Sustainable Economic Growth in Rural India: A Path to Inclusive Prosperity

Sustainable Economic Growth in Rural India: A Path to Inclusive Prosperity

Amit Kumar Patjoshi, CEO, Palladium India, 0

A Postgraduate in Management (Strategy) from Xavier Institute of Management, Bhubaneswar, and a World Bank certified Public Procurement Expert, Amit boasts 24+ years long career leading key roles across various companies such as KPMG India, Accenture, PwC India, Ernst & Young, and CTRAN Consulting. Some of his key areas of expertise include Urban Transformation, Smart Cities, e-Governance, Public Service Delivery Modernization, Public Procurement, and Performance Review, to name a few.

In a recent conversation with Bimlesh Prasad (Correspondent, CEO Insights), Amit shared his insights on various aspects pertaining to the importance of rural economic growth and ways to achieve the same. Below are a few key extracts from the exclusive interview –

How does sustainable economic growth in rural India help towards uplifting communities and contribute to the overall development of the nation?
The heart of India beats in its villages, home to over 60 percent of our population. Beyond being the backbone of agriculture, rural areas are pivotal in addressing not only our domestic food needs but also contributing significantly to global food security. By investing in agriculture, organizations can catalyze rural economic growth and foster a vibrant rural economy.

Take, for instance, India's approach to food processing; it not only ensures food security but adds value to raw products. Moreover, with the majority residing in rural India, it presents a substantial consumer base for diverse business opportunities. Recent studies show a faster consumption rate in rural areas compared to urban regions. Investing in rural infrastructure development not only empowers these communities but also expands markets, enhancing the overall economic fabric of the nation.

Furthermore, sustainable growth entails skill development programs, vital for creating a workforce contributing to various sectors. Improved rural infrastructure is crucial for seamless goods and services movement across the nation. These initiatives, I believe, can foster sustainable economic growth in rural India empower communities to participate in country’s global agendas.

What are the key challenges hindering sustainable economic growth in rural areas, and how should they be addressed?
In addressing the multifaceted challenges faced by our nation, it is crucial to acknowledge the commendable initiatives by the government, such as the Pradhan Mantri Awaas Yojana - housing, Pradhan Mantri Sahaj Bijli Har Ghar Yojna - electricity access, and Ujjawala - clean cooking gas adoption. While these efforts significantly contribute to rural development by diversifying income sources, there remains a need for more comprehensive measures to combat poverty, enhance healthcare and education access, improve infrastructure, and alleviate agricultural distress.

To effectively address these challenges, economic empowerment must be prioritized through initiatives that focus on upskilling, education, and market-led Agri-business. The establishment of Farmer Producer Organizations (FPOs) is a pivotal step in transitioning from traditional agriculture to agri-business, fostering value addition and crop diversification. Notably, FPOs like Sosonum Agro, supported by Palladium, have achieved success by cultivating lemongrass and exporting products to foreign markets.

Another critical challenge is ensuring access to credit and building a robust financial ecosystem. While microfinance institutions have played a commendable role in making credit more accessible, there is a need to address high interest rates. The government's JAM Trinity (Jhan Dhan, Aadhar, Mobile) has opened up opportunities, and it is imperative not only to provide credit at lower interest rates but also to support sustainable business models through FPOs and Self-Help Groups (SHGs), benefiting the economically disadvantaged.
Furthermore, leveraging technology is paramount for sustainable growth. Despite a 35-45 percent mobile penetration in rural areas, there is room for further advancement. Accelerating the integration of technology can significantly improve livelihoods in rural areas and empower the youth. As we navigate these challenges, a holistic and collaborative approach involving government initiatives, private sector partnerships, and technological advancements will be instrumental in driving inclusive and sustainable development.

What is the role of education and skill development towards achieving sustainable economic growth in rural areas?
Empowering individuals in rural communities and driving sustainable economic activities hinge on the fundamental principles of education and skill development. These pillars not only equip individuals to make informed decisions but also bolster their capacity to contribute meaningfully to the overall development of their communities. While the government has undertaken commendable initiatives to ensure universal access to basic education, the current focus must shift towards upskilling rural resources.

The post-pandemic landscape has underscored the imperative of narrowing the urban-rural gap and elevating the prosperity of rural communities. Education emerges as a potent tool in addressing this disparity by granting rural populations access to information and technology. This access proves pivotal in keeping them abreast of market trends, modern agricultural practices, and other pertinent aspects crucial for their development.

Education emerges as a potent tool in addressing this disparity by granting rural populations access to information and technology.

Moreover, there is an escalating demand for skilled manpower, accompanied by a growing gap between skill demand and supply. Initiatives in skill development can play a pivotal role in enabling individuals to cultivate diverse skill sets. This diversity is paramount for rural communities to adeptly navigate dynamic economic conditions and meet the evolving demands of the market, ensuring flexibility and resilience in the face of change.

Thus, it is imperative to advocate for a holistic approach that places education and skill development at the forefront of rural empowerment. By prioritizing these initiatives, we can bridge existing gaps, create opportunities, and fortify the foundation for sustainable growth in our rural communities.

Could you signify about private-public sector collaborations on achieving an accelerated rural economic growth?
The government has been playing the role of both a facilitator and an implementation partner in enabling services, infrastructure, and other aspects. However, due to the vast geography of India, it is practically impossible for the government alone to facilitate economic development across every rural region. We need to leverage the strengths of both private and public sectors to address the challenges faced by rural communities. The government should take care of developing the necessary basic infrastructure while it is the responsibility of the private sector companies to bridge the gap in empowering the remote rural communities. Some of them are augmenting the infrastructure that is being provided by the government, providing services based on that infrastructure, driving tech interventions at the rural level, etc. This way, the private sector plays a very critical role in strengthening the basic necessities that are already being provided by the government.

What is your advice to private sector leaders working towards rural economic development?
For fellow business leaders, I strongly recommend customizing solutions within a localized context by drawing on traditional knowledge instead of imposing urban-centric approaches onto rural settings. Prioritizing sustainable outcomes and resilience is key, and it's essential to consistently assess the impact of any initiatives at the grassroots level. In addition to fostering innovation, cultivating collaboration and partnerships, both within the private sector and with government entities, holds significant importance. This collaborative approach ensures a more nuanced understanding of the unique challenges in rural landscapes and facilitates the development of solutions that truly resonate and endure.