From sociological point of view, the term ‘rural society’ implies the following: In comparison with the urban society, it is a small society, meaning thereby that it has a small population and extends over a shorter physical area. Various institutions (such as police stations, hospitals, schools, post- offices, clubs, etc.) may or may not be there, and if existent, they are not available in plenty. Density of the rural population is also low, and it may be clustered according to the criteria of social status. In other words, people occupying the same status may share the same neighbourhood, and may observe considerable social, and sometimes physical, distance from others, especially those lower in hierarchy. A sizable number of rural people are engaged in agriculture, which is the mainstay of their lives. In addition, a rural society has several other groups, engaged in various other occupations of arts and crafts, usually known as artisans and craftsmen, who regularly supply their services to agriculturalists in exchange for grains and cereals. Rural society has some full-time and a large number of part-time specialists. Craftsmen and artisans also indulge in agricultural pursuits, especially during the monsoon and the agricultural produce of such specialists and small agriculturalists is mainly for domestic consumption. Rural society is regarded as the repository of traditional mores and folkways. It preserves the traditional culture, and many of its values and virtues are carried forward to urban areas, of which they become a part after their refinement.
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
From sociological point of view, the term ‘rural society’ implies the following:In comparison with the urban society, it is a small society, meaning thereby thatit has a small population and extends over a shorter physical area. Variousinstitutions (such as police stations, hospitals, schools, post-offices, clubs, etc.)may or may not be there, and if existent, they are not available in plenty.Density of the rural population is also low, and it may be clustered according tothe criteria of social status. In other words, people occupying the same statusmay share the same neighbourhood, and may observe considerable social, andsometimes physical, distance from others, especially those lower in hierarchy.A sizable number of rural people are engaged in agriculture, which is themainstay of their lives. In addition, a rural society has several other groups,engaged in various other occupations of arts and crafts, usually known asartisans and craftsmen, who regularly supply their services to agriculturalists inexchange for grains and cereals.Rural society has some full-time and a large number of part-time specialists.Craftsmen and artisans also indulge in agricultural pursuits, especially during themonsoon and the agricultural produce of such specialists and small agriculturalistsis mainly for domestic consumption.Rural society is regarded as the repository of traditional mores and folkways.It preserves the traditional culture, and many of its values and virtues are carriedforward to urban areas, of which they become a part after their refinement.When scholars say that ‘India lives in villages’, they mean not only that villagesconstitute the abode of three-quarters of Indians, but also that the fundamentalvalues of Indian society and civilization are preserved in villages, wherefromthey are transmitted to towns and cities. One cannot have an idea about thespirit of India unless her villages are understood.
Tribe And Peasants
a tribe, emphasis is laid on the isolationof its members from the wider world. Because a tribe has almost negligible relationswith the other communities, it tends to develop its own culture, which has littleresemblance with the culture of those communities that have enjoyed long-terminteraction among themselves. That is the reason why tribal communities inanthropological literature are known as ‘cultural isolates’. The implication of thismetaphor is that one can understand a tribal society without bothering to study theexternal world, of which the tribe may be an ‘island’. A tribal society is characteristicallya ‘holistic’ (i.e. complete) society.The term ‘peasant’ also shot into prominence with the works of Robert Redfield. Forthe first time, however, the term was defined in the writings of the Americananthropologist, A.L. Kroeber. His oft-quoted definition of peasants is as follows:“Peasants are definitely rural – yet live in relation to market towns; they form a classsegment of a larger population which usually contains also urban centers, sometimesmetropolitan capitals. They constitute part-societies with part-cultures. They lack theisolation, the political autonomy, and the self-sufficiency of tribal populations; but theirlocal units retain much of their old identity, integration, and attachment to soil andcults.”
1.5 RURAL AND URBAN SOCIETIES: DIFFERENCESAND RELATIONSHIPSAfter having learnt about the various characteristics of the rural society, it will nowbe easier for us to compare it with the urban society. Just to revise: rural and urbansocieties, or the village and the city, constitute two ends of the continuum. Over a13period of time, rural societies undergo a variety of changes. Some of them are Rural Povertyassimilated into urban societies; some start resembling urban societies in certainmaterial and social terms, but retain their identity as a village; while some remainless affected by the forces emerging from cities. It may be so because of theirlocation. Villages closer to the centers of urban growth are likely to change appreciablyand faster than their counterparts located in interior areas. With the passage of time,villages may grow into towns, which later on grow into cities. Continuity may, thus,be unmistakably noticed in the transition from the village to the city.For cities, which grow from the village, the term used by Robert Redfield and MiltonSinger is ‘orthogenetic cities’. These cities ‘emerge from below’, i.e. from the village,rather than get imposed on a population from outside. When a city is imposed on apopulace, as happened during the colonial period in India, it is called ‘heterogeneticcity’. Such a city, ‘emerging from above’, does not have its origin in local villages.The social consequences of these two types of city are not alike. In an orthogeneticcity, the migrants coming from villages will have less of a ‘culture shock’ onencountering the city and will not suffer much from any sort of ‘cultural inadequacy’while dealing with the city dwellers. By contrast, both the experience of a cultureshock and the feeling of cultural inadequacy will be tremendously high for ruralmigrants in a heterogenetic city. It is so, because an orthogenetic city carries forwardthe traditions of the village and the villagers can identify the segments of their culturein it and can relate with them easily. In a heterogenetic city, by contrast, memberswill feel completely out of place, because such a city contains the elements of atradition which grew somewhere else, with which the local people have no familiarity.Consequently, they will feel out of place in it.The point that has been stressed through out this lesson is that generally rural andurban areas are dependent upon each other. There is a mutually supportive relationshipbetween them. Sociologists have analyzed these relations in economic, political, social,and cultural terms.
Rural Society : This term is used for a small society, which comprises onlya few hundred households, who mostly produce their ownfood. Agriculture is the mainstay of their life. In this society,the number of people engaged in non-agricultural pursuitsis small, but these members also practice agriculture.Tribal Society : This term is used for a small society, smaller than thetypical agriculture-based society. It is largely isolated fromother societies and the centers of civilization. The tribalcommunities practice a large number of economic pursuits,ranging from hunting and food gathering to settledagriculture. There are many villages in India where tribesand non-tribal people live together.Urban Society : This term is used interchangeably with two terms—towns
and cities. Characterized by a much larger area andpopulation, an urban society grows faster because of themigration of people from villages to cities. An urban society,whether pre-industrial or industrial, is basically a nonagrariansociety. It is heterogeneous, complex, and futureoriented.Great Tradition : It is the tradition of the intellectual class called ‘literati’who live in cities.Little Tradition : It is the tradition of the unlettered people in villages andcities.Universalization : The process, by which cultural traits from the little traditionget carried forward, reflected upon, and systematized tobecome a part of the great tradition, is called universalization.Parochialization : The process, by which cultural traits from the great traditionget carried downwards to the village where they becomea part of the little tradition, is called parochialization.Fringe Villages : These are the villages that are found at the meetingpoints of typical rural and urban areas. They depict thecharacteristics of both the types of social organization.
1.2 CONCEPT OF DEVELOPMENTYou know that some countries are considered to be more developed than others. Itis not uncommon to come across references to the Less Developed Countries (LDCs)as compared to the Developed Countries (DCs). Similarly, within out own country,some states are said to be more developed than others. Clearly, development thereforeinvolves making relative comparisons.Development implies on overall positive change in the physical quality of life. Thispositive change for the better encompasses economic as well as social aspects.Therefore, development not only calls for economic growth but also the equitabledistribution of the gains made from economic growth. In other words, developmentimplies growth with justice. It means an improvement in the quality of life throughbetter health, education, housing and overall material and social welfare. The basicelements of development are the following:i) Removal of inequality and poverty;ii) Increase in material welfare of the people;iii) Increase in social well-being (education, health, housing, etc.);iv) An equitable distribution of the gains of development among different groups ofpeople in a region or country;v) An enhancement in technology and the capacity to produce a wider range ofgoods and services in the economy leading to a better quality of life;vi) Building institutional structures which permit participation in decision-makingat all levels, equalization of opportunities for development and removal ofdisparities.For a long time, it was assumed that development depends primarily on economicgrowth and would automatically occur if economic growth took place. This view ofdevelopment has, however, been criticized on the ground that it ignores the distributionof the gains from growth; and also, how the growth has been achieved and at whatcosts. An increase in production in a country does not automatically mean that therehas been better distribution of what has been produced. For instance, though the
production of food-grains has grown almost four-fold since Independence, this doesnot imply that every Indian gets enough to eat. This has meant that the question ofdistributive justice has assumed greater importance. Also, the composition of the setof goods produced is important.It is necessary to understand the difference between the concepts of economicgrowth and development. Economic growth means an increase in the value of allgoods and services produced in an economy. The sum total of all goods and servicesin an economy is termed as the Gross Domestic Product (GDP). Growth is, therefore,a sustained expansion in the productive capacity of an economy leading tosustained rise in its GDP. Development, on the other hand, is a sustainedimprovement in material welfare, particularly for those who are poor and afflictedby poverty, illiteracy and poor health conditions. Development is, therefore, aqualitative concept involving a qualitative improvement in the general standard ofliving in a country or economy.
1.3.1 Characteristics of UnderdevelopmentMost developing countries are characterized by the following conditions:i) Mass poverty;ii) Low levels of income and concentration of incomes in a few hands;iii) High levels of unemployment and under-employment;iv) Poor nutrition, health, housing, literacy and welfare status;v) Preponderance of primary sector and low levels of industrialization; andvi) Lower status of women and that of a variety of social groups such as scheduledcastes in India.
1.5 MAJOR ISSUES IN DEVELOPMENTIt must be emphasized that there cannot be a single well defined path towardsdevelopment. Different countries and regions will have to take their own specificitiesinto account in order to develop their societies. This is one reason why developmenthas been a much debated subject. In this section we will highlight some of the majorissues, which have featured in this debate.1.5.1 Growth vs DistributionFor a long time it was assumed that economic growth would be an engine that willlead naturally towards development. Consequently, little or no attention was paid tothe question of distributive justice. One of the major outcomes of this situation wasthe “trickle down” theory, which stated that if there was sufficient growth everybodywould benefit from it. India, during the first three plans, made heavy investments ofcapital and sought to take the country on to a new growth path. During the early11Rural DevelopmentExperiences — An AsianPerspective1970s, however, it was realized that the living conditions had not changed significantlyfor the better. It was then that the question of distributive justice assumed greaterimportance. The problem, however, continues to affect the developing countries asassets such as land and capital are concentrated in a few hands. This perpetuatesthe problem further and the question of distributive justice remains unsolved. Themajor result of this debate has been the realization that economic growth alone is notenough to lead a country towards rapid development. Growth by itself does not
guarantee an improvement in the quality of life for the vast numbers of people.Therefore the state has to formulate policies and design instruments to ensure thatdevelopment benefits flow to those categories of people who need them most.1.5.2 Agricultural vs Industrial DevelopmentThis has been one of the most important issues at stake in the debate on development.In India’s own case, it was thought that rapid industrialization would lead the countryto self-sufficiency. In the 1960s, however, the country experienced severe foodshortages that led to the realization that the agricultural sector could not be ignored.This led to increasing attention to this sector. New varieties of seeds and the useof fertilizers on a larger scale have led to an increase in agricultural production.However, it has now become clear that a balance between agricultural developmentand industrial growth will have to be maintained for genuine economic development.If the agricultural sector does not grow there may be sharp increase in the prices offood-grains that will affect the poor. On the other hand, industrial stagnation willmean that surplus labour from the agricultural sector cannot be usefully employed.Therefore, both agriculture and industry will have to grow so that the pace ofdevelopment is fast enough to improve the living conditions of the people.1.5.3 Capital vs Labour Intensive Technologies and DevelopmentYou may have heard the term ‘technology’ being used quite often in debates pertainingto development. What is technology and what is its role in the development of acountry and its people? Technology is the means by which goods are manufacturedin an economy. Any goods, however crude or sophisticated, can actually bemanufactured by several means. The development in technology is the process bywhich the manufacture of goods is made cheaper, faster and more efficient. Whatis the role of technology in development?You may be aware of the fact that tractors, harvesters, etc. are being used on awider scale now than a couple of decades ago. They are now used to perform manyof the agricultural operations, which were thitherto performed manually using ploughsand other equipment; this change may be termed a technological change.Now that you are familiar with this concept you must be able to appreciate that atany given point of time, we may have a number of technologies to choose from inorder to produce the same goods. Cloth can be woven on traditional looms in yourvillage or town, or it can be manufactured in the factories located in bigger cities. Theend product is more or less the same, but the process of making it is different. Whatare the implications of these facts for the process of development?An improvement in technology calls for investment to make this change feasible.Sophisticated technology, when it uses less labour, is termed “labour displacingtechnology”. On the other hand, an improvement in technology can also be madewithout displacing labour and also less expensively. This is called “labour intensivetechnology”. Capital intensive and labour displacing technologies are oftenexpensive and call for large investments. Labour intensive technologies, on the otherhand, have the advantage of being able to absorb the surplus labour in a developingcountry.12Rural Development —Concept, Strategies andExperiencesDuring the late 60s and the early 70s, a new trend of thinking on technology suitableto developing societies became popular. The question raised was that of “Appropriate
Technology”. It was said that developing countries should adopt technologies thatwere suitable for their own specific needs, situations and socio-cultural frameworkrather than copy the western technologies blindly. Thus, it was suggested that countrieslike India should use technologies that have evolved over many decades and adaptthem to make the best use of their cost-effectiveness.The choice between these types of technology, however, is not easy for a developingcountry. On the one hand, rapid increase in output is necessary to solve the problemsof the people and, on the other, the problem of unemployment (thus created)accentuates the problem of poverty. A balance is, therefore, required so that bothtechnology and living conditions of the people improve.1.5.4 Centralization vs DecentralizationThis has been another major issue in the debate on development. Generally, it isagreed that development is a long-term phenomenon and, therefore, needs to beplanned. While a certain degree of centralization is necessary to coordinate theefforts towards development, too much of centralization in the case of decisionmaking powers can weaken the process of popular participation. It also leads to theformulation of programmes and projects, which have limited local relevance. Inrecent times, the need to devolve decision making powers to the panchayats hascaught the attention of policy makers in India. Important steps, including constitutionalamendments, have been taken since the late 1980s to empower local level institutions.It is hoped that decentralization of the development process would also lead togreater accountability of those who are actually involved in the decision makingprocess. Devolution of powers is very vital for development. This ensures that theadministration is brought closer to the people. Consequently, there is greateraccountability of planners towards those whom programmes and policies are meantto reach.1.5.5 Urban vs Rural DevelopmentThe vast majority of the population in India and other developing countries live in ruralareas. There is a continuing influx of people into the cities looking for jobs as the ruraleconomy is not been able to provide employment to them. It needs to be pointed out,however, that the problem of poverty, poor health and illiteracy is widespread in bothrural as well as urban areas. The problem of rural poverty and unemployment is thecrux of the problem. Without solving it, there cannot be genuine development. Hence,rural development has come to acquire critical importance. Sustained improvement inthe quality of life in rural areas is likely to slacken the pace of large-scale migrationof villagers to cities in search of jobs.1.5.6 Respective Roles for the State and the MarketOne of the most contentions issues in Economics has been the scope and extent ofgovernment intervention in the economy of the country. During the immediate post-World War II era, there was a near consensus among economists, for a variety ofreasons, such as important developments in economic theory around the idea of‘market failure’ (which had several dimensions), that governments have to play majorroles in the economic sphere. Thus around the time India gained independence fromthe British, the need for planning had come to have wide acceptance in the developingcountries for them to break free from stagnation and backwardness. The debate inour country at that time was not about the need for planning but about what kind ofplanning and quite a few alternative suggestions and frameworks were widely discussed.In the recent years, however, government intervention in economic spheres has come
13Rural DevelopmentExperiences — An AsianPerspectiveunder much fire, particularly during the last couple of decades, and a sort of neoliberalmarket orthodoxy – which insists that ‘the market knows and does the best’– has become dominant. We cannot go into a detailed discussion of the reasons forsuch an extreme swing here, but it may be stressed right away that to a large extentsuch a swing is based on shaky theoretical foundations and faulty empirical associations.This will be briefly discussed, in the next section, with reference to Indian economicdevelopment.Check Your Progress IINote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end ofthis unit.1) Explain briefly in your own words the role that technology plays in theprocess of development......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
1.6 PLANNED DEVELOPMENT AND SHIFTS INSTRATEGIES IN INDIADevelopment is a long-term phenomenon. In order to achieve something in the longrun, it is essential to plan keeping in mind the goals that we wish to attain. We havealready seen that there is no single path towards development. Any country will haveseveral objectives that it may wish to achieve in a given time-frame. Among thesevarious objectives, it will be necessary to establish priorities. This is what a planessentially does. It is a conscious attempt to achieve the set of objective that it hasset for itself. Taking into account the particular set of priorities that it seeks to attain,a country may have to adopt a particular planning strategy.India, after Independence, decided to opt for a planned course towards developmentand coordinate the process of planning. The Planning Commission was set up in1950.It may be useful to view the past half-a-century of Indian economic story as achronological sequence of the following phases:i) the preparatory phase in planning for development (from independence to themid-1950s);ii) the phase of industrialization led by heavy industry (from the mid- 1950s to themid-1960s);iii) the phase of pulling up agriculture (the late 1960s and 1970s);iv) the phase of pump-priming of aggregate demand (the decade of the 1980s); andv) the phase of economic liberalization (from July 1991 to the present).The logic of distinguishing one phase from the other in the above sequence, ashopefully will become evident from the subsequent discussion, is based mainly on theshifts in official perceptions regarding the overriding economic issues and problems14Rural Development —
Concept, Strategies andExperiencesthe country was confronted with at different occasions and the associated policythrusts and changes.Let us come to the salient features of the first plan (1951-56). This plan, in termsof a simple model, emphasized the importance of raising the level of savings in theeconomy to accelerate the rate of growth; however, as has been noted often enough,beyond this simple model, it was a sort of a loose affair to put together a set ofimportant projects, and not an analytically rigorous formulation in terms of coordinatinginvestment decisions in different sectors. Projects pertaining to infrastructure andagriculture, in particular public irrigation, received emphasis. The fact that the increasein national income during this plan actually surpassed the modest target that theplanners had set must have been a very pleasing and encouraging experience forthem, particularly in the light of the pre-independence long-term record of nearstagnation (for aggregate as well as sectoral pre- and post-independence growthrates).According to most commentators, intellectually the most exciting moment in India’splanning strategy comes with the second five-year plan (i.e. at the beginning of thesecond phase in terms of the classification suggested at the outset). This plan (1956-61) has also been called the Nehru-Mahalanobis strategy of development, as itarticulated Nehru’s vision and P.C. Mahalanobis happened to be its chief architect.The central idea underlying this strategy is well conveyed by recalling the followingstatement from the relevant plan document. ‘If industrialization is to be rapidenough, the country must aim at developing basic industries and industrieswhich make machines to make the machines needed for further development’.The Mahalanobis model showed that, given certain assumptions, the higher the allocationof investment into the investment goods sector, the higher would be the investmentrate at the margin which would lead to a higher rate of growth of output. In otherwords, the emphasis was on expanding the productive ability or power of the system,through forging strong industrial linkages, as rapidly as possible. It is worth repeatingagain that such an emphasis enjoyed tremendous theoretical/intellectual legitimacy atthat time, although there were a few dissenting voices. The third five-year plan(1961-66) was essentially a continuation of the second plan in terms of the broadthrust and emphasis on industries such as machinery and steel. In terms of the coreobjective of stepping up the rate of growth of industrial production, the strategystarted showing quick and impressive results. For instance, the machinery indexincreased from 192 in 1955-56 to 503 in 1960-61, and the rate of growth of overallindustrial production during this period was also very impressive. To put it simply, thestrategy during these two plans laid the foundation for a well-diversified industrialstructure within a reasonably short period and this was a major achievement.As the strategy was unfolding, however, some of its key shortcomings were alsobecoming evident. The disproportion between the growth of the heavy industry sectorand other industries, and the shortfalls in achievements compared to the target growthrates for industrial output, both during the second and the third plan, were among themost obvious indicators of the problems underlying the strategy in operation.Consequently, as could be expected, the Nehru-Mahalanobis strategy was subjectedto increasing criticism around this time (and of course thereafter). A variety ofdiagnoses relating to the factors that were ailing the Indian economy, and consequentlya plethora of prescriptions were offered. Here one needs to stress the point, however,
that the performance prospects of the development strategy in operation had sufferedduring the 1960s not only because of its internal weaknesses, but also because of themajor exogenous shocks that the economy was subjected to. The two militaryengagements in quick succession (in 1962 and 1965) had led to severe cut backs inpublic investment, contributing to the emergence of significant excess capacities inthe heavy industry sector.15Rural DevelopmentExperiences — An AsianPerspectiveThe other major exogenous shock came in the form of two successive monsoonfailures in 1965 and 1966, leading to drastic reductions in the production food and itsavailability, which also had obvious negative consequences for the overall growthprospects. The widespread distress due to decline in the availability of food led to afew starvation deaths and food-riots in some states, and were thus rude remindersof India’s vulnerability in the area of the most basic need. In fact, even before thesedroughts, India had already come to depend partly on ship-to-mouth policy, mainly inthe form of wheat imports from the USA under PL-480, and the droughts werecatastrophic jolts that highlighted the failure in this critical area.The immediate impact of these exogenous shocks was so powerful that the governmenttemporarily abandoned the five-year plan in favour of annual plans for the next threeyears. These annual plans were too limited in their scope, essentially being budgetaryexercises, and this period (from 1966-1969) is also known as that of a “plan holiday”.One must note, however, that this period continued to witness sharp cut backs inpublic investment with obvious adverse consequences for industrial and overall growthprospects.It was mentioned earlier that the Nehru-Mahalanobis strategy came under increasingcriticism during the 1960s and the early 1970s from several quarters. These rangedfrom a rejection of the planning process itself to pointing out specific shortcomings,such as underestimation of the import-intensity of the indigenous industrializationdrive, unnecessary export-pessimism, over-extended regulatory structures, over optimismas regards the potential performance of the agricultural sector, if not its neglect, etc.Without going into the merits of the various criticisms here, we may note that theinadequacy on the agricultural front came to be viewed as one of the most significantgaps in the past effort. Consequently, formulation of a new strategy of agriculturaldevelopment became the overriding objective. The fourth five-year plan, launched in1969, adopted such a strategy, which in the popular parlance is known as the launchingof the ‘Green Revolution’. Thus, with the fourth plan (1969-74), there is a markedshift in development strategy from an emphasis on heavy industry to pulling upagriculture.This, as per the chronological classification suggested at the outset, is the beginningof the third phase. It may be recalled that the leftist opinion in India had been quitecritical of the earlier strategy for not taking up thoroughgoing land reforms. As ithappened, the ‘agriculture-first’ strategy, which came into being with the fourth planand was also the hall-mark of the fifth plan (1974-79), continued to neglect the issueof land reforms and focused on technological modernization and ‘betting on thestrong’. A variety of support-mechanisms, including credit and price support, weredevised to this effect. Sure enough, in terms of propping up the agricultural growthrate, the new strategy, in spite of its distributional limitations, delivered good results;
so much so that the dependence on frequent imports of food became a thing of thepast after the mid-1970s, and the government could claim that finally India hadbecome ‘self-sufficient’ in this regard.There are a couple of other important features of our third phase that need to betaken note of. First, while a degree of export pessimism may have been a featureof early post-independence thinking, things surely started changing during the 1960sitself as a number of export subsidies came into being, and this process continued inour third phase as well. Secondly, at the beginning of this phase itself, the dismalfailure of the earlier development strategy on the unemployment and poverty frontshad started dawning on the planners and policy-makers. Such a realization hadcertainly been sharpened by the growing restiveness among the masses expressingitself in radical movements of different kinds in various parts of the country andthreatening to go out of control.16Rural Development —Concept, Strategies andExperiencesConsequently, an important response from the policy-makers was to start thinkingabout the strategies of direct attack on poverty and unemployment, in particular fromthe fifth plan (1974-79) onwards, and gradually a variety of programmes got devisedand put in place to this end. Such programmes gained substantial significance duringthe sixth (1980-85) and the seventh (1985-90) five year plans and have continued toremain an important feature subsequently as well.Going back to the growth process itself, we have already noted that the strategy of‘pulling up’ agriculture resulted in an improved performance of this sector. This alsohad a positive effect on the industrial and overall growth rates, as these picked upduring the second half of the 1970s, (1979-1980) being an exception as it was adrought year. The turnaround in the industrial and overall economic performance,however, was certainly not spectacular. There was a widespread feeling that in termsof the long-term rate of growth, which stood at around 3.5 per cent per annumbetween 1951 to 1983, the performance of the economy was far from impressive.There are a number of explanations for why the economy was unable to move onto much higher growth levels than it actually achieved. We may only note that thereare at least two basic causes that must be acknowledged in this story. We havealready referred to one of these earlier, namely limited attention to the agriculturalsector, particularly the institutional issues such as land reforms. Second, economicgrowth in the post-independence Indian economy has depended to a large extent onpublic investment, and thus the state’s ability to maintain growing productiveexpenditures becomes crucial in this regard. As has been pointed out by someanalysts, it is precisely this ability that was getting constrained over time. The attemptto push up the growth rate in the 1980s, in particular in the second half of the decade,was based on seeking a way of coming around this problem; in terms of theclassification suggested at the outset, this constitutes the fourth phase.Essentially the major change in economic policy at this point in time hinged onsubstantial increases in government expenditure, in particular revenue expenditure, toincrease the overall level of demand or what is also known as pump-priming theaggregate demand in the economy. This was done by means of a very irresponsibleborrowing spree by the government, both internally and externally, and much of theexternal borrowing was from commercial sources.
Thus the gross fiscal deficit of the government increased dramatically during thisperiod, as did the external debt and debt-service payments. The increases in governmentspending obviously increased the industrial and overall growth rates, and the latter atwell over five per cent per annum for the decade of the 1980s was a distinctimprovement over the continued poor growth rate for the preceding three decades.The solution, however, was worse than the problem, as the enormous increase inexternal debt, a growing portion of it consisting of short-term borrowings, exposed theeconomy to the caprice of international lenders and investors, and in particular to thedanger of sudden capital flight due to ‘confidence crisis’. This is precisely what hitthe Indian economy in 1991 when its foreign reserves were depleted to abysmallylow levels and the economic managers of the country turned to the Bretton WoodsInstitutions, i.e. the International Monetary Fund (IMF) and the World Bank, for help.These institutions were too happy to bail out the country from the crisis, but on theterms that it accepted their conditions, which were what the package of liberalizationor reforms is all about. As is well known, India accepted the conditions and thus,compared to the preceding four decades, embarked on quite a different policy routein its economic journey since July 1991. The period since then, that of economicreforms/liberalization, has been designated as the fifth phase in this narration.The key phrases in the package of reforms disseminated by the Bretton WoodsInstitutions happen to be ‘stabilization’ and ‘structural adjustment programme’17Rural DevelopmentExperiences — An AsianPerspective(SAP). To put it simply, the first says that the budget deficits are bad and a governmentshould minimize them, whereas the second aims at changing the structure of theeconomy through major changes in the functioning of different markets as well asthrough a drastic overhauling of the role of the state. Essentially, the SAP advocatesthe case for a free play of market forces in the different product and factormarkets, including the financial markets, and a reduced role of the state,particularly as a producer and promoter but also as a regulator, in the economy.Without going into the details here, we may note that in case of the Indian economy,the policy changes since July 1991 are enough to view it as a case of transition fromthe state-led or dirigiste development paradigm, that characterized the earlier fourdecades, to a liberalization paradigm.Let me hasten to add here that the balance of payments crisis of 1991 was animportant input, but certainly by no means the only one, in effecting a sharp breakwith the earlier policy regime. We noted earlier that some of the critics of the Nehru-Mahalanobis strategy, around the late 1960s and the early 1970s, had started questioningthe wisdom of a state-led development paradigm itself. Over time such voices onlygrew louder and each one of the basic premises of the said paradigm came underattack, in particular from the neo-liberal economists.For instance, it was argued that the idea of autonomous development is a recipe forbackwardness; the public sector, instead of being the flagship of rapid growth, is adrag on society’s resources, and so on. Such criticisms started to find sympathetichearing among India’s policy-makers during the 1980s itself, and also elicited someresponses from them.Leaving aside the specific points of criticisms, whether from the Neo-liberal, Liberalor Left perspectives, which constitute subjects of intense debate among economists
working on India, there is little doubt that the neo-liberal wholesale condemnation ofthe earlier strategy has little merit. The achievements of the earlier strategy, withrespect to any appropriate benchmark, cannot be dismissed lightly, although theycertainly fell short of expectations. Growth rates of major sectors, and that of theeconomy as a whole, achieved during 1950-90 may not have been impressive butwere certainly respectable. Moreover, if one takes into account the size of theunaccounted economy (the black economy), which according to available estimates,grew from a negligible proportion of national income in the early 1950s to almost halfof it by the late 1980s, then we have a growth rate that is quite impressive! Thereare other notable achievements, such as a great deal of diversification of the economy,in particular within the industrial structure in a reasonably short period, among others.It is inconceivable that such successes would have been achieved in India soon afterindependence without planning. One of the fundamental problems with the neoliberalaccount is its ahistoricity, as it almost completely ignores the issue oflinkage between the stage of development that an economy is at and the realisticchoices and constraints it faces.This is of course not to endorse uncritically the dirigiste development paradigm of thefirst four decades, as it was flawed in important ways and missed on several promises,in particular to the large section of economically vulnerable segments of the population.The most glaring failure of India’s development strategy is with respect to povertyalleviation;as per the standard estimates, the absolute number of poor people in thecountry towards the end of the 1980s was not very much behind the total size of thepopulation in 1947!Apart from the raw deal received by the disadvantaged segments, several otherproblems of the dirigiste development paradigm, as it unfolded in India, have beencatalogued and analyzed by researchers in great detail. This has been followed bya range of suggestions for policy reforms, covering a wide spectrum of analytical andideological persuasions. However, as already mentioned in the foregoing, policy18Rural Development —Concept, Strategies andExperiencesprescriptions emanating largely from a neo-liberal perspective have been ascendantfor well over a decade now. Without entering into a discussion of the alternativepolicy perspectives, all of which emphasize ‘reforms’ of one kind or the other, wemay note that the neo-liberal paradigm may be on a weak turf, in particular whenit comes to the provision of adequate and sustainable livelihood options for largesections of the population. In other words, there is a real danger that those neglectedby the dirigiste development regime may get further marginalized by the ascendantneo-liberal policy regime, and there is increasing evidence to substantiate such aview.The performance of the Indian economy during the liberalization era continues to bea subject of intense debate. As it happens, the period of economic reforms since 1991does not seem to be doing better, in terms of standard macroeconomic indicators,compared to the preceding decade, and in some respects, such as employmentgeneration, the reform period has been a disaster. Moreover, as stated earlier, interms of prospects for the poor and other economically vulnerable groups, theliberalization era seems to be doing much worse.
Given such a view, you may have thefollowing as primary objectives of rural development.a) To improve the living standards by providing food, shelter, clothing, employmentand education;b) To increase productivity in rural areas and reduce poverty;c) To involve people in planning and development through their participation indecision making and through decentralization of administration;d) To ensure distributive justice and equalization of opportunities in the society
2.3 CONCEPT OF RURAL DEVELOPMENTThe notion of rural development has been conceived in diverse ways by researchers,ranging from thinking of it as a set of goals and programmes to a well-knit strategy,approach or even an ideology. If you wade through the relevant literature, you willrealize that its scope and content are nebulous and do not have well-accepted analytical23Rural DevelopmentExperiences — An AsianPerspectiveboundaries. As has often been noted, however, this may be viewed both as a weaknessas well as a strength. A weakness because, apart from the issue conceptual clarity,it also means that the very operation of this idea is in a grey zone. A strength becausesuch a situation allows considerable flexibility for policy makers to take into accountdifferent ground realities.Whatever be the differences in conceptualizing the notion of rural development, thereis a widely shared view that its essence should be poverty alleviation and distributivejustice oriented economic transformation. Given such a view, you may have thefollowing as primary objectives of rural development.a) To improve the living standards by providing food, shelter, clothing, employmentand education;b) To increase productivity in rural areas and reduce poverty;c) To involve people in planning and development through their participation indecision making and through decentralization of administration;d) To ensure distributive justice and equalization of opportunities in the society.In the preceding unit on development, we saw that there is no single universallyacceptable approach towards development. We also saw that strategies are necessaryto progress towards development since it is a long-term process. Similarly, there arevarious approaches to the problem of rural development. Various schools of thoughtperceive the problem of rural development differently and emphasize different setsof factors in their theories.2.3.1 Rural Development Projects and ProgrammesIt is important to distinguish between rural development projects and programmes.Rural development projects are micro level efforts to bring about change in ruralareas. These changes can take many forms ranging from efforts to increase literacyto attempts to increase agricultural productivity. The effects of these projects are notgenerally widespread in the sense that they concern only a small number of people.Rural development programmes involve a number of projects each, which are alignedto one another so that they influence the various facets of rural economic and sociallife. Therefore, rural development programmes attempt to bring about changes in awider area impacting a greater number of people. Rural development programmes
are more difficult to implement because of the problem of scale. This is particularlyso in the case of a country like India where the rural population is large, widelydispersed and with varied socio-economic and natural endowments.Because of these problems, adequate planning in launching and completing ruraldevelopment programmes is of great significance. Also, appropriate monitoring andevaluation agencies and mechanisms are important in order to ensure that theseprogrammes meet their objectives in cost-effective ways. India’s experience in theserespects is quite instructive as we will discuss in the last unit of this block.2.3.2 Community DevelopmentThe Community Development Programme (CDP) initiated in the 1950s intended toinvolve popular participation in rural development. It laid emphasis on the building ofinfrastructure in rural areas with the participation of rural communities.The CDP sought to promote rural development in a phased manner in different partsof the country. A block of villages was identified as the development unit and aninfrastructure of technical and administrative staff provided to implement developmentprogrammes in different sectors. You will read about the CDP in Unit 4, which gives24Rural Development —Concept, Strategies andExperiencesan assessment of the Indian experiences with this programme. But we may note herethat the CDP, however, did not lead to a noticeable impact on rural poverty becausethose who were powerful in these rural communities were able to corner much ofthe gains derived from this programme.2.3.3 Integrated Rural DevelopmentAs a concept, the term “integrated rural development” has gained widespreadacceptance in spite of the fair amount of disagreement among rural developmentexperts in defining the concept. In spite of the disagreement, however, most schoolsof thought emphasize certain basic elements of rural development. The rural economyand social structure in most developing countries is characterized by widespreadpoverty, poor health conditions, illiteracy, exploitation, inequitable distribution ofland and other assets, and lack of rural infrastructure and public utilities(roads, communications, etc.). Clearly, this means that the problem requires anapproach that will take into account all these factors in devising a comprehensivestrategy to further rural development.The concept of “integrated rural development” came into vogue with the need for amultipurpose thrust to rural planning. It stresses that various facets of rural development,which have an impact on rural life, are interrelated and cannot be looked at inisolation. Thus, an integrated approach towards rural development is essential. Thevarious dimensions of rural life – growth of agriculture and allied activities,rural industrialization, education, health, public works, poverty alleviation andrural employment programmes – all form a part of an integrated approach tothe problem of rural development.2.3.4 Local Level Participation in Rural DevelopmentSince the late 1980s, local level participation has been given a new thrust in India.The 73rd and 74th constitutional amendments in the early 1990s were of particularsignificance in this regard. Also, many non-governmental organizations (NGOs) inmany parts of the developing world including India, are now working towardspromoting participatory development. The following are the main objectives of these
efforts:a) Suppression of elitist elements in rural areas so that the process of developmentis shaped actively by the poor;b) Stressing the importance of the felt needs of people at the local level, andharnessing their energy and vision in designing appropriate programmes;c) The use of education as a tool in people’s perception towards change in ruralsocieties. Education is used so that it enables people to organize themselves tochange society.
2.4 RURAL DEVELOPMENT STRATEGIESIn order to foster sustained development in rural areas, different schools of thoughtadvocate different paths. It must be borne in mind that there is no single universalmeans by which this can be universally attained. Different economic and socialsystems have to take into account their own specificities in order to further ruraldevelopment.2.4.1 Rural Development PoliciesEach rural development strategy also has its own ideological roots upon which theelements of the strategy have been based. A strategy consists of an ordering ofvarious policy parameters to attain the desired goals. Different strategies emphasizedifferent sets of policies in order to achieve their goals. However, there are certainimportant policies that are common to most rural development strategies. Thesepolicies are related to: land, technology, agriculture, employment, education, researchand extension, rural institutions and agricultural pricing.Activities in rural societies, as you are aware, mostly relate to agricultural and otherallied activities. Needless to say, land is a very important question in this matter. Asis well-known distribution of land and other assets is very skewed in India, as thelarge majority have small land holdings. This has a direct impact on the ability to earnincomes in rural areas. Land reforms including the protection of the rights of tenantsis one of the primary means of transforming rural societies. It has also been contendedthat productivity levels of small farms are often greater than those of large farms.This is attributed to the fact that the small peasant puts in more intensive labour onthe small plot that belongs to him. Thus land reforms and a land policy that seeks toprovide distributive justice may also result in greater agricultural productivity. Therefore,land policy is a crucial element in a rural development strategy.Improvements in technologies available to rural societies can have a big impact onthem. On the one hand, it is essential that newer technologies are adapted to ruralsocieties and, on the other, it is necessary that existing technologies are extended torural areas. Technological planning, research and development are very vital ingredientsof rural development. In India, the agricultural sector is particularly vulnerable to theravage of the weather. Technological improvements can play a vital role in insulatingagriculture from the effects of the weather. Rural societies are also characterized bylarge-scale unemployment on the one hand, and low productivity, on the other.Therefore, care has to be taken when new technologies are introduced in rural areas.Technologies appropriate to rural societies have to be chosen so that there is nolarge-scale displacement of labour. A judicious balance between achieving higherproductivity and increasing employment opportunities to rural communities has to bestruck. Rural development strategies have to take this into account in formulatingtheir programmes.
26Rural Development —Concept, Strategies andExperiencesGiven the extent of unemployment problem in rural India, the need for well-formulatedemployment programmes can hardly be over stated. Such programmes can insulatefluctuations in rural incomes on account of poor weather conditions as is the casewhen the monsoon fails. As you are aware, agriculture employment is often seasonal.Under these conditions, rural employment programmes can ensure a better spread ofemployment through the year. The growth of non-agricultural activity within thevillage economy can also relieve the pressure of population on the land.Agriculture remains the main avenue for providing incomes and employment in ruralareas. Needless to say, agricultural planning is vital for rural development strategies.The balanced growth of the agricultural sector can play an important role in creatingbetter conditions for those depending on this sector.In India, the problem of illiteracy is particularly acute in rural areas. The lack ofeducation can act as a constraint in furthering rural development. Rural societies, asyou are aware, are also characterized by widespread inequalities in the distributionof incomes and assets. The lack of education creates a situation in which thisproblem is perpetuated. The spread of education, on the one hand, can enable therural poor to ensure distributive justice and, on the other, help them in activelyparticipating in rural development programmes.Research and extension is a very important ingredient of rural development strategies.Research enables furthering knowledge which is appropriate to rural cultures andextension ensures that the gains are actually delivered to the target groups. Trainedstaff are very important for any rural development programme since they actuallyinteract with the community for whom the programmes are meant.Rural institutions need to be reformed and utilized for successfully carrying out ruraldevelopment. The institutional aspects of rural societies are often ignored whenstrategies are formulated. The institutional structures such as panchayats need to benurtured so that there is popular participation in rural development. These structurescan act as powerful agents in actually implementing the development strategies.Since rural settlements are spread out and are often isolated, they cannot be monitoredsuccessfully from outside. Contrarily, local monitoring by institutions such as panchayatscan actually ensure that programmes are successfully implemented and that thetarget group actually benefits from such programmes. You may be aware that, duringthe last decade several states have taken significant steps in this regard. Ruralinstitutions such as banks and cooperatives can also play a vital role in ruraldevelopment. Unfortunately, during the period of economic reforms since the early1990, these institutions have suffered significant setbacks.The use of a price policy is also a crucial element in a rural development policy. First,agricultural produce has to be priced in such a manner that the farmers enjoyadequate returns. Secondly, the price policy through the use of subsidies can act asa means of providing essential items of mass consumption to people residing in ruralareas. This is particularly essential for those below the poverty line. The spread ofthe public distribution system through its network of ration shops in rural areas canbe used to solve this problem. This is particularly important during periods of poorrainfall when rural incomes are adversely affected, which in turn has a negativeeffect on consumption. Subsidies may have other forms—the form of input subsidies
to the agricultural sector, for example. This is particularly important in the case offertilizers, pesticides and seeds. Thus, the price policy can act as a useful means ofachieving rural development objectives. The recent thinking along the neo-liberal lineshas led to significant changes in the various aspects of the price policy, and it is quiteclear that rural India has been subjected to tremendous stress during the liberalizationera; some of it is on account of changes in some aspects of the price policy.27Rural DevelopmentExperiences — An AsianPerspective
2.4.2 Types of Rural Development StrategiesDifferent strategies emphasize and give importance to different mixes of agrarianrelations, techniques of production and state policies in order to achieve the goals ofrural development. To illustrate some of the relevant issues, we may briefly discussthe following rural development strategies, giving central importance to agrarian relationsfor purpose of classification. These are:i) A strategy based on collectivization of resources;ii) A strategy based on regulated capitalist perspective;iii) A strategy based on peasant agrarian perspective;iv) A strategy based on Laissez-Faire or unregulated free-market capitalistperspective.Of course, these four do not constitute an exhaustive list and are simply illustrative.Also, one can think of typologies that are different from the one mentioned here. Withthese qualifications, let us briefly sketch the contours of these strategies.Collectivization of rural assets (particularly land) is given utmost importance in thefirst strategy. Private ownership of land is abolished so that not only are inequalitiesin the ownership of land eliminated but also land use can be made more productive.The latter is achieved because small plots of land can be consolidated so that largescalecultivation can bring about economies of scale in agricultural production. Largescalecultivation also raises productivity by creating possibilities for the use of moderntechnology in the shape of tractors, harvesters, etc. This strategy was followed withfairly good success in the Soviet Union, China and the East-European countries.These countries were able to make sharp increases in production soon after theyinitiated this strategy. However, for a variety of reasons, which are too complex tobe recalled here, the erstwhile socialist regimes have collapsed or changed coursedramatically and this strategy is not in operation anywhere currently.The second strategy envisions a co-existence of a capitalist sector and a peasantsector that gets some support and protection from the state. Any large-scaleredistribution of land or reconfiguration of land relations are ruled out. It is hoped thatthe objective of rapid growth would be taken care of by the capitalist sector whilethe peasant sector would address the problem of unemployment till the time thenonagricultural sectors start growing at a rapid pace.This approach to rural development has been criticized for not being able to reckonwith the fundamental contradictions in rural areas. It is pointed out that withoutmeaningful land reforms, this strategy can only have limited success, as rural inequalitiesare ignored in this strategy. Rural elites, on the one hand, exercise control and preventchanges that will bring about a change in the unequal distribution of assets (particularlyland), and on the other, corner a large part of whatever resources are pumped in from“outside” to better the lives of the poor. An example of this is provided by the way
banking cooperatives have operated in India. A great portion of rural credit disbursedthrough cooperative institutions has gone into the hands of those who are better offand have the capacity to mobilize their own resources. Thus, it is pointed out that thisstrategy avoids taking hard decisions to make a breakthrough in rural developmentthat can create conditions for the rapid development of rural areas.The strategy based on the peasant agrarian perspective argues for thorough-goingredistribution of land and overhaul of land relations. It envisages strong support forsmall peasant units, which are supposed to take care of the twin-objectives of growthand employment. An extensive network of cooperative institutions, marketing facilitiesetc is accorded critical importance in this strategy.28Rural Development —Concept, Strategies andExperiencesBoth in the second and the third strategies, it is envisaged that the state will playimportant roles in promoting and strengthening the non-agricultural economic activitiesin the rural areas, so as to ease the pressure of surplus labour on agriculture and tofacilitate the creation of decent livelihood options elsewhere in the long-run. Sureenough, it is expected that a vibrant agricultural sector will itself generate strongimpulses for the creation of non-agricultural opportunities, but to harness such impulsesthe State is expected to perform a whole range of important functions. Furthermore,it is assumed that the problem of adequate infrastructure in rural areas will beaddressed by the state and also the investments in social sectors such as education,health, etc.Finally, we have what can be called a strategy based on unregulated capitalistperspective. Such a strategy presumes that rich landowners will play the vanguardrole in rapid increase in agricultural output, by taking advantage of the economies ofscale and gradually the small cultivation units will disappear. It is suggested that thestate should not intervene in the expansion of the capitalist sector and there shouldbe no ceiling on ownership. Unfettered expansion of this sector is supposed toprovide a dynamism that will overall rural economy and the benefits from it, throughemployment and increasing incomes, are supposed to percolate even to the loweststrata. The issues of inequality and distributive justice are considered non-issues insuch a strategy. To the extent the state has a role, it is with respect to infrastructure,but there too it is not viewed as the major actor necessarily.This is so, not only because it ignores a number of development concerns, but alsodue to its excessive and unwarranted optimism as regards growth and its percolation.It should be obvious that whichever strategy of rural development one may opt for,the core of it is an agricultural development strategy. If such a strategy has toaddress the concerns of development highlighted earlier, it has to be broad-based. Forthis a restructuring of land relations is obviously the key factor. We have alreadyreferred to some of the other important elements earlier, but the core concerns of arural development strategy may be listed here as follows:a) Agricultural research, extension, rural education and training programmes forfarmers form a part of institution building activities;b) Infrastructure building activity related to the growth of irrigation, transport,communications and health facilities;c) Programmes to improve marketing facilities for the distribution of agriculturalinputs and implements;
d) Policies related to land tenure, agricultural output prices and taxation of agriculturalincomes.Based on the experience of market economies as regards the approach towardsdistribution of land, types of strategies for fostering the growth of the agriculturalsector can also be classified as “uni-modal” and “bi-modal” strategies. A uni-modalstrategy is one in which land holdings are equitably distributed. This strategy wasfollowed with tremendous success in the case of Japan, Taiwan and Korea. It seeksto promote rural development through the use of thorough-going reforms in theagricultural sector. Thus, because of the land reforms and the consequent evendistribution of rural assets, resources meant for the agricultural sector are also spreadevenly. This type of agricultural strategy creates a situation that enables rapid growthof agricultural production with equitable distribution of incomes. This in turn not onlyresults in rapid rural development, but also provides an important basis for overalleconomic development.The bi-modal strategy for the growth of the agricultural sector attempts to increaseagricultural production without making attempts to drastically change the skeweddistribution of incomes and assets in rural areas. Many countries in Latin America29Rural DevelopmentExperiences — An AsianPerspectiveare examples of this type of strategy. In the case of this type of strategy there is noattempt to bring about land reforms. A large number of small farms coexist with asmall number of large size holdings. The idea is to concentrate modern technologyand inputs to the latter and thereby achieve agricultural growth. Such a growthpattern clearly ignores a whole range of developmental concerns and is also unableto provide strong foundation for overall economic development.2.4.3 Rural Development PlanningIn a vast country like ours where the diversity in socio-economic features is verygreat, one of the major problems facing rural development planners is the questionof aligning micro level needs to the overall planning process of the economy. Theneeds and problems of various regions have to be taken into account when planningfor rural development. Since the area that is to be covered is vast, there are difficultiesin planning and monitoring rural development from the top. Consequently, the needfor evolving a system of multi-level planning came into being.Planning came to acquire added significance with the realization that direct measuresto eradicate poverty can result only in limited gains. Subsidies, assistance and specialefforts for the uplift of the poor and under-privileged are obviously important, but theymust not be uncoordinated add-ons. In order to add to the productive base of theeconomy over a long period, planning is absolutely essential.Local area planning through panchayats can be a powerful means of bringing aboutrural development. In a monolithic planning structure, those at the top often fail tounderstand the specific requirements at the local level. Local planning also makesaccountability more immediate and identifiable. This can act as a means of preventingleakages from the system.Unfortunately, keeping in line with the sharp shift to neo-liberal thinking in policymaking since the early 1990s, the idea of planning itself has suffered a serioussetback. Sure enough, there were many problems with the policy regimes prior to thisshift, but the dilution of planning and leaving things to the market can hardly be
thought of as credible solutions.
55Rural DevelopmentExperiences — An AsianPerspective
UNIT 4 RURAL DEVELOPMENT IN INDIAStructure4.0 Objectives4.1 Introduction4.2 The Community Development Programme4.3 Green Revolution Phase4.4 Special Programmes for Area Development and Poor Farmers4.5 Direct Attack on Rural Poverty (beneficiary approach)4.6 Wage Employment Programmes4.7 Current Status of the Rural Development Programmes and the EmergingChallenges4.8 Let Us Sum Up4.9 Key Words4.10 References and Suggested Readings4.11 Check Your Progress – Possible Answers
4.0 OBJECTIVESAfter studying this unit, you should be able to:describe the different approaches to rural development as they have evolvedover time;explain the form, content and important features of the major rural developmentschemes introduced during the last 5 decades;critically comment on the rationale for and the context in which they wereformulated;identify the strengths and the weaknesses of each programme; andoutline the emerging challenges and draw your own conclusions regarding thepossible appropriate approaches to rural development in the present economicscenario and in the future
4.1 INTRODUCTIONRural development has been one of the important objectives of planning in India sinceIndependence (see Boxes 1 & 2). Intervention of the Government in ruraldevelopment is considered necessary in view of the fact that a sizeable populationcontinues to reside in rural areas despite growing urbanization. It is also required, asthe market forces are not always able to improve the welfare of the rural massesbecause of certain structural rigidities and institutional deficiencies existing in theseareas. As a result, there is a danger of large sections of the rural population to remainoutside the ambit of market driven growth processes. To enable the poorer sectionsof the rural population to participate more effectively in the economic activities has,therefore, remained the prime objective of Indian planning and the basic underlyingtheme of rural development programmes.This unit aims to familiarize you with the various approaches to rural developmentin the post-Independence phase. We will cover the evolution of various programmes
and schemes from the 1st Five Year Plan to the 10th Five Year Plan (1951-2007), inorder to understand how these have been changed/modified over time to respond tothe emerging needs and situations.56Rural Development —Concept, Strategies andExperiencesBox 1What is rural development?Rural development is utilization, protection and enhancement of the natural,physical and human resources needed to make long-term improvements inrural living conditions. It involves provision of jobs and income opportunitieswhile maintaining and protecting the environment of rural areas.Box 2Need for Rural Development at the Time of India’s IndependenceAt the time of Independence, India was predominantly an agrarian economywith roughly 85 per cent of the population residing in rural areas and derivinglivelihood from agriculture and allied activities. Agriculture growth in the firsthalf of the 20th Century was merely 0.3 per cent per annum. Illiteracy wasas high as 84 per cent. Public health services were inadequate to face epidemicssuch as malaria, cholera and small pox. The mortality rate remained highat around 27 per 1000 in 1947.Though agriculture was the mainstay of the people, the colonial governmenttook little interest in the improvement of cultivation practices except in thecase of export crops such as cotton, jute and tea. Bullock carts were thecommon mode of transport, wooden ploughs were the common implementsused in cultivation, spinning wheels the common device in cottage industries,thatched huts the common type of residence. The railway system was builtonly for connecting the ports with production centres and import markets; allother infrastructural facilities were lacking. There was an adverse impact onthe artisan sector under the British rule. The old crafts were left to languishand decay - ill prepared to modernize. The extremely narrow base ofindustrialization remained confined to a very few cities and states with littlelinkages with rural areas. Exports comprised mainly the primary commoditiesleading to transfer of cheap raw materials to the metropolitan cities of U.K.The imports of finished products were out of reach for the common man, asmore than half the population was below the poverty line.Check Your Progress INote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end ofthis unit.1) Was there a need for Government intervention in rural development afterindependence?......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
.................................................................................................................57Rural DevelopmentExperiences — An AsianPerspective
4.2 THE COMMUNITY DEVELOPMENT PROGRAMMEThe Community Development Programme (CDP) was the first major ruraldevelopment programme launched after Independence in October 1952 with thefollowing main objectives:1) To secure total development of the material and the human resources in ruralareas;2) To develop local leadership and self governing institutions;3) To raise the living standards of the rural people by means of rapid increase infood and agricultural produce; and4) To ensure a change in the mind-set of people instilling in them a mission forhigher standards.The CDP was conceived as an instrument to transform the social and economic lifeof the village community as a whole cutting across cast, religious and economicdifferences. Initially, it covered 55 projects with a wide range of programmes fordeveloping agriculture, animal husbandry, rural industries, education, housing, ruralcommunication, etc. It was, however, soon realized that covering the entire countryunder CDP was not possible due to shortage of funds and personnel. The NationalExtension Service (NES) was launched in October 1953 with a reduced number ofpersonnel and more modest financial provision, so that development work couldproceed on the basis of self-help efforts. The NES was initially launched for a periodof three years with the provision of 4.5 lakhs per block with stress on agriculture,animal husbandry, rural communication and social education schemes. After threeyears, the blocks covered under NES were to be converted into CDP blocks withthe provision of 15 lakhs for three years for more intensive development work inagriculture and other activities such as cooperation, health and sanitation, rural industries,housing, etc. It was presumed that the blocks covered in the first two phases wouldhave attained the desired self-sufficiency and therefore, the quantum of specialGovernment grants could be reduced. The major contribution in financial and technicalassistance came from the United States of America under a scheme of technicalcooperation. Funds were also drawn from the Central and State Governments tomeet the local expenditure on the implementation of the CDP.The main achievements of the CDP programmes were as follows:For the first time an organized administrative setup was established at the national,state, district, block and village levels. Its developmental functions were totallydifferent from the revenue collection functions of the existing administrativemachinery.Development was considered to be people centric.Due recognition was given to the importance of planning and inter-disciplinaryapproach to development.Recognition was also given to recruitment of trained personnel and the introductionof technical and technological inputs.It introduced modern technologies in agriculture with a view to demonstratingthat they could perform better than traditional technology.
It resulted in the establishment of institutions such as agriculture credit societies,primary schools, hospitals and dispensaries, maternity and child welfare centres,etc.Despite the above achievements, the CDP had some limitations:58Rural Development —Concept, Strategies andExperiences
The facilities created under the programme benefited mainly the rich farmersand could not bring any significant changes in the living standard of marginalfarmers and agricultural labourers.The objective of self-reliance and people’s participation could not be achievedgiven the inadequate attention to the development of responsive leadership.The programme failed to bring about changes in people’s ideas, attitude andoutlook with the majority of people having no understanding of social education.Efforts to promote rural industries and cooperatives did not take off.Administrative weaknesses, bureaucratic red tape, problems of coordination, interdepartmentalrivalries, absence of clear cut functional responsibilities at variouslevels were the other weaknesses of this programme.The plan outlay for this programme was spread very thinly over a wide rangeof projects, as a result of which the impact of the programme was quite limited.Despite the above shortcomings, the CDP was instrumental in laying the foundationfor the development of rural economy and defining rural development strategies andapproaches. It recognized the need for investing in men/women and material as ameans of bringing about social change in rural areas.Check Your Progress IINote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end ofthis unit.1) What were the main objectives of CDP?...................................................................................................................................................................................................................................................................................................................................................
4.3 GREEN REVOLUTION PHASEThe end of the Second Five Year Plan (1956-61) was characterized by stagnatingagricultural production and emerging food shortages. The report of the Ford FoundationTeam –1959 (entitled India’s Food Crisis and the Steps to deal with it) outlinedthe need for agrarian reorganization. The report also recommended that to increaseagricultural production, improved practices and services should be extended mainly tothe progressive farmers drawn from districts with the largest potential for immediateand appreciable increase in production. The approach of rural development thus tooka new direction in the Third Five Year Plan (1961-66) with greater emphasis onagricultural production. This led to a technocratic phase of rural development leadingto the introduction of the Intensive Agricultural Development Programme (IADP)and the Intensive Agricultural Area Programme (IAAP) and the high yieldingvariety programmes. The IADP was introduced in 1961 and the IAAP was launchedin 1964 on a pilot basis. The IADP was launched selectively in three districts andlater extended to 16 districts in 15 states. The programme concentrated mainly on
three components, namely high investments in agricultural production, higher pricesfor agricultural produce and modern technological inputs. Additional BDOs andextension officers per block were provided for specific areas. Once again, a majordraw back of the above programme was that it helped mostly the farmers with largeholdings in selected districts while poor farmers remained virtually uncovered.59Rural DevelopmentExperiences — An AsianPerspectiveThough IADP and IAAP contributed to good crop yields, the crop variety used inthese two programmes had a low response to fertilizers. At the same time, twosuccessive droughts in 1965-66 and 1966-67 increased the concern for feeding India’sgrowing population. The slowing down of growth in the cropped areas also createdspeculation and apprehensions in the minds of Indian planners regarding the possibilitiesof increasing food production.In 1963, adoption of high-grade seeds registered progress with the introduction ofMexican varieties of wheat and Taichung native variety of paddy seeds. TheMexican seed was found capable of producing up to 10 tons per hectare of irrigatedland compared with the 1.2 tons of yield from the existing varieties. Anotherbreakthrough came with the introduction of IR 8 Rice and High Yielding Variety(HYV) of cereals such as Jowar, Bajra and Maize.The HYV seeds were designed to be responsive to the use of water and fertilizers.These seeds, however, necessitated the use of pesticides as they were criticallyvulnerable to pests and weeds. The above inputs had to be administered in thecorrect proportion to get the best results. The results of using of HYV seeds werealso dependent on the time when the inputs were administered. Any delay in theapplication of inputs or inadequate or disproportionate use of inputs affected the yieldadversely.The HYV package had an overall impact on the cost of cultivation. It significantlyincreased the cost per unit of land but not necessarily the cost per unit of output. Thetechnology also resulted in a shift towards non-labour market with the use ofcommercial inputs.The green revolution by its very nature was a selective and target specific strategy.It was primarily directed towards regions with favourable “initial conditions”, such asirrigation facilities. Furthermore, the technology of wheat conservation was moresuccessfully adapted to Indian conditions than for rice and other food-grains. Thestrategy was also initially directed towards the better off farmers who were able toinvest in the new technologies. Bigger farmers also had better access to credit forpurchase of inputs. The HYV package required more labour inputs as well during thepeak time of sowing and harvesting. This encouraged larger farmers to go in formechanization by using tractors and combined harvesters. Hence, the use of newtechnology had both labour augmenting and labour displacing impact. In Punjab andHaryana, the increase in the seasonal demand for labour was met through migrationof labour from the Central and the Eastern parts of the country.The green revolution was intended to provide a breakthrough in agricultural productionand yield. However, experience shows that the growth rates of the production of allcrops, except wheat, fell during the initial 10 to 15 years of the green revolution.Furthermore, the limits of expansion in arable land were also reached. The relativestagnation of the yield of other crops accompanied by slowed down expansion of
areas under cultivation resulted in an aggregated rate of growth in food productionat a level less than 3% per annum. The main achievement of the green revolutionphase, however, was that the overall growth of agricultural output was preventedfrom falling.The uneven spread of the green revolution led to the growth of marketable surplusin certain pockets of the country such as Punjab, Haryana and Western U.P. Marketablesurplus was made possible also through the output pricing policy which was designedto make it attractive for farmers to sell part of their output in the market. At the sametime, a number of inputs required for the HYV package such as fertilizers, seeds,pesticides, diesel (for tube wells and tractors) were subsidized so that farmers couldbe encouraged to use these inputs. This led to accumulation of buffer stocks throughwhich the Government could implement its policy of public distribution system.60Rural Development —Concept, Strategies andExperiencesThe green revolution was initially confined to wheat and then it spread to rice. Thehigh yielding varieties could not be replicated with the same success in pulses andoilseeds, nor in course cereals such as Maize, Jowar and Bajra. This introducedcertain imbalances in the nutritional intake, especially as the pulses are the mainsource of proteins in the Indian diet. The relative increase in the prices of coarsegrains consumed mostly by the rural poor affected them adversely. The low yield ofoilseeds led to dependence on imports for meeting domestic requirements. However,the spread of HYV technology to rice led to a wider coverage of area under the newcrop in the central and the eastern parts of India, which are known to be the mostpoverty ridden. The reduction in rural poverty during the eighties and the nineties isrelated, to some extent, to this factor.Though the green revolution was scale neutral it was not resource neutral. The richfarmers having better access to inputs such as irrigation and credit for purchasingfertilizers, pesticides, etc, benefited more through the adoption of HYV packagesthan the small and marginal farmers. The growing dependence on purchased inputscoupled with the need to borrow money for financing the input requirements led togrowing vulnerability of small and marginal farmers to fluctuating yield and output.The latter in turn were forced to supplement their incomes working as hired labourers,an activity which eventually became their main source of income. Though real wagesincreased in some pockets of the country, there was also a mitigating influence asa result of the influx of migrant workers both seasonal and permanent from the morebackward areas.Over the years, the yield of HYV seeds has tapered off as a result of the followingfactors:1) High prices of certain inputs resulting in lower consumption and imbalances ininput usage.2) Excessive use of certain inputs having low user charges such as waterand electricity (for pumping water) resulting in water logging, problems ofsalinity, etc.3) Resistance of pests to chemical insecticides.4) Ecological imbalance.Despite the above shortcomings, however, the Green Revolution phase, especially theperiod marked by the extension of the HYV technology to rice cultivation in the
Central and the Eastern parts of the country, has been one of the most importantfactors responsible for poverty alleviation in some of the most backward regions ofthe country. This, accompanied by growing buffer stocks of food-grains has enabledthe establishment of a food security system unrivalled the world over in its size andrange. The Green Revolution also exposed farmers to scientific agricultural practicesleading to commercialization of agricultural operations.Check Your Progress IIINote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end ofthis unit.1) What, according to you, is the long-term impact of the Green Revolution inIndia?...................................................................................................................................................................................................................................................................................................................................................61Rural DevelopmentExperiences — An AsianPerspective
4.4 SPECIAL PROGRAMMES FOR AREADEVELOPMENT AND POOR FARMERSYou have seen in the previous section that intensive agricultural practices relyingheavily on water, chemical fertilizers and pesticides resulted in the degradation of landover a period of time in some parts of the country. The pressure on land was alsoaggravated on account of the drastic changes in the proportion of land utilized foragricultural activities, urbanization and industrial development. At present, Indiahas only 2.4% of world’s geographical area, but supports 16% of world’spopulation. It has 0.5% of world’s grazing area, but over 18% of world’s cattlepopulation. Given the inter linkages of crop production, live stock economy andenvironment, development of waste and degraded lands has emerged as an importantissue in rural development.The Drought Prone Area Programme (DPAP) introduced in 1973-74 was the firstmajor programme aimed at soil and moisture conservation in drought prone areas.The programme was designed to combat the adverse effect of drought on cropproduction, livestock and land productivity. The primary objective of the programmewas the promotion of overall economic development and mainstreaming of marginalizedvulnerable sections of the rural population.The Desert Development Programme (DDP) was introduced in 1977-78 with theobjective to restore the ecological balance, conservation of soil and water to erasethe formation of desert through planning. The Integrated Waste Land DevelopmentProgramme (IWDP) was started in 1989-90 to develop Government’s Waste Landand common property resources (CPR), based on village/micro water shed plans. In1993-94, the Technology Development, Extension and Training (TDET) schemewas launched for demonstrating the technologies meant for developing wastelands.The investment promotion scheme (IPS) was launched in 1994-95 to promoteparticipation of the corporate sector and financial institutions in the development ofnon-forest wastelands. The scheme was restructured during the 9th Plan and thethrust was on the development of degraded land belonging to small and marginal
farmers including Scheduled Castes and Scheduled Tribes. The National WaterShed Development Project for Rain Fed Areas (NWDPRA) was initiated in 1990-91 with the twin objectives of improving agricultural production in rain fed areas andto restore ecological balance. For channeling greater resources to rain fed areas, thewater shed development fund (WDF) was set up in 2000-2001 at the NABARD witha corpus of Rs. 200 crores. The fund was to be used for integrated water sheddevelopment in 100 priority districts across 14 states in a phased manner throughparticipatory approach.The programmes of land development were formulated for specific areas sufferingfrom water, soil and ecological problems. The major weaknesses in their implementationare as follows:Lack of people’s participation.Unfamiliarity of field staff with participatory approaches.Limited time for preparatory activity.Lack of transparent criteria for selecting areas and villages.Weak horizontal linkages among various agencies at the district levels.Plethora of water shed programmes with different (sometimes conflicting)guidelines and cost norms.In view of the shortcomings of area development programmes, the Central Ministriesevolved common guidelines for the different schemes in order to bring about62Rural Development —Concept, Strategies andExperiencesconvergence of these schemes for greater impact. Efforts were also made to buildhuman resources and capabilities in local bodies and involve non-governmentalorganizations (NGOs), community groups and extension functionaries. Financialresources were broad based through inter institutional credit linkages. An offer wasmade to build suitable institutions for long-term sustainable development.The Planning Commission set up a committee in 1997 to prepare a 25 year perspectiveplan for the development of rain fed areas. The plan made a strong plea for aparticipatory approach through water shed development and the use of appropriatetechnology in micro water shed. In addition, it emphasized agricultural diversificationin different zones and the need for a coordinated approach. The creation of aManagement Information System (MIS) under the National Management InformationSystem for the management of national resources is being given top priority underthe current approach to area development.
4.5 DIRECT ATTACK ON RURAL POVERTY(BENEFICIARY APPROACH)Alongside the area development schemes another stream of programmes were evolvedto directly benefit the poorer sections of rural population consisting mainly of marginalfarmers, agricultural and non-agricultural labourers. As already mentioned in theprevious sections the CDP as well as the IADP and the IAAP followed by the GreenRevolution failed to generate equitable benefits for the rural population leaving agrowing number of the rural population to subsist in poverty. It was, therefore,thought fit that if rural poverty was to reduce there should be a more direct, beneficiaryoriented approach for rural development schemes. In 1971, therefore, two new
programmes namely the Small Farmers Development Agency (SFDA) andMarginal Farmers and Agricultural Labourers Agency MFAL were introducedon the recommendations of the All India Credit Review Committee (1969). The mainobjective of these schemes was to benefit a numerically larger, economically poorclass of rural society. To implement these schemes specialized agencies wereconstituted to act as catalysts in the process of rural development.The role of SFDA was primarily to identify beneficiaries to enroll themselves asmembers of cooperative and for them to avail themselves of the credit and inputssupply facility that were provided at concessionary rates through these cooperatives.The agencies provided liberal subsidies for buying production assets, like cattle, bullocks,farm implements, etc. The strategy relied on financial incentives to the beneficiariesand detailed identification mechanisms to prevent leakages. The main function wasto identify and assess beneficiaries to raise their living standard through improvedagricultural practices, better farming, multiple crops, soil conservation, adoption of dryfarming practices, water harvesting techniques and diversifying into subsidiary activitieslike animal husbandry, horticulture, etc. The role of MFAL agencies was focused onmarginal farmers and agricultural labourers through the generation of employmentespecially through the promotion of rural industries and subsidiary occupations.During the 4th Plan (1969-74), SFDA scheme was started in 87 project areas andMFAL for additional 81 areas. During the 6th Plan (1980-85), however, these twoschemes were merged with the Integrated Rural Development Programme (IRDP)covering 1818 blocks all over the country.According to the Project Evaluation Organization (PEO) Report of 1979, theachievements of SFDA and MFAL were not encouraging. The average number ofdays of employment for the participants of programmes were only 10 per year inMFAL and 18 in SFDA. Only in 14% of the projects, the income of the beneficiariesof such programmes exceeded Rs. 300. There was also scope for improving the63Rural DevelopmentExperiences — An AsianPerspectiveidentification procedures for beneficiaries, as the better placed farmers were corneringmost of the benefits. The actual impact of assistance was, therefore, of doubtfulsignificance.Seeking to improve upon the SFDA and MFAL schemes, while at the same timeretaining their essential flavour of benefiting a target group of poor beneficiariesthrough provision of productive assets, the Integrated Rural Development Programme(IRDP) was introduced in selective blocks in 1978-79. The programme wasuniversalized on 2nd October 1980. The basic objective of the programme was toprovide assistance in the form of subsidy and bank credit for purchasing assetsleading to the creation of self-employment opportunities among the identified BelowPoverty Line (BPL) families. Subsequently, Training of Rural Youth for SelfEmployment (TRYSEM), Development of Women and Children in Rural Areas(DWCRA), Supply of Improved Tool Kits to Rural Artisans (SITRA) and GangaKalyan Yojna (GKY) were introduced as special programmes of IRDP to take careof the specific needs of rural populations.Evaluations of the IRDP show that the projects undertaken under the programmesuffered from numerous defects. These were as follows:The level of investment required for raising the living standard of the poor family
above the poverty line was inadequate / sub-critical.The projects were unviable on account of:i) Lack of technological and institutional capabilities in design and execution;ii) Illiterate and unskilled beneficiaries with no experience in managing anenterprise;iii) Indifferent delivery of credit by banks (high transaction cost, complexprocedure, corruption, one-time credit and poor recovery);iv) Overcrowding of lending in certain projects such as dairy projects.Other weaknesses of the programme included:Poor targeting and selection of non-poor beneficiaries;Absence of forward and backward linkages (veterinary and marketing facilitiesfor animal husbandry activities);Lack of continuing relationship between borrowers and lenders;Lack of desired linkages between IRDP and its sub-schemes, i.e., TRYSEM,DWCRA, SITRA, etc.The marginal impact of self-employment programme led to the constitution of aCommittee in 1997 to review self-employment and wage-employment programmes.It was found that the various sub-schemes of IRDP were implemented as ‘standalone’ programmes without desired linkages. This detracted from their effectiveimplementation. Consequently, on the recommendations of this committee, the IRDPand allied programmes including the Ganga Kalyan Yojna (GKY) were merged intoa single programme known as the Swaran Jyanti Gram Swayamrozgar Yojana(SGSY) in 1999. The SGSY was conceived as a holistic plan for encouraging microenterprise, organization of the rural poor into self-help groups with capacity building,selection of activity clusters, infrastructure support, technology, credit and marketinglinkages as essential ingredients built into the programme. It also sought to promotea network of agencies namely the District Rural Development Agencies (DRDAs),line departments of State Governments, banks, NGOs and Panchayati Raj Institutions(PRIs).The SGSY recognizes the need to focus its key activity and the importance of activityclusters. The programme also has in-built safeguards for the weaker sections, women64Rural Development —Concept, Strategies andExperiencesand SCs/STs. It insists that 50 per cent of the benefits should flow to SCs and STs.There is also a provision for disabled beneficiaries. The programme is credit drivenand the subsidy is back-ended. The credit and subsidy ratio is pegged at 3:1. Thesubsidy is fixed at 30 per cent of the project cost subject to a maximum of Rs.7,500per individual beneficiary for those in the general category and 50 per cent of theproject cost subject to a maximum of Rs.10,000 in the case of SCs/STs. In the caseof group projects, the subsidy is 50 per cent of the project cost subject to a ceilingof Rs.1.25 lakhs. The new approach to self-employment has made a significantcontribution to the empowerment of beneficiaries in certain parts of the country asrevealed by evaluation studies.Check Your Progress IVNote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end of
this unit.1) What do SFDA and MFAL stand for? What were the main objectives ofthese two schemes?.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................2) Why were wage employment programmes introduced and with what objective?.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
4.6 WAGE EMPLOYMENT PROGRAMMESWage employment programmes form an important component of the anti-povertystrategy aimed at providing employment opportunities during lean agricultural seasonand also in times of flood and drought and other natural calamities. These programmesfulfil the twin objectives of creating rural infrastructure to support further economicactivity and to create additional demand for labour market wages in times when thereis maximum unemployment.The National Rural Employment Programme (NREP) and the Rural LandlessEmployment Guarantee Programme (RLEGP) were started in the 6th and the 7th
Plans. These two programmes were merged in April 1989 with the Jawahar RozgarYojana (JRY). The JRY was meant to generate meaningful employment opportunitiesfor the unemployed and the underemployed in rural areas through the creation ofeconomic infrastructure and community and social assets. Initially the JRY alsoincluded the Indira Awas Yojna (IAY ) and the Million Wells Scheme (MWS). Boththese schemes were made two independent schemes in 1996.65Rural DevelopmentExperiences — An AsianPerspectiveThe JRY along with its sub schemes resulted in the generation of increased wageemployment in rural areas, an upward pressure on real wages and the creation ofuseful community assets. A major proportion of funds was spent on roads andbuildings. Unlike the IRDP, it is a self-targeting programme benefiting the lowersections of the population. Over 47 per cent of the employment generated benefitedSCs/STs. The share of the landless labourers among the beneficiaries was 36 percent. However, its efficacy was limited by lower central allocations during the nineties,increasing the cost of creating employment, thin spread of funds (given its universalcoverage) with many panchayats getting less than Rs.10,000 per annum.A major proportion of JRY was renamed on 1st April 1999, as the Jawahar GramSamridhi Yojna (JGSY). It now became a programme for the creation of ruraleconomic infrastructure with employment generation as a secondary objective.The Employment Assurance Scheme (EAS) was launched on 2nd October 1993 indrought prone areas and basically tribal and hill area blocks. It was later extendedto all the blocks in 1997-98. The EAS was designed to provide employment in theform of manual work in the lean agricultural season. The works taken up under the
programme were expected to lead to the creation of durable economic and socialinfrastructure and to address the felt needs of the people. The scheme also providedfor the maintenance of assets created in the past under the scheme. Initially, thescheme was demand driven, but since 1999 resources were allocated to states basedon the incidence of poverty.The Food for Work programme was started in 2000-01 as a component of the EASin 845 drought affected areas of the country. The programme aimed at augmentingfood security through wage employment.The wage employment programmes described above did benefit the rural areasthrough the following activities:Creation of rural infrastructure;Creation of demand for labour;Assurance for paying minimum wages;Exertion of upward pressure on real wages;Protection of the consumption patterns of the rural poor during natural calamitiesincluding drought;Strengthening of the finance of panchayats; andPromotion of better coordination between the village community and thegovernment departments.However, there were some areas of concern, such as:Inadequate employment and thin spread of resources;Violation of material-labour norms of 60:40;Fudging of muster rolls;Non payment of minimum wages / lower wages to women workers; andImplementation of schemes through contractors who hired outside labour at lowerwages.The above mentioned weaknesses led to revamping of the wage employment schemestowards the end of the 9th Plan and the beginning of the 10th Plan as elaborated inthe next section.66Rural Development —Concept, Strategies andExperiences
4.7 CURRENT STATUS OF THE RURALDEVELOPMENT PROGRAMMES AND THEEMERGING CHALLENGESTowards the end of the Ninth Five Year Plan (1997-2002) and the beginning of theTenth Five Year Plan, it became evident that the Centrally Sponsored Schemes(CSSs) for rural development had proliferated enormously. In the terminal year of theNinth Plan there were as many as 360 CSSs and 2247 Central Schemes. Many ofthese had similar objectives and targeted the same population. Certain genericcomponents, like information, education and communication (IEC) were repeated ina number of schemes. This also led to multiplicity of the implementing machinery andlack of synergy and coordination (see Box 3).Box 3Fallout of Multiplicity of Schemes
A large number of schemes having common objectives and meant for the samebeneficiary groups invariably get diluted in terms of impact. Excessivecompartmentalization of the executive into Ministries/Departments ensures thatsuch programmes are not only spread over a host of Ministries that encouragesa narrow sectoral approach to conceiving, formulating and implementing schemes,but also prevents mutual synergies that are inherent in most social sectorprogrammes to benefit the plan initiatives. The duplication of delivery structuresand the procedural hurdles invariably curtail the flow of assistance to the targetedbeneficiaries.In view of the shortcomings mentioned above a large number of rural developmentschemes were rationalized and merged. Given the complementarity of the JGSY, theEAS and the Food for Work programme, they were revamped and merged under thenew Sampoorna Grameen Rozgar Yojana (SGRY) w.e.f. September 2001. Thebasic aim of the scheme continued to be the generation of wage employment, creationof durable economic infrastructure in rural areas and the provision of food andnutrition security to the poor. The SGRY has three streams, one to address the needfor rural infrastructure in all states, the other to provide special attention to areasfacing endemic poverty and a third stream to respond to natural calamities.The benefit of amalgamating the wage employment programmes was that it led toaugmentation / consolidation of resources, thus addressing the problem of thin spreadof resources in the earlier programmes. Integration of the schemes is also expectedto result in better planning and monitoring of the projects in accordance with theneeds of the people and the norms laid down by the Government. The three streamsof SGRY would also be able to address the diverse needs of the rural areas atdifferent points of time with greater flexibility and efficacy.We have already seen in one of the previous sections that the self-employmentprogrammes were also rationalized and integrated. After a review and restructuringof IRDP and its allied schemes (TRYSEM, DWCRA and SITRA) the SwarnajayantiGram Swarozgar Yojana (SGSY) was launched in April 1999. This is the only selfemploymentprogramme currently being implemented in rural areas. The objective ofSGSY remains to bring the poor above the poverty line by providing them incomegenerating assets through bank credit and Government subsidy.The success of the rural development programmes and anti-poverty strategy can begauged from the decline in rural poverty levels from 37.27 per cent in 1993-94 to27.09 per cent in 1999-2000. In absolute terms, the number of rural poor fell below67Rural DevelopmentExperiences — An AsianPerspectivethe 200 million mark for the first time since 1973-74. However, despite the continuingefforts of the Government to address the challenges of rural development, the incidenceof unemployment and underemployment still persists along with poverty. Land andforest degradation in the rural areas and over-exploitation of groundwater is seriouslythreatening sustainability of food production. Owing to resource constraints at theCentre, state’s public investment in agriculture in general, and in irrigation in particular,has fallen. Development and dissemination of agricultural technologies, diversificationof agriculture into animal husbandry including dairying and poultry, development ofprocessing and marketing arrangements, rural connectivity, etc. are the other areaswhich will demand greater attention in the coming years while formulating new
strategies for rural development. Some of the concerns seen while chalking out futurestrategies are highlighted in Box 4.Box 4Issues in Rural Development – Chalking Future StrategiesAvoiding Multiplicity of Objectives, Programmes and Sub-Programmes:Multiplicity of objectives and large numbers of programmes and sub-programmesdiffuse focus, cause a strain for managerial resources, render monitoring andevaluation difficult and lead to sub-optimal utilization of resources. There is,therefore, need to ensure convergence among the sub-programmes around afew, clearly identifiable themes and objectives, and also geographically.Partnerships for Synergy and Long-term SustainabilityPartnerships and alliances need to be built at several levels in order to bringabout synergies in collaborative efforts and long-term sustainability ofprogrammes. Special attention needs to be given for building closer partnershipswith the State Governments, District Administrations, Panchayati Raj Institutions(PRIs) and NGOs. The strengths of the voluntary sector, namely their advocacyskills, organizational skills and being closer to the people should be used to theadvantage of all concerned.Approaching Development HolisticallyA uni-dimensional intervention will not ensure results in the long-term. It is,therefore, essential to adopt a holistic approach to rural development with suitableinter-sectoral linkages for maximising impact.People’s ParticipationPeople must feel a sense of ownership of such plans/programmes and mustparticipate and even contribute towards them. The trend of expecting thegovernment to do everything for them must come to an end. Programmes andschemes where people participate have been known to be much more successful.This could be done by involving the people through PRIs, local bodies, self-helpgroups,user groups, associations, trade unions, etc.Right to InformationTo a great extent, the task of the development administration would becomeeasier if steps are taken to make information available, as a matter of right, tothe citizens. The right to information is so important, because very often peopledo not even know what programmes and schemes are available and what theyare entitled to. Also, policy and procedural reforms can be effective only whenpeople know that such changes have been made.68Rural Development —Concept, Strategies andExperiencesSocial MobilizationPeople should not develop over dependence on programmes sponsored by thegovernment. Instead, they should learn to rely more on self-help-groups. Whiledesigning programmes and working out the time schedule for their implementation,it should be kept in view that social mobilization is a complex process andrequires time.Monitoring and EvaluationIn the absence of adequate monitoring and evaluation of rural developmentschemes, there could be a considerable amount of wastage and leakages leading
to a less than optimal use of the scarce public resources in the developmentprocess. The existing mechanisms for monitoring and evaluation have to beadequately used by the agencies responsible for implementing various programmesand effort has to be made to improve and strengthen these mechanisms overtime.Check Your Progress VNote: a) Use the space provided for your answers.b) Check your answers with the possible answers provided at the end ofthis unit.1) Why were various schemes under the self-employment programme mergedtogether and what are the objectives of the current self-employmentprogramme?.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
4.8 LET US SUM UPThis unit must have given you some idea of the challenges faced by the country inthe field of rural development and the different approaches evolved to meet thesechallenges since Independence. As you already know by now, the first major ruraldevelopment programme launched by the Government was the CommunityDevelopment Programme (CDP). This programme approached the problem of ruraldevelopment from a holistic perspective of bringing about overall economic and socialchange in the community at large. The programme created the necessary administrativeinfrastructure and institutions for the implementation of future rural developmentschemes but could not tackle the problem of stagnating agricultural yields and emergingfood shortages.Responding to the problem of food shortages in the mid-sixties the emphasis of ruraldevelopment shifted to area intensive programmes for implementing new technologyin agriculture to enhance crop production. The Green Revolution technology supportedby agricultural price policy and input subsidies, both explicit and implicit, succeededin not only overcoming food shortages but in generating food-grain surplus as well.The benefits of both CDP and the Green Revolution, however, were far from equitable.69Rural DevelopmentExperiences — An AsianPerspectiveRural poverty continued to persist and increase in absolute numbers. This led to theformulation of target/beneficiary oriented schemes in the seventies and the eightieswith the objective of creating self- employment opportunities for those below thepoverty line. Attention was also given to wasteland development, creation of communityassets and rural infrastructure through area based and infrastructure developmentprogrammes which generated wage employment as well.You know already that the sustainability of some of the rural development strategiesincluding the price and subsidy policy for agriculture came to be doubted in the earlynineties when the country faced an acute resource crunch and embarked on neweconomic reforms. By the turn of the millennium, most of the rural developmentschemes were reviewed and modified in order to make them more effective.
There is now growing evidence of significant reduction in rural poverty that tookplace during the eighties and the nineties. It can be attributed in no small measureto rural development interventions of the Government. New challenges, however,have emerged demanding further attention. This only confirms that rural developmentis an on-going process requiring new approaches to be evolved in tune with thechanging requirements. By now you must have a fair idea of the major issues inimplementing rural development strategies and the areas that require further attention.
4.9 KEY WORDSResource Neutral : When variation in resources is not an impediment inachieving particular outcome.Scale Neutral : When variation in skills is not an impediment in achievinga particular outcome.
4.10 REFERENCES AND SUGGESTED READINGSAnnual Reports of the Ministry of Rural Development and Poverty Alleviation 1992-2000 Government of India , New Delhi.Five Year Plans (1st -10th), Planning Commission, Government of India, New Delhi.Fifty Years of Rural Development in India, (ed.) NIRD, Hyderabad, 1998.India Vision 2020: Planning Commission, Government of India, Report of the Committeeon India Vision 2020 (Chairman: S.P.Gupta), Planning Commission, Government ofIndiaRural Development - Some Facets, (ed.) NIRD, Hyderabad – 1979Verma, S C ; Direct Attack on Rural Poverty, Ministry of Rural Development, Delhi,1980.Working Group on Poverty Alleviation Programmes for the 10th Five Year Plan,Planning Commission, Government of India, New Delhi.
4.11 CHECK YOUR PROGRESS – POSSIBLE ANSWERSCheck Your Progress I1) There is need for government interventions in rural development even today,mainly because a large section of the population continues to reside in theseareas. Furthermore, despite progress in various fields large tracts of rural areaslack basic infrastructure facilities and employment opportunities necessary tobring people above the poverty line. Growing pressure of population has resultedin adverse land–man ratio, thereby depleting natural resources and raising doubtsabout the sustainability of the development process itself. Weak institutions haveimplications for effective governance. Unless a larger segment of the ruralpopulation makes a productive contribution to the growth process, it may retardthe development prospects of the country. Given the large spillover effects ofpublic sector investment the need for government intervention is strengthenedeven further.Check Your Progress II1) The main objectives of CDP were:Secure total development of the material and human resources;Develop local leadership and self-governing institutions;Raise the living standards of the rural people;Bring changes in the mental outlook of the people concerned.Check Your Progress III1) The green revolution was intended to provide a breakthrough in agricultural
production and yield. It was primarily directed towards regions with favourableinitial conditions. The main success was achieved in the wheat growing regionsin the North West of the country. However, by its very nature, it was selectiveand a target specific strategy. The experience shows that the growth rate ofproduction of all crops, except wheat, fell during the initial 10 to 15 years of thegreen revolution period. Finally, the uneven spread of the green revolution alsoled to growth of marketable surplus in certain pockets of the country.Check Your Progress IV1) SFDA stands for Small Farmers Development Agency and MFAL stands forMarginal Farmers and Agricultural Labourers Agency. The main objectives ofthese two schemes were to benefit economically poor classes of the ruralsociety and to act as catalysts in the process of rural development.2) The wage employment programmes were introduced to provide employmentopportunities to those below the poverty line during the lean agricultural seasonand also in times of floods and droughts and other natural calamities. The mainobjectives of these programmes were to create rural infrastructure to supportfurther economic activity and also to create additional demand for labour intimes when unemployment is at its peak.Check Your Progress V1) There were a number of self-employment schemes having common objectivesand meant for the same groups of beneficiaries. The impact used to get dilutedin view of excessive compartmentalization in the process of implementation. Inorder to avoid this and also the duplication of delivery structures, these schemeswere restructured and merged into one scheme called Swarnajayanti GramSwarozgar Yojna. The basic objective of this, the only self-employmentprogramme, is to bring the rural poor above poverty line by providing them withincome generating assets through bank credit and government subsidies.
2MRD-101Rural Development:Indian Context
Rural Development — Concept,Strategies and ExperiencesIndira Gandhi National Open UniversitySchool of Continuing Education
29
Rural Credit and Banking UNIT 3 COOPERATIVES IN RURALDEVELOPMENT
Structure3.0 Objectives3.1 Introduction3.2 Meaning and Definition of Cooperation3.3 Principles of Cooperation3.4 Evolution of Cooperatives in India3.4.1 Pre-independence Scenario3.4.2 Post-independence Scenario3.4.3 Five-year Plans (Second to Fifth)3.4.4 Five-year Plans (Sixth to Ninth)3.4.5 10th Five-year Plan and Cooperatives
3.5 Growth and Development of the Credit Cooperatives3.5.1 Structure of the Cooperative Credit System3.5.2 Primary Agricultural Cooperative Society (Production Credit)3.5.3 District Central Cooperative Banks3.5.4 State Cooperative Banks3.5.5 State Cooperative Agriculture and Rural Development Banks
3.6 Growth and Development of the Non-Credit Cooperatives3.6.1 Cooperative Marketing3.6.2 Processing Cooperatives3.6.3 Cooperative Sugar Mills3.6.4 Dairy Cooperatives3.6.5 Fertiliser Cooperatives3.6.6 Industrial Cooperatives
3.7 Regional Imbalances in the Growth and Development of Cooperatives3.8 Assessment and Evaluation3.9 Let Us Sum Up3.10 Suggested Readings and References3.11 Check Your Progress – Possible Answers
3.0 OBJECTIVESAfter studying this unit you should be able to:define cooperation and principles of cooperation;trace the evolution of cooperatives in India;compare the characteristic features of cooperative enterprise with otherenterprises;review the progress and problems of cooperatives in their functioning and theirpotential in rural development; andcompare the relevance of cooperative organizations in the mixed economyscenario.
3.1 INTRODUCTIONIndia lives in villages where most of the inhabitants are small, marginal, landlessfarmers and artisans. After independence, agriculture was identified as one of the30Rural DevelopmentAdministration
thrust areas for rural development. Even at that time, the policy makers had visualizedthe fact that without people’s participation and institutional support, the rural developmentprogrammes could not be pushed through. Considering the situation of the ruralsector, the importance of the panchayati system and cooperatives was recognizedand these institutions were assigned specific roles to play. The main task assigned tothese institutions was to work for community development, to eradicate rural poverty,
to reduce inequalities and to eliminate privileges. Since the 1960s, a number of ruraldevelopment programmes, such as the Panchayati Raj and land reforms or the Greenand the White Revolutions through technical and cooperative missions, have beeninitiated and implemented. In a village, the cooperative society enjoys a focal positionas an important socio-economic institution. The objective of the cooperative societyis to provide services to its members (i.e. the rural community) and these services,which you will study in later units, are multifaceted. Although the membership ofcooperatives does not include the entire population of a village, it does include a majorpart and a broad spectrum of the rural population. Besides, in implementing anycommunity development schemes by other agencies (for example, the removal ofilliteracy, making people conscious of their environment, health care, poverty alleviation,water management, etc.), the involvement of cooperatives is envisaged to seekconsensus of the village community, as the cooperatives comprise a majority and across section of the village community. Moreover, a cooperative is a legal entity. Ithas institutional networks and infrastructure facilities at the grass roots level. It is alsoinvolved in social welfare and social protection activities of the rural people, such asvillage adoption, insurance, promotion of schools, hospitals, development of socialforestry, etc. It has also generated rural employment for large sections of rural peoplethrough its agro-ancillary activities. In what follows, you will study in detail about theemergence of cooperatives, cooperative principles and their values, structure, functions,institutional networks, types of activity and finally you work through a review of theperformance of cooperatives in rural development.The main aim of this unit is to familiarize you with the concept of cooperatives, theirprinciples, values, policies and the role they have played in the development ofagriculture and rural employment. Besides, it also aims at acquainting you with thevarious types of cooperatives operating in India and their socio-economic goals anddevelopment plans for the welfare of the rural people.
3.2 MEANING AND DEFINITION OF COOPERATIONThe word cooperation has many meanings, but in common discourse it meansworking, living and thinking together. In our existing socio-economic context,however, we need to define it somewhat differently—”Cooperation is a form oforganization wherein persons voluntarily associate with each other as human beingson the basis of equality for the promotion of mutual economic interests”.As per the definition given by the International Labour Organization (ILO), acooperative society is an association of persons, who assemble for their commoncause and work together voluntarily on democratic lines. According to the definitiongiven by the “International Cooperative Alliance”(ICA), a cooperative is anassociation of persons united voluntarily to meet their common economic, social andcultural needs and aspirations through a jointly owned and democratically controlledenterprise. It means that cooperatives are based on the values of self-help, self–responsibility, democracy, equality, equity and solidarity in the tradition of their founders.Cooperative members believe in the ethical values of honesty, openness, socialresponsibility and caring for others. Therefore, the cooperatives are different fromthe private enterprise in their forms of ownership, control, distribution of profits,values of equality, equity, solidarity and social responsibility.31Rural Credit and Banking
Check Your Progress I
Note:i) Write your answer in the space provided.ii) Check your answer with the possible answer provided at the end ofthe unit.1) What are the common features of “Cooperation “ in view of the definitionsgiven by ILO and ICA.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
3.3 PRINCIPLES OF COOPERATIONThe principles and the guidelines by which cooperatives put their values into practiceare:i) Voluntary and open membership: It means that the membership shall bevoluntary and available without any restrictions/discrimination on the basis ofgender or social, political or religious affiliations. All the members can make useof the services of their cooperative and willingly accept the responsibilities ofmembership.ii) Democratic member control: Cooperatives are democratic organizationscontrolled and managed by their own members. The primary members ofcooperative societies enjoy equal rights of voting (one member one vote) andparticipation.iii) Members’ economic participation: Economic results arising out of theoperations of the society belong to the members and shall be distributed amongthem proportionately according to the size of their transactions with the society,while a part of the funds will be kept aside for specified purposes as per theprovisions.iv) Autonomy and independence: Cooperatives are autonomous, self-helporganizations controlled by their members. If they enter into agreements withothers including governments to raise capital from external sources they do soon terms that ensure democratic control by their members and maintain theircooperative autonomy.v) Education, training and information: Cooperative provide education and/ortraining for their members, elected representatives, managers and employees sothat they may contribute effectively to the development of their cooperatives.vi) Cooperation among cooperatives: All cooperative organizations, in order tobest serve the interests of their members and community, shall actively cooperatein every practical way with other cooperatives at local, national, and internationallevels.vii) Concern for community: Cooperatives work for the sustainable developmentof their communities through policies approved by their members.32Rural Development
Administration 3.4 EVOLUTION OF COOPERATIVES IN INDIAAfter having studied the concept, values, principles and functions of the cooperativeenterprise, it will be appropriate to study the emergence of cooperatives incontemporary India, in particular the way they have evolved since independence.Before we do so, however, let us have a brief account of the pre-independence
scenario.3.4.1 Pre-independence ScenarioIn India, the cooperative movement began its work with the objective of makingbreakthroughs in the stagnation of the poorer classes who were heavily indebted andwere fully in the grip of Sahukars. With the enactment of the 1904 Act, the firstcooperative credit society was registered on 8th May, 1905 in the then state ofBombay in the Gadag Taluka of the Dharwad district under the name of KanginhalAgriculture Credit Cooperative. By 1911, the number of registered societies rose to5321 with a membership of 305,060. Subsequently, the 1904 Act was replaced byanother passed in 1912, with a broader base, opening registration to non-creditcooperatives also. The Reform Act was passed in 1919, when cooperatives becamea state/provincial subject. The decade from 1919 to 1929 was a period of unplannedexpansion and some re-organization. During the period 1930/31-1937/38, the movementunder went a number of changes. This period is known for the great depression,which was a major setback for the cooperatives in India, mainly due to our backwardeconomy and the disturbed political atmosphere. The arrears of the loans ofcooperatives rose from 39% in 1930-31 to 63% by 1937-38. But the Second WorldWar (1939 to 1946) came as a boon for agriculturists, as the prices of agriculturalcommodities rose significantly, and the cooperatives revived. The repaying capacityof the farmers increased significantly, they were able to clear off their old debts andthe arrears came down from 63% in 1937-38 to 39% in 1945-46. This period isconsidered the recovery period.3.4.2 Post-independence ScenarioAfter the independence of India in 1947, the country adopted the policy of plannedeconomic development for establishing an integrated and just society, providing individualliberty, equality of opportunity and a basic economic minimum for all. Cooperationwas accepted as an effective and important instrument for achieving the objectivesof rural economic development.The first five-year plan (1950-51 to 1955-56) emphasized that all agricultural families/households may join as members of primary agriculture cooperatives. In turn, thesesocieties would take care of their needs and safe guard the interests of farmers andartisans. During this plan period, the number and membership of cooperatives wentup from 115,462 and 5.2 million in 1950-51 to 159,939 and 7.8 million by 1955-56respectively.In the year 1951, the RBI set up a committee known as the All India Rural CreditSurvey Committee and its report was published in 1954. At that time, the main thrustwas on the viability concept. It was observed that only 20% of the cooperativeswere found to be economically viable due to their limited operations and it wasrecommended that large size cooperative societies should be organized to procuremore business. It was also recommended that a government, with a share capital tothe extent of 51%, be allowed to become a partner in cooperatives. Beside, it wasrecommended that the credit delivery system be three-tier for short and mediumterm loans, and long-term credit be arranged through land development banks. Also,the need for an effective cooperative training system to develop a sound network33of institutions from the village to the national level was emphasized in order to guide Rural Credit and Banking
and implement the rural programmes effectively. Fortunately, the Government accepted
all the recommendations of the committee.3.4.3 Five-year Plans (Second to Fifth)The broad objective of the second five-year plan (1956-57 to 1960-61) was to evolvea socialistic pattern of society. The plan envisaged building a cooperative sector asa part of the scheme of planned development. Subsequently, the National CooperativeResolution 1958 recommended that credit and marketing should be linked and it wasresolved to organize service societies instead of re-organizing large sized societies atthe village level. This subject was referred to the Vaikunth Mehta Committee, whichhaving studied both the aspects, recommended the middle path, i.e. the organizationof medium sized societies for them to be viable and manageable. The third five-yearplan concentrated on workers, consumer cooperatives and employment generation.Accordingly, eight different types of committee were set up. The need for thedevelopment of cooperative activity was emphasized in the fourth plan (1969-70 to1973-74). During this period, the education and training setup was strengthened. Alsothe All India Rural Credit Review Committee was appointed to review the ruralcredit supply in the context of the fourth plan. On the basis of its findings, thecommittee emphasized (a) re-organization of rural credit, (b) the need for relevantprimary education, (c) setting up of SFDA, MFDA, and IADP agencies and (d)ensuring adequate flow of credit for agriculture through cooperative and commercialbanks. The fifth five-year plan recognized the cooperative society to be an importantinstitutional framework for the development of weaker sections, particularly for providingrelevant inputs and the management of the public distribution system. In 1977, thepolicy resolution of 1958 was reviewed in the context of the political, social andeconomic changes that had taken place during the period. The resolution, now adopted,recommended that a) a strong and viable cooperative system should be put in placefor rural development, b) the Consumer Cooperative Movement should be developedto strengthen the public distribution system, c) cooperatives should be built to functionas one of the major instruments of decentralized labour-intensive and rural orientedeconomic development, and d) professional management of cooperatives should beput in place as early as possible.3.4.4 Five-year Plans (Sixth to Ninth)The main emphasis during these plans was on a) the strengthening of the primaryagriculture cooperatives (PACS) to act as multi-purpose societies to meet the diverseneeds of their members, b) the development of professional manpower, and c) a reexaminationof the existing cooperative policies and procedures in order to ensurethat the programmes actually improve the economic condition of the rural poor.During this period, a committee to review the arrangements for the institutional creditfor agriculture and rural development (CRAFICARD) was constituted. The seventhplan emphasized the need for cooperatives to a) increase food production, b) generateemployment avenues, and c) increase productivity generally. This pointed to theimportance of diversifying activities and also the consolidation of the efforts of thecooperative movement. During the Ninth plan period, it was emphasized that greaterautonomy should be given to all the cooperatives. As a result, the Multi StateCooperative Societies Bill was passed and a new Act 2002 came into force toprovide greater autonomy to the cooperatives. The other achievement of this periodwas that a new cooperative policy was declared. Among other things, it recognizedthe contributions of cooperatives and also pointed to their future role in ruraldevelopment.
34Rural DevelopmentAdministration
3.4.5 10th Five-year Plan and CooperativesThe current, i.e. the 10th Five-year Plan has shouldered greater responsibility inrelation to cooperatives for purposes of:a) actualizing the vast potential of agriculture,b) promoting more value additions to safe guard the interests of farmers,c) transferring technology to cooperatives to bring them at par with other sectorsof economy,d) identifying new areas for cooperative action, such as insurance, tourism, health,irrigation, electricity cooperatives, etc., ande) improving the social and economic health of the rural people.Check Your Progress IINote: i) Write your answers in the space provided.ii) Check your answers with the possible answers provided at the end ofthe unit.Tick mark the appropriate box:1) a) The first cooperative society in India was registered ini) 1904 ii) 1882 iii) 1885 iv) 1905b) Under which Act did the cooperatives become a State/provincialSubject?i) 1904 ii) 1919 iii) 1912 iv) 1922c) Who appointed the All India Rural Credit Survey Committee?i) GOI ii) NABARD. iii) Planning Commission iv) RBI
3.5 GROWTH AND DEVELOPMENT OF THE CREDITCOOPERATIVESLet us now study the mechanism of the credit cooperatives and their delivery system.Since cooperatives in India constitute a state subject, the primary responsibility forthe development of cooperatives vests in states. Cooperative credit has been classifiedinto three category: a) Production Credit, i.e. short and medium term credit,b) Investment credit, i.e. long-term credit and c) Urban credit for urban areas. Thesecredit systems are managed by different types of institution. The growth of thecooperative credit disbursement in recent years has been depicted through a graphicpresentation as follows.35Rural Credit and BankingYear 2001-2002 Value in Million RupeesNames of Cooperatives No. of Total ShareCREDIT COOPERATIVES Societies Membership CapitalTotal CapitalPrimary Agrl.. Cooperative Societies 100604 109832118 361943.59 4408333.25Primary Cooperative Agri. Devp. Banks 730 7181650 68019.52 926090.17Primary Urban Cooperative Banks 2038 17684798 214489.56 9102197.35Employees Credit Societies 47491 22448844 292267.24 1343646.79CREDIT TOTAL 150,863 157147,410 936,719.91 15780,267.56
3.5.1 Structure of the Cooperative Credit SystemBy and large, the structure of production credit is a three-tier system comprising theState Cooperative Bank at the state level, the District Cooperative Bank at thedistrict level and the Primary Agriculture Cooperative Society at the village level. Theinvestment credit structure has two tiers, i.e. the State Cooperative Agricultural and
Rural Development Banks at the state level and Primary Agricultural CooperativeRural Development Banks at the grass roots level. But wherever there is no structurefor providing the investment credit, it is rooted through the production credit systemas explained in the diagram below. Beside, there are national level Federations whichtake care of policy, planning and promotional works in this case. The refinance tocooperative banks comes largely from the National Bank for Agricultural and RuralDevelopment (NABARD).AGRICULTURAL CREDIT DISBURSEMENT BYCOOPERATIVES5403359046.480918.187589.8121674.9142947.8148390.4140845.3217782.422593927075090-91 91-92 92-93 93-94 94-95 95-96 96-97 97-98 98-99 99-0k 1-2
050000100000150000200000250000300000TLST 39318.244029.260186.667292.295173.2107895.2 93280 107400 157897 166803 208151MT 7470.3 5703.9 9621 7814.812773.919425.6 36160 32270 11924 34176 34237LT 7244.5 9313.311110.912482.813727.815626.9 18950 16934.223979.524957.128361.8Cooperatives in RuralDevelopment36Rural DevelopmentAdministration
3.5.2 Primary Agricultural Cooperative Society (ProductionCredit)The first Primary Agricultural Credit Cooperative Society was registered in 1905 atDharwad in the former state of Bombay. By March 2003, the number had increasedto 106,004 with a total membership of 109 million in the country. In 1960-61, thenumber of such societies was 2.12 lakhs, but the process of re-organization broughtthis number down considerably. Almost cent percent of the villages and 71% of therural households have now been covered by these societies. Initially, the PACS usedto provide only short and medium term credits (i.e. crop loans) to farmers, but afterthey were granted the status of multi-purpose societies, the PACS extended thenumber of services, which include distribution of inputs like fertilizers, certified seeds,insecticides, consumer goods, storage facilities and marketing of agricultural produceto farmers at the village level. By 2001-2002, the total loans advanced by thesesocieties amounted to Rs. 247.38 billion to 42.69 million borrowers. These societiesare also actively involved in the public distribution system and procurement of wheat,
cotton and jute on behalf of the Government. Nearly 58% of the PACS are involvedin consumer business and the distribution of inputs. During the year 2001-2002, thesesocieties marketed 132.3 billion rupees worth of agricultural produce and also distributedconsumer goods worth Rs. 9127.4 million. During the mid review period of the fourthfive-year plan, it was emphasized that there were SFDA, MFDA and Tribal areaswhere PACS could not meet their requirement of inputs and seeds, nor market thetribal produce easily. As a result, Farmers Service Societies were organized in theSFDA/MFDA areas and LAMPS in the tribal areas to meet their needs in theirrespective areas. But later on, in 1989, Khusro Committee reviewed the viabilitynorms of primaries and recommended that to materialize the viability of PACS, thesesocieties should be transformed into multi-purpose institutions. The recommendationswere accepted. Accordingly, PACS, LAMPS and FSS became multi-purpose institutionsand are now involved, besides the credit services, in the distribution of inputs, consumergoods and also in the marketing of agricultural produce. They are, however, operatingunder differing nomenclature in their respective areas. Even after re-organization,nearly 36% PACS are not viable. The main problems are low participation of membersin the business, high overdue amounts, lack of professionalism and little transfer oftechnology.INVESTMENT CREDITSTATECOOPERATIVEBANKS- 30CENTRALCOOPERATIVEBANKS-368PRIMARY AGRL.COOPS- 100,604STATECOOPERATIVEAGRL. &RURALDEVP.BANKS-19PRIMARY COOP.AGRL.RURALDEVP. BANKS-755
PRODUCTION CREDITProduction CreditDisbursed = Rs.208,151.7 millionRs. 34,237 million- STRENGTHENING CAPITAL BASEBY SAVINGS, SUBSCRIPTION- KISAN CREDIT CARDS FOR FREEACCESS OF MONEY
- BUILDING RESERVES
- LENDING POLICIES ARE BEINGREVIEWED INTEREST LOWERDFROM 13% TO 9%
RefinanceAGRL COOPERATIVE CREDIT SYSTEM
NABARD37
3.5.3 District Central Cooperative Banks Rural Credit and Banking
The District Central Cooperative Banks are the nodal banks for production credit atthe district level. By 2002-2003, there were 368 DCCBs, which operated through12,763 branches. These banks provide finances to Primary Agriculture Cooperative
Societies at grass roots level. The borrowings from these banks flow largely fromNABARD, which accounted for 87% of the total borrowings from the DCCBs bythe end of March 2002. The rest of the finances come partly from the respectivestate governments (10.8%) and partly from the commercial banks (3.5%). The DCCBsfunction as fully-fledged banks at the district level and accept deposits from nonmembersalso, but advance loans only to the members. By 31st March, 2001-2002,these banks had advanced loans to the extent of Rs. 506 billion. There are 1,12,692employees deployed in these banks.3.5.4 State Cooperative BanksThe State Cooperative Banks (SCBs) are the apex cooperative organizations forproduction credit, i.e. short and medium term loans, at the state level. These banksare classified as scheduled banks and perform all the business that a normal bankperforms. There are 29 State Cooperative Banks, which operate through their 880branches. The share capital of these banks is Rs. 6752.7 million and the governmentparticipation in the share capital accounts to only 8.5%. Major borrowings (nearly80.5%) from these banks come from NABARD. The SCBs provide finances to theirrespective District Central Cooperative Banks, and also supervise, monitor and controltheir operations. The total amount of loans disbursed by these banks during the year2002-2003 was about Rs. 366.4 billion. The deposits of these banks increased to Rs.35992.8 million in 2001-2002 from Rs. 7525.1 million in 1990-91, and 80.50% of thetotal deposits are from the cooperatives.3.5.5 State Cooperative Agriculture and Rural Development BanksThere are 19 State Level Cooperative Agriculture and Rural Development Banks(SCARDB). Of which 11 (those in Assam, Haryana, Himachal Pradesh, West Bengal,Karnataka, Kerala, Madhya Pradesh, Orissa, Punjab, Rajasthan and Tamil Nadu)have a Federal Structure, i.e. they function at both the state and the primary levels,and 8 (those in Bihar, Gujarat, J&K, Tripura, Uttar Pradesh, Maharashtra, AndhraPradesh and Pondichery) have a Unitary Structure, i.e. they function only at the statelevel. In all there are 1421 branches of SCARDBs spread all over the country. Thesebanks provide investment or long-term loans to farmers and to 726 Primary CooperativeAgriculture and Rural Development Banks (PCARDBs). Long-term credit is givenfor minor irrigation projects, farm mechanization, plantation and horticulture, diversifiedpurposes, land development, rural housing and non-farm sectors. The total amount ofloans advanced during the year 2001-2002 by these banks was Rs. 25185.8 Million,of which 80.04 % was advanced for farm sector development, 14.1% to non-farmsector and the remaining 5.58% to the rural housing sector. These banks raise theirfunds by floating special and ordinary debentures. The institutional membership ofthese banks has risen to 5556 members. The participation of the government in thetotal share capital of SCARDBs is 13.4%. In addition to their own operations,SCARDBs operate through the 1214 branches of PCARDBs also. The membershipof the PCARDBs stands at 7.11 million. These banks have disbursed long-term creditto the extent of Rs. 17844.7 million, of which farm sector constitutes nearly 64.1%and non-farm sector 16.3%. The remaining 5.8% was disbursed to the housingsector. These banks are guided, controlled and supervised by their respectiveSCARDBs.38Rural Development
Administration Check Your Progress III
Note:i) Write your answers in the space provided.ii) Check your answers with the possible answers provided at the end of theunit.1) What is the structural difference between production credit and investmentcredit?...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................2) Name the cooperative institution that takes care of the tribal people at thevillage level...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................3) Who provides credit for non-farm sector development?...............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................4) Who is the major refinance provider to Credit Cooperatives?.....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................39Rural Credit and Banking
3.6 GROWTH AND DEVELOPMENT OF THENON-CREDIT COOPERATIVESIn the previous units, you have learnt about the importance and role of creditcooperatives in the development of agriculture in India. Equally important are thenon-credit cooperatives and their role in rural development. The important segmentsof non-credit cooperatives are Marketing, Consumers, Dairy, Fishery, Fertilizers,Handloom and Handicrafts, Labour, Irrigation, Agro–processing, Transport, Weavers,Industry, Farming, Electricity, Poultry, etc. The non-credit cooperatives came intoexistence partly out of necessity and partly out of ideological reasons. The non-creditsector has played a significant role in developing infra-structural facilities, which havehelped in providing value additions to the agricultural produce as well as boostedemployment in the rural sector.Growth and Development of Non-credit Cooperatives In IndiaYear 2001-2002 (Value in Million Rupees)Names of Cooperatives No. of Total Share
NON-CREDIT COOPERATIVES Societies Membership CapitalTotal CapitalMarketing Cooperatives. 8869 5096863 49066.16 212459.00Consumer Cooperatives 23975 7055185 10984.39 33772.05Student Cooperatives 7688 14782458 1571.16 5214.44Agro-Processing Coop. 1564 508862 2890.66 25555.32Dairy Cooperatives 103305 11536704 27953.53 146678.67Women Cooperatives 11374 999673 2896.23 13572.38Housing Cooperatives 92000 6600000 36160.70 520000.00Farming Cooperatives 7149 349589 709.68 4714.90Irrigation Cooperatives 7315 571756 2648.19 82476.18Electricity Cooperatives 56 939551 3543.52 30831.99Industrial Cooperatives 45017 2439291 9089.63 44811.39(Other than Weavers)Weavers Cooperatives 20037 2015600 22399.27 87209.24Fisheries Cooperatives 13649 2130217 4043.54 17477.82Poultry Cooperatives 4900 441694 2100.27 13008.43Labour Cooperatives 30428 1671825 2711.43 23178.39Forest Labour Cooperatives 3408 739530 535.72 17516.68Transport Cooperatives 10446 156374 2326.69 14617.25Sugar Cooperative Mills 281 4484000 216218.00 873661.00Spinning Cooperative Mills 326 783635 94253.75 177561.25Tree Growers Cooperatives 633 49618 3.36 61.35Hospital Cooperatives 181 111824 1130.94 3508.35NON - CREDIT TOTAL 391370 63461007 493236.82 2347886.08
3.6.1 Cooperative MarketingThe need for cooperative marketing was realized in view of the growing malpracticesprevailing in buying and selling of agricultural produce. The producers were notgetting the due share of their agricultural produce. They were forced to sell theirproduce on through away prices. So as to protect farmers, marketing cooperativesemerged after the enactment of Cooperative Societies Act 1912. Accordingly, anintegrated programme of cooperative marketing was planned and a cooperative40Rural DevelopmentAdministration
marketing structure was set up at various levels. The significance of cooperativemarketing was recognized as early as 1928 by the Royal Commission on Agriculture,which remarked that group marketing would be more efficient than marketing byindividuals, especially in conditions that prevailed during that period in India. Theobjectives of promoting the marketing cooperatives were: a) to strengthen the bargainingcapacity of the member cultivators so as to secure them a better price for theirproduce, b) to help in improving the socio-economic conditions of producer members,c) to help in stabilizing marketing conditions to regulate the supply of commodities,d) to eliminate the middle men and moneylenders, e) to restrict the intermediaries andbenefit the consumers directly asking them for reasonable prices, f) to systematizefair trading practices, g) to educate and persuade the farmers to grow better qualityproducts, h) to arrange and provide the facilities of transportation, grading and storageof agricultural produce, i) to protect the economic interests of members by educatingthem about the latest techniques of farming and j) to inculcate the habits of self-helpand thrift among the members of the cooperative marketing society.The cooperative marketing structure in the country has two tiers, except in AndhraPradesh, Gujarat, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Manipur,Punjab, Tamil Nadu, Uttar Pradesh and Pondichery, where it has three tiers, i.e.primary at the block level, district marketing at the district level and state cooperative
marketing federations at the state level. Initially, general purpose cooperative marketingsocieties were organized and later attention was shifted to more specialized orcommodity marketing cooperatives, such as those for Fruits and Vegetables, Cotton,Tobacco, Areca nut, Coconut, Rubber, Sugarcane, Tea, etc. At present, there are 30general purpose and 22 specialized state level cooperative marketing federations, 394district marketing and 8869 primary marketing societies in operation. Besides, NAFEDand TRIFED are two national level federations. NAFED has been recognized as thenodal agency for marketing agricultural commodities, price support and exportchanneling of agricultural produce.3.6.2 Processing CooperativesThe marketing cooperatives did not seem to help much, as many of the earlierproblems continued. And it was felt that without making any value additions to theagricultural products, the cooperatives would not be able to help much in ensuringbetter prices for the products. In order to reduce the number of middlemen and toobtain a greater return on the agricultural produce, processing of crops by the marketingcooperatives was felt to be necessary. This resulted in the emergence of processingcooperatives, such as those for paddy processing, ginning and cotton baling, ricemills and those for pulses, and gradually the operation was extended to Fruits andVegetables, Cashew, Rubber, Cocoa, Copra, Isabgol and Straw Board. Later on, theAll India Cooperative Planning Committee recommended that in the cases where themarketing/sales society was unable to put up a processing plant, separate processingsocieties be organized. As a result, sugar, spinning, dairy and many other processingcooperatives came up. The important ones among them are the sugar, spinning anddairy processing cooperatives, which have not only helped in promoting the economicwell being of the farmers in the rural areas, but also generated rural employment bydeploying a large number of local people and the promotion of ancillary activities.3.6.3 Cooperative Sugar MillsThe second five-year plan also included a programme for starting cooperative sugarfactories. In the middle of 1958, licenses under the Industries Act 1951 were grantedto 38 cooperative sugar factories. By 2002, the number of cooperative sugar factorieshad increased to 281, of which 137 were in Maharashtra. The cooperative sectorcontributes nearly 59% of the total sugar produce in the country. By and large, sugarcooperatives have a two-tier structure, i.e. sugar mills at grass roots level and State41Cooperative Sugar Federations at the state level. Most of the sugar cooperative mills Rural Credit and Banking
are concentrated in 15 states. These mills have promoted a number of ancillary unitssuch as distilleries, paperboard units and baggasy. Besides, a number of educationaland social institutions such as medical colleges, engineering colleges, schools,polytechnics, health centers, etc. are being promoted by these mills at their respectiverural sites. Also, they are helping the rural youth in their efforts for higher educationand are generating rural employments. During the year 2002, these sugar factoriescrushed 96,272 million tones of sugar cane and produced 10,499 million tones ofsugar. These factories have not only assured a fair return to the primary producersbut are also providing extension services to farmers for producing high yield varieties.Obviously, all walks of rural life have benefited directly and indirectly from ruralindustrialization.3.6.4 Dairy Cooperatives
Dairy in India is closely interwoven with agriculture and plays an important role inthe rural economy. Besides having vast employment potential, dairy provides not onlymilk, but also stabilizes farm incomes. Small farmers and landless Labourers accountfor 53% of the animals and 51% of milk production. Thus small, marginal andlandless farmers play a very important role in milk production in the country. Theneed to form the dairy cooperatives emerged due to continued exploitation of theseweaker sections of the rural population by the private local dairy owners and othertraders. With the declaration of the National Policy on Dairying in 1956, the growthand development of dairy cooperatives received a major boost.The present structure of dairy cooperatives in India is three-tier. The main objectivesof the dairy cooperatives are: i) to increase the number of milk animals from thepresent average holding of 1-2 animals, ii) to collect and sell milk to milk unions,iii) to ensure regular and remunerative payment to producers, iv) to help members inincreasing milk production, v) to provide veterinary first aid and artificial inseminationservices, vi) to sell cattle feed, vii) to increase timely flow of milk (which is aperishable commodity) to far off markets and viii) to make value additions to dairyproducts and the related activities. The present network of cooperatives serves morethan 11.5 million farmers in over one lakh villages. The average milk procured bythese cooperatives per day, is around 165.0 lakh liters and the liquid milk marketedper day comes to 133.6 lakh liters. The total turnover per annum was Rs. 5957.90million by 2001-2002. Over the years, the dairy cooperatives have not only changedthe economic situation of the rural people, but also taken care of improving the healthof the animals. The production of milk has gone up from 38.8 million tones in 1983-84 to 81 million tones in 2002. The other important development related to thesecooperatives is the empowering of the rural women. Now, women play a major rolein dairying, as over 7000 village dairy cooperatives are now run by women. Theyhave given many a woman some degree of economic independence. Almost twomillion women belong to these women’s cooperatives. Overall, dairy cooperativeshave played a significant role in the White Revolution. Today almost every districtand state cooperative is engaged in processing activities and is manufacturing qualitymilk products, which compete favourably with the products of multinationals. Dairycooperatives have also diversified their activities and entered into new commercialareas, such as oil manufacturing, food processing, water bottling and salt manufacturingthrough their subsidiary companies. They are also serving the farmers in providingnutritious feed for their animals, hygienic containers, veterinary services, artificialinsemination and in organizing camps, study tours and educational programmes fortheir benefit.3.6.5 Fertilizer CooperativesWith the growing population and the increasing demand for food grains, pressurecontinued on farmers to grow more. So as to increase productivity, farmers were42Rural DevelopmentAdministration
required to ensure adequate and quality inputs at reasonable prices. Faced with thisrequirement, farmers were facing immense problems in relation to the timely availabilityof quality chemical fertilizers. To solve these problems, a cooperative fertilizer plantwas set up in 1967 at Kalol in Kandla in Gujarat under the aegis of the IndianFarmers Fertilizer Cooperatives with three major objectives: a) to produce chemicalfertilizers and ensure that they reach the door steps of farmers, b) to educate the
farmers how to use fertilizers effectively, and c) to transfer the required technologyfor modern farming to Indian farmers. With the success of the IFFCO fertilizerproduction and its network of distribution, the demand for quality and reliable fertilizersincreased significantly. As a result, another plant under the aegis of Krishak BharatiCooperatives was set up in 1980 at Hazira. These giant fertilizer cooperatives produce29% of the total fertilizer needs and distribute 36% of the fertilizer requirement ofthe country through rural channels. Besides, these institutions continue to providesocial services, such as developing the village farm forestry, setting up of storagecum-community centers, adopting villages for integrated rural development, extendingfunds for building rural houses to earth quack affected people of Gujarat and forpromoting educational and cultural activities.3.6.6 Industrial CooperativesAlong with agricultural production, it was thought necessary to promote village industriesfor rural development. The second five-year plan recognized the need for developingvillage and small-scale industries on cooperative basis as far back as the 1950s. Withthe acceptance of the recommendations of the first Working Group on IndustrialCooperatives in 1958, the industrial cooperatives made rapid progress. As against7101 Industrial Cooperatives with a membership of 7.66 lakh in 1950-51, their numberhad gone up to 33266 with a membership of 25.64 lakh in 1960-61 and by 2001-2002,the number of industrial cooperatives had increased significantly: Weavers’ cooperatives(20,037), Non-Weavers’ (43,786) and Handicrafts’ (1778), with memberships of 2.01million, 2.436 million and 1.09 million respectively. The industrial cooperatives havea three-tier structure, but it is facing difficulties in obtaining finances, availability ofraw materials and marketing due to competition and modernization. Well, this is asector that has vast potential to assist the weaker and rural artisans and also topreserve the traditional arts. This sector has not received the needed support, and isnow being reviewed to see how this sector may be improved.Check Your Progress IVNote: i) Write your answers in the space provided.ii) Check your answers with the possible answers provided at the end ofthe unit.1) In what way do the marketing cooperatives help the farmers?..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................43Rural Credit and Banking
2) List the types of processing cooperatives that are run by marketingcooperatives...........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................3) Name the major processing cooperatives, which have generated significant
rural employment and have also promoted the various types of socialsinstitutions...........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
3.7 REGIONAL IMBALANCES IN THE GROWTH ANDDEVELOPMENT OF COOPERATIVESThe growth and development of the cooperative movement in the country has beenreviewed from time to time by various committees and measures devised to minimizeimbalances in their development. Here we must remind you that with the enactmentof the Cooperative Societies Act 1919, cooperatives became a state subject.Consequently, all the states enacted their own laws as per their connivance. Thecooperative movement in this country emerged with the blessings of the government,which also works as an active partner in this enterprise. The laws framed by thegovernment, however, were restrictive and in certain cases contrary to the principlesof cooperation. The movement did not develop wherever the government equity wasmore, but it went well where the government control was minimal. For example, inthe states of Gujarat and Maharashtra, where the governments did not have anystake in the equity of cooperatives, the movement has shown steady progress and thegovernment control has been minimized. But in a number of other states, particularlyin the North–East, Bihar, Uttar Pradesh, Rajasthan, Orissa and Madhya Pradesh,development got restricted. The major reasons for imbalances in the development ofcooperatives are: a) excessive government control exercised through restrictive legalprovisions; and b) the absence of definite policy on cooperatives. The Registrar ofa cooperative society is considered to be the supreme authority empowered to supersedeand suspend the elected board, nominate the board of directors and appoint themanaging director. In absence of autonomy, the cooperatives could not developprofessionalism, enlist the services of professional manpower, and manage the affairsefficiently. Secondly, the cooperatives were used as agents of governments toimplement their schemes which did not help in achieving the viability of cooperativesdue to the lack of profit margins in most of the activities they engaged in.44Rural DevelopmentAdministration
But with the passing of the Reform Act, i.e. the Multi State Cooperative SocietiesAct-2002 and the enactment of parallel Acts in 9 states, namely Andhra Pradesh,Bihar, Chhattisgarh, Delhi, Jammu & Kashmir, Karnataka, Madhya Pradesh, Orissa,and, Rajasthan, the powers of the Registrar have been limited only to register, auditand hold timely Annual General Body Meetings. With these reforms, cooperativeswill have more autonomy to function freely, take their own decisions to plan andmange their business hopefully effectively. Moreover, with the announcement of theNational Cooperative Policy –2002, for the first, the ideology and principles ofcooperatives have been recognized along with their current role in the rural economicdevelopment and also their future role in the overall developmental process. Oncethese reforms are implemented by all the states and cooperative policies endorsed byall of them, the movement will be able to contribute effectively in the development
of rural economy and actualize vast agricultural potential, which should boost ruralemployment significantly.
3.8 ASSESSMENT AND EVALUATIONThe size and volume of cooperative business during the post-independence period hasshown rapid growth and multiplied many fold. The coverage of villages by cooperatives,which was 30% in 1950-51, has reached cent percent and by 2001-2002, 75% of therural households were brought into the cooperative fold. Cooperatives have enteredinto every sphere of economic activity and emerged as one of the significant segmentsof Indian economy. Their contributions in shaping the rural economy also are substantial.The share of cooperatives in rural credit disbursement amounted to 49.3% during theyear 2001-2002, fertilizer distribution was 36.0%, fertiliser production 29.0%, sugarproduction 59.0%, branded oil marketing 50%, ice cream production 45%, animalfeed production 50%, spindling 12%, fabrics production 22.0%, handloom cooperatives55%, wheat procurement 36.0%, jute procurement 21%, fishermen’s cooperatives11%, rural fair price cooperatives 28%, salt manufacture 7% and employment wascreated for 15.1 million people. The contribution of milk cooperatives in milk production,procurement and distribution is significant. Cooperatives were also organized at grassroots level for fisheries, forest labour, farm forestry, poultry, weavers, handlooms,handicrafts, and irrigation to organize the rural people and provide them necessaryservices for the development of rural community. The education and training networksof cooperatives have promoted awareness regarding development, advantages andtechniques of living under the umbrella of cooperatives. This has helped in curbingthe migration of the rural people from rural to urban areas. The cooperative ventureand its programmes have also promoted diversification in crop production; effectiveuse of chemical fertilizers, insecticides and better seeds; new techniques for improvingthe fertility of the land and various ancillary activities. The setting up of marketingand processing cooperatives has not only helped the farmers in ensuring better pricesfor their produce but have also generated significant rural employment.With the present size and network of the cooperatives, their contribution should havebeen much more than what it is today. The major problems that have limited the sizeof their contribution are, to name the important ones, the increasing amount of nonperformingassets (NPA), limited resources, lack of infra-structural facilities andprofessionalism, absence of modernization and little technology transfer, overdependence on governments, absence of effective monitoring and poor marketinformation systems.
3.9 LET US SUM UPIn the introductory part of the unit, we explained the concepts, values and principlesconcerning rural cooperatives in order to distinguish them from other cooperative45enterprises. Then we moved to the circumstances, which forced us to organize the Rural Credit and Banking
cooperatives, i.e. details about the evolution of cooperatives during the pre-independenceand the post-independence periods were presented. The post-independencedevelopments were presented sequentially with plan-wise responsibilities assigned tocooperatives along with the details regarding their progressive stages of development.Besides, details about the important committees, which were constituted to reviewthe progress and shortcomings of the cooperatives at various stages, were alsopresented. Later on, the development of credit and non-credit cooperatives was
presented with details specifically about their structure, functions and operations.Here, we described every level of working with facts and figures and also detailedthe extent to which the services of cooperatives have helped in shaping the ruraleconomy. Some of the problems inhibiting speedy development were also highlighted.
3.10 SUGGESTED READINGS AND REFERENCESBedi, R.D., 1983, Theory, History and Practice of Cooperation, InternationalPublishing House, Meerut.Daman Perkash, August, 1988, “Cooperative Democracy vis-à-vis Member’sEducation”, The Coop. Times, D-64 Saket, New Delhi.P.K. Jain, 1992, Marketing Management of Cooperative Sector in India, KanishkaPublishing House, New Delhi.Nalwaya, K.L., 2002, Indian Cooperative Movement–A Profile, National CooperativeUnion of India, New Delhi.
3.11 CHECK YOUR PROGRESS – POSSIBLE ANSWERSCheck Your Progress I1) Both the definitions of cooperatives have certain common elements, such as:a) association of individuals/persons, b) achieving common goals and c) workingvoluntarily on democratic lines. So, we may say that cooperatives aredemocratically run institutions managed and controlled by their members.2) The cooperatives are based on the values of self-help, self-responsibility,democracy, equality, equity and solidarity.Check Your Progress II1) a) iv)b) ii)c) iv)Check Your Progress III1) Production credit has a three-tier structure, i.e. it operates at the state, thedistrict and the primary levels, whereas investment credit has a two-tier structure,i.e. it operates at the state and the primary levels.2) The name of the cooperative institutions organized for tribals at the village levelis LAMPS, i.e. Large Size Agricultural Multipurpose Cooperative Societies.3) The non-farm sector is covered by investment credit. Therefore, State CooperativeAgriculture and Rural Development Banks and Primary Cooperative Agriculturaland Rural Development Banks provide the non-farm credit.46Rural DevelopmentAdministration
4) The National Bank for Agriculture and Rural Development (NABARD) is themajor refinance provider for Cooperative Credit Institutions.Check Your Progress IV1) The marketing cooperatives have been established to fulfil various objectives,namely: a) to ensure that the producers get remunerative prices for their produce,b) to increase the retention power of producers by storing their produce ingodowns, c) to stabilize the marketing conditions to regularize the supply ofcommodities, d) to eliminate the middlemen and moneylenders, e) to stabilize fairtrading practices, and f) to promote value additions to all the products andservices.2) The processing societies, mostly promoted by marketing cooperatives, are:
paddy processing, rice mills and those for pulses, rubber, coca, copra, isabgol,etc.3) The important processing cooperatives are sugar cooperative mills, spinning millsand dairy cooperatives, which have not only generated significant employment,but are actively involved in promoting social activities and institutions for thewelfare of their members.
Planning forRural Development5
UNIT 1 PLANNING FOR RURALDEVELOPMENTContents1.0 Objectives1.1 Introduction1.2 Need for Planning1.3 Theories and Techniques of Planning1.4 Development Programmes and Projects1.5 Notion of Resources1.6 Rural Development Planning in India: A Brief Retrospective1.7 Let Us Sum Up1.8 Key Words1.9 Suggested Readings
1.0 OBJECTIVESThe purpose of this unit is to provide you with an understanding of the conceptsof planning and planning approaches for rural development. It aims at encouragingyou to ask questions about planning. After reading this unit, you should be able to:l identify the role of planning;l elaborate some of the development planning theories;l explain the meaning of projects and project cycles;l discuss the concept of resources, andl give the evolution and development of planning experience in India.
1.1 INTRODUCTIONYou have learnt about the concepts, strategies and performance of rural developmentprogrammes in the preceding two courses. The planning process was not discussedthere, so that your attention remained focused on the practical aspects of variousprogrammes.Rural development planning has gained prominence in recent times because of thegrowing realization that benefits from development have, by and large, bypassedlarge segments of rural society. At the same time, it has been recognized that theorganisation and structure of the process of planning have to be modified, so thatpolicies and programmes reflect the development needs of rural areas.In this unit, we give the overview of rural development planning. In the unit, whichfollows, we discuss the process of rural development planning in India, while in thesubsequent units, the planning structure at different levels are considered.
Rural DevelopmentPlanning6
1.2 NEED FOR PLANNINGPlanning is the process of preparing a blueprint of actions to attain stated objectiveswithin a time frame. The determination of objectives, the specification of targets,the strategy for mobilization of resources, the allocation of resources to differentdevelopment sectors, the blueprint of actions (including their operationalisation in theshape of policies, programmes and their delivery system) are aspects, which haveto be considered in any planning exercise.Planning is essential because it enables us to formulate, with some precision, whatwe intend to achieve within a given time frame. Prioritization among variousobjectives enables us to demarcate more important objectives from those, which areless so. Once this is done, one can decide what is feasible, considering the resourcesat hand and how additional resources can be mobilized. Therefore, planning is amore scientific path towards achieving development objectives, and for bringingabout economic and social transformation in a systematic manner.Perhaps, the most important reason, which comes to your mind, may be that youare faced with a severe shortage of certain resources/factors. Given the fact thateach of these resources may also have different uses, you may be unable to decidehow to utilize these resources. It is in such a situation that planning becomesextremely important. Therefore, you must plan the use of resources in some rationalmanner.A logical question, which you must then reflect upon is: What is a rational manner?Or, what are the resources available? Let us further illustrate the first questionbefore answering it. Suppose the objective is to plan the utilization of unskilledlandless labour in a community development block, so that people are able to getgainful employment. Naturally, you would now start asking for information, suchas how many are employed by landowners for agricultural operations, whichagricultural operations are performed at various point of time? What would be theprevalent wage rate, which schemes employing rural labour are being run by thegovernment department, how useful would be the works in which labour are employedfrom the point of view of creating durable community assets and so on. From thepoint of view of providing solutions, some of these alternatives may be more rationalor more desirable or feasible. Choice of alternatives, thus, may narrow down tosuch preferable alternatives. The manner of arriving at this choice is to know thedecision criteria – an important component of planning process at any level.Most of the other justifications for planning can be broadly grouped into two–growth and distributive justice. Growth, here, would mean an increase in output perunit of time, given the level of resource use. The growth in output is conditionedby the quality and quantity of resources. Distributive justice means that, as growthtakes places in a society, the gains from increased prosperity are distributed in amore egalitarian manner across various classes and groups in that society. Thiswould, for instance, cover policies, which aim at income distribution to reduceincome inequalities among classes and regions, asset distribution to reduce inequalityin terms of ownership of asset, alleviation of poverty, and improvement in qualityof life through better access and utilization of social services.The Need for Planning in IndiaAn underdeveloped economy like India is characterized by inequalities of incomes
and ownership of assets. The high incidence of rural poverty, coupled with theseinequalities, makes the task of rural development particularly important. There arePlanning forRural Development7also regional imbalances and problems connected with the development of areas,which are disadvantaged due to geographical and ecological factors (as for example,drought-prone areas, flood-prone areas, etc.). Needless to say, planning in Indiahas to be geared to meet these challenges.You will appreciate that it is the people who are the focus of development andthe poor should be given priority because their numbers are large and they are themost vulnerable. In India, vast numbers of the rural poor have limited access tosocial services and these are reflected in low rates of literacy, high incidences ofinfant and child morbidity and mortality, poor health and nutrition status, poorenvironmental sanitation and hygiene, limited access to potable water and poorhousing. The central approach to any development process has to be one of enablingthe poor and other disadvantaged people to improve their situation, both social andeconomic.Check Your Progress INotes: a) Use the space provided below for your answers.b) Compare your answers with the text.1) Justify, in your own words, the need for planning.…………………....................………………………………………....….…...………..…………………………………………..……………..…...………………….......……………………………………………................……..……………………………………………..……………..2) How can planning reduce regional disparities?…………………....................………………………………………....….…...………..…………………………………………..……………..…...………………….......……………………………………………................……..……………………………………………..……………..
1.3 THEORIES AND TECHNIQUES OF PLANNINGThere are several theories of development planning that have been put forwardduring the last few decades. They are suited to particular situations prevailing insome countries. They cannot be applied uniformly in all situations. It is importantthat you understand this. Many approaches to development are being evolved andtried and a number of alternative theories have been put forth. Since the mainobjective of planning in the initial stages was growth, the main attention wasfocused on ‘Modelling’ the production structure of the economy and identifying thefactors limiting its expansion. These theories are readily applied to most of thedeveloping countries in which the industrial sector has a predominant share in thetotal output.As the concept of distribution (social justice) came to be recognized as an importantobjective, the growth planning models started including a set of disaggregated regionsor spatial areas in their framework. Thus, multi-sectoral models have been proposedto include factors affecting the income levels of different groups. The developmentduring the sixties and seventies paved the way for theories of regional developmentplanning.Rural Development
Planning8Theories of Regional Development PlanningThe earlier approaches to regional development, evolved in the industrially developedwestern countries, were mainly growth oriented and presumed that higher growthrate could be achieved through modern sectors’ activities. However, the concept ofgenerating higher growth in regional economy varied in different development theoriesor models. The various types of regional development theories with their implicationsfor rural regional planning are shown in Table 1.1. Some of the relevant developmenttheories are mentioned in the table. You may refer to Section 1.8 (Key Words) inorder to understand the meaning of some terms, which you may not be acquaintedwith. Further, if you would like to read more on some of these theories, there areseveral books available. You may, for instance, refer to Michael P. Todaro’s EconomicDevelopment in the Third World (1985) or to Subrata Ghatak’s An Introduction toDevelopment Economics (1986).Table 1.1Theory Associated Policy/Planning Models/approaches1) Economics Base Multiplier Theory Economic base Models (Multiplier analysis)2) Macro-economic Growth Theories i) Input-Output Models.ii) Tinbergen Planning Model/incrementalcapital output ratios for sectors/industries.3) Polarised Development (Diffusion Growth pole centre strategies:Theory; Central Place Theory; i) Intermediate size cities as countermagnetsPropulsive Firm Concepts) to primate cities.ii) Lower order population centres as foci fordevelopment from below.4) Modernisation/Neo-classical and i) Accelerated urban base.Marxist Stage Theories ii) Two-sector growth models.iii) Large-scale capital intensive resourcebased projects5) Agriculture/Land use Theories Von Thunen models; Agricultural land usezoning or regionalisation with locationaladvantages.The basic principle in these theories, as presented in rows 2, 3 and 4, is that growthdoes not take place everywhere at the same time. Since factors that affect growthhave varying intensities, it manifests itself at some points of the economy or incertain regions called ‘poles’, and then spreads to other sectors and areas throughdifferent channels. Also, there are variations in the impact of such growth on theeconomy as a whole. Growth in a regional economy, thus, can be induced throughmodern sector activities or by diffusing the process of development through growth‘poles’. The “economic base theory”, while recognizing the role of local resourcesin the regional economy, emphasized that higher growth can be achieved by expansionof either primary or manufacturing activities to produce goods for export.The regional development approach, adopted in the developing countries, was derivedmainly from the models discussed above. Developing countries are characterized byPlanning forRural Development9a high degree of regional imbalances, income inequalities and an agrarian economywith low rates of growth and high unemployment and under-employment. So, suchcountries have reconstructed these growth models in such a way that they would
help in achieving the twin objectives of development, viz., economic growth anddistributive justice.Rural Development Planning MethodologiesThere has been considerable work in evolving methodologies for micro-level planningin India in recent years, particularly after the Fourth Five Year Plan. The PlanningCommission emphasized the formulation of district plans, provided guidelines fordistrict planning and suggested:“The first objective of the formulation of district plans is to set forth a long-termperspective indicating the economic activities to be established in different subregionsof the district and the measures to be taken over the next 15 to 20 yearsto develop (and conserve) natural resources, build up infrastructural facilities andsocial services and foster the growth of towns and cities in a manner that wouldhelp the district to develop in the predetermined direction. The second objective isto prepare an integrated programme of action for the next conditions and a realisticassessment of the immediate problems, short-term priorities and available resources”.From the above statement, it is clear that in the beginning, the approach to developmentwas regional with emphasis on growth points and location of economic activities.Over the years, there have been shifts in the national policy for rural developmentto achieve growth with distributive justice by minimizing income inequalities betweenvarious sections of society and growth disparities between areas and regions. Toachieve these objectives, area approach and target group approach were added inthe framework. Based on the progressive changes in the approach, the methodologiesevolved for rural development planning can be described under three categories –Growth Centre Approach, Area Development Approach and Integrated DevelopmentApproach.Growth Centre ApproachThe basic logic behind this approach is that development in rural areas can befostered by interesting resource mobility towards these areas for the generation ofinfrastructural facilities. The constraints, in this regard, arise because of two mainreasons. Firstly, there are financial constraints. Secondly, economic efficiency ofinvestment has to be ensured. This means that facilities should be located atappropriate places. Some villages have smaller population that are not sufficient forproper and full utilization of investment. Location of facilities have to keep in viewthe minimum threshold population.The concept of rural growth centre is to identify ideal locations for investment andalso act as a focus for inducing growth in the area concerned. The main foundationof this approach was provided by Location Theories and the Central Place Theory.Location theories emphasize the importance of spatial factors in development. Thus,the provision of economic and infrastructural facilities in certain locations can generategrowth in the areas adjoining these centres. The central place theories focus attentionon growth centres, which generate growth in areas around them. However, theconcept ignores the potentiality of local economic forces that may induce growth.Emphasis on dynamic local factors may be more impracticable under rural Indianconditions. The other problem is that the growth centres do not take into considerationthe future trends of repolarisation of socio-economic activities taking place in anarea.Rural DevelopmentPlanning10
Area Development ApproachThis approach is an extension of the growth centre approach and takes into accountthe local factors in achieving economic growth. Then, integrated development of anarea depends not only on the development of an adequate infrastructural networkbut also on the way factors of the local economy are activated around the productioninfrastructure. In other words, for integrated development of an area, spatial andfunctional integration is necessary. Thus, while rural growth centres provide ideallocations for the provision of infrastructural facilities, their hinterlands are regardedas basic planning units for integrated multi-sectoral planning to achieve integrateddevelopment of an area. This approach, therefore, was able to provide a widerframework for rural development. The approach, while taking poverty in the areainto consideration, provides a balance between various sectoral activities as wellas spatial patterns of growth. However, it does not ensure that economic growthis being shared by all classes and communities of the rural areas. The spread effectof development may not necessarily affect the whole society in the same way orwith greater equality, particularly in Indian rural situation because of two reasons:l In the areas where modern farm technology has not been able to make an advance,agriculture and its allied activities cannot absorb fully the labour available in villages;andl A sizeable number of rural people have little or no access to resources, particularlyland.Integrated Rural Development ApproachIn the context of problems in the area development approach, as discussed above,and the government policy to tackle the problem of rural poverty, a new strategyof rural development, i.e. the integrated rural development approach, has beendeveloped because the area development approach, by and large, failed to addressthe question of inequalities in the distribution of employment, incomes and assets.A mere geographical emphasis, as is the case with the area development approach,has been found to be inadequate in solving the problems. Target groups have to beidentified for a more direct approach to alleviate the problems faced by specificsections of the population having specific identifiable problems.The draft Sixth Plan (1978-83) indicated the concept of integrated rural developmentin the following words:“Experience of various rural development programmes in the earlier plans hasshown that a mere project approach or a sectoral approach is not adequate to leadto an overall development of the area and distribution of benefit to local population,particularly the weaker section of the society. The distribution of unemployment andpoverty and the potential for development of agriculture and related activities varywidely from region to region and also within regions. It will, therefore, be necessaryto plan for integration of various programmes and establish appropriate linkages foroptional utilization of local endowments, consistent with the plan objectives, localneeds and environmental balance.The integrated rural development, now envisaged, will be specially focused on thetarget group comprising small marginal farmers, agricultural labourers and ruralartisans, whose economic improvement is an important concern of rural development.The new approach will aim at integrating field programmes reflecting the economicactivity of the rural family whose employment and development is the basic objective.Planning forRural Development
11It is proposed to bring this about by developing the primary secondary and thetertiary sectors. A major effort will be made to formulate area specific plans at thegrass root level”.Check Your Progress IINotes: a) Use the space provided below for your answer.b) Compare your answer with the text.Explain and contrast Growth Centre Approach and the Area DevelopmentApproach...........…………………….......……………………………………………..............……...…………………………………………………..……………............…………………….......……………………………………………..............……...…………………………………………………..……………............…………………….......……………………………………………..............……...…………………………………………………..……………..
1.4 DEVELOPMENT PROGRAMMES ANDPROJECTSRural development programmes, planned and executed during the last four decades,can be grouped under two heads:l area-based programmes, andl target-group oriented programmes.Intensive Agriculture District Programme (IADP), Drought Prone Area Programme(DPAP), Command Area Development Programme (CADP), and DesertDevelopment Programme (DDP) are some of the area-based programmes. Targetgrouporiented programmes, such as the Integrated Rural Development Programme(IRDP), are meant for the upliftment of specific sections of the rural society.Every programme, whether area based or target group oriented, is made up ofa set of development projects. For example, Command Area Development includeson-farm development project, project for the creation of infrastructural facilities,canal modernization project, and so on. Sets of projects make up a developmentprogramme; therefore, development projects can be called the building blocks of adevelopment programme.Let us examine the meaning of a development project. Every project requiresdifferent types of resources, such as material, manpower, machinery, and finance.A development project is a time bound task to achieve specifically stated objectiveswith investment of resources. It, in contrast to a scheme, is a very specific activityin a specific area to achieve specific results within a specified time frame.Advantages and Disadvantages of Development ProjectsLet us first discuss the advantages. The Development projectsl concentrate resources on select priorities.l focus on specific geographic areas.Rural DevelopmentPlanning12l address specific population groups and constraints on development.l function as intensive social laboratories using an innovative approach, a limitedscale to gain experience for larger scale efforts.Some of the disadvantages are listed below. They
l function as segmented units of intervention.l bypass overall structures.l develop atypically.l create enclaves.l siphon resources away from parallel non-project activities.l cannot always generate sustainable development.l often overlook socio-structural and institutional variables.Project CyclesThe project, from conception to operationalisation, passes through various stages ina cyclical fashion. These stages constitute the project life-cycle.First, a project idea is floated. Who floats the project idea? It may be the departmentconcerned, the village assembly, block level bodies, the target groups, voluntarybodies engaged in development work, scientific and technical research groups, orthe central planning agency.Subsequently, the floated idea has to be tested for its worthiness before preparinga blueprint. A sound judgment based upon experience and available knowledge ofthe local conditions can be the only guide to this decision. However, once a projectidea has been identified and accepted, work on the preparation of its blueprint hasto begin in the department concerned. A continuous interaction and feedback amongteam members is very necessary for successful completion of the task.With the completion of the blueprint, if the project is found admissible, it goes forelection, along with other projects of the sector. Further, if it is selected, it ismonitored, and finally, the results need to be evaluated.The following Chart illustrates the project life-cycle:Chart I: Project Life-cycleOperationPre-Plan PeriodConceptionorIdentificationTechnicalfeasibilityEconomicworthinessFinancialviabilitySelectionPlan Period Post-Plan PeriodConstructionEx-ante Evaluation ConcurrentEvaluationEx-postEvaluationProject Working life(1) (2) (3) (4) (5) (6) (7)Planning forRural Development13The chart indicates different time phases of a life-cycle, the position of the phaseswith reference to the plan period and the kind of decision problems to be solvedat different phases follow the sequence shown in the chart. Although each phasehas its own specific problems of decision, the overall problem of the pre-plan
period is to decide whether the project is worthy of selection for inclusion in theplan. The problems of construction phase are of different nature, where managementtechniques when applied, help to answer questions like how to organise work withina time schedule, so that a smooth flow of materials and labour to the project ismaintained. This also helps the managerial staff in achieving maximum efficiencyin construction and operation of the project.
1.5 NOTION OF RESOURCESIn any developing country, the major problem is always of resources. Essentially,these are of three types–women, money and materials. Financial resources can bemobilised within the country through tax efforts and market borrowings, etc., andfrom external sources through exports, remittances, borrowings and aid loans.Planners have to ensure a match between these sources. With these resources, theplanner has to consider completing demands and then accommodate as many ofthem as possible, looking at the overall objectives set for the country.As regards the manpower required, this, again, has to be carefully planned andnecessary arrangements should be made for human resource development rightform the grass roots level upwards to the highest technical levels.The third aspect of resources is the materials required for enabling the developmentprocess to take place. Planning has to provide for the availability of such resources– for example, oil, steel, cement, power, fertilizer, etc.Therefore, while seeking to meet the demands of the people through the plan, theplanner has to ensure that the materials required for building up the infrastructureand support are simultaneously planned for and provided.Let us briefly view the various dimensions of resources. Generally speaking, stockand flow, mobility and immobility over space, quality variations or grades of resources,and renewal ability are the dimensions we will take up for discussion.i) Stock and Flow: A stock is the quantity of a resource existing at any point oftime. Agricultural and forest land, a herd of cattle, and agricultural implementsrefer to a stock of respective resources existing at the time of counting, say, as onMarch 31 of a particular year. Human use of resources means that there is adrawing on the stock itself, as in the case of non-renewable resources like minerals,or there is drawing of an output from the stock, as in the case of renewableresources like fisheries, forestry, livestock, agricultural land or underground waterreservoirs.Any drawing on (i.e., slow release or use) the stock itself or of an output from thestock is considered a flow. In other words, any drawing or use of a quantity of theresource of the output from the resources during a period of time is called a flow.For example, conceptually, whereas agricultural land is a stock , the produce fromthe land is a flow. Let us take another example. Consider a sum of money (sayRs. 10,000) deposited in bank at the beginning of the year. This sum is a stock,capital fund. If you need some money, say at the end of the year, you have twoRural DevelopmentPlanning14options to exercise. Withdraw a part of the capital fund, stock or principal sum;or withdraw part or whole of a year’s interest earned on the principal sum. If youchoose the first option, the money withdrawn is a flow out of stock, whereas,when the second option is chosen, it is a flow out of output (interest earning). Analternative illustration is your monthly income, which is a flow because it has
been earned over a period of one month. This means that a flow will always havea time dimension like per day (e.g., wages), per month (salary), per year (interest).A stock is always defined at a point of time (for example your bank balanceon any given day).ii) Mobility in Space: Most natural resources have specific location because theiruse by human beings has to be in places where they are found. Agricultural land,fishing grounds, forests, pastures, mines, reservoirs and water streams are alllocation specific, immobile resources. A few resources like livestock and humanlabour are, however, mobile within the constraints of ecological and social factors.Most man-made capital resources, especially manufactured means of production,are more mobile over space. From the angle of development planning, aclassification of resources by their relative mobility is extremely desirable. Afund of money or capital in value form is the most mobile resource.iii) Grades of Resources: Since output flow from a stock of resources tends todecline with degradation in quality, an essential planning task is to preserve,conserve and improve the quality of resources. Accordingly, a knowledge ofdistribution of resources by quality and grade becomes a primary requirementfor any planning agency. Therefore, an essential planning task at the appropriatelevel is to prepare an account of stocks of resources existing in the base yearof a planning period. Such an account has to reflect on the characteristicfeatures of different types of resources discussed above. The account is sodesigned as to provide answers to relevant questions of planning such as:l What is the quantity of the stock of a specific resource?l What is the pattern of ownership, utilization or under-utilization?l What is the current flow of output?l What could be the attainable output, given the current status of science andtechnology?l Is there a scope for increasing the quantity of stock?iv) Renewal: In our everyday life, a continuous flow out of non-renewable stock(for example mineral mines, oil-well) means depletion of stock and its eventualexhaustion. The process is irreversible. In the case of renewable stocks (pastures,forests, cattle or livestock herd), in most cases, the process is reversible in thesense that a period of depletion can be followed by a period of regeneration andrebuilding of stock. However, there is always an upper limit to the flow. Therefore,in some cases, the depletion is faster than the pace of regeneration. Over fishing,overgrazing and felling of trees, illustrate precisely this phenomenon. Thus, thereis a maximum sustainable output level, determined by the biological and ecologicalconditions of regeneration of resources concerned.Planning forRural Development15Check Your Progress IIINotes: a) Use the space provided below for your answer.b) Compare your answer with the text.Explain and differentiate between the concept of stocks and flows.………..........…………….......……………………………………………..............……...…………………………………………………..……………............…………………….......……………………………………………..............……...…………………………………………………..……………..
..........…………………….......……………………………………………....
..........……...…………………………………………………..……………..
1.6 RURAL DEVELOPMENT PLANNING IN INDIA:A BRIEF RETROSPECTIVEEven before 1947, the Indian National Congress indicated its commitment to planningand prepared a set of reports, which generated a lot of interest and discussion.Apart from this, some prominent industrialists published in 1944 the document, ABrief Memorandum Outlining a Plan of Economic Development for India.Much earlier in 1934, M. Visveswaraya had published a Ten Year Plan, aimed atdoubling the national income.Jawaharlal Nehru, the nation’s first Prime Minister, is generally regarded as thearchitect of planning in India. He viewed planning as a way of developing thecountry avoiding the unnecessary rigours of an industrial transition in so far as itaffected the lives of the masses living in India’s villages. Moreover, he recognizedthat planning was a positive instrument for resolving imbalances and contradictionsin a large and heterogeneous country, such as India. The first three Five Year Plansare generally regarded as the most lively phase in India’s planning exercise.The Early Years of PlanningThough the First Five Year Plan (1950-55) was basically a simple exercise ofputting together programmes, targets and outlays, it provided the first milestone inrural development through the launching of the Community Development Programmeand National Extension Service.India’s tryst with planning came with the formulation of the Second Five Year Plan.P.C. Mahalanobis, an eminent statistician, and a man with a wide range of ideas,is generally credited with preparing the blueprint of the Second Plan. At that pointof time, this plan was the most self-conscious attempt at planning in any newlyindependent country in the Third World. Almost all major contemporary economists,who took an interest in the study of development economics, interacted with Indianplanners during these years – and so did several of today’s Nobel Laureates.The Second Plan (1955-60) laid a strong emphasis on industry. The idea was thatthis strategy will relieve the excess population in rural India. The strategy soughtto increase employment in heavy industry and the capital goods sector, so that theload on the agricultural sector could be lightened. It was primarily a strategy ofindustrialization, which hoped to succeed by forging strong industry linkages, bothforward and backward. As a result of this emphasis, the performance of India’sRural DevelopmentPlanning16capital goods sector improved substantially during this period. It also laid a solidground for a vibrant and self-reliant industrial base in India.Though the Second Plan is widely regarded as an “industrial plan”, there were otherpath-finding formulations made by Indian planners during this period, as well. Forexample, the Plan document included a very lucid chapter titled “Land Reform andAgrarian Reconstruction”. Emphasis and hopes were placed on cooperative farmingpractices in Indian agriculture. The formulation also envisaged a vast network ofcommunity development programmes, national extension services and an irrigationnetwork financed by public budgets. The concept of democratic decentralization forassigning development responsibilities to Panchayati Raj institutions was also
advocated (by the Balwantrai Mehta Committee). Thus, while it would be inaccurateand unfair to say that the Second Plan lacked an agricultural strategy, it would notbe unwarranted to maintain that planners were grossly over-optimistic as to whattraditional Indian agriculture, with its conventional input-output basis and deepseatedsocial stratification, could do within the political constraints.Role of Planning During the Years of CrisesAmong the priorities listed in the Third Plan, it was generally recognized thatagriculture had the first place. Thus, in its initial formulation at least, the Third Plandiffered from the Second Plan. It is generally recognized that there was a generalde-emphasis of agriculture in the Second Plan. The Third Plan attempted to reversethis.Indian planning suffered two major shocks caused by exogenous factors in the1960s. The first came in the shape of the war with China in 1962 and the secondin the form of successive harvest failures in 1965 and 1967. The first shock causeda sharp increase in India’s defence outlays and a severe curtailment in publicinvestment of the government. Consequently, the capital goods sector was badly hit.The crises on the food front was met with wheat import from the USA. Thissituation, for the first time, seriously exposed India’s dependence on internationalaid. However, Indian planners woke up to the need to build food self-sufficiencyas a result of these crises. The response of the government to the crises came inthe shape of the abandonment of the Five Year Plans. As a result, the periodbetween 1966 and 1969 – the Annual Plans Phase – is often labelled as the ‘PlanHoliday’ period.The Annual Plans were notable for the formulation of a clear-cut strategy ofagricultural development. This strategy carried over into the Fourth Plan and wasnotable for its shift in perception of the binding constraints on Indian agriculture. Ithad hitherto been maintained that a conservative rural social and economic structure,coupled with inefficient agricultural practices, acted as major constraints on theagricultural sector. Further, land reform had largely been avoided; in practice, however,their need was felt as vital. On the other hand, the new strategy made a perceptibleshift from this perception of the problem of the agricultural sector. Instead,technological modernization was felt to be the main problem. In other words, itcalled for a strategy that would make it possible to “bet on the strong”.Planning and Agricultural TransformationThe new strategy came to be implemented during the course of the Fourth Plan andwas more popularly known as the “Green Revolution” in agriculture.Even as the “Green Revolution” in agriculture was ushered, it was realized that“distributive justice” still remained a distant dream. Thus arrived the popular sloganof Garibi Hatao (Remove Poverty) and with it came the emphasis on povertyPlanning forRural Development17alleviation as a distinct planning objective in its own right. In fact, a documentprepared by the Planning Commission, though never officially published, for the firsttime put the problem of poverty eradication in the forefront of political and publicdiscussion.The Approach Paper to the Fifth Plan followed the recommendation of WorkingGroup in its definition of poverty in terms of nutritional inadequacy and ventured toput the explicit redistribution of incomes towards the lowest three deciles as an
objective in itself. Thus, the basic approach of the Fifth Plan was growth withredistribution. However, on account of the serious harvest failure of 1972-73 andthe oil crises of 1973, inflationary pressure forced Indian planners to seriouslycurtail the ambitious programmes they had envisaged. Public investment continuedto be under strain and, as a result, many of the programmes had to be postponedto the next Five Year Plan. The 1970s are significant because of the MinimumNeeds Programmes, IRDP, Rural Employment Programmes and some areadevelopment programmes about which you have read in the previous courses.Poverty Alleviation and Indian PlanningThe Sixth Plan, (1980-85) again undertook eradication of poverty as its primaryaim. Consequently, the programmes to eradicate poverty – NREP, RLEGP (latermerged into Jawahar Rozgar Yojana). TRYSEM, DWCRA Integrated RuralDevelopment Programme – were strongly emphasized. The IRDP, coupled withrural employment programmes, the Minimum Needs Programme and the areadevelopment programmes, meant that the Sixth Plan had a strong emphasis on therural sector.Poverty alleviation continued to be a central concern in the Seventh Plan. Growthof employment opportunities, human resource and infrastructure development, removalof inequalities, an expanded system of food security, increase in productivity inagriculture and industry, participation of people in development and substantialimprovement in agricultural and rural development administration, were identified aspriority areas. In the course of the Seventh Plan, the emphasis had shifted towardsthe concept of modernization again – this time in industry. With this came therelative de-emphasis on the public sector as an engine of growth. Modernizationand diversification of industry, adoption of new technology, a generally satisfactorylevel of industrial performance (more so in some sectors), broad basedentrepreneurship development and growth of new industries like petro-chemicalshave also been considered as positive developments.A number of imbalances cropped up during the Plan Period. First, the massiveinflow of imports under the liberalization regime had meant an adverse movementin India’s balance of payment position. During the plan period, the continuous strainon the fiscal resources of the government was so severe that it generated inflationarypressure despite the record levels of agricultural output. The decline in the abilityof India’s economy (the organised sector) to generate employment out of investmentswas manifest during the Seventh Plan. As the Approach to the Eighth Plan 1990-95 pointed out, “The large reduction in the share of the agricultural sector in GDPhas been accompanied by only a marginal reduction in the proportion of peopledependent on this sector. Consequently, the agriculture non-agriculture disparities interms of output (and incomes) per head”.The Ninth Plan emphasized “priority to agriculture and rural development with aview to generate adequate productive employment and eradication of poverty”.The Tenth Plan continued the three programme strategies of the Ninth Plan to(i) increase farm productivity and growth of other activities in rural areas,(ii) poverty alleviation progremmes, and (iii) public distribution system, especiallyto those below the poverty line.Rural DevelopmentPlanning18The Tasks Ahead
It is widely recognized that India’s planning process has been one of the mostconsistent among such efforts undertaken in the Third World. The Plan efforts havecontributed significantly in many fields, most notably in the increase in food production.However, a number of problems still remain.The desire for planning at multiple levels remains largely unrealized despite thecommitment made by successive governments. This contradiction has seriouslyundermined the concept of making planning more democratic and responsive topeople’s aspirations. Further, regional inequalities and income inequalities persist inIndia despite planned economic development. This is a serious problem, which ifuncorrected, can lead to more strain on the political fabric of the Indian state.Centre state relations, particularly in regard to planning functions and powers tomobilize financial resources, have been under stress. These issues mean thatdecentralization of the planning process has become an issue of top priority, whichif not seriously implemented, may well jeopardize the concept of planned economicdevelopment itself.The problem of inequalities in the distribution of incomes and assets and lowproductivity continuous to be a major problem facing Indian planners. As you mayrecollect, we had focused attention on these aspects in the first Block of course 1.Tardy progress in land reforms and major institutional rigidities still hamper thedevelopment of Indian society. The problem of the rural poor – particularly, thelandless and marginal farmers – still remains a major issue on the agenda of Indianplanning. Social services in rural areas continue to be at unsatisfactory levels. Thedevelopment of women, Scheduled Caste and Scheduled Tribes and other backwardclasses are other areas of concern.Check Your Progress IVNotes: a) Use the space provided below for your answer.b) Compare your answer with the text.You have read how our planners viewed the “binding constraint” in agricultureduring different points in time. Explain briefly, in your own words, thedifferences in perception.........…………………….......……………………………………………..........……...…………………………………………………..……………........…………………….......……………………………………………..........……...…………………………………………………..……………........…………………….......……………………………………………..........……...…………………………………………………..……………..
1.7 LET US SUM UPIn this unit, you have learnt the importance of planning for developing countries.We saw how the goal of attainment of growth with social justice has to be specificallyincorporated into development planning if the social and economic transformation ofthe country is to be brought about.* state with smaller ‘s’ refers to its meaning in the macro sense, as Indian statewhile State with capital ‘S’ refers to the federal units as in the state of Maharashtra.Planning forRural Development19We also read the different development theories and the various approaches to ruraldevelopment planning. You came to know about the growth centre approach, thearea development approach and the integrated rural development approach, You
were also briefly acquainted with the main features of development projects thatwere introduced to the concept of project cycle.Resource is an important factor in planning. We introduced you to the notion ofresource and the concept of stock and flow.We then went through a brief review of the planning exercise undertaken in Indiasince Independence. The main areas of emphasis in different decades were indicated.
1.8 KEY WORDSConcurrent Evaluation : On-going evaluation, while the project is underimplementation.Decentralized Planning : Planning at several levels and not just at the apex(i.e. the centre).Distributive Justice : Justice to ensure that gains from development reachevery section of society.Economic Base : The term used for a form of regional multiplier,Multiplier which is able to estimate the impact of changes inan area’s economic base on the economy as a whole.Ex-ante Evaluation : Evaluation carried out prior to the actual or mainevent occurring, i.e. before the actual project isoperational.Ex-post Evaluation : Evaluation carried out after the event has takenplace, i.e. after the project (some phase or all) hasbeen implemented.Flow : Output during a unit period of time.Growth : Increase in output/number per unit of time.Growth Pole Centre : Growth generated at nodal centres acting as polesleading to accelerated growth in the region.Input-Output Model : An economic model, which is based on the capacityof inputs of each sector (of the economy) togenerate outputs. The quantity of outputs generatedby the use of inputs is represented by the inputoutputratio.Incremental Capital : The amount of capital that results in output increasingOutput Ratio by one unit.Multiplier : An economic term, which means that any investmentundertaken in an economy normally causes incomesto increase by a proportion greater than itself.Essentially, it means that incomes increase by acertain multiple of the original investment undertaken.The value of the multiplier, however, depends onthe quality and nature of the investment made.Polarised Development : Development of two opposite qualities.Rural DevelopmentPlanning20Project : Time-bound package of inter-related activities.Stock : A quantity of resource existing at a point of time.
1.9 SUGGESTED READINGSChakravarty, Sukhamoy (1987), Development Planning: The Indian Experience,
Claredon Press, Oxford.Ghatak, Subrata (1986), An Introduction to Development Economics, Allen andUnwin, London.Misra, S.N. (1984), Rural Development Planning – Design and Method, SatvahanPublications, New Delhi.Tadaro, Michel, P. (1985), Economic Development in the Third World, OrientLongman, New Delhi.
47
Rural Poverty UNIT 3 RURAL SOCIAL STRUCTUREStructure3.0 Objectives3.1 Introduction3.2 Caste System3.2.1 The Concept of Caste3.2.2 Caste in Villages3.2.3 Caste and Class3.2.4 The Jajmani System3.2.5 Social Mobility in Indian Villages3.3 Families in Rural India3.4 Nature of the Distribution of Power in Rural India3.5 Let Us Sum Up3.6 Key Words3.7 Suggested Readings and References3.8 Check Your Progress: Possible Answers
3.0 OBJECTIVESThe aim of this lesson is to introduce you to the different aspects of rural society inIndia. After having worked through this unit, you should be able to:Describe the organization of Indian villages;Describe the nature of castes and classes, and the cases of upward socialmobility;Define jajmani system;Talk/write knowledgeably about the family system in rural India; andAnalyse the nature of power in villages.
3.1 INTRODUCTIONVillage community, family and caste are the basic components of the rural socialstructure and they bind the economic and social life of people in rural areas.In order to understand this social structure, it is necessary to understand the natureof society. Each society consists of different parts, such as individuals, groups,institutions, associations, and communities. The simplest analogy one can think of atthis point is that of an organism that has different components working together asa whole. Society is a system like any other system, such as the solar system, thechemical system, a mechanical system or an organic system. Of these the mostsuitable analogy for elaborating the concept of society is that of an organism. Thisis usually known as the ‘organic analogy’.You are perhaps aware that the basic unit of an organism is the cell; similarly the
basic unit of a society is the individual. As cells combine, a tissue is formed. In thesame way, an individual exists in relationship with other individuals. A collection ofindividuals is called a group, and the smallest group comprises two individuals; it isknown as the dyad. In an organism, the tissues aggregate and the resultant entity isan organ. In the case of human society, like the individual, no group exists in isolation.The collectivity of the groups is termed the community. In an organism, the organs48Rural Society andEconomycombine to form the organism, which is the whole. In a similar fashion, the aggregationof several communities makes the whole called society.What is social structure? Sociologists use the word ‘social structure’ to refer to theinter-relationship, inter-connectedness, and inter-dependence of the different parts ofsociety. In terms of their form, all societies have the same parts. Thus, there aregroups and communities in all societies, but the nature and substance of these groupsand communities differ from one society to another. For instance, an Indian villageis unthinkable without the caste system, while a Chinese village does not have castes.Its units are the people of different families and occupational groups. The sense ofidentity that the people of different groups have is also seen at the level of the peopleof different families and occupational groups in Chinese villages. The inter-relationshipof the different units constitutes the structure of the society.All the units of a society are supposed to be important, for each one of them makesa contribution to the functioning of society. In other words, none of them can bedispensed with. But, in each society, some of its elements are regarded as crucial,because the society is structured around them. Sociologists think that for defining anIndian village, its population, physical structure, and modes of production are definitelyimportant. Usually, a village has less than five thousand individuals. As a physicalentity, it is an aggregation of houses of mixed architecture (some of mud and thatchand some of cement) in the midst of surrounding agricultural fields—the mainstay ofvillage life is agriculture. Of course, there may be some exceptions to the image ofvillage that is presented here: for instance, a village may have more than ten thousandpeople, as is the case in Kerala. Or, the village may be a conglomeration of beautifullybuilt cement houses inhabited by people who may predominantly be in service or maybe self-employed non-agriculturalists, as is the case in a number of villages situatednear towns and cities in Himachal Pradesh.In addition to these indices, sociologists think that the social structure of an Indianvillage is understood best in terms of the interrelationship of different castes, as acommon proposition is that the caste system has weakened in urban areas, but notin the rural areas, where even the members of non-Hindu communities, which haveopposed the caste system, have continued to be treated as ‘castes’. In the sectionthat follows, we shall discuss the caste system in detail.Check Your Progress INote: a) Write your answers in the space provided.b) Check your answers with the possible answers provided at the endof the unit.1) Define the term social structure...........................................................................................................................................................................................................................................................................................................................................
..............................................................................................................2) Where do you find the most populous villages in India?........................................................................................................................................................................................................................................................................................................................................................................................................................................................49Rural Poverty
3.2 CASTE SYSTEM3.2.1 The Concept of CasteCaste is the main social institution of Indian villages. Referred to as jâti, jât, zât orvarious other local terms, it is a collectivity of people, related also by the ties ofkinship and marriage, which has a ‘monopoly’ over an occupation. It provides itsspecialized services and the products of its occupation to other caste groups. HaroldGould characterizes caste as a ‘monopolistic guild’. The occupation on which a castehas monopoly may be very simple. It may not involve any elaborate technology andskill, and may be learnt easily without much arduous work, such as the occupationof the caste of messengers, or drumbeaters, or vegetable-peelers. But no caste willever venture to usurp the occupation of any other caste howsoever simple and lessspecialized it may be.Under the ideology of caste, one’s merit lies in subscribing as conscientiously anddiligently as possible to the duties prescribed for one’s caste. The political bodies ofthe village strictly deal with any case of usurping the occupation of other castes.Among other things, the occupation related to it gives identity to a caste. Sometimes,the castes are also named after the corresponding occupations. For example, thosewho ‘supply oil (tél)’ belong to the téli (oil-man) caste; those who beat drums (dhols)are dholîs; and those who dye (rangnâ) clothes belong to the rangrez caste. Theoccupations are hereditarily transmitted.Members of a caste marry within their own caste, but usually outside their ownvillage. In other words, the village is exogamous, while the caste is endogamous.At one time, in some upper caste communities of Bengal (such as the Rarhi Brahmins)and Gujarat (such as the Patidars), the men had the privilege of obtaining spousesfrom lower castes in addition to spouses from their own caste. Such a system ofmarriage, in which the men of upper castes marry women of lower casts allowingthe lower caste women to move up the hierarchy, is known as hypergamy (anuloma).The contrary system, where women of the upper stratum marry men of the lowerstratum (i.e. where women move down in the hierarchy), is called hypogamy(pratiloma).That the classical Hindu tradition permits hypergamy, but not hypogamy, is clearfrom Manusmriti, the Hindu law book authored by a sage known as Manu. It allowsa Brahmin man to have spouses from Kshatriya, Vaishya, and Sudra castes inaddition to a spouse from his own caste. Kshatriya men are permitted to have threewives: one of their own caste and the other two from Vaishya and Sudra castesrespectively. A Vaishya can have two wives: one from his own caste and the otherfrom Sudra caste. A Sudra can have only one spouse belonging to his/her own caste.Children born out of hypergamous marriages are legitimate but they do not have thesame rights over the property of their father, as do the children from endogamousmarriages. One of the consequences of hypogamy is the excommunication of the
couples concerned. With the passage of time, such couples established new castes.A person acquires the membership of his or her caste by birth, i.e. caste is ascriptivein nature, and theoretically, it cannot be changed, i.e. it is immutable. The chief goodof a person lies in living according to the culture and duties (dharma) of his caste.According to this ideological system, leading a life according to the dictates andcommands of one’s caste not only ensures one’s existence in this world, but also theworld hereafter, as one will have an improvement in one’s caste status in the followingbirths. Why one is born in a particular caste is explained in terms of the deeds(karma) one had done in his or her previous birth. It may be noted that basicallycaste system is a ‘system of ideas’ derived from the classical tradition of Hinduism.M.N. Srinivas once wrote: ‘The structural basis of Hinduism is the caste system.’50Rural Society andEconomy
3.2.2 Caste in VillagesA village may be conceptualized as an aggregate of castes, each traditionally associatedwith an occupation. Members of a caste are generally clustered together, occupyinga particular physical space in the village, which may come to be known after thename of the caste like dhobîbârâ (i.e. the settlement of the laundrymen), jâton kagudâ (i.e. the habitation of the Jats) or raikon rî dhânî (i.e. the hamlet of theRaikas). Each caste has its own style of living, its own types of clothes, its owndistinct pattern of houses, and mutually acceptable common grounds for existance.It also has its distinct dialect, folk deities, lore, and ceremonies. The members of acaste are spread over a region in more than one village. The members of a casteliving in nearby villages have matrimonial relations among them. Each caste has itsown council (panchayat), which is a collective body of the members of that casteliving in different villages, but situated close to each other. This body takes up alldisputes between the members of the caste and discusses all instances where theidentity of the caste is abrogated and is in danger. Thus, for political purposes, socialcontrol and matrimony, the members of a caste in a village are dependent upon theirco-caste fellows in other villages. These relations result in the unity of the membersof a caste spread in different villages. M.N. Srinivas has called this type of unity‘horizontal solidarity’.In Rajasthan, a common saying is that generally there are thirty-six castes (chatrisquam) in a village. But, in actual fact, no village is found to have all the castes.Moreover, the total number of castes far exceeds thirty-six. Two points need to beremembered here.First, since all the occupational and service castes are not stationed in one and thevillage, the members of a caste in a village depend upon the services of castessituated in other villages. In such a context, the village market (hât) plays a significantrole, because a large number of artisan castes come to it with their specializedproducts. For instance, Surajit Sinha studied the weekly market at a village calledBamni in Singbhum district of Jharkhanda. He found that the average number ofcastes in a village of this district is about six. In these weekly markets, however,goods and services of some sixteen artisan castes are available in addition to theproducts handled by specialized traders of some other castes. All this substantiatesthe point that the Indian village was never a self-sufficient unit. In a village, differentcastes depend on one another for various services. Such dependency relationships(i.e. those among the various castes living in one and the same village) result in what
M.N. Srinivas has called ‘vertical solidarity’.Secondly, when Indian villagers talk of ‘thirty-six castes’ or ‘thirty-three crore Hindugods and goddesses’, what they imply is that there are ‘many’ and ‘very many’things of which they are speaking. These numbers should not be taken literally. Asfor the castes, their number is not stable; it keeps on increasing over time and in somecases small castes get merged into bigger ones. As noted earlier, often in the past,sections and sub-sections of tribes moved to multi-caste villages, adopted an occupationand acquired monopoly over it, and with the passage of time came to be known asa ‘caste’ in their own right. Thus, all along there has been a continuum from a tribeto a caste.3.2.3 Caste and ClassCaste, as we have seen, is the fundamental principle of social organization in theIndian village. As Louis Dumont said in his work titled Homo Hierarchicus, castesare arranged in a hierarchy based on the principles of purity and impurity, whichin fact give distinctiveness to the caste system, because no other system of rankingin the world makes use of these principles. The caste occupying the highest position51is ritually the purest, and as one goes down the hierarchy, purity decreases while Rural Povertyimpurity increases. Those placed at the bottom of the hierarchy, the people who atone time were called ‘untouchables’ (now they are called Harijans or Dalits) areconsidered to be the ‘permanent carriers of impurity’ within the idiom of the castesystem. No other social system in the world incorporates the notion of ‘permanentimpurity’ with such rigidity as the caste system. There may be notions of ‘temporaryimpurity’ (such as, impurity incurred by menstruation, death, or birth), which is overcomewith the performance of rituals, but no ritual can neutralize ‘permanent impurity’.In the caste system, the styles of living are ranked. The way in which, for instance,the Brahmins are expected to live is regarded the most superior, and those who areBrahmins by birth have to follow only this lifestyle and no other. Ranking in thissystem is not based on economic facts, i.e. the ownership or non-ownership of themeans of production. It is also not based on control over political power. Thus, botheconomy and polity are subordinate to the ideology of caste, according to whichranking is facilitated. The classification based on economic facts is called the classsystem. Class is an indicator of the distribution of economic inequality in the society.The term ‘power stratification’, on the other hand, is used for inequality in termsof the decision-making ability, by which some, as Max Weber says, are able toimpose their will on others and seek compliance from them.Ideally, class and power, as said previously, are subordinated to caste. A Brahmin,even if poor, occupies the highest position in the caste hierarchy and commandsunlimited respect from other castes. At one time, the Kshatriya kings wielded power,but the Brahmin priest officiated in the ritual that accorded them legitimacy to rule.The producers of economic wealth, the merchant castes (the Vaishyas) pursue differentwealth generating occupations, and are placed just above those whose jobs areprincipally menial, i.e. ‘to serve the other three upper castes’, as the classical textsput it. In some parts of India, there was a clear overlapping of the three rankedorders of caste, class, and power. For instance, both André Béteille and KathleenGough, in their respective studies of villages Sripuram and Kumbapettai, found thatthe Brahmins, who numbered around four per cent of the total population of SouthIndia, owned around ninety-eight per cent of the land, which they abstained from
tilling because of religious injunctions that did not allow Brahmins to touch ploughs.The Brahmins, who lived in their separate quarters called agraharam, were also incontrol of political power. Therefore, being a Brahmin also meant occupying thehighest position in class and power hierarchies. This was an example of what afterRobert Dahl one would call ‘cumulative inequality’. In this case, social status togetherwith economic and political power are all concentrated in one group, the Brahmins.The typical ‘Brahmin villages’ of South India have also been locally calledagraharavadai.Surely, not all the villages in India followed the pattern charactristic of villages inSouth India. In many other parts, the caste that controlled economic resources wascertainly not of Brahmins, nor even of Kshatriyas. In Rampura, the Mysore villagethat M.N. Srinivas studied, the landowners were the peasants, the members of thecaste called Vokkaligas. In North India, the principal landowners were and are theJats. In such cases, economic stratification is independent of the other principles ofranking, and can in fact influence them. Thus, those who control political power mayalso be the landowners. In this case, different ranked orders do not overlap; theyrather exist independently. For such a system, one can use the term ‘dispersedinequality’, for the group that occupies the highest position in one ranking system isplaced lowly in the other. Keeping this in mind, many sociologists make a distinctionbetween ‘ritual status’ and ‘secular status’ – the former emerges from the caste,which is essentially a ‘ritual hierarchy’, while the latter emerges from the ownershipof economic and political power. When these two statuses exist independently, it isa case of dispersed inequality; and when they overlap, it is cumulative inequality.52Rural Society andEconomyAlthough myriad varieties of social change have affected social stratification in Indianvillages, perhaps one will not be wrong in saying that at one time, South Indiagenerally had ‘Brahmin-centred villages’ whereas North India had ‘non-Brahmincentred villages’. For the villages where non-Brahmin castes control economicresources, the term pandaravadai is used in contrast to agraharavadai, the ‘Brahmincentredvillages’.3.2.4 The Jajmani SystemEarlier, it was observed that the various castes living in a village are interdependentbecause each one of them has a monopoly over an occupation. If some occupationalcaste is not found in the local area, then some other caste may take up its occupation,and develop specialization in it. For instance, the blacksmiths of Senapur, a village inJaunpur district of Uttar Pradesh, also worked on wood because there were nocarpenters in that area, and so they made and repaired agricultural implements forthe landowner-peasants, the Thakurs. The interdependence between castes obtainsin two ways:i) A caste provides its goods and services to other castes in exchange for paymentin kind or cash, but this payment is done instantly, and if deferred, it is for theshortest period of time. A lot of haggling also enters this exchange. The relationshere are largely contractual and impersonal. They are quite like the relations onewill expect to find in cities and towns. In villages, such relations may existbetween the merchant caste and the other castes. The latter buy goods andcommodities from the shop of the local merchant, a man of the Vaishya caste,and pay him instantly. If instant payment is not made, the shopkeeper may
advance credit, but before further merchandise is acquired, the buyer will haveto settle all the previous accounts. In some cases, the merchant may chargeinterest for the amount on credit.ii) By contrast to the first type of interdependence, the second type comprisesrelations that are broadly supportive, group-oriented, long-term and continuing,and they involve multiple bonds between people involved in the exchange. Theserelations are durable, unlike the relations between the shopkeepers and thebuyers, where after one has bought the product and paid for it, the relationcomes to an end.In villages, durable relations obtain mainly between food-producing families and thefamilies that supply them with goods and services. These relations are called jajmani,the Hindi word for them as used in William H. Wiser’s study of a village in UttarPradesh. In other parts of India, they are known by other names. For instance, inMaharashtra, they are known as balutdari. Notwithstanding the differences in theterms used, certain features of the system are common throughout India. Althoughthe jajmani system is regarded as a characteristic of rural India, it has also beenreported from urban areas. Sylvia Vatuk described the jajmani system that was inoperation in Meerut City.In the jajmani system, at the center is the family of the agriculturist (zamindar). Itreceives services from the families of occupational castes. One who receives servicesis known as jajman, the patron. The families that provide services are known askamin, kam karne waley, or kamgars (workers). In other parts of India, terms suchas parjan, pardhan, balutedar, etc., are also used for the providers of goods andservices. All these words literally refer to the same people, i.e. those who ‘work’for others, and one may call them clients. The implication is that those who do not‘work’ (like zamindars, the big landowners) occupy the highest position in the secularranking; those who ‘work’ for themselves, the self-employed workers, come next;and at the bottom of the system are placed those families that ‘work’ for others,53carrying out various menial jobs. The castes, which happen to provide services to the Rural Povertyagriculturalists, vary from one village to another. And, not every caste in the villagehappens to be a part of the jajmani system. The simplest definition of the jajmanisystem can be: it is a patron-client relationship.Although the jajmani relationship seems to be between castes, in reality, it is betweenparticular families belonging to particular castes. It is the relationship between familiesthat continues to exist over time. Jajmani ties are hereditary, i.e. various families(belonging to various castes) keep on providing their specialist services to particularagriculturist families generation after generation. The latter do not have the right todiscontinue the services of the families of serving occupational castes. If they are notsatisfied with the quality of the service, or they notice slackness on the part of theservice-providers, they are expected to bring this matter to the attention of the councilof the caste to which the erring family belongs.These relations are not like wage-relations, which can be terminated after the transactionis over. They are durable, in the sense they continue over generations. They areexclusive, in the sense that one family will carry out its relations with only oneparticular family of the particular occupational caste. Because of whatever reasons,if a family is to move out of an area, it is its moral duty to find an alternative serviceprovider for its patrons. Many sociologists have found that jajmani rights are alsosold. The point is that no family (whether of the jajman or kamin) will move out of
the relationship unless it has provided an alternative to the other.Earlier, it was noted that there are multiple bonds between the patron and the client.The patron looks after all those families that work for him. He advances loans or giftsto them at the time of festivals and other similar occasions. He safeguards theirinterests and saves them from exploitation at the hands of others, i.e. the jajmanisystem is based on the ideology of paternalism.The clients continue to provide services throughout the year to their patrons. At thetime of the harvest, the patrons give their clients a portion of the produce, which inNorth Indian villages is known as phaslana. The jajmani system is an example of‘deferred payment’, which is entirely different from that in the wage labour. Further,there is no bargaining on the amount of crop/produce given to a client. If the seasonis lean, all suffer, be he the patron or the client. And, if there is a bumper crop, thenall are equally benefited. Generally, jajmani payments are made quietly, but there canalways be situations where the patrons publicize the size of payments they aremaking, or the clients may show their unhappiness on receiving not-so-satisfactorypayments.Some sociologists think that the jajmani system is exploitative. The agriculturalcastes, which are invariably upper castes, seek the services of occupational castes,which are generally lower castes, without reciprocating adequately. The exploitationof lower castes continues under the garb of paternal ties. The opposite argument isthat the jajmani system is functional. It gives security to lower castes that they willnever go hungry. For the upper castes, it ensures a regular and uninterrupted supplyof services. Because of these relations, the village emerges as a unified body, wherethe patrons organize rituals and activities that symbolically effect the unity of thevillage. For instance, it is believed that some deities (known as Bhumia, Kshetrapal,etc.) guard the boundaries of the village. The patrons regularly organize collectiveworship of these deities. The overall picture is that those who receive the largestnumber of services are the ones who are expected to care the most for the welfareof the village.In the last fifty years, the jajmani system has undergone many significant changes.It has already been said that not every caste of the village participated in this system.In addition to the jajmani relation, there has always been contractual, wage-labour54Rural Society andEconomytype of ties between the providers of goods and services and their buyers. Further,with the rise of the backward class movements in the recent past, certain castes thatwere a part of the jajmani system have withdrawn themselves from it. The introductionof cash economy has also brought about changes, because payments in the jajmanisystem were always in kind rather than in cash. With the ever expanding commercialfrontiers, new opportunities have come up in towns and cities, and many occupationalcastes have sought to take advantage of this situation. They move to participate inthese opportunities after seeking withdrawal from the jajmani ties.3.2.5 Social Mobility in Indian VillagesAs discussed earlier, a person born into a caste is expected to live according to itslifestyle and perform duties that characterize it. Thus, being allocated by birth, one’scaste cannot be changed. A person born into a caste will always belong to it as alife-long member. In his/her future births, because of good deeds, he/she may be borninto a superior caste. In other words, theoretically, upward mobility is not possible
within the caste system, except for women who may move up by means ofhypergamous marriages. Similarly, downward mobility results from hypogamousmarriages.Economic opportunities are considerably limited in villages. Agricultural surplus is notsignificant either. Virtually nothing is left with the peasants after they have made thejajmani payments. Barring the big landlords, others in villages live rather precariously,often hand to mouth. Those, who have been able to move out to towns and cities forwork, have been able to make some money, which they have invested in buyingagricultural land, but the number of such families is not large. The point to beemphasized here is that class mobility was also non-existent in the village. Powerhierarchy in villages depends on the control over economic resources. Therefore,those who lagged behind economically would never hope to get any significant placein political bodies. By considering the factors of caste, class, and power, one may saythat the Indian village was a ‘closed system’, i.e. it did not provide any avenues foranyone to move up in the caste, the class, or the power hierarchy.Undoubtedly, it is true that in villages the position of an individual is fixed once andforever. This is in sharp contrast to urban areas where the individual is mobile, andupward mobility is a cherished value. In spite of the formidable restrictions on one’smobility in the rural areas, there have been cases of the sections of lower castesmoving up in the hierarchy. There are cases of individuals becoming rich after theirhaving participated in the newer economic activities emerging in towns and cities.Mobility from villages to urban locales has always been there. Whether this mobilitywas triggered by rural poverty or the concentration of lucrative opportunities in urbancontexts is a different question.The first person to show that the caste system was not truly immutable and that itwas not as stagnant as it was made out to be, was M.N. Srinivas. In his study ofCoorgs in Karnataka, he showed that originally they were tribals. With the passageof time, they were able to find a place in the caste system, where they rose to theposition of the Kshatriyas. Srinivas termed this process of upward mobility in thecaste system ‘sanskritization’. It can be defined as the process of ritual mobilitywhereby a lower caste or a tribe (wholly or partially) emulates the customs andpractices of the upper caste with an explicit intention of improving upon its ownstatus. It envisages its eventual merger with the caste whose customs and practicesit endeavours to follow.Srinivas shows that the evidence for the existence of the process of sanskritizationis available in the ancient as well as the medieval literature, but it became animportant process of upward mobility with the advent of the British. A significant55change that occurred in the Indian society under the British regime was that land Rural Povertybecame a marketable commodity; it could be sold and acquired in the market. Earlier,it was inherited through the ties of kinship; it passed down in the family line, but couldnot be sold and bought.The other change that took place was the emergence of towns in the vicinity ofvillages. These towns provided several opportunities, offering caste-free and classfreeoccupations. The only occupation that happened to be caste-free in villages wasagriculture. Further, the pressure of population in villages, along with the emergenceof opportunities in towns, was sending people out to towns and cities, where theyparticipated in cash economy. Within a space of few years, they were able to earnsubstantial amounts of money with which they could buy agricultural land in their
native villages. And, once they had attained economic power, they claimed a higherritual status, which they would certainly achieve, provided originally they were abovethe line of pollution. There have been cases of castes below the line of purity,which claimed upper caste status, but could not succeed in acquiring it mainly becauseof their ‘polluting status’. Srinivas wrote that ‘Sanskritization does not help theuntouchables’.Thus, changes have occurred in the position of castes by means of sanskritization.It may be noted, however, that sanskritization was of no consequence to the uppercastes, such as Brahmins, Kshatriyas, and Vaishyas, for they were alreadysanskritized, i.e. they already followed what Srinivas has called ‘sanskritic Hinduism’.These castes were the first ones to opt for a Western way of life that came alongwith the advent of the British. Srinivas has called the process of adopting the Westernlifestyles ‘Westernization’.The castes below the line of purity tried, from time to time, their level best to moveup in the ritual hierarchy. They also had the pre-requisites for sanskritization, suchas control over the local economic resources. But, being below the line of purity,they failed to establish marital and commensal (i.e. eating together) relations with thecastes whose lifestyles they were trying to emulate. Once their attempts to moveupwards failed, they had no option but to adopt the political path for bringing aboutchanges in their status. In other words, their mobility was not along the ‘axis of castestatus’, but along the ‘axis of political power’. Initially for these castes, but later forall the castes, the route of politics grew in importance for purposes of upward socialmobility. All the castes realized that in a democratic setup each one of them constituteda ‘vote-bank’, and they could exercise their pressure on the state for a better deal.Thus, the caste became ‘an interest and a pressure group’ and politicization, i.e. theprocess of adopting various political values, became a functional alternative tosanskritization.Thus, sanskritization was meaningful only for castes lying in the middle level of thehierarchy, but then, these castes constituted the majority of them. In addition to thecases of upward ritual mobility, sociological literature also acquaints one with thecases of downward mobility in ritual hierarchy. In the study of a village in Haryana,S.K. Srivastava found that the Brahmins were gradually assimilating the lifestyles andoccupational aspects of Jats, with the explicit intention of becoming one with them.This case was the converse of the process of sanskritization, and Srivastava termedit ‘de-sanskritization’. In Udaipur villages, S.L. Kalia found that some castes wereadopting the lifestyle of the Bhils, a tribal group. This was also a case of downwardritual mobility. Kalia called this process ‘tribalization’.To sum up, the Indian village was never a self-sufficient social or economic unit. Ithad relations with the outside world. Benefiting by the changes emerging in it, manypeople were able to find respectable places in villages. As a consequence, differentunits of the village were able to move up. Upper castes adopted the Western wayof living and institutions. Castes below the line of purity had no option but to follow56Rural Society andEconomythe political path for ameliorating their status and conditions. Middle castes followedthe process of sanskritization. Also, some upper castes tried to seek their identificationwith lower castes. In terms of these four processes (viz sanskritization, Westernization,politicization, and de-sanskritization), one may formulate a composite model of
social mobility in India.Check Your Progress IINote: a) Write your answers in the space provided.b) Check your answers with the possible answers provided at the endof the unit.1) Write briefly about the concept of caste.........................................................................................................................................................................................................................................................................................................................................................................................................................................................2) What do you mean by a class in the context of an Indian village?........................................................................................................................................................................................................................................................................................................................................................................................................................................................3) What do you understand by the jajmani system?........................................................................................................................................................................................................................................................................................................................................................................................................................................................4) Do you think that sanskritization is still a relevant process of upwardmobility for lower castes in contemporary rural India?......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
3.3 FAMILIES IN RURAL INDIAFamily is the cornerstone of human society. It is a universal social institution. Of themany functions, the most important and non-transferable function it performs is thesocialization of children. Along with the changes occurring in the human society, thefunctions of the family have also undergone change. In traditional societies, the familyperforms many economic, political, and religious functions; thus, it is not a specializedentity. With the passage of time, however, these functions are transferred to other57specialized institutions. The family, which is the unit of production in simple societies, Rural Povertyceases to be so when the market and the other specialized institutions take over thefunction of production. In modern societies, the family becomes a unit of consumption.During the course of its evolution, the family has shed many of its function in favourof other institutions, and so, it has become a truly specialized institution in modernsocieties. Talcott Parsons says that its first function in the contemporary Americansociety is to carry out the task of providing basic learning to children; this is thefunction of ‘primary socialization’. Its second function is to help in the process ofstabilizing adult personalities. As the family is a primary group, resting on the sentimentsof affinity, love, and concern, it combats the strains and stresses that are generatedin the modern society, which is pivoted on means to ends relations.Writing about India during the colonial times, Henry Maine stated that mainly twocultural traits characterized India: the caste system and the joint family. The latter
was described as being found predominantly in villages. It was also considered anideal – a supreme value – to which every family aspired to approximate. In manysurveys, it was found that people preferred to live in joint families because of severaladvantages that it offered. For example, both the old and the young could be lookedafter well in joint families.A joint family is defined as an aggregate of kinspersons who share a commonresidence, a common kitchen, a common purse including property, and a common setof religious objects. Generally, a joint family has a name, which in many cases isgiven/taken after the name of its founder. It has a depth of more than two generations.It is not uncommon to come across joint families that have members of four generationsliving together. Joint families in India are patrilineal (i.e., descent is traced in themale line, from father to son), patrilocal (i.e., all the males of the family live together,while the females born in the family move out when they get married), and patriarchal(i.e., men exercise authority).The chief textbook of Hindu law, written in the twelfth century, the Mitakshara, hascodified the most significant characteristic of the joint family. Under this code, eachmale is entitled to an equal share of the household property from the time of his birth.Thus, all the male members of the family have equal rights in relation to the familyproperty. The oldest male called karta, however, has the exclusively right to manageit on behalf of others. One of his main duties is to see that the family property is notdivided. The equal rights that all males have on the property are known as coparcenaryrights, which constitute the prime characteristic that defines the Indian joint family.When speaking of an extended family, one’s emphasis is on the size of the family.An extended family is a conglomeration of two or more nuclear families. On theother hand, when one speaks of the joint family, one’s emphasis is on the fact thatall brothers/males are coparceners.Although joint families are found more in the rural than in the urban areas, wheremost of the families happen to be nuclear, one should not conclude that all castes ina village have the tradition of joint families. It has been observed that upper castes,which are also land owners in many cases, have a higher proportion of joint familiesthan the lower castes, the less propertied as well as the non-propertied ones, whichtend to have a higher number of nuclear families. Undoubtedly, there is a directrelationship between the ownership of land and the joint family, because propertyremains one of the important unifying forces.The ideal of a joint family, as an institution in which each individual surrenders hisor her personal interests for the sake of the family and its unhampered continuity, ishardly ever achieved. Till the time the head of the household is alive, he can succeedin keeping all his sons together and the family property may continue undivided. After58Rural Society andEconomyhis death, his eldest son would succeed him by the right of primogeniture, but it mightbecome difficult for him to keep all the brothers and their wives together. Sooner orlater, they would all separate, each getting an equal share of the family property, andeach nuclear family, thus formed, would start its process of expansion, becoming ajoint family in course of time, and then breaking up once again and so on.This process of ‘expansion-depletion-replacement’ of the family is known as itsdevelopmental cycle. One of the suggestions that emerge from this analysis is thata family should be studied as a process, as this approach promises a better understanding
of the issues at hand.As in cities, the forces of modernization have also affected village societies, leadingto both occupational differentiation and geographical mobility. Members from thesame family take up different occupations. Once this occurs, it becomes extremelydifficult for brothers to live together; and being in different occupations, there isbound to be inequality in their respective earnings. Such a situation does not arisewhen they are all working as agriculturists on the same land, as whatever is producedis for the consumption of the entire family. This system works well in situations thatdo not have individualism and ‘individual consciousness’ is subordinated to ‘collectiveconsciousness’. With occupational differentiation crystallizes individualism and inequality,making it difficult for the joint family to continue undivided for years and years.Geographical mobility fits quite well with the nuclear family. When a married son getsa job abroad or away from the village, he moves to his new locale alone, leavingbehind his wife and children under the care of his joint family. When he gets a placeto live, or is allotted family accommodation, he takes with him his wife and children,rather reluctantly, because it is the beginning of the disintegration of the joint familyand the establishment of a nuclear family. This explains the preponderance of nuclearfamilies in urban areas.Lastly, it should be kept in mind that the nuclear families emerging in India becauseof the break up of joint families are very different from the nuclear families in theWestern world, where the expression ‘nuclear family’ implies a family that is‘structurally isolated’, i.e. a family that has no dependency relations with any otherfamily whatsoever. Indian nuclear families are still embedded in strong kin bonds;they are not isolated as are their counterparts in the West. In India people may livein nuclear families, but they are dependent on their relatives, living in different typesof families, for varieties of help.Thus, the Indian nuclear family is not ‘structurally isolated’. If ‘structural isolation’is the main characteristic of nuclear families, then the Indian phenomenon needs tobe designated differently. Some sociologists are using the term ‘nuclear households’to differentiate Indian nuclear families from their Western counterparts. They saythat so far ‘structurally isolated’ nuclear families have not emerged in India; insteadwhat has emerged here is a variety of ‘nuclear households’. Each one of themcomprises a man, his wife and their unmarried children. And each of these units haslong-term, stable, and multiple relations of interdependence with their kinspersons.Check Your Progress IIINote: a) Write your answers in the space provided.b) Check your answers with the possible answers provided at the endof the unit.1) Give three salient characteristics of an Indian joint family...........................................................................................................................................................................................................................................................................................................................................592) Explain one of the major reasons behind the break up of the joint family in Rural Povertyrural India.........................................................................................................................................................................................................................................................................................................................................................................................................................................................
3.4 NATURE OF THE DISTRIBUTION OF POWER INRURAL INDIAThe popular image of an Indian village is that it is free from conflicts and thefts.During the course of their fieldwork, scholars have noted invariably that villagersnostalgically remember the days when they did not need to lock their houses, for eachone respected the dignity and the goods of others. Consensus prevailed on almost allissues, but if disagreements cropped up, they were amicably sorted out with theintervention of the elderly. The rich parted with their excessive wealth for the welfareof the poor. In some cases, people praised their villages for having never been visitedby policemen. Women were safe in all respects, and people adhered to religiousvalues and led a god-fearing existence.Although it is an idealized version, which of course is far being exact, there undoubtedlyis a grain of truth in much of what has been and is being said about the village. Incomparison with the situation in towns and cities, inter-personal conflicts are fewerin villages. The rich may not part with their wealth in favour of the poor, but theycertainly display a guardian—like supportive attitude towards them. General consensusprevails with respect to the norms and values, which in any case are largely uniformand hardly contradictory, and this is one of the reasons why there are fewer casesof dissent and conflict in villages. Certainly, the hold of religion on traditional societiesis greater than it is on complex societies.The conclusion one reaches from a comparison of the idealized view of the villageheld by its inhabitants and the reality that exists, is that the village is not a stable,stagnant, and changeless entity.Conflicts emerge between the members of a caste and also between different castes,and the contending parties do not always find it easy to solve them. Villagers in NorthIndia say that conflicts between different people pertain mainly to the matters of land(zamin), wealth (zar) and women (zanani). For reaching a solution to these conflicts,each village has a council called panchayat, consisting of knowledgeable and uprightpeople, who pronounce impartial judgements, supposed to be binding on all.In addition, as has been noted earlier, each caste has its own panchayat, which takesup matters it is confronted with. For the sake of distinguishing one from the other,one may call the village panchayat a gaon panchayat, and the caste panchayat, ajati panchayat. The functions of each one of them are different, for they servedifferent bodies. Besides resolving the conflicts between different families, a gaonpanchayat is also entrusted with undertaking the collective tasks of the village, suchas performing rituals for the welfare of the entire village, or organizing programmespertaining to the donation of voluntary labour (shramdana) for building a road or agranary. A jati panchayat deals exclusively with the issues pertaining to the casteconcerned. For example, it may further the interests of the caste or, in some literatecontexts, it may publish a caste periodical.60Rural Society andEconomyA traditional caste council called panch (i.e. five) comprises a small but always anodd number of members. It listens to the cases of dispute and takes decisionsdemocratically. The odd number of its members helps in deciding cases by the ruleof majority when they do not reach a consensus. It is not necessary that a panchwill always have just five members, as is sometimes proverbially said. The idea of
five implies that the council is a small group and that the number of its number isalways odd.Srinivas says that in villages, it is invariably the members of one particular caste whoexercise their dominance on others. To explain this phenomenon, he introduced theconcept of the ‘dominant caste’, which is defined in terms of the following criteria:numerical predominance;control over economic resources;control over political power;high ritual status; andthe first-ones who have taken advantage of the Western education system.It is not necessary that all these criteria have to be met for designating a group asdominant. A dominant caste may not have numerical preponderance or it may not tilttowards Westernization. The more important criteria, it has been emphasized, arecontrol over the factors of production and political power. In villages, the dominantcaste is usually associated with agriculture. Let us refer to Jan Breman’s data onpeasants and migrants belonging to Surat (Gujarat). He says that in the whole districtof Surat, the Kanbi Patidars occupy the highest status in the field of agriculture. Theyown large portions of land, and with the passage of time, they add more and moreland to their already massive land holdings. Consequently, in this area, lower casteshave been reduced to a marginal status. In Rajasthan, even after the land reforms,the ex-landlords (jagirdar) continue to own vast tracts of land and remain dominantsocially. It has also been seen that the dominant castes resort to violence to keep theother castes in a state of submission.Take an example to illustrate this. In Wangala, a village in Mysore that ScarlettEpstein had studied, in the plays that the Harijans of the village organize, the actorplaying the role of a king does not sit on a prop throne but squats. The idea is thathis head should not appear at a level higher than that of the dominant caste membersamong the audience. On one such occasion, their drama company announced that intheir forthcoming production, a stage throne would be used, and the king would siton it. There was a strong reaction to this idea. The Vokkaligas, the dominant casteof Wangala, stopped employing Harijan labourers. Eventually, the Harijans had totender an apology and pay a fine for their assertion. Only after this expression ofsubmission peace came to prevail. Similarly, in Madhopur in Uttar Pradesh, when thelower caste people (of Noniya caste) started donning the sacred thread, the dominantcaste adopted violent methods to make them stop assimilating the traits of uppercastes. The point being made is that the dominant castes do adopt methods of alldescriptions in order to maintain their status unassailed.Often, the dominant castes display uniformity in terms of their behaviour and interests.Although with the emergence of Panchayati Raj and land reforms, the nature ofdominance has changed in rural India, there is no doubt that certain castes stillexercise decisive dominance in villages. In many cases, the studies point out thatpeople have become disillusioned with their traditional councils. There was a timewhen the council members were compared to gods (the idea of panch parmeshwar),and it was said: ‘Where there is a panchayat, there is god.’ But now, people preferto approach formal institutions (such as the courts, police, and other administrativebodies) for the settlement of their disputes.61Rural Poverty
Check Your Progress IVNote: a) Write your answers in the space provided.b) Check your answers with the possible answers provided at the endof the unit.1) What are the different types of the traditional council (panchayat) foundin Indian villages?......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................2) Define the concept of ‘dominant caste’.......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................
3.5 LET US SUM UPAn Indian village is composed of endogamous units, each following its own occupationtraditionally associated with its caste, locally known as jati. The number of castesa village has varies from one context to another. Large villages have more castesthan small villages, but no village has all the castes. Thus, the members of one villagedepend upon others in their neighbourhood for various services. The Indian villagewas never self-sufficient as some colonial officers believed. Each village has its owndominant caste, which has very high representation in the political bodies of thevillage. Often, the decisions they take serve their own interests. At the local level,each caste comprises a set of families, and it has been noticed that there is a closerelationship between caste and kinship. Generally the upper, propertied castes usuallyhave joint families, whilst lower, non-propertied castes have nuclear families. Withchanges occurring because of urbanization and modernization, the families are becomingsmaller all over India, but it does not imply that joint families have disappeared.
3.6 KEY WORDSAscriptive : This term means ‘by birth’. Ascriptive status is that socialposition which one acquires by birth.Caste System : Practised in India, it is the main traditional system of socialstratification, which is ascriptive and based on the notion ofmutually opposing characteristics—pure and impure.Client : While translating the words, jajman and kamin, the termsused are ‘patron’ and ‘client’. The meaning of the word‘client’ in this context is ‘one who provides the services ofan occupation to the other caste.’ The term ‘client’ can beused interchageably with the term ‘occupational caste’.62Rural Society andEconomyPanchayat : It is a small body of elders that takes up the cases ofdispute among people, and pronounces its judgement, whichthe contending parties are expected to follow.
Horizontal Solidarity: It is the unity of the people who belong to the same casteor social stratum, but are spread across a number ofneighbouring villages.Vertical Solidarity : It is the unity of the people who belong to different castesor hierarchical social strata, but belong to one and the samevillage.
3.7 SUGGESTED READINGS AND REFERENCESReferencesAtal, Yogesh. 1968. The Changing Frontiers of Caste. Delhi: National PublishingHouse.Béteille, André. 1965. Caste, Class and Power: Changing Patterns of Stratificationin a Tanjore Village. Berkeley: University of California Press.Bliss, C. and N. Stern. 1982. Palanpur: The Economy of an Indian Village.Oxford: Oxford University Press.Breman, J., P. Kloos, and A. Saith. (eds.) 1997. The Village in Asia Revisited. Delhi:Oxford University Press.Chauhan, Brij Raj. 2003. “Village Community” in Veena Das (ed.) The Oxford IndiaCompanion to Sociology and Social Anthropology. Delhi: Oxford University Press.Mandelbaum, David G. 1970. Society in India. Berkeley: University of CaliforniaPress.Sharma, K.L. (ed.) 2001. Social Inequality in India. Jaipur and New Delhi: RawatPublications.Srinivas, M.N. 1996. Village, Caste, Gender and Method. Delhi: Oxford UniversityPress.Suggested ReadingsChakravarti, Anand. 1975. Contradiction and Change: Changing Patterns ofAuthority in a Rajasthan Village. Delhi: Oxford University Press.Dasgupta, B. (ed.) 1977. Village Studies in the Third World. Delhi: HindustanPublishing House.Gough, Kathleen. 1981. Rural Society in South India. Cambridge: CambridgeUniversity Press.Gould, Harold A. 1990. Politics and Caste. Delhi: Chanakya Publications.Jha, Hetukar. 1991. Social Structure of Indian Villages: A Study of Rural Bihar.New Delhi: Sage Publications.Leaf, Murray. 1972. Information and Behaviour in a Sikh Village. Berkeley:University of California Press.63Mayer, Adrian C. 1960. Caste and Kinship in Central India: A Village and its Rural PovertyRegion. London: Routledge and Kegan Paul.Pocock, David F. 1973. Mind, Body and Wealth: A Study of Belief and Practicein an Indian Village. Oxford: Basil Blackwell.Srivastava, V.K. 1999. “Some Characteristics of a ‘Herding Caste’ of Rajasthan”in M.K. Bhasin and Veena Bhasin (eds.) Rajasthan: Ecology, Culture andSociety. Delhi: Kamla-Raj Enterprises.
3.8 CHECK YOUR PROGRESS: POSSIBLE ANSWERSCheck Your Progress I1) The term ‘social structure’, originally coined by Herbert Spencer, refers to theinter-connections of different parts of society, such as individuals, groups,
institutions, associations, organizations, communities, etc.2) The most populated villages in India are found in Kerala; some of them haveabove ten thousand individualsCheck Your Progress II1) Caste is a system of social hierarchy found in south Asia, especially India, andall those countries where Hindus have settled down, such as Fiji, Trinidad,Mauritius, South Africa, United Kingdom, United States of America, etc. In thissystem, the society is divided into clearly bounded units called castes, locallycalled jatis, each exercising monopoly over a particular occupation. A personbecomes the member of a caste by being born into it. In other words, caste isascriptive. The members of a caste share a common lifestyle – they live inhouses that look alike, they dress up in a similar manner, they speak the samedialect, they repose faith in the same set of deities, they have the same set ofrituals, and in a village, they are generally clustered together. Each caste isendogamous, i.e. each one of its memebers seeks its spouse from the familiesof its own caste that are settled in other villages. Each caste has its ownpolitical body called panchayat, which is entrusted with the task of amicablyresolving the conflicts that surface between the members of the caste. Inrunning the systems of production in a village, each caste is dependent uponother castes. It is because of the inter-caste dependence that a village developsbonds of social unity.2) By comparison with caste, class has an economic referent. Classes pertain tothe system of production and there are basically three classes that make anIndian village:i) those who own the means of production (i.e. land, livestock and/or capital);ii) those who lease the needed resources from the first class and use themon condition that in return they would pay the relevant rent or a part oftheir produce; andiii) those who do not have any resources at their command, nor do they enterany economic arrangement to procure resources, but work as labourersto earn wages for the service they render.The first class is of the owners (malik ), the second of the tenants (kisan)and the third of the labourers (mazdur). Theoretically, class relations areindependent of caste, but it has been seen that in Indian villages, there isoften an overlapping between the two. Those who happen to own land alsohappen to be from the upper castes, and those who are landless labourersare from the lower castes.64Rural Society andEconomy3) William Wiser introduced the term jajmani system in his study of a village inUttar Pradesh. It is a system of patron-client relations. At the center of thesystem are the agriculturist communities, which are served by various occupationalcastes, such as the carpenter, the barber, the laundryman, the potter, the blacksmith,etc. These occupational castes provide their services to the agriculturist caste forthe entire year but are paid in kind at the time of harvest. These relations arehereditary and happen to be between families belonging to different castes.Sometimes, a family has jajmani ties with the entire village. For instance, thefamily of the village guard (chowkidar), who serves all the different castes of
the village, receives payments in kind from only some of them, as it may notreceive any payments from the castes below the line of purity.4) The impact of the process of sanskritization as a process of upward mobilityhas considerably reduced because backward castes have found the political routeto upward mobility far more effective in the present-day India. Mobility along theaxis of status (i.e., sanskritization) has been replaced by mobility along the axisof power (i.e., politicization). It is so mainly because sanskritization has nothelped the castes below the line of purity to move up the caste hierarchy.Check Your Progress III1) The three salient characteristics of the joint family in India are:i) Kinspersons belonging to the joint family share common religious beliefs,common property and a common residence.ii) All the descendants of the joint family (male and female), recognized by theprinciple of descent, have an equal right on the family property. These rightsare called coparcenary.iii) The head of the household in a patrilineal family is usually the eldest male,who is called karta. His main job is to work towards the unity and integrityof the family. He is the manager of the property and is supposed to superviseit well and keep it together by saving it from all forces that try to break it.2) Many reasons have been given to explain the break up of the joint family in India.‘Occupational differentiation’, however, seems to be the strongest of them all.When members of a joint family follow the same occupation, it is easier for themto live together than when they branch out into different occupations. When indifferent occupations, they are also differentially placed in terms of their respectiveincomes. This inequality at the level of economy does not create viable conditionsfor different members of the household to live together and pool in their resources.Occupational differentiation is also closely connected with geographical mobility.Occupations take individuals away to different places. Obviously, in such migrations,it is the nuclear family that travels together instead of the entire joint family whichgoes on losing its sub-groups by and by.Check Your Progress IV1) Indian villages have two types of traditional council. The first to which an individualis affiliated is the council of one’s caste, called the jati panchayat; and thesecond is the council of the village, which is known as gram/gaon panchayat.Caste councils extend beyond the boundary of a village. They comprise membersof the same caste distributed over the region in neighbouring villages. In otherwords, a caste council cuts across the villages in the neighbourhood. It is one ofthe principal factors contributing to solidarity among members of the same caste,called horizontal solidarity. A village council, as the name suggests, is of thevillage. Its jurisdiction is confined to the village concerned. It takes up matterspertaining to the village, thus contributing to the solidarity between the membersof different castes living in one and the same village. This type of solidarity iscalled vertical solidarity.652) It was M.N. Srinivas who introduced the concept of dominant caste. This term Rural Povertyis used for the caste that has numerical preponderance in a village. It alsoexercises control over economic resources, such as land, livestock, houses,instruments and implements of production, etc., because of which it has politicalpower. Its members constitute the best represented group in the village council.
In other words, in the case of the dominant caste, there is a close associationbetween economic and political factors. Also, it enjoys a high ritual status, andhas often been the first to take advantage of the education system that the Britishintroduced in India.
Related Documents
