NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, August 22, 2018

By Sanjay Nandrajog

Tapan is a middle-aged resident of Bhogpur village in district Purba Medinipur, 75-km from Kolkata, involved in his traditional family business of farming. For several years he had been visiting his nearest bank branch for withdrawing or depositing money, travelling over 15-km; similarly, to make electricity bill payments, he would need to go every month to the nearest collection centre, again time-consuming. However, things have changed rapidly in the recent past with a new Digitalised Common Service Kendra opening up in his neighbourhood, where not only are his banking and bill payment needs are getting conveniently fulfilled, but he can also now get top-ups for his mobile and DTH, book rail tickets, and get online motor insurance for his two-wheeler—all digitally and literally at his doorstep. This is the new rural reality.

The Indian economy is predominantly rural with over two-thirds of its population and workforce residing in rural areas. Rural India contributes a substantial part of the total net value added in many sectors, with an overall 46% contribution to our national income. With a population of 833 million people (which incidentally is larger than rural China) residing in 640,867 villages, it is projected that, by 2050, more than half of India’s population will still be rural, despite rising urbanisation. Thus, the growth and development of the rural economy is imperative for inclusive development and overall growth of the country.

Photo courtesy of Simone McCourtie.