20 Aug 2019

Rural Non Farm Sector

Source: Yojana Magazine

What is Rural Non- Farm Sector?

Rural-Non-Farm-Sector (RNFS) includes all economic activities viz., household and non-household manufacturing, handicrafts, processing, repairs, construction, mining and quarrying, transport, trade, communication, community and personal services etc. in rural areas.

Need for Rural Non-Farm Sector  

  • Contribution of agriculture to India’s GDP is steadily declining.
  • As per the tenth Agricultural Census the average size of agriculture land holding declined to 1.08 hectare in 2015-16 from 1.15 hectare in 2010-11. This explains the rise of employment in the Non-Farm Sector.
  • 64% of the rural employment is in the agriculture sector but the share of the agricultural output is  39% . hence reducing the dependence of rural masses on agriculture as a source of income will help improve the overall income of rural population

Different Rural Non-farm Sectors

  • Mining and Quarrying
  • Household and Non-Household manufacturing
  • Construction and manufacturing
  • Trade, Hotel and Restaurant
  • Transport, Storage and Communications

Government of India initiatives 

The Government of India has introduced a large number of schemes over the years to diversify the rural population into non-farm activities, few of them are;

  • The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), 2005: It provides one hundred days of guaranteed wage employment in every financial year to every household whose adult members volunteer to do unskilled manual work. 
  • Deendayal Upadhay Grameen Kaushal Yojana: It is implemented by the Ministry of Rural Development to drive the national agenda for inclusive growth, by developing skills and productive capacity of the rural youth from poor families. It funds training projects benchmarked to global standards, with an emphasis on placement, retention, career progression and foreign placement. 
  • Deen Dayal Antyodaya Yaojana-NRLM: It seeks to  seeks to alleviate rural poverty through building sustainable community institutions of the poor. 
  • Aajeevika Grameen Express Yojana (AGEY): It is related to operating  road transport service in backward areas by the SHGs which provide an additional avenue of livelihood for SHGs.
  • Pradhan Mantri Mudra Yojana (PMMY): Under this scheme collateral free loans are provided by Banks, Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs) to small/micro business enterprises in the nonagricultural sector to individuals to enable them to set up or expand their business activities.

Challenges in Rural Non-Farm Sectors

  • Quantity, quality and reliability of Infrastructure
  • Regulatory restrictions on small sectors
  • Illiteracy and lack of awareness

Rural Tourism -An asset to Non Farm Sector

Meaning of Rural Tourism

Rural tourism can be defined as the country experience‘ which encompasses a wide range of attractions and activities that take place in agricultural or non-urban areas

As per Ministry of Tourism, any  form of tourism that showcases the rural life, art, culture and heritage at rural locations, thereby benefiting the local community economically and socially as well as enabling interaction between the tourists and the locals for a more enriching tourism experience can be termed as rural tourism 

Mapping of the Rural Tourism

Each of the 52 commissioned rural sites of Ministry of Tourism has a USP (rural resources), it has attempted to divide the rural resources into three categories they are:

  1. Resources by virtue of geographical and climatic characteristics of the region, flora and fauna, rivers, landscape, scenic beauty, etc.
  2. Aspects of the rural culture like village folklore, handicrafts, textile products, social bonds etc
  3. Farm produce and practices like sowing, harvesting

Importance of Rural Non-Farm Sector

The Non-Farm Sector is being accorded wide recognition in recent years for the following reasons :

  • It may facilitate employment growth 
  • It may prevent many rural people from migrating to urban areas
  • It offers more remunerative activities to supplement agricultural income
  • It provides a means for the rural poor to cope when farming fails