Rural revival needs structural change

Last year 18 farmers deprived of meaningful elementary education in rural India’s collapsed school system and driven to despair by drought, falling produce prices, and inaccessible credit and insurance, killed themselves every day, leaving behind vulnerable families who in the lawless badlands of village India are soon reduced to slavery. According to a deeply researched special report in the Economic & Political Weekly (May 27) since 2002, 270,000 farmers (including 12,360 in 2014) enduring tough conditions and economic distress, took the extreme exit.  Although post-independence India’s blinkered intelligentsia and self-serving academics comfortably tenured in the country’s 800 unproductive universities, seem to suffer selective amnesia, the seeds of the excessive economic distress currently sweeping rural India were planted in the early years after independence when free India’s first prime minister Jawaharlal Nehru road-rollered the inorganic Soviet-style public sector-led economic model. Consequently, rural and urban savings were vacuumed to finance heavily capital-intensive public sector enterprises (PSEs).  Inevitably, the country’s monopoly PSEs managed by business-illiterate clerks and bureaucrats proved to be huge failures, and instead of investible surpluses, gifted the nation the curse of unrelenting inflation. Seven decades later, only 45 percent of agrarian India is serviced by irrigation and rural connectivity is in a shambles. Moreover, despite India being the world’s largest producer of perishable fruits and vegetables, the licence-permit-quota raj imposed by Nehruvian socialism prevented the establishment of a post-harvest food storage and processing industry. As a result, an estimated 40 percent of horticulture produce valued at Rs.50,000 crore, is spoiled and wasted annually.  Given this horrific reality of decades of under-investment in agriculture development, periodic waivers of bank loans of the nation’s hard-pressed farmers is likely to achieve little except ruin the banking system. Quite obviously, rural India is paying the price of sustained neglect of agriculture which needs to be remedied. The priorities for rural development and resurgence have long been self-evident. Topmost are massive investment in rural primary-secondary education, extension of irrigation coverage, improved rural-urban connectivity and urgent expansion of the minuscule downstream food processing industry thwarted for decades by powerful horticulture wholesalers in the states. However, these seemingly simple solutions require major structural changes in the budgetary resource allocation process and improving the ease of doing business in rural India, still dominated by entrenched caste elites and money-lenders hand-in-glove with corrupt public bank officials. This challenge combined with the indifference of the urban middle class to the prolonged suffering of rural India, has dissuaded successive governments at the Centre and in the states from offering little more than lip service to the country’s neglected rural majority. Facebook Twitter LinkedIn WhatsApp