunities adversely affect the economy and also affect the health and socio-economic status of unemployed people. Unemployment in various forms is rampant in the rural sector.
  • The focus should be given to in situ employment creation in the rural economy.

SDG 9-Industry, Innovation and Infrastructure:

  • Adequate and accessible infrastructure not only enriches the quality of life but also brings betterment of rural livelihood. Better infrastructure always has a positive correlation with economic development.

Conclusion:

  • A structured and well-crafted rural development strategy will certainly help in attaining the Sustainable Development Goals. The attainment of SDGs can be possible in India only through the integrated and inclusive development of rural India. The following measures can help in this direction.
    • A significant focus on livelihood enhancement through MNREGA, agriculture, dairy farming, fisheries and poultry, horticulture, forestry, etc., will help rejuvenate and strengthen the integrated rural development in the Indian context.
    • The three ‘f’s i.e. funds, functions, and functionaries are needed to optimally operate to enhance the desired benefits.
    • Strategic planning, commitment in effective implementation of SDGs, with GLOCAL approach, timely execution, close monitoring and evaluation with clearly defined accountability, etc. are inevitable for ensuring sustainable rural development in India.

Chapter 8: Sustainable Mining

Mineral resources in India:

  • India is extremely rich in mineral resources including coal (4th largest reserves in the world), iron ore, Manganese ore (7th largest reserve in the world), Mica, Bauxite (5th largest reserve in the world), besides having large reserves of Chromite, Limestone, Thorium, Diamonds and Natural gas.
  • Minerals contribute about 1.69 percent to the country’s GDP.
    • Out of this, the share of coal and lignite is the maximum, followed by major minerals like Iron ore, Bauxite and limestone and minor minerals like marble, sandstone, dolomite, sand, etc.
    • Among the principal metallic minerals, iron ore contributed the highest while limestone contributed almost 92 percent of the total value of non-metallic minerals.
      • Iron ore constitutes more than 71 percent of the total value of metallic minerals mined in the country.

Mineral trade in India:

  • During the year 2018-19, the exports (including re-exports) of ores and minerals accounted for about 9.50 percent of the total value of all merchandise exported from India. Diamond (total) continued to be the largest constituent item with a share of 80.22 percent in the total value of mineral exports in 2018-19; however, a majority of diamond export was of the nature of re-exports. Next in the order of share was granite.
  • During 2018-19, the imports of ores and minerals accounted for 36.14 percent of the total value of all merchandise imported into India. Petroleum (crude) continued to be the largest constituent item with a share of 61.44 percent in the total value of minerals imported in 2018- 19. Diamond, coal and natural gas were the other major imports. The combined share of these four minerals was 93.98 per cent in 2018-19.

Concerns associated with the mineral sector in India:

Weak performance despite huge potential:

  • Indian mineral sector is very small and India is a very small player when it comes to mineral exports. This is ironical because India has the potential to be a big player in the global mineral trade, owing to its huge Obvious Geological Potential (OGP) in several minerals.
  • Despite having huge proven reserves of iron ore, India’s iron ore exports are insignificant in comparison to countries like Australia and Brazil. India is a minor player (market share 1.8 percent) in the international iron ore market.

Dependency on imports:

  • India continues to remain overly dependent on the import of crude oil to meet its energy requirements.
  • Despite huge proven reserves of coal, India continues to be a net importer of thermal coal.

Non-supportive economic policies:

  • The export duty on Iron ore exports with Fe content more than 58 percent has subdued iron ore exports from India and hence India accounts for an extremely low share in the global iron ore export market.
    • The aim of this export duty was to discourage the export of high-grade iron ore and conserve it for the domestic steel industry.

Outdated policies:

  • Captive iron ore mines not mining optimally as they did not have the permission to sell surplus iron ore in the market. As a result, huge reserves in such captive mines are lying unutilised.

High logistics costs:

  • Despite vast reserves, India imports iron ore. The reasons for import are lower landed cost of imported iron ore, especially for steel plants near the coast. Higher logistics cost are an additional problem in the country as railway freight is very high in India, thereby adversely affecting the raw material cost for steel plants located in Karnataka, Andhra Pradesh, Tamil Nadu or Maharashtra.

Delay due to environmental clearances:

  • The biggest impediment in opening up greenfield mines remains forest diversion and Environmental Clearance. Draft EIA Notification 2020 has already got delayed and the Supreme Court has banned iron ore mining in Goa and imposed several restrictions on iron ore mining in Karnataka.
  • The non-issue of Environmental Clearance on account of several mines being located in forest areas has delayed the issuance of mining leases.

Recommendations:

Promoting Environmentally Sustainable Mining:

  • Environment protection and mining should not be seen as each other’s opponents. Rather, a balanced approach needs to be followed to adopt sustainable mining.
    • The lessee should undertake proper mine closure within a specified time frame after the expiry of the lease. This would also open up large areas in closed mines where compensatory afforestation can be taken up.
    • The slow pace of mining enhances environmental degradation and therefore the lease period needs to be significantly reduced with a clear sun-set clause.
    • Manual mining should be banned and only mechanised mines should be allowed to operate. For this, the size of the auctioned blocks offered for lease should be large, so as to justify investment in mechanization.
    • Zero waste mining should be the norm. Beneficiation plants should be mandatory along with ore processing plants.
    • Rules relating to Compensatory Afforestation (CA) should be amended and a pan-India pool of CA land should be created. This would reduce the time required for identifying CA, which is a major reason for the delay in obtaining environmental clearances.
  • Mining has to be carried out scientifically, using state-of-the-art technology, within a specified timeframe and with minimum ecological damage.

Mining faster:

  • Given the impact of mining on GHG emissions and environmental degradation, most of the developed countries have either shifted or are in the process of shifting steel making from the blast furnace route to the scrap route. The developed countries have reached a stage of circular economy, which means that scrap generated in the country is enough to meet the ongoing steel consumption in the country. The EU is thinking of imposing a Carbon Border Adjustment Tax on steel imports.
  • The future of the iron ore route of steel making is not very bright since most of the countries would shift steelmaking to the scrap route.
  • As the world moves towards reducing CO2 emissions, and as the cost per unit of solar power goes on falling with each passing year, demand for coal shall keep on shrinking. China has already announced that it would start reducing coal consumption in the plan window 2026-30 and become carbon neutral by 2060. Coal consumption is set to go down.
  • If India does not exploit its iron ore and coking coal reserves in the next 20 years, these reserves would become dead assets very soon.
  • Hence India should start mining mineral resources like Iron ore and coal faster for self-consumption as well as export.
  • The impact of this fast pacing of mining would have a direct impact on the income as well as employment generation in rural areas, as all the mines, without exception, are located in rural areas. The country’s mining sector which currently provides direct employment to over 30 Lakh people can easily become an employment provider to over 60 lakh people directly and 5 Cr people indirectly.

Come up with supportive policies:

  • To develop mining as a modern stand-alone industry, substantial investment is required. A long term export-import policy for the mineral sector would provide stability and prove to be an incentive for investing in large scale commercial mining activity. This will also help attract the much needed FDI into the mineral sector.
  • Removing tariff and non-tariff barriers towards mineral export, at least in those minerals where domestic reserves are more than adequate should be explored.
  • The move to allow captive miners to sell up to 50 percent of their product after meeting the requirements of the end-use plant and on paying additional royalty to the state government will help increase domestic production of iron ore.
  • Involving the private entities to undertake mineral exploration without the need for RP-PL, in addition to public sector entities will help hasten mineral exploration and production in India.

National Mineral Policy, 2019:

  • The aims of NMP, 2019 are to bring in transparency, better regulation and enforcement, balanced social and economic growth as well as sustainable mining practices.
  • NMP, 2019 aims to develop mining as a modern stand-alone industry.

Gist of Kurukshetra June 2021:- Download PDF Here

Leave a Comment

Your Mobile number and Email id will not be published. Required fields are marked *

*

*