Rural India had always been neglected. This was the story till just around twelve months ago. However, the revival of the Indian economy, which has now happened, has now been attributed to the revival of demand for a whole range of goods and services.
One of the chief reasons for the spurt in rural prosperity, has been the higher purchasing power that has now been available in the hands of the rural poor, through the National Rural Employment Guarantee Act, which aims at providing employment to rural folks for atleast one hundred days in a year. This scheme has been effectively implemented in several States of India, and many State Governments are now keen on transferring wages due to rural workers directly to their bank accounts.
This apart, the reach of television has brought about significant changes in the lifestyle of rural people. For example, till around ten years ago, Churidar as a dress worn by women in rural India, was totally unheard of. Today, this dress is worn by women in literally every village in India, and this dress is rapidly replacing the sarees, hitherto worn by most Indian women.
This change in attitude, even as far as dress is concerned, has its own ripple effects, in as much as the aspirations of a huge mass of millions of people, has changed for the better.
This gets translated into desire for a whole range of goods like televisions, motorcycles, computers, refrigerators, and what have you. In fact, rural demand now outstrips urban demand in many cases, primarily due to the fact that urban areas had already reached saturation levels. Add to this fact that virtually every branded product is now available in small quantities, at prices that do not exceed one tenth of a US dollar, in Indian rupees. When incomes go up, the same population emulates their urban counterparts and starts to buy such goods in much larger quantities.
According to a report published in the April 2009 issue of Indian Management, rural share in stock of scooters increased from 25.2% in 1995-96 to 32% in 2009-2010. Thew corresponding figures for motorcylces in the same period increased from 45.8% to 55.4%.
Ever since the present Government of India, under the United Progressive Alliance (UPA), came into power in 2004, it has built 11 million kilometer of rural roads. This has increased the mobility of several hundreds of thousands of people, who sell rural produce in the nearby urban markets and make their living.
Perhaps nowhere is this so famously done, as it is done in Tamil Nadu. This South Indian State has the largest and the best organized bus transport system in India. The present State Government, under the DMK party has built a huge network of good roads that serve as nodal points for several villages. In addition to this facility, it has introduced mini buses in several hundreds of villages, and these mini buses facilitate movement of people to the nearest semi-urban centres. This has increased rural incomes.
There are several clusters in this State, each having some economic activity to keep going. For instance, in the District headquarter town of Kancheepuram, which is just eighty kilometers from Chennai, there is a flourishing trade in silk sarees. This provides livelihood to thousands of families, who live in the surrounding villages. This apart, the Government has industrialized the town to some extent in the recent past. This has made the town have access to money that would have otherwise been rotating only in Chennai, which is the fourth largest city of India.
Indians do not believe in restricting their expenses when it comes to weddings. This is more so in rural India. Every small village has a thriving business that is centered around weddings that are performed with religious fervour. The money that keeps rotating augurs well for the rural economy.
The reach of television and the internet has also changed lives in rural India, like never before. This has meant that "wants" have replaced needs. This tranlates into rural people aspiring for more income, and an aspirational lifestyle that makes every single family work for more disposable income.
In the years ahead, that is, the next two decades, the explosion of the smaller towns is bound to have its own ripples in rural India as well. This is exactly why every single company, whether multinational or Indian, is busy designing and manufacturing a whole range of goods and services that can be sold in rural areas. This, in turn, will simply mean that rural India will lead the economic rival of India itself, and to some extent, the entire world as well.