“The soul of India lives in its villages” (- Gandhiji). About two-third of Indian population live in rural areas. Over the years, different development policies and programmes through various development agencies have brought a significant change in the life and the livelihoods in rural India. There has been an improvement in access to credit and many other financial services especially in rural areas. However, the rural-urban divide in socio-economic conditions of people has been increasingly noticed. Interventions in rural contexts are still lacking innovation and collaboration. Adaptation of technology, improvement of skill matching to the need of the emerging market and cost-effectiveness in managing credit are continued to be the gray areas in rural areas. Moreover, COVID 19 has shaken the economy severely. The rural unorganized sector including the producers, the consumers and the returned migrants still find difficulty in its rejuvenation. In this juncture, discourse on the two important rural sub-sectors such as rural finance and rural livelihoods is felt to be very crucial.

The overall objective of the conclave is to bring the development/business practitioners, the academicians and the students to a common platform and discourse on various challenges and way forward with special reference to rural finance and sustainable livelihoods.

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Rural Finance in Post-COVID Scenario: Challenges and Prospects

Credit has been considered as one of the important instruments for economic improvement. Micro credit, in this regard, has been associated with poor and marginalized section of the society. Various financial initiatives in India such as bank nationalization and introduction of Lead Bank Scheme in 1969, establishment of Regional Rural Banks in 1975-76, Service Area Approach in 1989, Microfinance in 1980s, launch of Self-Help Group-Bank Linkage Programme in 1989-90, Local Area Banks in 1996, RBI’s Banking Correspondents (BCs) scheme in 2005-06, to Pradhan Mantri Jan DhanYojana in 2014 and Jan Suraksha scheme in 2015 have made accelerated access to various financial services especially in rural areas.

India provides about $200 billion agriculture credit every year to small and marginal farmers. However, it is much less in terms of term loans; major portion is crop loans. The crop loans are mostly ever greening of the existing loans and in real term much less additional loan is provided. The real credit flow to agriculture should be significantly increased. The increasing number of recent FPOs will be a boosting factor in uptake of agricultural credit.

However, it is not only the 7P-issues of rural finance as given by Shri Harun R Khan, the then Deputy Governor, Reserve Bank of India (2014) such as product strategy, processes, partnership, protection, profitability, productivity and people; but also innovation, collaboration and adaptability continue to be challenging in rural financial sector. COVID 19 has added vulnerability to it.
With this the following questions, in this context, need special attention:

  1. What are the important challenges of rural finance during and post-COVID 19 period? Which rural sub-sectors are more vulnerable in this regard? What are the possible ways forward?
  2. What are the important challenges and way forward for financing innovation and technology adaptation in rural finance?
  3. How can the value chain funding in agriculture be augmented, especially when farmers anchor it?
  4. What are the important frontiers of financing rural sectors, which needs to be focused?


Sustainability in Rural Livelihoods: Prospects and Way Forward

The frontiers of sustainability in livelihoods especially in rural contexts have been challenged by the emerging complexities in the linkages among skill set mapping and matching with market needs, innovation in skill building, livelihood mapping and follow up mechanisms, access to timely and affordable credit and marketing. Besides, COVID 19 has shaken the rural livelihoods severely. The rural unorganized sector including the rural MSMEs and the returned migrants still find difficulty in its rejuvenation.

It has been widely felt that livelihoods in rural contexts need to be managed professionally with appropriate knowledge, attitude and skill. The professionals are expected to equip themselves to face the challenges in ensuring sustainability in frontiers of livelihoods.

The following important questions, in this context, need special attention:

  1. What are the important frontiers of sustainable livelihoods, which need to be focused?
  2. What are the prospects of innovation and collaboration in sustainability of rural livelihoods?
  3. How practically possible the skill set mapping, innovation in skill building and livelihood mapping?
  4. What are the possibilities to engage the returned migrants (due to COVID 19) in rejuvenation of rural livelihoods and local economy?
  5. What are the roles and possibilities of institutional mechanisms (at what level) in ensuring sustainable rural livelihoods?