The Nature of Rural Infrastructure: Problems and Prospects
71 percent of Indians live in rural India, more than 244 million is the number of poor people there and the average distance to the nearest all wether road is 2 Km. Add to it the dismal condition of access to basic sanitation, drinking water, power and telephone to get a much clearer picture of rural India as it is today. Various studies, spearheaded by giants in the industry agree that poor is a part of the fundamental problem for economic development of these regions. Additionally the lack of infrastructure directly co relates to lower per capita income.
Various studies and surveys boil down to a conclusion that developing infrastructure will in the short and long run increase the per capita income and employment in the rural parts of the country. Add to it increased efficiency and productivity due to reduction of travelling time and more time to rejuvenate. Additionally a better infrastructure means better access to resources and better health eventually culminating in an increased standard of living. For example: developing a constant source of clean drinking water supply will reduce instance of people falling sick from water borne diseases and in turn increase good health and productivity.
Empirical evidence suggests that development of power, irrigation, water, sanitation and road infrastructure has increased productivity, savings, income, better jobs, better health, increased attendance in school and tourism benefits. Increased connectivity means the the middle men will be taken out of the equation and farmers and small businesses can grow. Additionally secondary benefits like access to education and medical facilities have positive long term effects in terms of a developed work force. Hard evidence is available to support the statement that better infrastructure promotes over all growth in a community.
The problem that is unique to rural India is that it has a low population concentration in addition to a very low income and spending power. Infrastructure like telecom, power and connectivity are too cost intensive for timely returns. However fundamental infrastructure like housing, sanitation etc can easily be provided locally with proper initiatives and funding. The people in rural areas have one third the spending power as compared to their urban counter parts but are willing to spend their income for the requisite infrastructure. The problem essentially is a lower concentration of people and income to be of adequate incentive for private players to invest in developing the markets.
Prospects for development in rural India is good and on an increasing trajectory. The government and private players are both realising the potential in developing the smaller scattered markets. This is being done by means of various government ventures and scheme. Some of them being semi private and semi government organisations to push the potential of rural India in the development of the Indian economy and make it all inclusive. Various government initiatives have been showing positive effects over the years and are coming on the fast track to bring about the required change much faster than its current rate. The Make in India campaign for one is proving to be a tremendous boost.