Limited access to education and infrastructure, dependence on agriculture, and unequal land distribution are among the key causes of rural poverty in India. Government initiatives have aimed to promote rural development through various five-year plans and economic reforms, but poverty remains an issue. Microfinance can help address rural poverty by expanding access to financial services and credit for rural communities.

1. INDIAN RURAL ECONOMY AND MICROFINANCE
DR.N.ARUNSANKAR

2. Causes of rural poverty
• Rural poverty can be attributed to a complex interplay of various factors.
Understanding these causes is essential for developing effective strategies to
alleviate rural poverty.

3. CO 1: Describe the government initiatives for rural development
 Module 1 Indian Rural Economy
 Features of Rural India
 Economic, Demographic and social – Causes of rural poverty
 Rural development policy of the Government since 1947
 Five-year plans
 Impact of economic reforms,
 demonetization on rural Economy.

4. Limited Access to Education:
• Insufficient educational opportunities and resources in rural areas can lead to a lack of skills and
qualifications, limiting employment prospects..

5. Agricultural Dependence:
• Heavy reliance on traditional and subsistence agriculture can make rural communities
vulnerable to fluctuating commodity prices, climate change, and market uncertainties.

6. Lack of Infrastructure:
• Inadequate infrastructure, including poor roads, limited access to electricity, and deficient
healthcare facilities, hampers economic development and quality of life.

7. Unequal Land Distribution:
• Unequal distribution of land and limited access to land ownership contribute to economic
disparities, with small farmers facing challenges in sustaining livelihoods.

8. Limited Job Opportunities:
• Scarce non-agricultural employment opportunities in rural areas often force residents
to migrate to urban centers in search of work.

9. Market Access Challenges:
• Limited market access for rural products and lack of proper transportation infrastructure
can hinder the growth of rural economies.

10. Climate Change and Environmental Factors:
• Vulnerability to climate change, unpredictable weather patterns, and environmental
degradation can adversely impact agricultural productivity and livelihoods.

11. Social Discrimination:
• Social factors, including caste-based discrimination, can restrict access to resources
and opportunities for certain marginalized communities in rural areas.

12. Health Issues:
• Inadequate healthcare facilities and limited access to sanitation and clean water
contribute to health challenges, impacting overall productivity and well-being.

13. Technological Gaps:
• Limited access to and adoption of modern technologies in agriculture and other sectors
hinder efficiency and competitiveness.

14. Government Policies:
• Ineffective or poorly implemented government policies may not adequately address the
specific needs of rural populations, exacerbating poverty issues.

15. Limited Financial Inclusion:
• Lack of access to formal financial institutions and credit services can hinder investment
in agriculture and other income-generating activities.

16. Population Growth:
• High population growth in rural areas can strain available resources and services,
making it challenging to meet the needs of the growing population.