Digital Transformation for Socio-Economic Development of Rural India!
| S Kumar Saha, Business Editor, IOP, Mumbai - 28 Jun 2021

Digital Transformation for Socio-Economic Development of Rural India!

Trinity linkage between Transformative constitutions, Digital India, Employments with economic development: needs immediate attention-course corrections!!

By S. Kumar, Business Editor, IOP

Mumbai: In globalized era, when every sector of the economy is highly affected by Information and Communication Technology (ICT), the rural and agricultural domain could not become isolated and remain in hibernation. Indian Economy is primarily governed by agrarian infrastructure. Since independence, the majority of our population thrives on agriculture and its allied activities as their means of livelihood. Till today, the contribution of the agriculture sector in Gross Domestic Product (GDP) enhancement is remarkable.

Not only that, the Indian economy thrives and sustains the capacity of Indian geographical natural resources for the agriculture products and services. The topography and climatic conditions of the country makes agriculture the natural choices for our rural and village populace. At this juncture it becomes imperative to focus and understand the dynamics of agriculture services. These are in terms of employment and its various dimensions, fertility and crop production and certainly about the financial benefits provided by the Government of India to our farmers to boost the sector with dignity and commitment. 

Indian rural market is budding with a rapid graph year after year and the urban segment is saturating at a very fast rate due to changes in consumer habits and preferences that are never-ending and there is not much to offer as a catalyst to this market. The rural smartness is mounting in e-tailing with a rise in smartphone shopping and tariff of internet data being brought down to its minimum that has compelled the rural consumer to shop more online with a variety of brands offered for hassle -free shopping.

The rural market has potential but is lagging due to lack of investment in the digital infrastructure of online shopping by the investors and the state that already has preceded the old brick and mortar format of shopping structure in rural markets that have not been witnessed for a decade.

Financial Inclusion, bank’s role and states initiatives:

Digitalization and financial inclusion must have a symbiotic relationship. The digitalization is expected to provide the platform for enhancing the reach of financial services to the unreached and excluded in the rural areas. These financial services include opening accounts, credit, insurance, pensions, social security and managing money or transferring money.

There are various payment systems such as UPI, NEFT, RTGS, IMPS, e-Wallets, PoS, USSD, Aadhaar Enabled Payment Systems (AEPS) and internet banking services (net banking, e-passbook, banking applications, mobile banking, etc). It will discuss the accessibility of these payment systems to the rural people and their ability to use them. The digital divide and other barriers like infrastructural gaps, non-affordability, limited ease of use and lack of security are also matters to identify the bottlenecks in achieving financial inclusion, may also compare these payment systems with those of selected developing countries to learn from their experiences.

Financial inclusion may be defined as the availability and equality of opportunities to access financial services. Financial inclusion intends to help people secure financial services and products at economical prices. Nowadays, inclusive growth is focused on ‘Digital finance’. Thus, digital finance has given a new shape to the banking industry. Digital finance provides greater control of customer personal finance, quick financial decision making and the ability to make and receive payment.

Lending towards agriculture is an important function of any bank in India. When banks grant loans to farmers for agricultural activities, the concerned land is normally mortgaged as collateral security towards the loan. The central and state governments have made many regulations to simplify the formalities of mortgage, and to reduce the cost and time of farmers in the process. The Digitization of land records drive from the central government started in 1991.

However, the progress on the front has remained slow across many states due to various implementation issues. Few states have progressed well in this regard such as- Maharashtra, MP & Chhattisgarh, Gujarat, Karnataka, AP & Telangana, Tamil Nadu, Rajasthan, Punjab & Haryana UP & Uttaranchal, Orissa, Bihar & Jharkhand and West Bengal whereas few states are still lagging behind. In order to spread computer literacy in interior areas Jharkhand introduced the Ekal Abhiyan in association with NGO Vikas Bharti which launched Computer on Wheels, a mobile van service.

The tiny state is ahead in the area of land digitalization as compared to other progressive states. In this context, there is a need to percolate digitalization to the people at the bottom of the pyramid both at the regional and national level. This national seminar will inculcate creativity and innovations from different streams of the society which will foster rural economy. Through this article I would like to highlight the processes of digitized charge creation done at Banks itself in a few states and highlights the savings on cost and time to farmers and risk reduction to banks. 

National Bank for Agriculture and Rural Development’ (NABARD) has played a crucial role in creating infrastructure for rural India. NABARD has been working with the Government to ensure rural development to the fullest extent. Areas where the success has been achieved include e-governance, digital marketing, e-Shakti initiatives and application of Artificial Intelligence for Rural Development. Implementation of MIS for Swarnjayanti Gram Swarozgar Yojana in the state of Gujarat is one of the best examples. Digitalization has become a buzzword in today’s era and digital transformation has been yielding rich dividends in all sectors of the economy.

Digitalization, as a concept is not restricted to urban areas but also has been making inroads into rural India and holds the prospect. As estimated by McKinsey Global Institute, India is one of the largest and fastest-growing markets for digital consumers with more than 560 million internet subscribers, after China. So, there is more space and opportunity in rural areas towards digitalization.

Digitization and technology can ease the approach and applicable of new services and products be made available to meet the growing target of the underserved and unreached rural India. Rural India is expected to jump towards urban India and constitute above 50% of all Indian internet users by 2022. Digitization can be provided with some of the key needs of rural India including e-governance services, banking and financial services, educational and healthcare services, mobile/DTH recharge, e-ticketing services, online shopping, etc.

Near about 10 years ago, the government, with the help of its flagship National e-Governance Plan, envisaged to empower rural citizens by making available various government services to them via electronic media and created access points, i.e., common service centers run by village-level entrepreneurs (VLEs) at the village and gram panchayat level.

The Impact of MGNREGA–CFT Programme: Employment, poverty, infrastructure development, F T O.

The majority of people of these countries are still rural and agriculture is the dominant source of employment.  Around 70% of the populations are living in rural areas and depending on agriculture and maximum are youth who are unemployed which leads them to move to urban areas from villages in search of better employment as well as better life.

They are migrating towards cities due to limited resources, weak infrastructure, and unemployment in rural areas. So, in connection to youth from the rural background, Agribusiness can prove an important tool to stop the exodus of rural youth from rural to urban areas. Agribusiness provides various employment opportunities in the areas of agricultural inputs, crop production, agro chemicals, fruit and vegetable cultivation, agricultural marketing and processing of agricultural produce. Agribusiness helps in making rural youth to become an agri-preneur which will help in remunerative farming which further leads to increases the level of income, employment and living standard of people in rural India.

An agri-preneur may start an agro business, change a business direction, acquire a business or may be involved in innovative activity of value addition. However, with the increasing number of workers in rural areas, agriculture alone will not solve the problem of unemployment in rural areas. The rural non-farm sector, therefore, has become an important source of employment. The importance of the non-farm sector as a source of employment is well recognised in the process of development.

For most rural people in developing economies, rural non-farm activities are part of a diversified livelihood portfolio. However, there are large variations in the share of non -farm income in poor countries. In regional terms, average non -farm income shares in rural areas are higher in Africa (42%) and Latin America (40%) than Asia (32%) (Reardon, 1997).

There is also some evidence to suggest that income diversification may have increased in recent years. For example, Sub-Saharan Africa is becoming steadily less agrarian and increasingly more reliant on non -farm sources of income. Also, in rapidly growing East Asian countries like South Korea, the rate of growth of income generated in the rural non -farm sector has been substantial. In surplus labour countries of South Asia such as India and China, this sector is absorbing a growing amount of human labour.

In the context of India, diversification in rural employment has gained significant importance over time which has been studied by several researchers over the past two decades. Importantly, the non-farm sector’s share in employment (principal and subsidiary status) increased during the period 1993-94 to 2009- 10. However, if we compute the growth rate of non -farm employment (NFE) for different periods and make a comparison, we can note that the annual growth of non -farm employment has decreased during 1993-94 to 1999-00, the early years of economic liberalization. However, the situation changes during 1999-00 to 2004-05, when the growth rate of non-farm employment show an upturn. The situation again reversed during 2004-05 to 2009-10. 

National Rural Employment Guarantee Act (NREGA) enacted by the legislation of India on 25 August 2005 and as notified on September 7, 2005, it was renamed as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) on 2nd October 2009 on the birth anniversary of Mahatma Gandhi. The Act guarantees to provide 100 days of wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work. Wages are paid to the MGNREGA beneficiaries according to the state-wise Government of India notified MGNREGA wages or according to piece rate as per the Schedule of Rates (SoRs).

The Act mandates that payment of wages has to be done on a weekly basis and it cannot be delayed more than 15 days, checking migration, and building rural infrastructure. Incorrect data of workers in the official MGNREGA website (NREGA Soft) is a common reason for delays in wage payments. To mitigate this problem, the CFTs should verify the NREGA Soft data by examining the job card and pass book of workers. The required corrections in NREGA Soft are to be made by the computer operator and the CFTs have to monitor this task of Fund Transfer Order (FTO). 

Through this the track of the Data will be available for all the concerned Govt. and Non- Governmental Departments who have been working for the development of rural areas of India. By this, the transparency will be maintained and the wages will be directly transferred to the accounts of beneficiaries which can be monitored by any concerned person and the updated data will be available with the help of digitization process in the first few years of MGNREGA implementation, the payment of wages to beneficiaries was done in cash. In order to bring about transparency in wage payments and prevent misappropriations of funds, the Act was subsequently modified with the support of the central Cluster Facilitation Team (CFTs).

Finally, there is a need for the job not only for the urban market but also for the rural masses. Rural development not just develops the livelihood of rural people but the overall economy of the country. There are certain factors that act as the hindrance of development, and in which Lack of awareness is the major cause that is affecting the development.

If rural masses also get the job, then it will increase the per capita income and can boost the GDP of the country in addition to fulfilling the need for a job for rural people. Education and Technology are the two basic things that help the rural people to keep them updated with all the government policies which the government is providing to develop them and their livelihood. The main occupation of the people of rural areas is Agriculture and by the use of the latest technologies and equipment, they can enhance their productivity through proper irrigation and cultivation.

The use of technology in education that is e-Learning can be a favorable way to make education interesting for the children of rural areas and that also helps them to connect with the technology from the beginning. If we talk about the adults then it is difficult to educate them through alphabets and letters but by E- learning it will be easy to develop and make them aware of the new changes. 

It is correctly said by the former President of India and greatest scientist Dr. A. P. J. Abdul Kalam – ‘’All the scientists and technologists should work in the appropriate region, specifically the rural technologies, to transform the Indian rural sector.’’- However, the Government should also ensure maximizing such a job portal enabling the intake of jobs both quantitatively and qualitatively as well by the rural areas to boost the job availability for the people residing in rural households thus making them socially and financially rich. Concluding with a verse by Einstein- “It is madness to solve complex problems with the same ideas that have caused those problems.”!

Writer is a Sr. Journalist and political critic. 


INDIAN OBSERVER POST (IOP) is a Class, Creative, and Constructive News platform which publishes ONLY exclusive and Special News / Views / Interviews / Research Articles / Analysis / Columns / Features and Opinions on the national and international issues, politics, security, energy, innovation, infrastructure, rural, health, education, women, and entertainment. Email –






(Onkareshwar Pandey is Founder, Editor in Chief & CEO, Indian Observer Post and former Senior Group Editor- Rashtriya Sahara (Hindi & Urdu) and also former Editor, (News), ANI. Email - SMS- 9910150119)





Browse By Tags

Latest News