Rural Economy & Development Why should we study in this paper?3. To understand and analyze the socioeconomic dynamics of the rural areas of India as well as other countries2. To know the basics and conceptual frameworks of rural development1. To put rural development theories methodically into practices at state, national & international level
What is Economy ?• Economy means certain living conditions of people in certain region through which the physical quality of life of the people is determined.• Rural economy is characterized by the primary sector & allied(joined) activities.• Rural economy is basically a producers’ economy
Development• Development is a continuous process of positive change towards improvement of PQL• Development is not only the economic growth, but it is also the equitable distribution of the development gain• Development means growth with justice
Characteristics of Development• Increase in PQL• Growth with justice• Removal of inequality & Poverty• Equitable distribution of development gain• Sustainability• Equalization of opportunities
Alternative Development Indicators• PQLI• Human Development• Empowerment• Moral & Ethics• GNH
Schools of Thoughts• Rostow’ s Growth Theory• Lewis Development Theory• International Dependence Theory• Gandhian Development Theory• Nehruvian Development Theory• Marxist Development Theory
Issues of Development in Global Context• Polarization of Wealth• Feminization of Poverty• Rural Urban Influx• Large Scale Displacement• Destruction of livelihoods System• Synergic Problems
Issues in Development in Indian Context• Growth VS Distribution• Agricultural Development VS Industrial Dev• Technology intensive VS Labor replacing Economy• Centralized VS Decentralized Planning• Urban VS Rural Development
What is Poverty ? The word "poverty" suggestsimpoverishment: an inability toprovide a family with nutritious food,clothing, and reasonable shelter. UNO
Types of poverty• Absolute Poverty ( Physical requirements at subsistence level, price quotations, per capita consumer expenditure)• Relative Poverty ( income distributions of fractile groups, top 10, bottom 10)
What does Poverty create ? People residing in tribal and forested areasare likely to remain poor forever as a result theyfoment violence, conflicts & social unrest infuture.
Factors of Poverty• Poor Quality Human Capital: low level of productive efficiency• Instability of output in Agriculture sector• Imbalance in distribution & growing inequalities• Prevalence of Chronic Unemployment• Prevalence of low level technology• Steadily improving rate of capital formation
Why Poor is Poor?Poverty becomes hereditary in India because Chronic Poor pass on the poverty syndromes to the next generation
Uneven distribution of food grains & absence of right to food act (Peoples Union for Civil Liberties )
What is Poverty Line ? Poverty Line is an economic benchmarkand threshold used to indicate economicdisadvantage and to identify individualsand households in need of theirsubsistence.
Underlining the Poverty• 9th FYP criteria ( < 22,000/- AFI/ 2 hectors)• 10th FYP criteria (Cut off mark-17 out of 52)• 11th FYP criteria ( Rural & Urban)• BPL criteria in Kerala ( 4 out of 9 point criteria)
Various Studies on Poverty• Ojha’s estimate of Poverty (2,250 calories)• Dandekar & Rath’s Study of Poverty ( Rs20/-pm)• Minha’s Study of Poverty ( varies during Harvest)• Montek S. Alhuwalia’s study of Poverty (Agricultural performance & PoG=Z-Y/Z ( for detail see the book: Indian Economy by Mishra & Puri or Datta & Sundharam)
Poverty is widespread in India, with thenation estimated to have 1/3rd of theworlds poor. According to a 2005 WorldBank estimate, 41.6% of the total Indianpopulation falls below the internationalpoverty line of US$ 1.25 a day.
International Poverty LineInternationally, an income of less than $1.25 perday per head of purchasing power parity isdefined as extreme poverty. Income-basedpoverty lines consider the bare minimum incometo provide basic food requirements; it does notaccount for other essentials such as health careand education. That is why some times thepoverty lines have been described as starvationlines.
Poverty in China• < 0.2 US$ pd/ph ( 2005) & <1.25 US$ (2010)• 230 million BPL
Infrastructure in Indian Economy• Energy & Power• Agriculture & Irrigation• Transport• Communication & IT• Industry• Defense• Entertainment & Media• Science & Technology• Banking & Insurance• Health & Education
Energy Consumption: World wide ( 2008)Country PCI ( PPP) (US$) PCEC (KGs of Oil)INDIA 2,930 529CHINA 6,010 1,484UK 32,240 3,464JAPAN 35,190 4,019USA 46,790 7,766
Natural Resources in Indian Economy• Land Resources• Water Resources• Forest Resources• Marine Resources• Mineral Resources• Non-Conventional & renewable energy
Major Areas of InterventionIncome Generation Road R&REmployment Electricity ForestryMigration Communication Women IssuesAgriculture Housing Social SecurityIrrigation Health MarketingDisaster Management Livelihoods FinanceFisheries Education Others
Tips for Drafting the Scheme• Download a related scheme which is already in force (or phased out).• Critically assess the scheme and find out the gaps• Collect the all India level vital statistics on land, population and others.• Draft the scheme on any one of the areas of rural development (Latest by 23rdof July) which will be presented group wise on class from 1st of August & will be assessed with 20 marks.
Guidelines of the Scheme ?Give a nomenclature of the Scheme i.e.“ National Poverty Alleviation Programme”
Part I - Programme Objectives and Guiding Principles1. Introduction2.Programme Objectives3.Guiding Principles
Part II – Planning, Funding & Execution4. Planning for the projects5. Funding and Allocation6. Proposals7. State Level Agencies8. Preparation of Project Proposals and their Clearance9. Scrutiny of Project Proposals
10. Empowered Committee11. Tendering of Works12. Programme Implementation Units13. Execution of Works14. Quality Control and Supervision of Works15. Monitoring
Part III - Flow of funds, procedure for release and Audit16. Flow of Funds17. Procedure for Release Of Funds to the State Level Agency18. Audit19. Miscellaneous20. Convergence