NCERT Solutions for Class 12 Economics Part B Chapter 5 Rural Development

1. What do you mean by rural development? Bring out the key issues in rural development.

Ans. Rural development can be described as a comprehensive term or an “action-plan” which essentially focuses on action for the development (economically or socially) of areas that are typically lagging behind in the overall development of the village economy.

Some of the areas wherein there is a need of fresh initiatives for rural development are:

(i) Development of human resources like literacy, especially female literacy, education and skill development.

(ii) Development of human resources like health, considering both sanitation and public health.

(iii) Honest and timely implementation of land reforms.

(iv) Development of the productive resources on the level of each locality

(v) Development of infrastructure like electricity, irrigation, credit, marketing, transport facilities including construction of village roads and connecting roads to nearby highways, facilities for agriculture research and extension, and information dissemination.

(vi) Effective measures for alleviation of poverty and bringing about significant improvement in the living conditions of the weaker sections of the population.

2. Discuss the importance of credit in rural development.

Ans. Farmers require money to buy additional land, implements and tools, fertilizers and seeds, paying off old debt, personal expenses like marriage, death, religious ceremonies, etc. Because of the long gestation period between sowing and harvesting the crops, short-term bourowing is necessary to buy seeds, fertilises, etc.

3. Explain the role of micro-credit in meeting credit requirements of the poor.

Ans. The following are some ways that micro-credit assists the under-privileged in satisfying their credit needs:

(i) By granting credit for their consumption, it contributes to the empowerment of woman.

(ii) It aidsin encouraging tiny savings that can be accumulated and used in times of need.

(iii) It helps in protecting the formes from the exploitation of lenders and traders.

(iv) It offers farmers loans with affordable interest rates that are repaid in small business.

4. Explain the steps taken by the government in developing rural markets.

Ans. The government has taken various steps for the improvement of agricultural marketing system.

Some of the steps are as follows:

(i) Establishing the Regulated Markets: Government has established regulated markets to remove most of the drawbacks or shortcomings of an unorganised market system.

Functions of regulated markets are:

(a) Enforcement of standard weights.
(b) Fixation of charges, fees, etc.
(c) Settlement of disputes among the operating parties in the market.
(d) Prevention of unlawful deductions and control of malpractices of middlemen.
(e) Providing reliable market information.

(ii) Provision of Infrastructural Facilities: The government has also taken measures for developing the infrastructural facilities like roads, railways, warehouses, godowns, cold storages, processing units etc.

(iii) Co-operative Market: Co-operative marketing is a measure to ensure a fair and reasonable price to farmers. Member farmers have to sell their surplus to the co-operative society which substitutes collective bargaining in place of an individual bargaining. It connects the rural credit farming marketing processes to the best advantage of the farmers.

(iv) Key Instruments to Safeguard the Interests of Farmers: The Government has also developed some important instruments to safeguard the interests of farmers. These instruments are:

(v) (a) Fixation of Minimum Support Price (MSP)
(b) Buffer Stock
(c) Public Distribution System (PDS).

5. Why is agricultural diversification essential for sustainable livelihoods?

Ans. For the following reasons, agricultural diversity is crucial for sustainable livelihoods:

(i) It causes a movement in the workforce away from crop cultivation and towards non-agricultural enterprises like food processing, tourism and other allied industry like poulty, cattle, etc.

(ii) Gainful employment for farmers, ensuring familiy budget even in the off-season.

6. Critically evaluate the role of the rural banking system in the process of rural development in India.

Ans. When the nationalisation of commercial banks took place back in 1969, the rural banking has expanded a great deal. A considerable expansion of rural banking system played a positive role in following ways:

(i) By providing services and credit facilities to farmers to raise farm and non-farm output.

(ii) By providing long term loans with better repayment options. It helped in eliminating moneylenders from the scene.

(iii) Generating credit for self-employment schemes in rural areas.

(iv) Achieving food security which is clear from the abundant buffer stocks of grains.

Limitations of rural banking are:

(i) The sources of institutional finance are not sufficient to meet the demand of agricultural credit. Farmers still depend on money-lenders for their credit needs.

(ii) There exist regional imbalances in the distribution of institutional credit.

(iii) Rural banking is persistently suffering from the problems of large amount of overdues and default rate.

(iv) Small and marginal farmers receive only a very small portion of the institutional credit. A large portion of institutional credit is usually utilised by the rich farmers.

7. What do you mean by agricultural marketing?

Ans. Agricultural marking consists of assembling, storing, processing, transporting, packing, grading and distributing various agricultural products across the nation.

8. Mention some obstacles that hinder the mechanism of agricultural marketing.

Ans. Obstacles that hinder the mechanism of agricultural marketing are:

(i) Inadequate warehouses
(ii) Multiplicity of middlemen
(iii) Malpractices in unregulated markets
(iv) Improper measuring for weighing, grading and standardisation
(v) Lack of adequate finance
(vi) Inadequate means of transport and communication
(vii) Inadequate market information.

9. What are the alternative channels available for agricultural marketing? Give some examples.

Ans. In India, alternative marketing channels are emerging. Through these channels farmers can directly sell their output to the consumers. This system significantly increases farmers, share in the price paid by the final consumers. Important examples of such channels are: Apani Mandi (Punjab, Haryana and Rajasthan), Hadaspar Mandi (Pune); Rythu Bazars (Vegetable and fruit market in Andhra Pradesh) and Uzhavar Sandies (Tamil Nadu), Several national and international fast food chains and hotels are also entering into contracts with the farmers to supply them fresh vegetables and fruits.

10. Distinguish between ‘Green Revolution’ and ‘Golden Revolution’.

Ans. Following are the differences between Green Revolution and Golden Revolution:

S. No.	Green Revolution	Golden Revolution
(i)	The introduction of High-Yielding Varieties (HYV) of seeds and a rise in the usage of irrigation systems, pesticides, and fertilisers are collectively referred to as the "Green Revolution."	The Golden Revolution refers to the fast expansion in the production of various horticulture products, including fruits, vegetables, tuber crops, flowers, medicinal and fragrant plants, spices, and plantation crops.
(ii)	It increased the production, particularly of wheat and rice.	It led to increase in the production of fruits, vegetables, flowers, aromatic plants spices, etc.
(iii)	Green Revolution helped to make India self-sufficient in the production of foodgrains.	Golden Revolution made India a world leader in the production of mangoes, bananas, coconut and spices.
(iv)	The Green Revolution increased agricultural incomes and facilitated food security.	Golden Revolution offered possibilities for sustainable livelihoods and food.

11. Do you think various measures taken by the government to improve agricultural marketing are sufficient? Discuss.

Ans. The government has implemented a number of initiatives to enhance agricultural marketing, including market regulation, the development of cold storage, roads, and railways, as well as policy instruments, but in spite of these efforts, private trade—led by moneylenders, rural political elites, large merchants, and wealthy farmers—dominates agricultural markets.
Some additional barriers to the agricultural marketing system include the following:

(i) Account misuse and poor weighing procedures affect farmers.
(ii) Farmers frequently lack knowledge of market conditions and prices.
(iii) Farmers' ignorance forces them to sell their goods for less money.
(iv) Farmers are vulnerable to moneylenders because they cannot secure agricultural loans and do not have enough access to storage facilities to keep their produce and sell it at a higher price in the future.

12. Explain the role of non-farm employment in promoting rural diversification.

Ans. A different source of work for those living in rural areas is the non-farm industry. It is divided into several categories, like food processing facilities, agro-processing facilities, tourism, and traditional household-based businesses like pottery barn and handlooms. While some of these segments may have high growth potential, others might have low productivity. The non-farming sector's ability to develop quickly may also be limited by the absence of infrastructure. Positively, the potential for this industry has increased work options for women. The goods produced in this sector help to increase GDP.

13. Bring out the importance of animal husbandry, fisheries and horticulture as a source of diversification.

Ans. (i) Importance of Animal Husbandry:

(a) The farming community in India usually uses the mixed crop-livestock farming system—in which the widely held species are (cattle, goats, fowl).

(b) This system also has the potential to increase the stability in income, food security, transport, fuel and nutrition for the family without disrupting other food-producing activities.

(c) At present, livestock sector alone has the potential to provide alternate livelihood options to over 70 million small and marginal farmers including landless labourers.

(d) Meat, eggs, wool and other by-products are simultaneously emerging as important productive sectors for diversification.

(ii) Importance of Fisheries:

(a) The fishing community refers to the water body as a ‘mother’ or ‘provider’. The water bodies refer to sea, oceans, rivers, lakes, natural aquatic ponds, streams, etc.

(b) Presently, fish production from inland sources is contributing for about 49 per cent to the total fish production and the balance 51 per cent is coming from the marine sector (sea and oceans). Today total fish production stands to be 1.4 per cent of India's overall GDP.

(c) Among the coastal states like Kerala, Gujarat, Maharashtra and Tamil Nadu have turned out to be the major producers of marine products as they are major source of income.

(iii) Importance of Horticulture:

(a) Due to varying climatic and soil conditions, India has adopted growing diverse horticultural crops such as fruits, vegetables, tuber crops, flowers, medicinal and aromatic plants, spices and plantation crops, etc.

(b) These crops play a major role in providing food, nutrition and employment.

(c) India has also emerged as a world leader in the production of a variety of fruits like mangoes, bananas, coconuts, cashew, nuts and a lot of other spices and has become the second largest producer of fruits and vegetables.

(d) Flower harvesting, nursery maintenance, hybrid seed production and tissue culture, propagation of fruits and flowers and food processing are significantly profitable employment opportunities for rural women. It has been estimated that this sector is responsible for providing employment to around 19 per cent of the total labour force.

14. ‘Information technology plays a very significant role in achieving sustainable development and food security’—Comment.

Ans. Information technology plays a crucial role in achieving the goal of sustainable development and food security in the following ways:

(i) It has the potential to act as a tool for releasing the creative efficiency and knowledge embedded in our people.

(ii) Issues like weather forecast, crop treatment, fertilisers, pesticides, storage conditions, etc., are also well administered if the expert opinion is made available to the farmers.

(iii) The quality and quantity of crops and other farm outputs can be increased manifold if the farmers are made aware of the latest and new equipments, technologies and resources.

(iv) IT has ushered in a knowledge economy.

(v) It also has potential of generating employment in rural areas.

15. What is organic farming and how does it promote sustainable development?

Ans. Organic farming is a unique system of sustainable farming that maintains, enhances and restores the ecological balance.
It promotes sustainable development because of the following reasons:

(i) In the past, modern farming methods have encouraged excessive use of chemical fertilisers and pesticides. All of it has led to soil, water and air pollution along with the loss of soil fertility and too much chemical contents in foodgrains.

(ii) There is now an urgency to conserve the environment and eco-system and therefore, promotion of sustainable development has become the need of the hour.

(iii) Organic farming is also an inexpensive farming technology. It can be purchased by small and marginal farmers.

16. Identify the benefits and limitations of organic farming.

Ans. Following are the benefits of organic farming:

(i) Inexpensive Process: Organic farming provides a means to substitute all the costlier agricultural inputs (such as HYV seeds, chemical fertilisers, pesticides, etc.) with locally produced organic inputs. So, that generate, more return on investment at cheaper rate.

(ii) Generates Income: Organic farming generates income through international exports well, because the demand for organically grown crops is on a rise.

(iii) Healthier and Tastier Food: Organically, grown food has comparatively higher nutritional value than food grown with chemical farming. Therefore, it provides healthy foods to us.

(iv) Solves Unemployment Problem: Since more labour input is required in organic farming than conventional farming, it will solve unemployment problem.

(v) Environment Friendly: The produce is pesticide-free and produced in an environmentally sustainable way making it environment friendly

Limitations of organic farming are:

(i) It has been observed that the yield from organic farming is a way too less than modern agricultural farming techniques. Thus, goods produced organically demands a higher price.

(ii) It is not easy for the small and marginal farmers to adapt to this type of farming due to lack of awareness and limited choice of alternate production in off-seasons.

(iii) Organic produce may also have a shorter shelf life.

17. Enlist some problems faced by farmers during the initial years of organic farming.

Ans. Problems that were faced by farmers during the initial years of organic farming are:

(i) Organic farming requires:

(a) Organic Manure

(b) Bio-fertilizers

Although, they are cheaper to obtain, yet it is difficult for the farmers to get them.

(ii) The yield from organic farming is much less than modern agricultural farming.

(iii) The price of organic foods is usually kept high, so it becomes quite difficult to sell them.

(iv) Organic produce generally comes with a shorter shelf life.

18. “Jan-Dhan-Yojna helps in the rural development.” Do you agree with this statement? Explain.

Ans. The expansion and promotion of the rural banking sector has taken a backseat after reforms. To improve the situation, in recent years, all the adults are encouraged to open bank accounts as a part of a scheme known as Jan-Dhan Yojana. Those bank accountholders can get ₹1-2 lakh accidental insurance coverage and overdraft facilities for ₹10,000 and get their wages if they get any govenment-related jobs and works under MNREGA; old age pension and other social security payments of the government are transferred to bank accounts.
There is no need to keep minimum bank balance this has led to more than 40 crores people opening bank accounts, indirectly it has promoted thrift habit and efficient allocation of financial resources particularly in rural areas, Banks also could mobile funds of more than ₹1,40,000 crores through these accounts.