Rebooting Rural Economy

COVID-19 Pandemic and the Economy

• The economic behavior of the developed and developing countries have been hugely hit by the pandemic COVID-19.
• In this regard, the government of India has launched Aatmanirbhar Bharat Abhiyaan (Self-Reliant India Mission) with a huge package of Rs.20 lakh crore to accelerate the pace of growth in rural economy by introducing systemic changes in the near future. The package provides enough budget-
  • Healthcare sector: for emergency healthcare requirements of the hospitals
  • Working population: for safeguarding the employees and employment during the crisis as well as post-crisis
  • Poor & Vulnerable population: for the support of the poor and vulnerable sections in the form of direct financial assistance, food and livelihood support.

Doubling of Farmers' Income (DFI) by 2022

• The Government of India has set a target of doubling the farmers' income (DFI) by the year 2022. To administer this strategically, the Government has set up the Inter-Ministerial Committee on Doubling Farmers' Income (DFI).
• The Committee identified seven sources to double farmers' income by 2022 which include—
• Within the Domain of Agriculture
  • Improvement in crop productivity;
  • Improvement in livestock productivity;
  • Efficiency in the use of resources/ savings in the cost of production;
  • Increase in the cropping intensity;
  • Diversification towards high value crops; and
  • Improvement in real prices received by farmers.
• Outside the Domain of Agriculture
  • Shift from farm to non-farm occupations (like backyard poultry; goat rearing;fisheries;dairy; vegetables-fruit, and food processing, etc. which are high value-yielding)
• Several steps have already been taken to implement the recommendations of DFI Committee (to double the farmers' income). These include:
  • Advocating progressive market reforms through the State Governments and Union Territories;
  • Supporting contract farming through the State Governments by promulgating of Model Contract Farming Act, Up-gradation of GraminHaats to work as centers of aggregation and for direct purchase of agricultural commodities from the farmers;
  • Providing e-NAM to farmers which is an electronic online trading platform;
  • Distributing soil health cards to farmers so that the use of fertilizers can be rationalised;
  • Increasing water efficiency through Pradhan MantriKrishiSinchayeeYojana (PMKSY) - "Per drop more crop";
  • Better insurance coverage to crops for risk mitigation under Pradhan MantriFasalBimaYojana (PMFBY);
  • Making loans available to farmers at a reduced rate of 4 percent per annum and extending the facility of Kisan Credit Card (KCC) for animal husbandry and fisheries related activities to the farmers;
  • Increase in the Minimum Support Price (MSPs) for all Kharif and Rabi crops; and
  • Providing old age pension of Rs. 3000 to the eligible small and marginal farmers and cover around 5 crore beneficiaries in the first three years.
• Besides, the government took yet another initiative to amend the Essential Commodities Act to remove commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. This historic decision will not only transform the farm sector but also help in raising farmers' income.

Way Ahead

• Boosting rural economy is a key to overall growth and inclusive development of the country. Some of the crucial areas which require immediate reforms include:
  • Streamlining the MGNREGA so as to provide maximum benefit to the poor by avoiding any sort of mismanagement in implementation and execution. With government's emphasis on Aadhar-linked Direct Benefit Transfers (DBT) through Jan Dhan bank accounts, the mismanagement has been largely taken careof;
  • Grooming and promoting youth as Entrepreneurs or Self-employed (YSE),who are linked to local livelihood eco-systems;
  • Promoting backyard poultry and goat rearing with provisions for improvement on sheds, vaccines and other support;
  • Encouraging Farmer Producer Organisation (FPOs) to support Small and Marginal Farmers (SMFs);
  • Working with farmers towards a new paradigm by shifting from intensive chemical-based agriculture to adopting sustainable eco-friendly agriculture practices;
  • Connecting villages physically and digitally is essential for village enterprise to prosper. In this case, the roads/highways will improve the last-mile delivery of relief and welfare programmes;
  • Development of cluster-based specialised farming,promotion of organic farming,support for farmers' organisations, extension of farmer credit to fisheries and animal husbandry farmers;
  • Livestock, fisheries, dairy, vegetables, fruit and food processing are more labor-intensive and high value-yielding. After many decades of neglect in research and development, lack of market access, on-off policies for exports, and market distortions, the present adversity may be a timely opportunity for this sector. The government is focusing on this through its schemes concerning the rural development.

Conclusion

To sum up, the success of India's economy is strongly rooted in the rural areas. India doesn't advocate a self-centered system by becoming self-reliant, but in India's self-reliance there is a concern for thewhole world's happiness, cooperation and peace.

Without uplifting the rural economy first, the rest of India will not pick up momentum that easily. Therefore, revisiting the rural segment with strategic financial plans is inevitable. To achieve doubling the farmers' income by 2022, it is also the equal responsibility of the States and Union Territories to collectively work on achieving the targets set by the government. This collective effort will ultimately help the farmers to increase their income, and if our farmers progress, the country will certainly progress.

If it happens so, the words of Mahatma Gandhi, "The future of India lies in its villages", will become reality.