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UNIT-1RURAL BANKING Q1) Explain the features of Indian Rural Demography.A1) Demographic feature implies the characteristics of population like, size, composition, diversity, growth and qualitative aspects of population etc. The various demographic features of Rural India are 1. Large Size and Fast Growth:One of the main feature of Indian population is its large size and rapid growth. The 2001 census report reflects that, the population of India is 102.87 crore. In terms of size, it is the second largest population in the world, next only to China whose population was 127 crore in 2001.The population was 23.6 crore in 1901 and it increased to 102.7 crore in 2001. There was a remarkable increase in its population .In addition to its size, the rate of growth of population has also been increasing since 1951. At present times India’s population is growing at a rate of 1.9 percent/annually. at around 21 million people are added every year which is more than the population of Australia. It is situation of population explosion resulting from high birth rate and declining death rate.2. The Second Phase of Demographic TransitionThe theory of demographic transition implies that the population growth of a country passes through three different stages of development . The first stage is characterized by high birth rate and high death rate. In this stage the net growth or overall of population is zero. Till 1921, India was in the first stage of this demographic transition.The second stage is characterized by high birth rate and low death rate resulting to the rapid growth of population. India entered the second phase of demographic transition after 1921; at around 1921-30 India entered the 2nd stage, the birth rate was 464/thousand and death rate was 363/thousand.Currently India is passing through the second stage of demographic transition. While developed countries are in 3rd stage which has characterized by low birth rates and low death rates.3. Predominance Of PopulationAnother Important feature of Rural India is that the population is dominating in rural areas. Rural population was 82.7% in 1951 and urban population was 17.3%. Similarly In 1991 the rural population was 74.3% and urban population was 257. In 2001, the rural population was 72.2% and urban population was 27.8. The ratio of rural urban population of a country is an index of the level of industrialization of our country. It is a sole reason for which the process of urbanization is still slow and India continues to be land of villages.4. Low Literacy RateThe Literacy Level in India is low. The level in 1991 was 52.2% while male-female literacy ratio was 64.1 and 39.3 percent. In 2001, the rural literacy rate was 58.7% while the urban literacy rate was 79.9%; had a difference of 21.2%. In 2011, the rural literacy rate was improved to 68.9%; had an increase of 10.2%.But in overall context still 35 crore people in our country are still illiterate.5. Low level of Education and Training:The status of education and training is very underrated in India. This is the prime reason which cause poor quality of population. The total persons enrolled for higher studies as percentage of population in age group 20-25 in 1982 is equal to only one fourth of the developed countries. The total number of doctors and engineers are very low as compared to developed nations which is only per million of population are 13 and 16 respectively.6. Low Life Expectancy:Life expectancy refers the average number of years a person is expected to live. Life expectancy in India was 33 years before 1991. It was increased to 58 in 1991 and in 2001, life expectancy increased to 62.2. Decline in death rate, decline in infant mortality rate and general improvement in medical facilities etc. have improved the life expectancy. However life expectancy is lower in rural India as compared to life expectancy of the urban India.7. Sex Ratio CompositionSex Ratio is defined as the number of females per one thousand males. Enumeration of population in terms of gender composition is one of the important factors bringing out useful data for development of the country. The sex ratio of India in 2011 Census is increased to 940 from 933 in 2001 Census. The sex ratio in rural India is 947 per thousand in 2011 and 926 for urban population. Q2) Write some important Economic features of Rural IndiaA2) Main characteristics of rural economy are:a. In Indian Rural Economy the Village is a prime institution and it satisfies almost all the needs of the rural community. The villagers or rural people have a feeling of belongingness and a sense of unity towards each other.b. The rural people primarily depends very much on natural and agricultural activities which is also referred to as primary occupation. Various Agricultural as well as cattle farming, pottery and allied activities are the main occupation in rural areas.c. The Lifestyles and stand of living of rural people in villages are very much simple. There are various Public services like education, construction, health and sanitation, transport and communication, banking, roads and markets are quite limited compared to the urban areas. It is seen that rural people rely much on faith, superstitions and traditional cultural practices. The standards of living of major portion of rural people are very poor and sorrowful. There is a lack of the various methods of production, social organization and political mobilization, which puts rural sector in an extremely backward and weak shell. In current times, the incidence of various alcohols drinking practices has gone up.d. The density of population is measured by the numbers of persons living per sq. kilometer is low and houses/buildings are scattered in the entire villages.e. It is seen that the existence of unemployment, seasonal unemployment and underemployment in rural areas is very prime. Unemployment implies to the situation of people with willingness and ability to work but is not getting employed. Underemployment also referred to as disguised unemployment; it is the situation of people employed in excess, over and above the requirement. The Disguised unemployment is a situation where people work but there is no increase in production i.e. Marginal Productivity is gradually decreasing over time. These situations are very common in rural areas.f. Poverty is a situation where the basic or substantial needs of the people like food, clothing and shelter are not being met. According to the 2011-12 estimates, approximately 22 crores of people in rural areas are very poor and they live below the poverty line i.e. the people have not able to make out their substantial living . Q3) What are the major component of Rural Infrastructure?A3) i. Rural roads: Roads provides mobility and connectivity to people living in rural areas with the outer areas. It also provides needed boost to agricultural activities by making available water, seeds and other raw materials to the farmers. By improving connectivity, rural roads also a means to provide employment opportunities for the rural people in non-agriculture sectors like- banking, finance, technical etc; thus it helps in increasing livelihood opportunities. Rural roads also serve as a channel to ensure that the they are served with better public services the benefits offered by the state.ii. Rural electrification: The rural electrification basically used to maintain the requirements of agriculture and other activities including irrigation, small and medium scale industries, handloom and village industries, cold storage houses to store food, healthcare and educational facilities.iii. Housing infrastructure in Rural Areas: Improved housing facilities leads to higher living standard of the rural people. In our country the government constantly tries to increase the housing facilities for the rural people by providing various free housing schemes. For example Indira Awas Yojana Scheme has provided housing facilities for the rural people.iv. Water supply system: The rural Water supply system can lead to sustainability of systems and sources and tackle the problem of water quality, thereby, increasing good health of people. Q4) What do you mean by Poverty ? What are its causes? A4) Poverty India comprises of 1/3 of the poverty-stricken individuals. Indian poverty is basically rural. In rural communities, landless labourers and casual workers are the individuals, who are residing in the conditions of poverty. The individuals, who are required to experience unfavourable effects as a result of poverty are, scheduled castes, scheduled tribes, the families, in which women are the heads, elderly individuals and children. The conditions of poverty among rural communities are characterised by lack of financial resources, land, assets, property and other resources. Due to lack of these resources, the individuals experience problems in sustaining their livelihoods in an appropriate manner. The vast majority of the poverty-stricken individuals are employed in the agriculture sector, farming practices, and other activities, such as, animal husbandry, fisheries and so forth.Causes of Povertyi) Unemploymentii)Participation in Minority Jobsiii) Illiteracy and unawarenessiv) Natural Calamities and disasterv) MigrationThe programmes are basically designed to target rural poverty as the prevalence of poverty is high in the rural areas. It is also important to note that targeting poverty is a great challenge in rural areas due to various geographic and infrastructure limitations. The programmes can be mainly grouped into 1) Wage employment programmes 2) Self-employment programmes 3) Food security programmes 4) Social security programmes 5) Urban poverty alleviation programmes. 6) skill India programmes for employment. The five year plans immediately after independence tried to focus on poverty alleviation through sectoral programmes. Q5) What are the major types of Agricultural practices are performed in Rural India?A5) In India the following types of farming are practiced:1. Shifting Agriculture (Jhoom):(a)In shifting agriculture, land is obtained by cleaning forest and agriculture is practiced till the fertility of the farm is exhausted. After this another farm is cleared and agriculture is practiced on it.(b)Usually, plant, tuber crops like yam, tapioca and root crops are raised. (Hi) It is practiced mainly by tribal living in forest. 2. Subsistence Agriculture:(a) In subsistence agriculture, farmer and his family produce cereals for themselves only or for local market.(b) Cereals like wheat, rice, millets are mainly raised. This is practiced in most parts of India even today. 3. Intensive Farming:(a) Intensive farming aims at maximum possible production on the limited farms with all efforts possible under the circumstances.(b) Intensive farming is capable of raising more than one crop a year.(c) Huge capital and human labour is employed on every hectare of land.(d) It is practiced in most parts of densely populated areas. 4. Extensive Farming:(a)It is the modern system of farming done on large farms.(b)It is also known as mechanical farming due to extensive use of machines.(c)Extensive farm raises only one crop a year.(d) Employment of labour and capital per hectare of land is comparatively less.(e) It is practiced in sparsely populated areas like USA, Canada, Russia and Australia. 5. Plantation Agriculture:(a) In plantation agriculture, bush or tree farming is done on huge areas.(b) It is capital-centered and needs good managerial ability, technical knowledge, improved machineries, fertilizers, irrigation and transport facilities.(c) A particular or single sown crop like rubber, tea, coconut, coffee, cocoa, spices and fruit crops etc. is sown and the yield is generally obtained continuously for a number of years.(d) It is practiced in Kerala, Karnataka, Assam and Maharashtra.(e) Plantation agriculture requires a long growing period. 6. Commercial Agriculture:(a) Commercial Agriculture is practiced to raise crops on a large scale with a view to export them to other countries and earn money.(b) Commercial agriculture is done mostly in sparsely populated areas.(c) Purpose of commercial agriculture is to sell the produce for money.(d) Gujarat, Punjab, Haryana and Maharashtra, mainly practice this type of farming.(e) Wheat, cotton, sugarcane, corn etc. are some of the commercial crops. Q6) Briefly Write about trends in Agricultural finance in Rural India.A6) Agricultural finance is crucial to support the growth of the agricultural sector. Indeed, it is essential for food security, job creation, and overall economic growth.The finance is an important input for the farm cultivation. But the majority of Indian farmers are poor. They cannot find sufficient finance from their own savings. Hence they have to depend on others. This dependence was mainly on indigenous money lenders, traders and commission agents. But these sources exploited the farmers by charging exorbitant interest rates. Not only that thee exploited the farmers but they were not willing to lend for a long time. These circumstances compelled the government to strengthen the institutional system of finance for farmers and rural people.
Q7) What are the major issues that are responsible for underdevelopment in Rural India?A7) Problems and challenges are integral to the existence of the individuals as well as the communities. In rural areas, people are experiencing number of problems and challenges, which are proving to be major impediments within the course of meeting livelihoods opportunities. The major problems are, poverty, illiteracy, unemployment, homelessness and crime and violence. The individuals get effected by either one or more of these problems, which are having unfavourable consequences within their overall quality of lives. Poverty is characterized by lack of resources, when the individuals do not possess adequate financial resources, they are unable to fulfil their needs and requirements. The prevalence of illiteracy is common among rural individuals, apart from poverty, there are number of causes, leading to illiteracy. Lack of literacy skills, education and awareness leads to an increase in unemployment. Homelessness among rural individuals takes place due to unaffordable housing, when they lose property, wealth and housing due to the occurrence of natural calamities and disasters and so forth. Prevalence of crime and violence is common in households as well as in other places, such as, schools, market places and so forth. There have been implementation of policies and programs by the government and organizations that have the major objective of promoting well-being of rural communities. The following are the various issues that are very prevalent in Rural AreasPovertyPoverty India comprises of 1/3 of the poverty-stricken individuals. Indian poverty is basically rural. In rural communities, landless labourers and casual workers are the individuals, who are residing in the conditions of poverty. The individuals, who are required to experience unfavourable effects as a result of poverty are, scheduled castes, scheduled tribes, the families, in which women are the heads, elderly individuals and children. The conditions of poverty among rural communities are characterised by lack of financial resources, land, assets, property and other resources. Due to lack of these resources, the individuals experience problems in sustaining their livelihoods in an appropriate manner. The vast majority of the poverty-stricken individuals are employed in the agriculture sector, farming practices, and other activities, such as, animal husbandry, fisheries and so forth. IlliteracyIlliteracy is a common social issue which is prevalent among rural individual. it is seen that it primarily concerned with deprived, marginalized and socio-economically backward sections of the society. This social problem is not only detrimental upon the lives of the individuals, but impose impediments within the progression of the entire community. When the rural individuals are illiterate and do not even possess the basic literacy skills, then they not only experience problems within the course of implementation of their tasks and activities, but also remain unaware of their rights and duties. The individuals are unable to understand the causes of problems and challenges that may take place within the course of their daily lives. They are unable to acquire employment opportunities. As a result of illiteracy, they also remain unaware in terms of policies, programs and strategies that have been put into operation to promote their well-being. UnemploymentIn rural communities, the problem of unemployment is severe among the individuals. When they are unemployed, they experience number of problems and challenges, which are regarded as major barriers within the course of attainment of better livelihoods opportunities. When the rural individuals are unemployed and are struggling to make ends meet, then they are continuously looking for employment opportunities or means to generate a source of income. When the individuals are looking for employment opportunities, they need to ensure that they possess adequate skills and abilities to put into practice their job duties in a well-organized manner. Q8) Write the Characteristics of Indian Rural Society.A8) The following characteristic has been stated by Reddy in 1985 about the Indian Rural Society:1. The rural society has centered by a village; it is a unitary aspect for rural people. The caste and social customs are very prevalent in rural society and it directly affects the businesses of rural people. Caste is a predominant social framework which permits the social and economic relations. Traditional caste occupation are very prevalent. For agro-economic activities and also for socio-religious life, the co-operative labourers are needed. In the large villages its population comprises all the occupational castes, giving a variety to it and have a comparatively more integrated and self-sufficient economic condition as well as socio-religious life than smaller villages.2. The villages act as a social and cultural unit which tries to possess basically as a uniform organization and structure of values all over India. The problems are very common to the entire Indian country side.3. The composition of ethnic, linguistic, religious and caste determines a village's character and structure. The villages of hamlets are inhabited by the certain castes as in the case of Agraharams for Brahmins. Even in case of a village which has mixed population; the different castes usually live-in different sections of the same village. It is seen that Inter caste rivalries are still present.4. Females do not have full equity as well as equality with men or male in several aspects of life.5. The agriculture is the main source of income or livelihood in Indian Rural Societies. Holding of land carries with it social and prestige value, besides being considered as an economic asset. In many villages, the land is mostly distributed between two or more castes, or among a few families, or between one big land owner and the rest of the community. Landless labourers and tenants constitute a considerable part of the population depending on agriculture.6. In Every village there is a presence of its own organizational set up, authority and sanctions. It has its growing body, the governing body- panchayat, based on local tradition since long, but now constituted on a regular basis according to provisions of Panchayat Raj.7. The settlements of village are generally governed by certain regional and local traditions which has followed from years by the elders. The layout of the village, construction of the house, the dress, the speech, and manners follow the set pattern of the cultural area. Each village possesses an individual of its own. Some have a reputation for generosity, hospitality and fair play, while others are notorious for their meanness and corruption. Some villages are known for their co-operatives, while some are noted for their litigations and factions. Q9) Briefly explain the Sources Indian agricultural economy.A9) The primary source of livelihood in India is Agriculture which is for about 58% of India’s population ; Gross Value Added (GVA) by agriculture, forestry and fishing was estimated at about US$ 276.37 billion in FY20 (PE).Progress in Gross value Added in agro&allied sectors stood at 4% in FY20.Our Agricultural Economy is constituted by production of various agro-products, their exportation, farming, small scale financial institution which works to boost up the small-scale industries. Gradually our Economy is moving, from being exploited by foreigners to make ways for its development; is a very tough work. The following are some key points of agricultural improvement-Food industry The Indian food industry has a future for huge growth, by increasing its contribution to world food trade every year due to its immense potential for value addition, particularly within the food processing industry. Indian food and grocery market is the world’s sixth largest, with retail contributing 70% of the sales. The Indian food processing industry accounts for 32% of the country’s total food market, one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth.Outputs of Agriculture According to 2011 report, India had a very large and diverse agricultural sector, on average, for about 16% of GDP and 10% of export earnings. India's arable land area of 159.7 million hectares (394.6 million acres) is the second largest in the world, after the United States. Its gross irrigated crop area of 82.6 million hectares (215.6 million acres) is the largest in the world. India is among the top three global producers of many crops, including wheat, rice, pulses, cotton, peanuts, fruits and vegetables. Worldwide, as of 2011, India had the largest herds of buffalo and cattle, is the largest producer of milk and has one of the largest and fastest growing poultry industries.The 20 most important agricultural products in India which have prime economic value in national’s productivity (in 2009) are:Rice, Buffalo milk, Cow milk, Wheat, Cotton (Lint + Seeds), Mangoes, guavas, Fresh Vegetables, Chicken meat, Potatoes, Banana, Indonesia, Sugar cane, Maize, Oranges, Tomatoes, Chick peas, Okra, Soybeans, Hen eggs, Cauliflower and Broccoli, Onions etc .These agriculture products are used for exporting which generates a lot of foreign currency for our country.Agricultural cooperatives There is a huge growth in cooperative societies in India, especially in the farming sector, since post independence. The country has networks of cooperatives at the local, regional, state and national levels that assist in agricultural marketing. The commodities that are mostly handled are food grains, jute, cotton, sugar, milk, fruit and nuts which are supported by the government; led to more than 25 thousand cooperatives being set up by the government. Cooperatives in India are set up on the basis of the following industries. They areSugar industryMost of the sugar production in India takes place at mills owned by local cooperative societies. The members of the society include all farmers, small and large, supplying sugarcane to the mill. Over the last fifty years, the local sugar mills have played a crucial part in encouraging political participation and as a stepping stone for aspiring politicians.MarketingThe cooperatives play a prominent part in the overall marketing of fruit and vegetables in India. Since the mid 80s, the amount of produce handled by Cooperative societies has increased exponentially. Common fruit and vegetables marketed by the societies include bananas, mangoes, grapes, onions and many others.Dairy industryDairy farming based on the Amul Pattern, with a single marketing cooperative, is India's largest self-sustaining industry and its largest rural employment provider. Successful implementation of the Amul model has made India the world's largest milk producer.Banking and rural creditCooperative banks play a great part in providing credit in rural parts of India. It serves as a financial institution through which rural people could able to take loans to start up their agro businesses, invest money on farming etc at low interest rates. Q10) Write some remedial measures taken to reduce the causes of underdevelopment.A10) Here are some measures are used to reduce the causes of under developmentFor poverty alleviationJawahar Gram Samridhi Yojana (JGSY) National Old Age Pension Scheme (NOAPS) National Family Benefit Scheme (NFBS) National Maternity Benefit Scheme Annapurna Integrated Rural Development Program (IRDP) Pradhan Mantri Gramin Awaas Yojana Programmes taken for removing illiteracy from India areNational Literacy Misson Sarva Shiksha Abhiyan Rashtriya madhyamik shiksha abhiyan Mid day meal scheme etc. Polices adopted by Govt. for removal of UnemploymentIntegrated Rural Development Programme (IRDP) National Rural Employment Programme (NREP) Rural Landless Employment Guarantee Programme (RLEGP) Jawahar Rozgar Yojana (JRY) Minimum Needs Programme (MNP) National Rural Employment Guarantee Scheme (NREGS)
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