India's rural sector stands at a pivotal juncture, poised for transformation through small-scale and green enterprises. It has potential to become India’s growth engine
India's rural sector must be transformed for inclusive growth and sustainable development. This change relies on small-scale and green enterprises to boost the rural economy, empower women, and employ unskilled workers. By channelling resources such as the extra Rs 1 lakh crore RBI dividends into capital projects and innovative schemes, India can foster self-sustainability in rural areas, mitigate youth distress, and rejuvenate the demand side of the economy.
This comprehensive approach not only addresses immediate employment needs but also lays the foundation for long-term capital formation and environmental preservation.
Incorporation of small-scale and green industries as the engine of growth
Micro enterprises have always been the backbone of the Indian agriculture-based economy. These labour-intensive enterprises perfectly capture the unskilled and semi-skilled manpower from the farming communities, therefore, creating employment and improving existence standards without much training. The development of these industries generates a massive multiplier effect on the creation of other business lines that support them and the general economy. Green industries are therefore leading this change. Encompassing renewable energy, organic farming, and sustainable manufacturing, these sectors offer dual benefits: employment opportunities for production and environmental management.
The establishment of green industries in the rural region targets to solve social problems like climate change and environmental degradation and at the same time create a sustainable means of living. This was done by allowing biogas and biofuel plants, solar energy farms, Ayurvedic and Unani medicine industries, and cooperative organic farming. These measures create employment, lessen the dependency on fossil energy and foster the preservation of the environment.
Women empoerment Out of the total rural population of India, the female population is about 30 % which is a great unexplored talent pool. It is shown the promotion of employment and entrepreneurship in these women brings substantial socio-economic returns. Micro and sustainable industries remain essential in empowering women since they create employment, skills development, and business opportunities for women. Self-help groups, women-based cooperatives and micro enterprises are the best way to ensure women’s productive participation in the rural economy. These initiatives exist in areas where women dominate including handcrafting, production in textiles, manufacturing of alternative/Ayurvedic products, processing of raw materials, farming organically, milk production, and food processing. Credit, training, and market linkages also enable women to set up and expand their businesses besides improving on household incomes and community development.
Public private partnerships
A Channel for Facilitating PPP for Rural Development PPP is a powerful platform for pooling resources and skills to promote rural development. Thus, PPP models can initiate the development of small and green industries in rural areas with the support of the government and private investors. The government can provide policy support and an environment for development and financial backing while the private players bring in funds, technical expertise, and managerial skills. As per this model, to encourage rural development, a part of ?1 lakh crore RBI dividends can be spent to co-finance with private entities. It can be used to fund the development of industrial clusters, renewable energy projects, and training institutions with efficient implementation and compliance with social and environmental responsibility.
Capital formation and rural employment
These are two basic objectives of the growth process that need to be understood and analysed. To sum up, the provision of ?1 lakh crore RBI dividends for capital investments in the form of sustainable rural development plans provides a strong base. Construction of infrastructure such as roads, bridges, renewable energy facilities, and development of industrial estates can offer employment in the short run as well as in the long run spur economic development. A targeted investment can engage millions annually, thus erasing rural unemployment and distress to a large extent. In this way, employment of non-skilled and semi-skilled people from rural areas is possible, and thus future generations are protected from unemployment migration to urban areas, and rural-urban disparity. The placement of rural youth through placement in local schools, hospitals, and government offices helps in the tackling of manpower issues leading to improved service delivery and welfare of the populace.
Funding rural transformation
Funding the strategic rural development agenda calls for out-of-the-box funding acquisition strategies to tap several sources of funds. To the Rs 1 lakh crore RBI dividends, contributions from CSR, and own finances of panchayats and municipalities, and specific cess on fuel, income tax, and GST can be added. For example, the mandatory 25% contribution from CSR funds can be used to direct corporate money into rural development causes While a 0. 5% cess on luxury items, cars, aeroplane fares and GST can fetch a huge additional amount. However, it revealed that additional resources can be mobilized from the Skill Development Schemes (SKS) and hospital’s SKS funds for support of wages in essential sectors. The introduction of a small cess on share trading can also produce a fairly good revenue for such a scheme in turn funding the rural employment programme permanently.
Addressing rural unemployment
At the moment, unemployment has touched the figure of 8% in India. 1 per cent of the nation’s unemployed populace is comprised of rural youth. If PM wants to bring the unemployment rate down to 6% and this is considered nearly equal to the employment rate observed in the developed countries, the scheme should ensure employment generation for at least 1 crore rural youth. The scheme should aim at offering low-wage employment to the increase in unemployment among the rural youthful population while at the same time ensuring that such employment offers incentives to make the youth stay in their given community without competing for skilled employment opportunities. This way the scheme means setting wages at ? 10,000 per month with 80:20 work distribution will sustain rural households’ income and at the same time does not hinder organised labour employers markets.
A Roadmap to rural rejuvenation
Additional Rs1 lakh crore of RBI dividends coupled with idea capitalisms as sources of funding open the doors of a scheme that has the potential of providing a road map for rural rejuvenation. As a result, the small-scale industries, green industries, women and unskilled rural labour can make the scheme self-sustainable, reduce unemployment and bring a long-lasting impact on the environment. PPP and the focus on capital development will help the scheme to be sustainable and grow in scale, thus painting a better picture for rural India.
(The writer is Chairperson of the National Unity & Security Council; views are personal)
