The Growth of the Rural Economy: Growth and Reforms

Prime Minister Modi has said that a new committee will be constituted to make agriculture more effective, reduce the hardships of the farmers and increase the income of the farmers.

There is no doubt that the Minimum Support Price (MSP) of agricultural production can be increased by this committee.

The three main pillars of the country’s rural economy improving and strengthening agriculture and rural development are emerging.

One, the massive outflow of funds under various schemes announced for agriculture and rural development in the country to provide relief from the hardships of the COVID-19 pandemic has led to a rapid inflow of funds into rural India.

Two, programs to increase production and productivity in the agricultural sector have increased the income of farmers.

The Growth of the Rural Economy: Growth and Reforms

Three, the effective role of MGNREGA in employing people in rural India has increased. Undoubtedly, the purchasing power of small farmers and rural poor has been increased through Jan Dhan and Krishi Vikas Yojana amid the challenges of COVID-19.

The joys of financial inclusion have grown rapidly among the small farmers and landless labourers of the country. Under PM Kisan Yojana, till August 2021, Rs 1.58 lakh crore has been deposited in the bank accounts of 11.37 crore farmers through Direct Benefit Transfer (DBT).

There is no doubt that the increase in production and productivity in the agricultural sector has led to a favourable recovery in the rural economy.

The second quarter of the current financial year 2021-22 released by the government on November 30, i.e. July to September, has registered a growth of 8.4 per cent in the Gross Domestic Product (GDP).

Agriculture is the only sector in which the growth rate has increased continuously in the second quarter of three years. Foodgrain production in the country has reached a record high of about 3,086 lakh tonnes in the year 2020-21.

Similarly, during the year 2020-21, the total oilseeds production in the country has reached a record 361 lakh tonnes and the record production of pulses has reached 257 lakh tonnes.

Along with this, according to the first advance estimates for the year 2021-22, the record production of the Kharif crop is estimated to be 15.05 million tonnes.

The Growth of the Rural Economy: Growth and Reforms

Certainly, with the encouragement of small farmers in every possible way and special programs of agricultural development, the GDP has increased continuously in the agriculture sector.

Mahatma Gandhi Rural Employment Guarantee Scheme (MNREGA) has played an effective role in increasing the income of people in rural India by employing in the year 2021.

While MGNREGA has given more employment to the people traditionally working in the villages, it has also given a large number of employment to the migrant workers who have returned from the cities to the villages due to the second wave of Corona. But still the challenge of increasing the income of farmers and rural poor stands.

According to the latest report of NITI Aayog published on 26 November, more effective efforts are needed to reduce poverty in rural India.

During the year 2015-16, 32.75 per cent of the population in rural areas and 8.81 per cent in urban areas were found to be in multidimensional poverty.

The Growth of the Rural Economy: Growth and Reforms

In such a situation, it is necessary to ensure new measures to increase the income of farmers and rural poor. On December 1, 2021, three agricultural laws have been formally withdrawn after the signature of President Ram Nath Kovind.

Prime Minister Modi has said that a new committee will be constituted to make agriculture more effective, reduce the hardships of the farmers and increase the income of the farmers.

There is no doubt that the Minimum Support Price (MSP) of agricultural production can be increased by this committee. Given the demands of the farmers, schemes like PM Asha and Bhavantar payment can be started.

The Growth of the Rural Economy: Growth and Reforms

More cash transfers to the Jan Dhan accounts of small farmers can increase their financial assistance and the rural poor. Despite all this, since 80 per cent of the country’s farmers do not have enough farmland to earn a living, the option of increasing their non-farm income will have to be pursued.