Recent trends in fast moving consumer goods as well as bridging of the gap between urban and rural per capita monthly consumption expenditure have led many policymakers to conclude that things have looked up in rural India. Stagnating rural wages, however, makes others question this conclusion.
It is true that many pro-poor public welfare programmes (Jan Dhan Bank Accounts, Ujjwala gas connections, Swachch Bharat Mission individual household toilets, Pradhan Mantri Awaas Gramin homes, free electricity connection for the deprived, higher rates of immunization, over a hundred million women in Self help groups of the National Rural Livelihoods Mission and over 50 per cent credit linked, Swamitva Property Cards creating the opportunity for higher bank credit penetration in rural areas through housing property collaterals, over 92.5 per cent households having a pucca all weather road within 2.5 km), are all an indication of improved ease of living in rural areas.
While many initiatives have worked very well in temporarily ameliorating the hardships through cash transfers to farmers and women, such transfers rightly raise the question of sustainability of very high public debt through doles to the deprived. The classic question of teaching people to fish rather than distributing fish has rightly become a major policy challenge.
Stagnating real wages in rural areas raises the issue of productivity, higher standards of education and skilling. Post Covid, deprived households are averse to migrating with very paltry wages or poor living conditions in urban areas. This has slowed down the rate of migration to cities. The sober rise in consumption in urban areas and the decline in savings of many from the upper poor and lower middle classes, indicate the crisis of incomes despite more people getting jobs. The challenge of underemployment is more serious than we visualise as reflected by an increase in the number of those engaged in agriculture and allied activities.
The rural economy is having to cater to a very large working age population in the absence of high paced movement of able-bodied persons into non-farm occupations. Despite over half of manufacturing and construction and one-fifth of services opportunities in rural areas, the integration of the rural deprived households in such emerging opportunities requires a greater thrust on human development.
In the light of the current scenario, what should be the rural ask?
Decentralised action
First, it is time to give up lip service to decentralised community action and devolution of funds. Education, health, skills, nutrition, livelihoods need top-most priority action, and they give best outcomes when convergence begins from below, within the framework of the Eleventh Schedule of the Constitution of India, assigning 29 sectors to local governments. The sectors are so integrally linked to each other that outcomes cannot come through narrow departmentalism.
Second, local community action requires moving away from mistrust to trust. We need much more untied funds and data driven, technologically empowered, accountability framework, that allows local governments to engage professionals for outcomes. The Mission Antyodaya framework for annual community validated data on 216 localised Sustainable Development Goals is clearly the way forward. Success will require untied funds at the community level; centralisation does not allow a hundred flowers to bloom.
Third, the performance of Secondary and Higher secondary Schools and access to Industrial Training Institutes (ITI) and Polytechnics need to be significantly improved for rural areas as high-quality skills are always built on a base of formal secondary education with satisfactory learning outcomes. Under-nutrition and morbidity due to health challenges can also compromise productivity. Rural secondary schools need good professionals.
Fourth, rural areas are also getting manufacturing, construction and services opportunities that can be grabbed by rural youth only if they have the appropriate skills. The emerging non-farm clusters growth points will need urban-like basic infrastructure. The Rurban Mission was doing that in 300 Clusters, and we need to revive that programme. We also need to encourage rural Panchayats that wish to become Nagar panchayats by assuring financial support.
Fifth, women’s collectives have demonstrated their ability to become lakhpati didis on scale. We need to map individual Jan Dhan Accounts of SHG members with the SHG credit to create a complete credit history and higher CIBIL score for first generation women entrepreneurs. The success of the Start Up Village Entrepreneurship Programme (SVEPs) should be replicated on scale.
Rural infra programme
Sixth, there is a need for an exclusive rural infrastructure programme, over and above the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) to ensure that MGNREGS focuses on the 2,500 dark Blocks that have major water challenges and on high deprivation districts. For the rest, a large infrastructure programme or inclusion in the national infrastructure pipeline will enable a faster removal of deficits on rural infrastructure.
The rural ask must enable a higher order economy that does not have 50 million households reporting for MGNREGS year after year. Education, skilling, health, nutrition, livelihoods outcomes must be improved to create higher productivity.
Devolution will provide a platform for local action; technology enabled strong accountability framework with full transparency, social and financial audit, IT/DBT, geo tagging, evidence-based research, public information, and easy to use apps, can greatly facilitate localized effective governance. Professionals on fixed term contracts could be brought in at market rates to really transform things in a short period of five to ten years.
They could come on a lien from their current place of work to transform a gram panchayat through pursuit of scientific principles and convergent use of untied finances for the 29 transferred Sectors.
The writer is Senior Fellow, Centre for Social and Economic Progress. Views expressed are personal
