India’s rural economy has enormous potential. During covid-19 rural areas were the silver lining with agriculture spending support to Indian GDP. Although the dependence on agriculture has reduced over the years, still it accounts for more than one-third of rural income and is the fundamental aspect of the rural economy.
With two-third of the population living in villages’ rural economy had become the inherent strength during the pandemic. By boosting the economy of rural India investment, consumption, government expenditure and exports will be multiplied. Currently, the rural economy is distressed.
Rising Inflation and low real wages both result in sluggish spending. To ensure inclusive economic growth, the government needs to urgently focus on transforming the village economy to pull the maximum number of people out of subsistence farming and give them a much more remunerative role.
The upcoming budget should be focused on rural income growth and our target should be at least 100% growth in every household income in near future.
All existing cooperative societies would be put under the aforesaid Apex society. The existing cooperative societies would continue to operate and get payment in the same way, as is being done at present.
However, the supply of sugarcane to sugar mills shall be routed through Apex society only.
This cooperative society will supply sugarcane to the sugar mills, on a job-work basis, which means that the sugarcane will be supplied to the sugar mills at fixed processing charges, and the sugar produced, will belong to the Farmers’ Co-operative Society and sold in the market directly by the Apex Co-operative Society on market rate.
We can implement this modal in cotton farmers, oil seed farmers, jute farmers, and other farm products also. We can’t increase the income of rural households only in the paper we have to plan and implement it on the ground.
This modal will help increase the income of almost 50 percent of the Indian farm population. This is a tested and result-orientated modal and India had seen the impact of this modal in the dairy farming sector.
Rural areas are under a lot of stress and growing slowly, so the budget should also be given equal attention. It should be a priority to focus on skill development to get stable jobs and improve business prospects through the development of food processing industries, handicrafts, and handlooms in rural areas.
Through women’s self-help groups (SHG), millions of jobs can be created in rural areas, provided if the marketing and sale of the products made by these women’s self-help groups are taken care of by the private sector through public-private partnerships and it will increase the income of these women.
In this PPP model each woman can earn anything between 10000 and 15 thousand per month. Marketing and sales of rural products by private players can have a large-scale impact, boost the rural economy, and address sustainability, efficiency, and inclusivity challenges.
The Government should provide financial assistance to buy machineries required to produce food and other products and the same can be marketed through private participation, which will increase the rural house-hold income.
Many rural jobs can be created if the government invests in infrastructure and increases capital expenditures. With the focus on rural infrastructure, the upcoming budget should increase allocation to capital expenditure which would help create employment in rural areas and boost rural demand that is today a concern in the domestic economy.
