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Rural industrialisation in Kerala: Re-examining the issue of rural growth linkages

Listed author(s):
  • Mridul Eapen

    (Centre for Development Studies)

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    The main purpose of our paper is to re-examine the role of linkages in a process of rural industrialisation (RI) deriving from the field experience in two purposively selected, newly emerging areas of industrial growth in an industrially backward state. While considerable evidence on survival of manufacturing activities in rural areas, particularly an agriculture-linked process of rural industrialisation, was not very encouraging, our perserverence arose out of (a) what we perceived as a rather narrow view of intra-spatial linkages in most of the studies taken up; and (b) the possibility of its greater potential in the sub region we attempted to study viz. the state of Kerala, marked by a relatively favourable rural infrastructure. We argue that: (a) an excessive concentration on agriculture induced linkages has resulted in an underestimation of the potential of rural linkages for rural manufacturing. The fast growing service sector in rural areas and its demand for simple intermediate goods provides considerable scope for production linkages; (b) at the same time the relative importance of agricultural linkages very often tends to be swamped out by `urban' indicators of rural diversification. The former could play a dominant role in generating non-agricultural employment in relatively isolated rural areas primarily through consumption linkages; and (c) the local capital linkage or indigenous entrepreneurship has been relatively underemphasised. Stimulating local initiative can facilitate a rurally-linked process of RI. There is a real (psychic) advantage for local entrepreneurs operating in a local environment which redresses to some extent the relative place specific disadvantages of rural locations.

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    Paper provided by Centre for Development Studies, Trivendrum, India in its series Centre for Development Studies, Trivendrum Working Papers with number 348.

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    Length: 63 pages
    Date of creation: Jul 2003
    Handle: RePEc:ind:cdswpp:348
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    1. Haggblade, Steven & Hazell, Peter & Brown, James, 1989. "Farm-nonfarm linkages in rural sub-Saharan Africa," World Development, Elsevier, vol. 17(8), pages 1173-1201, August.
    2. Rangarajan, C., 1982. "Agricultural growth and industrial performance in India:," Research reports 33, International Food Policy Research Institute (IFPRI).
    3. Hazell, P. B. R. & Roell, Ailsa, 1983. "Rural growth linkages: household expenditure patterns in Malaysia and Nigeria," Research reports 41, International Food Policy Research Institute (IFPRI).
    4. Liedholm, Carl & Mead, Donald C., 1987. "Small Scale Industries in Developing Countries: Empirical Evidence and Policy Implications," Food Security International Development Papers 54062, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    5. Dunham, D.M., 1991. "Agricultural growth and rural industry : some reflections on the rural growth linkages debate," ISS Working Papers - General Series 18870, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
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