India needs to take mfg to rural areas to bridge income gap, say experts

India does not consist of binary rural and urban areas anymore and the country needs to look at taking manufacturing to its villages to fill the income gap and achieve development goals, experts said

India does not consist of binary rural and urban areas anymore and the country needs to look at taking manufacturing to its villages to fill the income gap and achieve its development goals, experts said on Wednesday.

At a conference on re-imagining rural India, organised by the Union Rural Development Ministry in collaboration with the World Bank and the Bills and Melinda Gates Foundation, NITI Ayog member Ramesh Chand said a major portion of resources allocated for rural development were on social schemes and stressed on the need for investment for overall development.

Former secretary of Rural Development Ministry Nagendra Nath Sinha laid emphasis for formulating policies for rural areas that are fast transforming to urban areas.

 

Speaking during the concluding session of the two-day conference, Chand said a clear trend has emerged over the years in the rural sector and there is a shift in balance from development approach to an approach which involves enabling a particular set of targeted groups, the ultra poor.

"Look at it in terms of total resources spent by Ministry of Rural Development in 2022-23, the Budget was Rs 1.8 trillion for central schemes. Out of that, Rs 1.6 trillion has gone for NRLM and MGNREGA..." he said.

"Somehow, I feel the approach shifted to uplifting individuals rather than the whole rural area. Rather than supporting economic activities that will help every one, focus shifted to the bottom 25 per cent or 30 per cent, I am talking of balance, I am not against it," Chand added.

"We are spending 83 per cent on these schemes, and capital is always limited. I think the overall strategy for rural development got a hit," he said.

Chand said in 2011, almost 51 per cent manufacturing was happening in rural areas.

"If we are focused on making India a developed country, it requires a growth of 7.7 per cent for 25 years, and double-digit growth in the first few years. Manufacturing will have a big role," The NITI Ayog member said.

He said in future, most of the manufacturing will come to rural areas, adding "there is a need to focus on how to make rural areas gain from it".

Sinha highlighted the transformation being witnessed by many rural clusters which now have population and density as high as that of urban areas, saying India is no more a binary of rural and urban areas.

"Do we imagine an India which still consists of binary - rural and urban? Still think of occupational profiles being different for rural and urban? In my opinion, given the technological advancement, the way decentralised manufacturing can take place, there need not be a difference," he said.

"Many rural clusters are urbanising...I call upon the rural development ministry to consider whether we could think of a component for taking care of necessities of areas that are developing. Once haphazard development has taken place, remedies are complex," the former Rural Development Ministry secretary said.

He said India needs to think about location-independent occupation profiles and services.

"That would mean advancing on several fronts, with a cluster of services present in urban areas in terms of finances, logistics, and business services also being available in rural areas," he said.

Sinha also stressed that the problem of ultra poor need to be addressed through poverty eradication programmes.

"Simple poverty reduction strategies don't work on this group," he added.

The two-day conference titled 'Evolving India: Re-imagining Rural Development for Shared Prosperity' was focused on creating a roadmap for rural India during the "Amrit Kaal".

Issues like leveraging digital opportunities for rural India, strengthening the nexus of agri-food, climate change, nutrition, gender, entrepreneurship and jobs for rural youth, investing in rural-urban transition, re-imagining the design of collectives and financing for inclusive rural growth were among the topics discussed.