Page 46 - Banking Finance January 2025

ARTICLE

market conditions. This dependence makes rural Land Reforms: Incomplete or ineffective land re-
livelihoods precarious. forms can limit access to land for small and mar-
Lack of Diversification: The rural economy lacks ginal farmers, hindering agricultural productivity
sufficient diversification, limiting opportunities for and rural livelihoods.
income generation and reducing resilience to Bureaucracy: Inefficient bureaucracy and red tape
shocks. can delay the implementation of development
Infrastructure Deficiencies: Inadequate infrastruc- projects and discourage investment.
ture, such as roads, electricity, and irrigation, ham- Lack of Coordination: Lack of coordination among
pers economic growth and development in rural different government departments and agencies
areas. can result in duplication of efforts and inefficiencies
2. Social Challenges in service delivery.
Education and Skill Development: Limited access
to quality education and skill development opportu- Government Initiatives to Mitigate Rural
nities restricts the potential of rural youth. This con- Challenges in India
tributes to unemployment and underemployment.
The Indian government has implemented numerous initia-
Healthcare: Rural areas often suffer from inad- tives to address the various challenges faced by rural India.
equate healthcare facilities, leading to poor health These initiatives span across economic, social, environmen-
outcomes and increased vulnerability to diseases. tal, and institutional domains.
Gender Inequality: Women face significant dis-
crimination and limitations in rural areas, affecting 1. Economic Initiatives
their access to education, employment, and prop- Mahatma Gandhi National Rural Employment
erty rights. Guarantee Act (MGNREGA): Providing 100 days of
Social Exclusion: Certain marginalized groups, such wage employment to rural households, aimed at
as Scheduled Castes, Scheduled Tribes, and other guaranteeing livelihood security.
backward classes, face social exclusion and discrimi- The National Rural Employment Guarantee Act,
nation, limiting their opportunities for develop- 2005 provides for 100 days of guaranteed wage em-
ment. ployment in a financial year for adults of rural
3. Environmental Challenges households. The law has been operationalised
Climate Change: Rural communities are particularly across the country through the Mahatma Gandhi
National Rural Employment Guarantee Scheme.
vulnerable to the impacts of climate change, such
as droughts, floods, and soil erosion. These environ- The scheme covers all districts except those with
mental challenges can disrupt livelihoods and ex- 100% urban population. Any individual who de-
acerbate poverty. mands work through the scheme is entitled to a
daily unemployment allowance if work is not pro-
Natural Resource Depletion: Overexploitation of
vided within 15 days. The projects taken up under
natural resources, such as forests and water, can
the scheme include those related to digging canals
lead to environmental degradation and unsustain- for irrigation, construction of Anganwadi centres,
able development.
plantation drives, drinking water supply and sani-
Pollution: Pollution from industrial activities and ag- tation.
ricultural practices can have adverse effects on the For 2024-25, the scheme has been allocated Rs
health of rural communities and the environment.
86,000 crore, same as the revised estimates for
4. Institutional Challenges 2023-24. As MGNREGS is a demand driven scheme,
Governance and Corruption: Weak governance, the expenditure rises and falls in response to de-
corruption, and lack of accountability can hinder ef- mand for work in rural areas. It jumped 55% in
fective implementation of development programs 2020-21 as the demand for work went up during
and divert resources. COVID-19 pandemic driven by people migrating

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