Rural Credit and Employment: Indian Experience and Future Strategy

Ever since the First Five-Year Plan, there has been emphasis on creating more employment opportunities in rural areas as a part of the overall rural development programme. The Community Development Projects and National Extension Service initiated from 1953 onwards had ‘more employment’ as one of the important objectives and in the Sixth Five-Year Plan, stress has been laid on this goal. The Bhagavati Committee on Unemployment, in its report submitted in 1973, also made a number of general suggestions to promote rural employment. The Working Group of the Bhagavati Committee on agriculture estimated the number of persons unemployed in the rural areas at the beginning of the Fourth Five-Year Plan and classified them in three categories: (i) 7.82 million persons estimated to be totally unemployed and seeking work; (ii) 9.12 million persons including the 7.82 million of category (i), plus the full-time equivalent of the extra hours of work required for those underemployed and seeking additional work to make them fully employed; and (iii) 22.52 million persons made up of the cumulative total of 9.12 million under (ii) above plus 13.40 million persons as the full-time equivalent of the extra work needed for the underemployed males, on the assumption that such work would have to be provided for all the male labour force working less than 42 hours per week to make them fully employed.