Globalization and Rural India

chillibreeze writer — Bhupali Gursale

The process of liberalization and industrialization, fast gained importance in India in the 1980s. However it was only in 1990s, after the phenomenon of globalization gaining momentum in India, that the Indian economy truly opened up. Globalization has led to increased opportunities to the average Indian - an increase in employment, income, output, investment and also to a rapid expansion of the banking and financial sector, telecom sector, growth in export potential and social sector projects.

The government implemented the new industrial policy in 1991. There was a regard that the benefits of policy implementation would trickle down to the lower sections of the population.

The rural economy comprises 71% of the total population of India. Agriculture and allied activities are the main sources of income and this primary sector contributes to almost 25% of India's GDP. The advantages of globalization, as envisioned by the government, have not trickled down to the rural poor. There has been no evidence of positive growth in the unorganized sector of the economy. Globalization, it is said, is adversely affecting the rural Indian.

The opening up of the economy signifies cheaper imports in a country where agricultural prices are constantly fluctuating. This hampers the producers and leads to further losses. The producers might be hesitant to produce the same crops next year and also, multiple cropping is not common in India. Thus, farmers cannot shift from food grains to more marketable crops.

Farmers, artisans, unskilled labor and workers bear the impact of losses due to increased competition and comparative advantage enjoyed by the more developed countries. The critics of globalization also affirm that Multi-national Corporations (MNCs) have penetrated the economy only to gobble up Indian enterprises and also to gain a foothold in one of the largest and fastest growing economies of the world.

India is characterized as a dualistic economy, where a modern economy exists side by side with a traditional one. This technological dualism is further exaggerated owing to globalization. The disparity between the rural and urban rich and poor is widening at a greater pace than ever before. However, this disparity is not evident at the initial stages and will show up when the gap is extended.

India is a labor surplus country facing an acute problem of population explosion. Most of India's population comprises the rural people. Increased investment and growth in capital or adopting technology that is capital intensive will lead to unemployment. Governmental schemes and measures to control poverty and unemployment in rural India are deficient due to bureaucracy and widespread corruption. Thus, inequalities in rural India are exceedingly difficult to tackle.

Due to the failure of the trickle down effect, the rural Indian suffers his miserable fate at the hands of globalization. The MNCs and investors are also unlikely to bring about development due to regional disparity and lack of development in the financial sector.

The recent spate of suicide of farmers in the Vidharbha region and the attacks on retail outlets in rural areas bears testimony to this ugly reality. Without adequate improvement in the government's delivery mechanism, the despair of the average rural Indian will be prolonged.

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—About our writer:

Bhupali says, "I'm a 19 year old, currently pursing economics from Mumbai university. I like to be involved in various social organizations for different causes. I am very passionate about life, and everything I do in general. To sum it up, I'm creative, enthusiastic, artistic, persistent and yes, I love writing."

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