getting rural india to grow again…

the budget is around the corner. and here is what this opinionated hack thinks the finance minister should focus on in budget 2012-13.

story one. on agri.

It is no secret that Indian agriculture is in doldrums. Lakhs of farmers have committed suicide. Millions supplant their meagre earnings from farming by working in local factories and brick kilns, or by migrating to cities to work as labour. Step into the house of a small and marginal farmer, who now comprise 92% of all farming households in India, and you will see gnawing impoverishment. A complex set of factors is to blame.

story two. on the non farm sector.

With agriculture in crisis, India needs to create lots of jobs in the rural non-farm sector. However, travel around in rural areas and you will find most businesses in the hinterland service the rural market itself –garages, small shops, and the like. Businesses based in rural areas but serving larger markets elsewhere –like Amul — are almost non-existent. This is suboptimal. Fortunes of these rural businesses continue to be hitched to the agrarian economy villagers were trying to escape.

also see these two stories in our package today. the first, by iim professor m s sriram, on where india’s massive financial inclusive drive  is going wrong. and the second by NAC member n c saxena on why the indian government’s rural development plans go awry so often.

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