CBSE Class 11 Economics On Rural Development Worksheet

What is ‘Rural Development? Bring out the key issues in rural development.
Process of improving the quality of life and economic well-being of people living in rural areas

Key issues in rural development.
• Rural people account for about 3/4th of total population
• Share of agriculture sector to GDP was on a decline
• Inadequate infrastructure,
• Lack of alternate employment opportunities in the industry or service sector

What are the various areas covered in rural development
1. Human Resources development
– literacy, more specifically, female literacy, education and skill development
– health, addressing both sanitation and public health
2. Expansion of the productive resources of each locality to improve opportunities of employment (particularity other than farming).
3. Land reforms
– Abolition of exploitation in hand relations; Increasing agricultural productivity and production.
4. Poverty reduction:
– Alleviation of poverty and bringing significant improvement in living conditions of weaker sections. Around 30 % of total population is still below the poverty line
– By providing employment opportunities
5. Development of Infrastructure
– Electricity, irrigation, credit, marketing, transport facilities including construction of village roads and feeder roads to nearby highways,
– Facilities for agriculture research and extension

Discuss the importance of credit in rural development.
1. Exploitation by middlemen:-,
• Moneylenders and traders exploited small and marginal farmer’s and landless laborers by
⎯ Lending to them on high interest rates
⎯ Manipulating the accounts to keep them in a debt-trap.
2. Long gestation period: -
⎯ Time gestation between crop sowing and realization of income after production is quite long
⎯ Farmers need credit to meet their initial investment on seeds, fertilizers, implements and other family expenses.
3. Source of economic development
⎯ Rural economic development depends primarily on infusion of capital/credit, from time to time, to realize higher productivity in agriculture and non agriculture sectors

A major change occurred after 1969 when India adopted social banking and multiagency approach to adequately meet the needs of rural credit. Explain
• Agriculture and Rural Development (NABARD) was setup in 1982 as an apex body to coordinate the activities of all institutions involved in the rural financing system.
• The Green Revolution was as mile stone in the credit system as it led to the diversification of the portfolio of rural credit towards productionoriented lending.
• The institutional structure of rural banking today consists commercial banks, regional rural banks
(RRBs), cooperatives and land development banks They are expected to distribute adequate credit at cheaper rates. Recently,
• Self-Help Groups (henceforth SHGs) have emerged

Explain the role of micro-credit programmers in meeting the credit requirements of the poor. Need: - Fill the gap in the formal credit system
• Formal credit delivery mechanism has proven inadequate for rural development.
• Since some kind of collateral is required, vast proportion of poor households were automatically out of the credit network.

Working of SHGs
• The SHGs promote thrift (savings) in small proportions by a minimum contribution from each member.
• From the pooled money, credit is given to the needy members to be repayable in small installments at reasonable interest rates.

Success
• By March end 2003, more than seven lakh SHGs had reportedly been credit linked.
• SHGs have helped in the empowerment of women.

Critically evaluates the role of the rural credit / banking system in the process of rural development in India.

Success
• Rapid expansion of the rural banking system had a positive effect on rural farm and non-farm output, income and employment, especially after the green revolution - it helped farmers to avail services and credit facilities and a variety of loans for meeting their production needs.
• We have now achieved food security which is reflected in the abundant buffer stocks of foods grains.

Failure
• Except commercial banks, other formal institutions have failed to develop a culture of deposit mobilisation - lending to worthwhile borrowers and effective loan recovery.
• Agriculture loan default rates have been chronically high.

Suggestion
• Banks need to change their approach from just being lenders to building up relationship banking with the borrowers.
• Inculcating the habit of thrift and efficient utilization of financial resources needs to be enhanced among the farmers too.

What is 'Agricultural marketing'?
• Process that Involves assembling, storage, processing, transportation, packaging, grading and distribution of different agricultural commodities across the country to the consumer’s .is called ‘Agricultural marketing System’.
• An efficient way by which the farmers can dispose their surplus produce at a fair and reasonable price

Why ‘Agricultural marketing is required?
▪ Manipulations by Big Traders: Prior to independence, farmers suffered from faulty weighing and manipulation of accounts while selling their produce to traders.
▪ Market Facilities lacking: Farmers were often forced to sell at low price due to lack of required information on prices prevailing in markets.
▪ Storage Facilities lacking: They also did not have proper storage facilities to keep back their produce for selling later at a better price.

Discuss the measures initiated by the government in developing rural marketing aspect Or State intervention became necessary to regulate the activities of the private traders. How
1. Different policy Instruments: In order to protect the farmers, the government has initiated the following policies:
▪ Minimum Support Prices (MSP): To safeguard the interest of farmers, government fixes the minimum support prices of agricultural products,
▪ Maintenance of Buffer Stock: The Food Cooperation of India (FCI) purchases wheat and rice at the procurement prices, to maintain buffer stock. Buffer stock is created in the years of surplus production and is used during shortages.
▪ Public Distribution System (PDS): Fair price shops offer essential commodities like wheat, rice, kerosene, etc. at a price below the market price, to the weaker sections of the society.
2. Regulated Markets: Regulated markets have been organized with a view to protect the farmers from the malpractices of sellers and brokers. This policy benefitted farmers as well as consumers..
3. Infrastructural Facilities: to provide physical infrastructure facilities like roads, railways, warehouses, godowns, cold storages and processing units.
4. Policy of Cooperative Marketing: Under this, marketing societies are formed by farmers to sell the output collectively and to take advantage of collective bargaining, in order to obtain better price.

What are the emerging alternate marketing channels for agricultural products? Explain their benefits.
1. Direct selling to customers: If farmers directly sell their produce to consumers, it increases their incomes. Some example of these channels are:
• Apni Mandi (Punjab, Haryana and Rajasthan)
• Rythu Bazars (Vegetables and fruits markets in Andhra Pradesh and Telangana)
• Hadaspar mandi(Pune)

2. Contracts/Alliances with national and multi-national fast food chains. They encourage farmers to cultivate farm products (vegetables, fruits etc) of the desired quality by providing seeds and other inputs as well as assured procurement of the produce at pre-decided prices. Such arrangements will help in reducing the price risks of farmers and would also expand the markets for farm products.

What is meant by 'Agricultural Diversification'?
Diversification is essential to provide extra profitable employment for the rural people to overcome poverty and to raise their level of income.

Explain the role of non-farm employment in rural economic development.
1. Risk reduction: - Helps in overcoming the risks of the agricultural sector which may arise if there is a crop failure due to droughts or floods.
2. Increasing income:- Provides additional opportunity of employment and income generation, diversification helps in increasing income of rural people.
3. Seasonal Factor:- Most of the agricultural employment opportunities in India are seasonal. Diversification helps in providing employment opportunities during this time.
4. Export booster: - Changes in consumer diets drive agricultural diversification. Such diversification is also encouraged by the opening up of new export markets for horticulture, livestock and aquaculture products, etc.

CBSE Class 11 Economics Chapter 6 On Rural Development  MCQs

Question. NABARD is ____________ source of rural credit
(A) Institutional
(B) Non-institutional
(C) Cooperative society
(D) Regional
Answer : A

Question. Non farm areas of employment :
(A) Animal husbandary
(B) Fisheries
(C) Horticulture
(D) All of these
Answer : D

Question. From the following which is not a non-institutional source of credit in India.
(A) Money lenders
(B) Traders
(C) Commission agents
(D) Commercial banks
Answer : D

Question. Organic farming uses
(A) Organic manure
(B) Bio-fertilisers
(C) Organic pesticides
(D) All of these
Answer : D

Question. Diversification in agriculture activities means finding alternate employment in
(A) Non-farm sectors
(B) Urban sectors
(C) Rural sectors
(D) None of these
Answer : A

Question. Government has assured the farmers of some minimum income from the sale of their crop by introducing:
(A) Warehousing facilities
(B) Regulated markets
(C) Minimum support price policy
(D) Co-operative agriculture marketing societies
Answer : C

Question. The ‘Golden Revolution’ was a period of very high productivity in:
(A) Foodgrain production
(B) Horticulture
(C) Organic farming
(D) Piscicultre
Answer : B

Question. Traditional sources of rural credit in India are :
(A) Money lenders
(B) Relatives and friends
(C) Traders
(D) All of these
Answer : D

Question. Father of ‘Green Revolution’ In India
(A) M.S. Swaminathan
(B) Norman Borlong
(C) Chidambaram Subramaniam
(D) None of the above
Answer : A

CBSE Class 11 Economics Chapter 6 On Rural Development  Fill in The Blanks

Question. ___________ was set up in 1982 as an apex body to coordinate the activities of all institutions involved in the rural financing system.
Answer : The National Bank for Agriculture and Rural Development (NABARD)

Question. There is a need to increase credit facilities through ___________ and __________ for fisher women to meet the working capital requirements for marketing.
Answer : cooperatives; SHG5

Question. ________ , in realising fair prices for farmers’ products, is one of the initiatives taken by the government.
Answer : Co-operative marketing

Question. __________ and ________ are major concerns which need to be addressed apart from an appropriate agriculture policy to promote organic farming.
Answer : Inadequate infrastructure; the problem of marketing the products

Question. __________ is a process that involves the assembling, storage, processing, transportation, packaging, grading and distribution of different agricultural commodities across the country.
Answer : Agricultural marketing

Question. ________is a system whereby all the farmers can pool their milk produced according to different grading (based on quality) and the same is processed and marketed to urban centres through cooperatives. In this system, the farmers are assured of a fair price and income from the supply of milk to urban markets.
Answer : Operation Flood

Question. As agriculture is already overcrowded, a major proportion of the increasing labour force needs to find alternative employment opportunities in other non-farm sectors. Non- farm economy has several segments in it; some possess dynamic linkages that permit healthy growth while others are in subsistence, low productivity propositions. The dynamic sub sectors include ____________.
Answer : agro-processing industries, food processing industries, leather industry tourism, etc

Question. The SHGs promote thrift in small proportions by a minimum contribution from each member. From the pooled money, credit is given to the needy members to be repayable in small installments at reasonable interest rates. Such credit provisions are generally referred to as __________.
Answer : micro-credit programmes

Question. In recent years, awareness of the harmful effect of chemical based fertilisers and pesticides on our health is on a rise. Efforts in evolving technologies which are eco-friendly are essential for sustainable development and one such technology which is eco-friendly is _______.
Answer : organic farming

Question. Those non-farm sectors which have the potential but seriously lack infrastructure and other support include ___________
Answer : traditional home-based industries like pottery, crafts, handlooms etc.

Question. _________ is a whole system of farming that restores, maintains and enhances the ecological balance.
Answer : organic farming

Question. Rampant underemployment, low per capita earnings, absence of mobility of labour to other sectors and __________ and ____________community face today.
Answer : a high rate of illiteracy; indebtedness, Rampant unemployment

Question. National Bank of Agriculture and Rural Development was set up in ________ as an apex body to coordinate the activities of all institutions in the rural financing system.
(a) 1969
(b) 1982
(c) 1949
(d) 1991
Answer : B

Question. The yields from organic farming are more than modern agricultural farming. True/ False? Give reason.
Answer :  Ei: The yields from organic farming are less than modern agricultural farming in the initial years.

ASSERTION AND REASON BASED QUESTION

Question. ASSERTION (A): Rural development is an action plan for complete and comprehensive development of rural area.
REASONING (R): In required to increase the standard of living of Indians as two third of the population of India lives in rural area.
a. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
b. Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason (R) is true.
Answer : A

Question. ASSERTION (A): National Bank for Agriculture and Rural Development (NABARD) was set up in 1980.
REASONING (R): National Bank for Agriculture and Rural Development (NABARD) is an apex body to coordinate the activities of all institutions involved in the rural financing system.
a. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
b. Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason (R) is true.
Answer : D

Question. ASSERTION (A): Rapid expansion of the banking system had a positive effect on rural farm and non-farm output, income and employment.
REASONING (R): The institutional credit arrangement continues to be inadequate as they have failed to cover the entire rural farmers of the country.
a. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
b. Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason (R) is true.
Answer : B

Question. ASSERTION (A): Rural people not only face problems with regard to finance, but also encounter difficulties in marketing their goods.
REASONING (R): Agriculture Marketing’ needs urgent attention in the scheme of securing rapid rural development.
a. Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
b. Both ASsertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
c. Assertion (A) is true but Reason (R) is false.
d. Assertion (A) is false but Reason (R) is true.
Answer : A

CASE STUDY

Rural Development is the key issue with the government. Without the development of rural areas India cannot increase its growth to desired level. Rural development does not mean only to develop its agriculture marketing and credit but also to develop education, training, and infrastructure in rural areas. The government has launched many programs especially of provision of credit and marketing facilities. The farmers often have shortage of funds. Farmers generally go to non-institutional sources for their short term and long-term loans. But farmers are generally exploited. To help them government started provided loan through commercial banks and an apex bank named NABARD was established in 1982. Government is also making efforts to improve agricultural marketing by removing the role of intermediaries where farmers can directly sell their produce to seller without involving any commission agent or middlemen.

Question. Name the Non-institutional sources of credit
(a) Landlords
(b) Moneylenders
(c) Traders and commission agents
(d) All of above
Answer : D

Question. NABARD is established in the year
a) 1982
b) 1992
Answer : A 

Question. Non-farm activities are promoted by government for:
(a) regular income to farmer
(b) addressing the problem of disguised unemployment
(c) reducing pressure on land
(d) All of the above
Answer : D

CBSE Class 11 Economics Chapter 6 On Rural Development Short Answer Type Questions

Question. What is rural development?
Answer. Rural development is an action plan for the economic and social upliftment of rural areas.

Question. What is meant by agricultural diversification?
Answer. Agricultural Diversification means a major proportion of the increasing labour force in the agricultural sector needs to find alternate employment opportunities in other nonfarm sectors.

Question. What is TANWA?
Answer. TANWA (Tamil Nadu Women in Agriculture) is a project initiated in Tamil Nadu where rural women find employment in nonfarm jobs, as well as they are trained in latest agricultural techniques.

Question. What is ‘Golden Revolution’?
Answer. The period between 19912003 is called ‘Golden Revolution’ because during this period the named investment in horticulture became highly productions and the sector emerged as a sustainable livelihood option.

Question. Write two instruments to safeguard the interests of farmers by the government.
Answer. Two instruments are fixation of minimum support price (MSP) buffer stock.

Question. What is cooperative marketing?
Answer. Cooperative marketing is a measure to ensure a fair price ot farmers. Member farmers sell their surplus to the cooperative society which substitutes collective bargaining in place of individual bargaining and hence provides best advantages to the farmers.

Question. What do you mean by ‘Operation Flood’?
Answer. From 1966 onwards operation flood is a system whereby all the farmers can pool their milk produce according to different grading (based on quality) and the same is processed and marketed to urban centers through cooperatives.

Question. What do you mean by micro credit programmer.
Answer. Credit provisions made by self help groups (SHG) to its different members is known as micro credit programme.

Question. Define no institutional sources of agricultural credit.
Answer. Noninstitutional sources include money lenders, traders, commission agents, landlords, relations and friends.

Question. What is agricultural marketing?
Answer. Agricultural marketing is a process of marketing in which farm produce are distributed through wholesalers and stockiest to ultimate consumers.

Question. Mention two limitations of rural banking.
Answer. Two limitations of rural banking are inadequate finance and large amount of over dues and default rate.

Question. Name two institutional sources of agricultural credit.
Answer. Two institutional sources of agricultural credit are cooperative credit societies and commercial banks.

Question. Which state has an efficient implementation of milk cooperatives?
Answer. Gujarat state has the efficient implementation of milk cooperatives.

Question. When was NABARD established?
Answer. NABARD (National Bank for Agriculture and Rural Development) was established in 1982

Question. What is sustainable development?
Answer. Sustainable development is a system of a long period sustainable process along with an eco-friendly environment.

CBSE Class 11 Economics Chapter 6 On Rural Development  Long Answer Type Questions

Question. Explain the steps taken by the government in developing rural markets.
Answer. The following are the various steps initiated by the Indian government to develop the rural markets:
1. Regulated Markets: The government came up with the concept of regulated market where the sale and purchase of the products are monitored by the Market Committee. This Market Committee consists of farmers, government agents and traders. This practice infuses greater transparency in the marketing system through the use of proper scales and weights. Such committees ensure the farmers and the consumers in receiving fair price in exchange of their products
2. Infrastructure Development: The present infrastructure is not sufficient to meet the growing demands of the farmers. Indian government provided cold storages and warehouses that help the farmers to sell their product at the time when the price is attractive. Also, railways offer subsidised transport facilities to the farmers. This enables the farmers to bring their product to urban areas where they can earn huge profits.
3. Co-operative Agricultural Marketing Societies: The government also started co-operative marketing under which the farmers get access to fair prices. This is due to the better and enhanced bargaining power of the farmers via collective sale in the market.
4. MSP Policy: Minimum Support Price is a minimum legislated price that a farmer may charge in exchange for his products. This enables them to sell their products in the open market at a higher price. The MSP insulates the farmers in case of price fall as this is the minimum price that they can receive. The need of such assurance to the farmers is of immense importance as farming in India is subject to many uncertainties.

Question. What do you mean by agricultural marketing?
Answer. agriculture marketing is a process that involves the assembling storage, processing, transportation, packaging, grading and distribution of different agricultural commodities across the country.

Question. Bring out the importance of animal husbandry, fisheries and horticulture as a source of diversification.
Answer.
1. Importance of Animal Husbandry
Animal husbandry is the most important non-farm employment in India. It is also known as Livestock Farming. Poultry, cattle and goats/sheep are the important components of livestock farming in India. Most of the rural families carry out livestock farming together with crop farming in order to increase their income. The share of livestock farming is comparatively higher in the semi arid and arid areas than the irrigated areas. This is because the arid areas have lesser access to irrigation facilitiesand thereby, crop farming is less feasible. Thus, in other words, it can be said that livestock farming provides sustainable livelihood to the people in the semi arid and arid regions where farming can’t be performed well. Further, capital investment in livestock farming is comparatively less than that in crop farming. In addition, livestock farming is an important source of employment for rural women. Presently, animal husbandry is the most important source of alternative employment, employing approximately 70 million small and marginal farmers. Besides providing employment, livestock farming has resulted in increased production of milk, eggs, meat, wool and other by-products, enhancing the consumption bundle qualitatively and nutritionally.
2. Importance of Fisheries
‘Fisheries’ are an important source of livelihood in the coastal states such as Kerala, Maharashtra, Gujarat and Tamil Nadu. The fishing community in India depends on water bodies- both inland and marine water bodies. Inland sources include rivers, lakes, ponds, and streams, while, the marine sources include seas and oceAnswer. The increasing efforts by the state governments have attracted funds in this sector, boosting the production. But this community remains one of the backward communities in the country due to low per capita earnings, lack of labour mobility to other sectors, illiteracy and indebtedness. Despite a significant segment engaged, this sector contributes only 1.4% to India’s total GDP.
3. Importance of Horticulture
Horticulture is emerging as an important source of livelihood in the rural areas. Horticultural crops include fruits, vegetables, medicinal and aromatic plants and flowers. Presently, India is the second largest producer of fruits and vegetables that includes mangoes, bananas, coconuts, cashew nuts and variety of species. There has been a considerable rise in the income levels of families engaged in horticultural production. The increase in horticultural production has lowered the vulnerability of small and marginal farmers. This has provided a gateway of opportunities for employment for women. It generates employment for 19% of India’s total labour force. In contrast to fishing, Horticulture does not suffer from ecological and environmental problem. Hence, horticulture must be promoted with sufficient investment and infrastructure.

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