3 Features of rural economy in India

3 Features of rural economy in India

India is a country of villages. Even today more than 60% of the country's population lives in villages. Even today the village is the heartbeat of India. You cannot understand Indian culture by ignoring village culture and in the same way, you cannot understand the Indian economy.  If asked what are the three important features of the rural economy? These three features can be considered as follows. 

Also read: How weather and climate affect Earth?

The first feature is agriculture. 

Agriculture is the backbone of the Indian economy.  At the same time, it changed the shape of the rural economy. It will be interesting to understand in phases how this happened. The British did not show any generosity to the Indian farmers.  land ownership structure has changed. Farmer is no longer able to cultivate only for livelihood.  Now the farm became property. Mentality developed, that who have more land was considered more prosperous and that is why a class of landlords (zamindar) came into existence. These landlords were not farmers. They had no knowledge about farming but they had very large land.  On the pieces, they were now farming for trade. Cash crops started from here. The second biggest change during British rule was that agricultural produce was widely used in industries. Agriculture was being commercialized and the third change was that Indian agriculture that  The market was organized in an orderly manner. The farmer kept enough for himself and sold other products to get the necessities of life.... it was a matter of the past.

The Krishi Upaj Mandis, that is, agricultural produce markets, have emerged close to the clusters of villages. The villages are linked with the approach road and thus the new infrastructure has brought the villages close to the regional, state, and national markets.

The Green Revolution after 1970 changed the face of villages

The major factors that contributed to the commercialization of agriculture are as follows:

a.  High production and productivity gains have turned out agriculture to be a profitable proposition.

b.  Increase in production was possible due to the use of advanced technology in agricultural operations.

c.  Massive expansion of road transport has reduced the distance between rural and urban areas.

d.  Development of regulated markets and cooperative marketing the structure has helped the farmers to break away from the village system of moneylenders and middlemen.

Also read: Paul Milgrom and Robert Wilson: Nobel Prize-Winning Economists

Commercialization of Agriculture:

In the present day, a large part of the rural economy has been opened up, which has made the commercialization of agriculture possible. The extent of the commercialization of agriculture in the rural economy marks the stage of its development.

The changing nature of the villages has created two other important features of the rural economy. , So the second feature of the Indian rural economy is,

The village market.

The village market has a special form but it still has a distinct identity.

Subsistence Market Economy on Rural Society in India!

Throughout the periods of history, the village economy has been a subsistence economy.  It is because of this that we characterize rural society as an agrarian society.  Opposite to it is the industrial and urban society.

As a result of the development programs and the consequent emergence of infrastructures of technology, education, transport, media, the village economy has moved towards a diversified economy.  In this economy, the market has assumed an important space.  It will, therefore, be interesting here to mention something about the role of the market in the village economy.

The new market system has created and strengthened the rural class system.  In the villages, a new class of big traders, big peasants, and petty officials, along with the elites and political workers, have emerged.

This class is influenced by media has begun to consume objects of a new culture.  They demonstrate a style of life that differentiates them from the other rural groups and brings them closer to the urban consumer society.  The market in this way provides a nexus with the regional and national markets.

Rural marketing is now a two-way marketing process.  There is the inflow of products into rural markets for production or consumption and there is also an outflow of products to urban areas.

Features of Rural Marketing:

The main reason why the companies are focusing on the rural market and developing effective strategies is to tap the market potential, that can be identified as follows:

1. Large and scattered population:

2. Higher purchasing capacity:

3. Market growth:

4. Development of infrastructure:

5. Low standard of living:

6. Traditional outlook:

These six features make it clear that the village market in India is a constantly growing market. With a large population and a large number of buyers. 

The green revolution has taken place in agriculture. Advanced technology is being used so the income of the villagers has increased. 

Increased infrastructure has become richer, paved roads and communication facilities have increased, you may not believe, but as many mobile phones are sold in cities, so many modern and expensive mobile phones are also sold in villages.  Mobiles towers can be seen in every village.  

The famous economist has a well-known saying 

"Whether a political leader of a region knows whether there is a gas cylinder in a village in India or not but Hindustan Lever knows that a bar of Lux soap is sold in every village. "

The standard of living of the villagers is very low even today so the village is the best place to sell cheap products. You can say the biggest feature of the village market is that.  if it is a cheap item, it will sell faster in the villages than in the cities. However, the villages of India have accepted the items available in the modern market without changing their traditional form. This is also a surprise.

The Indian industrial market, in its turn, is also expanding its horizons.  In this expansion network, rural society has also been caught.  The remote corners of our villages, even in high lands and forests, have received the new commodities of various brands.  Thus, the local rural market is becoming a fast-growing consumer market.

The development of the consumer market is through mass media and technology.  The advertisements through print and electronic media are approaching the local rural market.  One can easily get products of national standard companies even in the villages. There is another aspect of this whole phenomenon. Just as the village is a big market for the products made in the city industries, the products produced in the villages are now being sold in the cities.

The network of the new market has also provided opportunities to the rural market to send their raw material to towns, cities, and metropolises.  Milk, tomatoes and raw fruits produced in the village side move towards the city and town side.

Now let's talk about the third feature of the rural economy. 

Rural Society under the Impact of Urbanism:

A big mass of the villagers has gone to the cities due to a lack of employment. It is also interesting to know about the impact of the urban community on the villages. Yes, I m talking about Migration. Rural people are forced to migrate from villages to urban areas in order to seek gainful employment for their livelihood.  This character of the development gives rise to the formation of cities.  Enmity and Lack of basic amenities in rural areas also push people to migrate to urban areas.  

This is called ‘double poisoning’ by Schumacher, 

On one side villages are empty, on the other side towns are congested.  His book is "Small is Beautiful" describes the dangers of the present kind of development.


The past five decades have witnessed the rural society of India getting exposed to the waves of urbanism.  Most of the features of urban areas have been modified and diluted into rural society.  This has led to a new way of urbanism called rural-urbanism.

Urbanism has induced the disintegration of traditional joint family, the disappearance of neighborhood, sophistication, the emergence of individualism, etc.  Urbanism also created new social institutions, which were absent in the traditional rural setup.  Urbanism has also brought about modernization.

Contacts between the rural and urban areas have been increased due to the development of the means of transportation.  Similarly, the means of communication such as radio, transistor, television, and telephones have brought the remote villages nearer to the urban towns.  An increase in the contacts between the rural and urban areas has enabled quick assimilation of rural areas with the mainstream of urban life.

Earlier, the demand for rural India to industrial goods was limited only to the basic necessities However, the situation has changed now.  Today, rural India is seen as the potential market for industrial goods.  Observing such a situation, many industries have been flourished in rural areas, which are rich in the resources needed for the setting up of industries.

Two reasons can be attributed to such a situation. 

Firstly, contacts with urban areas have created awareness among the rural masses about consumer goods.  Due to the green revolution, the income levels of the rural people have increased, which encourages such consumption of goods possible.

Secondly, the new agricultural technology has resulted in the green revolution.  It supplies industrial goods such as fertilizers, machinery, etc.  There is also an increasing demand for repair services and workshops, which is inevitable when there is a supply of industrial goods.  Thus, the above-mentioned reasons have created an increasing demand for industrial manufacturers in rural India.

Also read: Yes to Investment! Invest now.

Next Post »

For any kind of happiness visit regularly
www.thelitthings.com ConversionConversion EmoticonEmoticon