| Rural areas |
|---|
| Currency | Indian rupee (INR)₹1 |
|---|---|
Trade organisations | WTO,WCO,WFTU,G-20,BIS,AIIB,ADB |
| Statistics | |
| GDP |  $3.53 trillion (nominal; 2022)[1] $11.75 trillion (PPP; 2022)[1] |
| GDP rank | |
| Unemployment |  2.6% (2018)[2] |
Main industries |
|
All values, unless otherwise stated, are inUS dollars. | |
In rural areas, the business operates towards different industries, which areagriculture,forest, andhandloom industries. The people lived in different areas of rural India master in unique skills. Such as the rural people living in Kerala, they have professional skill in carving wood, the other rural people proficient in weaving carpet live in Kashmir, there are various skills from place to place is because of the factors of resources and traditions.[3] Besides, in India, the agricultural is vital for the economy because it accounts for 44.5% of GDP[4] from 1970 to 1971 and offers 68% of rural employment. However, theagriculture sector shrunk to 16.1% of GDP in 2009 while the proportion of non-agricultural industry achieved 86% of the GDP.[5]
A rural enterprise refers to a company registered in the rural areas, was under the responsibility of theDepartment for Environment, Food and Rural Affairs.[6] The reasons for business operating in the rural area are favorable factors such as the appealingdwelling, fresh air, bigger extend headroom, cheaperrental fees, and harmonious relationships withlabor. In India, there are still many people living in rural areas.[7] Furthermore, There are approximately 90% of employees are residents who work in an assigned area in thecountryside and aim to increase the local economy. The purpose of increasing in rural economy is to make fewer people living under the poverty line.[7] Thejoint family structure is predominant as the strongkinship relationship in India.[8] Therefore, to assure that there are lucrative employment opportunities in rural India, the intervention of the plan is needed.[7] For example, theMahatma Gandhi National Rural Employment Guarantee Act has been promulgated to increase the opportunities for wage employment.[9]
In a different historical time, the performance of agriculture has a discrepancy, at the beginning of thegreen revolution, between the 1970s and 1980s, the growth rate of agricultural remains high inUttar Pradesh. In the 1990s, the substantial loss is suffered by the farm economy as the growth space brings by theGreen revolution may be used up. Such as the decline in the outputs of Cereal crops, wheat, andgroundnuts. After the period of theliberalization, the growth of thefood grains stayed behind the increase in the population between 2000 and 2001 and theTotal factor productivity show a decreasing trend from 1993[10] Therural economy with slow growth pace has developed to a high-speed growth economy after theliberalization in economic and the improvement in the facilities. Between 1990 and 1991, the launch of neweconomic policies leads to a decline in the output offood grains and an increase innon-food crops such as cotton. The location of 61% of the total enterprises is in rural areas, as stated in the 2005Economic Census Report.[11]
Theagriculture industry is crucial as it solved thesubsistence of the 2/3 of the population in the field study atAmbedkar Negar district, in which, the labor force of India accounts for 52%, and this sector made the contribution of 15.7% of the Gross domestic product between 2008 and 2009.[12] The majority of the National economy is contributed by the agricultural industry.[7] The job of people who lived in rural India is still mainly engaging in agricultural.[7] Nevertheless, it also found that the agricultural has a receding proportion in the GDP. There are approximately 91% of the population in the 13 selected villages in India works associated with farming, among these, over 86% are the small and marginal farmers who have an achievement of cultivating 75% of thetotal arable land.[12] Besides, Theagrarian economy mainly comes from the little area and marginal and small land possessed by farmers. However, there are still some factors such as the advent ofdiseconomies caused by theliberalization agenda,[12] the downward trend of the share of the land, the limited job opportunities andproduction possibilities may lead to the livelihood under the line of poverty. Finding the sources or crops that can generate incomes and trying to satisfy the need of the consumers is needed to sustain their daily life. The sources or crops that can generate incomes and trying to satisfy the need of the consumers is needed to sustain their daily life.[13] For example, thecommercial products (milk, vegetables, and fruits) are the sources that can be traded in markets and are required by the residents as secured food. Besides, the small and medium farmers are more likely to foster diversified resources with catering the demand such as the grains,fibers, andoilseeds, which makes more profits. Therefore, many farmers made a transformation from farm to non-farm agriculture businesses. For instance, there are roughly 66% of thepeasant engaged in non-traditional agricultural enterprises.[13]
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Theforest industry traditionally produces two primary resources, which are timber andnon-timber forest products (NTEPs). The fuelwood plays a crucial role among theforest products as it taking up more than 35% average forest income in the selected 27 villages around theJharkhand in India. Besides, the forest income is significant because it made 12% to 42% increases to the village economy, and it is the dominant source of income in HFLA and HFHA villages. From which, it would alleviate the livelihood burden of households. It is using the majority of thefirewood in the rural family as a source for heating in the selected villages inJharkhand. Thus, less than 10% of the fuelwood for trading. Apart from the firewood, there is another forest product also very valuable, which is NTFPs.[14] Thetimber uses for producing furniture and equipment.
In contrast, theNTFPs encompass the products that can use in different areas, such as themedicinal plants for healing, some specific plants used in making cosmetics. Furthermore, NTEPs is one of the oldest product in trade. For instance, in the 12th century AD, there is trade insandalwood oil andArabic gum. Thus, it contributes to the local economies that started from the early days. Nowadays, the Baigatribal in India still lives to rely on the NTFPs as the source for living and income. Moreover, it also stated that NTFPs has intangible values such as in many cultures, specific Forest area issacred. Therefore, the function of the NTFPs also can be related toreligion, not merely on the trade and the products.[15]
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Thehand loom industries inOdisha state, India is followed by theagriculture sector in terms of the contribution of the employment, which maintained the livelihood of theweavers in thelow class. In rural India, the Bastralaya handloomcooperative producestraditional clothes (sarees,lungis) and household's products (bed cover) with dyeingYarns. There is a tradition in India, when the advent of theNuakhai festival, the handloom items will be sent between family members. Also, women will wear asari to dance during this festival. Furthermore, there is a complicatedbraid art calledIkat, based in Telangana, which weaving prominent patterns on the silk with using environmentally friendly coloredthreads. Furthermore, while carrying on the orders, the quality of the product is strictly controlled, such as if the weaver did not meet the standard criteria in terms of thedimension of the sari, the cash fined will be required after rigorously check. Weavers in this industry should possess Textile skills,[16] learn new knowledge through regular activities and observe the needs of the customer such as the color they preferred for the sarees, these competencies with the help of Bastralaya company will improvesocial-economic. Thus, the Bastralaya commit to bringing moreearnings for weavers.[17]
AJoint family enterprise in India has a dominant place due to the concept of family and the incentives of the economic benefits.[18] The Joint family encompasses two types of family, which arepatrilineal andmatrilineal.[19] Besides, the partnership between the family members or relatives with the samecaste andsub-caste will bring significant start-up capital and assistance from relatives to solve the issue, such as handling all of the business simultaneously. Besides, another predominant reason for this form of partnership is the concept of unity in akinship, which is a cherish perception relate to theimmediate family orDistant Relatives as partners. For example, 23 partnership ventures have a corporation with family members in the total of the 48 enterprises in the selected two villages atGujarat,West India. However, even if the strong sense of unity as a family but the conflicts may appear eventually, and sometimes the certain activities need different nature of the collaboration. Therefore, it could happen that the partnership established outside of thejoint family.[8]
In India, there are different forms of rural enterprises, which arecommunity-based organizations,self-help groups, andcooperatives, these companies are beneficial for therural economy due to the job opportunities created. However, there are some challenges for enterprise in rural India, such as the limitedassets, inadequate skills and labors, unsteadycommunication system, and weaktransport infrastructure. These are obstacles for enterprises in rural areas to be enlarged to a higher-value market. Also, the deficit of knowledge on promoting the product may lead to the proposition of improper decisions. For example, India rural enterprise has a reliance on the traditional experiences to thrive on, such as the weavers in Sambalpuri BastralayaHandloom cooperative society limited obtained basic knowledge from parents and community.[17] Therefore, the appearance ofe-commerce is to solve these issues. For instance, Anand Milk Union Limited is an India dairy cooperative; it applied the e-business in rural India to gain a robust supply chain, eliminatetransport obstacles, and have a good relationship with customers.[20]
Cooperatives in India is on behalf of one of the most extensive system in terms of rural finance in the world. Agricultural cooperatives in India still have excellent scope for improvement with the changing economy.[7] Through reaching a large number of clients, farmers (small and marginal farmers),[21] and people under the poverty line, it can be seen that rural cooperatives have an essential role in thehinterland of rural areas.[22] There are approximately 450,000cooperatives in India with 220 million people involved.[7] Cooperatives originated from the twentieth century, and at an early stage mainly catered to the financial needs of the farmer, especially the advent ofharvesting andsowing. Today, the cooperatives are responsible for the majority ofrural credit, which constitutes 65%.[7] Under the different types of cooperatives in India, thecredit cooperative is a powerful system in India, which encompasses the organization of the rural credit cooperative. In the villages of India the other types of cooperatives found are societies of farmer service and multipurpose society for large-scale agriculture.[22]Rural Cooperatives also engaged in distributing quality inputs to farmers by charging maximum price through the activity ofprocurement.[7] The dairy cooperatives in rural India help women become involved in the production of milk, acquiring confidence, more specifically, concerning the success of theAmul experiment.[7] Pravaranagar CooperativeSugar industry is another successful example as the contribution to the development of thesocial-economic rising in the economic benefit and the improvement of rural facilities, which are inclusive of the areas of education,recreation center, hospitals, andcooperatives.[7]
Theself-help group in India is an action taken in a group in a wide range, which helps approximately 33 million ofIndian women to obtainfinancial services and other activities with lower prices. Women in rural India, especially with lower castes and lower education level, facing a plight such as the adverse health condition and limitation to acquire financial products.[23] There are commonly 10 to 20 members in a rural self-help group, who funded money mutually for the enterprise or emergency. For example, inTamil Nadu, India. The newself-help groups established after thenatural disaster.[24] One of the famous models launched in rural India is to providemicrocredit to poor Indian women.[25] The initiatives of rural development in India concentrate on the development of the economic status of women and other vulnerable people by providing micro-credit.[23] Besides, there is another model not only offer theMicrofinance plus[25] but also involved in the areas ofeducation, socialattendance, andpolitics. The self-help group has ethical implications for Indian women, such as alleviating the economic burden and eliminatinggender inequality. After accessing the loan products, there is an improvement for rural women in the aspects of psychological and economic conditions.[23] Moreover, women who arewidowed will receive support.[24] In South India, the large proportion of rural women, especially widows, experienced poverty, uncertainty in the inheritance of land, and barriers of involving in community.[23] The existence of the rural self-help group is to empower the vulnerable group, especially women, to conquer the barriers.[23]
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