Contents

INTRODUCTION....................................................................................................................................... 2
HISTORY OF KHADI ............................................................................................................................... 5
PERFORMANCE OF KHADI SECTOR................................................................................................. 7
PERFORMANCE OF KHADI INDUSTRIES IN INDIA FOR THE PERIOD 2009-10 TO 2015-19 8
ABOUT UNDUSTRY ............................................................................................................................... 11
Sales of Khadi and Village Industry Products .................................................................................. 11
The role of Khadi and Village Industries............................................................................................ 12
REVIEW OF LITERATURE .................................................................................................................. 14
RESEARCH METHODOLOGY ............................................................................................................ 15
Research Objectives .............................................................................................................................. 15
Research Variables ............................................................................................................................... 15
Research Hypothesis ............................................................................................................................. 16
Research Instrument ............................................................................................................................ 17
Research Model ..................................................................................................................................... 18
Research Methods ................................................................................................................................. 18
RESULTS AND DISCUSSION ............................................................................................................... 20
CONCLUSION ......................................................................................................................................... 23
BIBLIOGRAPH ........................................................................................................................................ 24
INTRODUCTION

Khadi constitutes an important segment of the textile sector. Khadi has been defined as any cloth
woven on handlooms in India from cotton, silk or woolen yarn handspun in India or from a
mixture of any two or all of such yarns. Due to the artistic nature of khadi products and with
sustained efforts, good demand of khadi products can be created in the international market.
KVIC (Khadi and Village Industries Commission) has been creating employment opportunities
for spinners, weavers, and other allied artisans. A large number of women artisans are covered in
the spinning segment. Khadi activities are supported by 30 State Khadi & Village Industry
Boards (KVIBS), 2000 khadi institutions affiliated to KVIC and State KVIBs, 7050 sales outlets
of khadi banders / Bhawnas and an extensive network of 250 training centers of KVIC / state
KVIBs spread throughout the country. Khadi products, being environmental and user-friendly,
are ideal for the present day market both within the country and outside.
Khadi has the unique property of keeping the wearer warm in winter as well as cool in summer
season. This fabric on washing is more enhanced, thus, the more you wash it, better the look.
Khadi easily lasts years together, at least for 4-5 years. Very attractive and designer apparel can
also be made from doing handwork on the khadi garments. The weaving of khadi is preceded by
the spinning of the thread on the charkha after which it goes on to the robin winder, warped,
sizer, and finally the weaver. The khadi board organizes spinning while weaving is done by the
weavers (mostly men) at their home in an individual capacity. Spinning is mostly done by the
women in villages.
Among all types of fireside, cotton, silk and woolen, cotton khadi is more popular in both
domestic and export markets. Cotton khadi is required to be starched so that it does not get easily
crumpled. It comes in many colors and is not harmful to the skin as synthetic fabrics. This cotton
khadi is very comforting in summer season as ample amount of air ventilation is there; it has the
capacity to absorb moisture. Therefore, it easily soaks the sweat, and keeps the wearer cool and
dry. Cotton khadi comes in plain as well as in printed fabrics. The most common outfit made
from khadi is the ’Kurta’. Many types of apparel are made from khadi like sarees, salwar suits,
fabric yarns, western tops, shirts, trousers, skirts, handkerchief, etc. All are having export
demand potential. It is a very durable fabric. The khadi wearer gets a royal and distinguishable
look due to its historic significance and style. It symbolizes luxury and uniqueness. Previously,
khadi was dyed in earthy colour tones, and was used to make traditional garments; but, now,
designers are experimenting by dyeing khadi with striking colors like lime green, violet, baby
pink, turquoise blue, carpets, etc. Stylish garments like miniskirts, halter neck tops, racer tops,
tunics, etc. are made from khadi. Woolen khadi products are also famous for its aesthetic
appearance at the same time keeping the body worm. The most common outfit made from
woolen khadi is the ’Kurta’. Many types of apparel are made from khadi like sarees, salwar suits,
fabric yarns, western tops, shirts, trousers, skirts, carpets, etc.
HISTORY OF KHADI

In India, Khadi refers to handwoven cloth. Weavers prefer the yarn produced by Mills because it
is more robust and of consistent quality. Swadeshi movement of boycotting English products
during the first two decades of the twentieth Century was popularized by Mahatma Gandhi and
Indian mill owners BACKED Nationalist politicians who called for a boycott of foreign cloth.
Gandhi argued that the mill owners would deny handloom weavers an opportunity to buy yarn
because they would prefer to create a monopoly for their own cloth.[5] However, handspun yarn
was of poor quality and too costly. Thus Mahatma Gandhi started spinning himself and
encouraging others to do so. He made it obligatory for all members of the Indian National
Congress to spin cotton themselves and to pay their dues in yarn. He further made the chakra
(spinning wheel) the symbol of the Nationalist movement. Initially the Indian flag was supposed
to have a chakra, not the Asoka Chakra at its center. Mahatma Gandhi collected large sums of
money to create a grass-roots organization to encourage handloom weaving. This was called
'khaddar' or 'Khadi' movement.
The British Raj was selling very high cost cloths to the Indians. The Indian mill owners wanted
to monopolies the Indian market themselves. Ever since the American Civil War had caused a
shortage of American cotton, Britain would buy cotton from India at cheap prices and use the
cotton to manufacture cloth. The khadi movement by Gandhi aimed at boycotting foreign
cloth.[7] Mahatma Gandhi began promoting the spinning of khadi for rural self-employment and
self-reliance (instead of using cloth manufactured industrially in Britain) in the 1920s in India,
thus making khadi an integral part and an icon of the Swadeshi movement.
The freedom struggle revolved around the use of khadi fabrics and the dumping of foreign-made
clothes. When some people complained about the costliness of khadi to Mahatma Gandhi, he
started wearing only dhoti though he used wool shawls when it got cold. Some were able to
make a reasonable living by using high quality mill yarn and catering to the luxury market.
Mahatma Gandhi tried to put an end to this practice. He even threatened to give up khadi
altogether if he didn't get his way. However, since the weavers would have starved if they
listened to Gandhi, nothing came of this threat.
INDIA

In 2017, a total of 460,000 people were employed in industries making khadi

products. Production and sales rose by 31.6% and 33% in 2017 over the 2016 figures after the
multi-spindle charkas were introduced to enhance the productivity by replacing the single-
spindle charkas. Various states have boards and/or cooperative societies for the khadi production,
promotion, sales and marketing, such as Haryana Khadi and Village Industries Board, Andhra
Pradesh State Handloom Weavers Cooperative Society, Gujarat State Handloom and Handicrafts
Development Corporation Ltd, Jharkhand Silk Textile and Handicraft Development
Corporation and Tamil Nadu Handloom Weavers' Cooperative Society. Additionally, several
institutes are involved in the research and training in this area, such as Indian Institute of
Handloom Technology, Indian Institute of Handloom Technology, Champak and Institute of
Handloom and Textile Technology. Handicrafts and Handlooms Export Corporation of India is
focused on popularizing khadi overseas. NGOs involved in khadi are Rahwa Society.
Popular products being khadi cloth for tailoring various dresses such
as dhoti and kurta, handloom saree such as Puttapaka Saree, Keypad Handloom
fabrics, ChambaRumal, Tussah silk, etc. GajamAnjaiah, an Indian master handloom designer and
recipient of Padma Shri honor, is known for his innovations and developments of tie-
dye handloom products along with TeliaRumal technique of weaving products based
on IChat process.
After Independence, the Government reserved some types of textile production, e.g. towel
manufacture for the handloom sector, which resulted in a deskilling of traditional weavers and a
boost for the power loom sector. Private Sector enterprises have been able to make handloom
weaving somewhat remunerative and the government also continues to promote the use of Khadi
through various initiatives.
Prime Minister Narendra Modi, asserted that khadi cloth is a movement to help the poor. He
further highlighted that the Khadi and Village Industries Commission is a statutory organization
engaged in promoting and developing khadi and village industries. He lauded that Gujrat and
Rajasthan are well known for khadi poly, while Haryana, Himachal Pradesh and Jammu and
Kashmir are known for the woolen khadi.
PERFORMANCE OF KHADI SECTOR

A.COTTON,SILK,WOOL AND MUSLIN

Spindles installed 2.18 million

Yarn produced 25.91 million kegs

Looms installed 1,33,270 nos.

Employment 14.97 Lakhs

Total Production 111.49 million sq.mtrs

Sales Rs.581.20 crores

B.POLYVASTRA 0.20 million

Spindles installed 25.91 million kegs

Yarn produced 8,727 no’s

Looms installed 0.46 lakh

Total Production 10.05 million sq.mtrs

Sales Rs.42.35 crores

Khadi production activity is spread all over India, mostly in villages and also in small town.
Yearly, India produces Rs.600 crores worth khadi and has accumulate sales worth Rs.900 crore.

Present target is to increase the khadi sale to Rs 2000 crore in the next five years. The overall
production of village industries is Rs.18, 000crore. There are more than 1 crore people attached
with Khadi and Village industries and most of them from scheduled and minority caste.
At present Khadi fabric is used to produce readymade garments like men’s short sleeve slack,
long sleeve shirt, long kurtas, cherisher, dhoti, saree, lungi, angavasthiram, shawl, pajama, ladies
Kurtis, nighty long leisure robes are being manufactured and sell in their own khadi
gramodhyogbhavanshowroom.
Right now Khadi is exported to many countries like China, Japan, USA, England, Germany,
Russia, Canada and many more
Khadi is an eco-friendly apparel. The demand for Khadi is being increased rapidly. Presently,
India exports around Rs.150 crore worth of Khadi and village industries products and to reach
Rs.5000 crore in the next five years. Indian Government has taken continuous effort to grow
further more of the Khadi sector in all the states within India
Ten million people are gaining self-employment opportunities in next five years. The vast
challenges is to push up the Khadi institutes to move the changing times and trends. Moreover,
new design production to the people connected with Khadi industry. At present 32 industries are
catering the skill and training offered to the younger generation to gain knowledge.

PERFORMANCE OF KHADI INDUSTRIES IN INDIA

FOR THE PERIOD 2009-10 TO 2015-16
PERFORMANCE OF KHADI INDUSTRY OF CENTRAL
ZONE 2015-16

PERCENTAGE CHANGE IN PRODUCTION FROM THE

PRECEDING YEAR
25

20

15

10

0
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
PERCENTAGE CHANGE IN SALES FROM THE
PRECEDING YEAR
30

25

20

15

10

0
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
ABOUT INDUSTRY

The Khadi and Village Industries Commission (KVIC) is a statutory body formed by the
Government of India, under the Act of Parliament, 'Khadi and Village Industries Commission
Act of 1956'. It is an apex organization under the Ministry of Micro, Small and Medium
Enterprises, with regard to khadi and village industries within India, which seeks to - "plan,
promote, facilitate, organize and assist in the establishment and development of khadi and village
industries in the rural areas in coordination with other agencies engaged in rural development
wherever necessary." In April 1957, it took over the work of former All India Khadi and Village
Industries Board. The First Director of KVIC was Late Sirdar KA Venkataramaiya, a veteran
freedom fighter from Karnataka. Its head office is based in Mumbai but challenged by Naresh
Kadyn, Secretary General, National KVIB Employees Federation, to shift HQ to Delhi, whereas
its six zonal offices in Delhi, Bhopal, Bangalore, Kolkata, Mumbai and Guwahati. Other than its
zonal offices, it has offices in 29 states for the implementation of its various programmers.
Khadi, (pronounced Khadi) refers to hand-spun and hand-woven cloth. The raw materials may
be cotton, silk, or wool, which are spun into threads on a charkha (a traditional spinning
implement).
Khadi was launched in 1920 as a political weapon in the Swadeshi movement of Mahatma
Gandhi.
Khadi is sourced from different parts of India, depending upon its raw materials - While the silk
variety is sourced from West Bengal, Bihar, Odisha and North Eastern states, the cotton variety
comes from Andhra Pradesh, Uttar Pradesh, Bihar and West Bengal. Khadi poly is spun in
Gujarat and Rajasthan while Haryana, Himachal Pradesh and Jammu and Kashmir Karnataka are
known for the woolen variety.
There are a wide range of Khadi personal care products manufactured in Uttarakhand Khadi
Products - Handmade and Natural.

SALES OF KHADI AND VILLAGE INDUSTRY PRODUCTS

The products produced by the institutions are either sold by them directly, through government)
In total, there are 15431 sales outlets, out of which 7,050are owned by the commission. These
are spread all over India.
The products are also sold internationally through exhibitions arranged by the commission.
The role of Khadi and Village Industries

Khadi is the proud legacy of our national freedom movement and the father of the nation. Khadi
and Village Industries are two national heritages of India. One of the most significant aspects of
Khadi and Village Industries in Indian economy is that it creates employment at a very low per
capita investment. This Sector not only serves the basic needs of processed goods of the vast
rural sector of the country, but also provides sustainable employment to rural artisans. It
represents an exquisite, heritage product, which is ethnic as well as ethical. It has a potentially
strong clientele among the middle and upper strata of the society (MSME working group report,
2012)
The Khadi and village industries continue to be more relevant in the globalized India. India is
now reaping the benefits of demographic dividend. The average age of today’s India is 24 years.
India should provide /facilitate its youths to get the jobs, so that their energy is channelized in
right direction towards economic development of nation. The already existing surplus labor and
the new entrants to the job markets must be provided jobs; otherwise it would prove disaster to
the economy. Globalized India has welcomed FDI established SEZ, but it cannot provide jobs to
all those who demand the jobs, except by developing and encouraging the Micro, Small and
Medium Enterprises, Khadi and Village industries.

Khadi and Village Industries Commission (KVIC)

Before Independence, the development of Khadi and Village Industries was entirely a non-
governmental effort under the guidance of Mahatma Gandhi. After independence, the
Government of India took the responsibility of bringing the development of Khadi and Village
Industries within the overall framework of the Five Year Plans. Therefore, the Government of
India set up Khadi and Village Industries Commission (KVIC), which is a statutory organization
by an Act of Parliament. This organization came up in 1956 and it plays a pivotal role in the
strengthening of rural economy by promoting and developing Khadi and Village Industries.
The functions of the KVIC are generally to plan, promote, organize and assist in implementation
of programmers for the development of khadi and village industries. To achieve this, it
undertakes (a) financing of eligible agencies (b) training of persons employed or desirous of
seeking employment in Khadi and Village industries, supervisors and other functionaries; (c)
building the reserves of the materials; (d) R&D in Khadi and Village Industries sector; (e)
promotion of sale and marketing of khadi and village industries products; (f) promotion and
encouragement of cooperative efforts among the persons engaged in Khadi and Village
Industries, etc.
Khadi & Village Industries Commission established under the Khadi and Village Industries
Commission Act, 1956 (61 of 1956), is a statutory organization engaged in promoting and
developing khadi and village industries for providing employment opportunities in the rural
areas, thereby strengthening the rural economy of the country. It took over the activities from the
erstwhile All India Khadi and Village Industries Board i.e. 01 April 1957. KVIC has been
identified as one of the major organizations in the decentralized sector for generating non-farm
employment opportunities in rural areas at low per capita investment. It undertakes activities like
skill improvement, transfer of technology, research & development, marketing, etc., in the
process of generating employment/self-employment opportunities in rural areas (KVIC Annual
Report, 201314)
Objectives of Khadi and Village Industries Commission (KVIC) 1. The social objective of
providing employment in rural areas; 2. The economic objective of producing saleable articles;
and 3. The wider objective of creating self-reliance amongst people and building up a strong
rural community spirit.

Khadi and Village Industries in Chhattisgarh

Khadi and Village Industries in Chhattisgarh is managed and controlled by the Chhattisgarh
Khadi and Village Industries Board (KVIB). The main objective of Chhattisgarh Khadi and
Village Industries Board is to generate mass opportunities of employment for trained artisans and
craftsmen and yarn spinning women with the help of advanced technology by development of
khadi and village industries in rural areas.
The main objectives of KVIB are:
1) To assist individual Trust, Institution, society, SHGs to setup village industries (VI) in rural
area for creating employment opportunities.
2) To encourage to develop the rural industries through technical training.
3) To provide for sale and marketing of khadi and village industries product (KVI) through
departmental banders.
Three Khadi Bhandari run by board in the state. Khadi banders are in the districts headquarter
Raipur, Shastra Market, JagadalpurChitrakut Road, Ballarpur Satyam Complex and Selling of
khadi & village industries products during the year 2005-2006 was Rs. near about 1.00 Crore
(Economic Survey, 2014-15).
REVIEW OF LITERATURE

The idea of revitalizing traditional industries generates from the significant role they are playing
in the economic development specially employment generation (PrabinBaishya, 1989). The rural
people lives a miserable life, meant to be a process of slow starvation. Extinction of
village/traditional industries can easily deteriorate the villages in India and the rural life (Gandhi,
1959). The traditional belief about the role of small and cottage industries in our country is
generally spread of ‘unreconstructed Gandhists’ (Myrdal Gunner, 1968). Village Industries
predominantly engage the rural population by providing employment to earn a livelihood. They
form a part of the rural occupational structure and their decline leads to the dislocation of a
sizeable number of rural people (Paola and Metra, 1982).
Indian economy is basically characterized with large scale unemployment and poverty. Village
and Small Scale Industries play an important role in the country by providing employment
opportunities in rural areas with less amount of capital and infrastructure, in particular to women
and weaker sections of society and for bringing about a reduction in regional disparities and
removal of economic backwardness of the rural and undeveloped area of the country
(VadilalDagli, 1976). The village and small scale industries come under the category of rural
industrialization. Rural industrialization is important not only as a means of creating employment
for rural people and raising the real income of the nation but also it contributes to the
development of many other rural occupation like agriculture. The development of rural industries
also creates opportunities for women domestically and changes the pattern of living (Desai,
1993).
RESEARCH METHODOLOGY

Research Objectives

This study seeks to understand and analyze the role of khadi and village industries on the
economic development of the Chhattisgarh State. The following objectives have been formulated
for the purpose of the study:
1. To study about the Khadi and Village Industries of India and Chhattisgarh State.
2. To study about the physical performance of Khadi and Village Industries Board of the
Chhattisgarh State.
3. To study about the Economic Development of the Chhattisgarh State through Khadi and
Village Industries.
4. To study about the relationship between physical performance of Khadi and Village Industries
and Economic Development of Chhattisgarh State.
5. To understand the contribution of Khadi and Village Industries in the Economic Development
of the Chhattisgarh State.

Research Variables
Contribution of Khadi and Village Industries in the Economic Development of the Chhattisgarh
State can be explained by Physical Performance of Khadi and Village Industries. The three
indicators of physical performance are production, sales and employment. The independent
variable and dependent variable of the study are physical performance and economic
development respectively as mentioned in table 1. Three indicators of physical performance have
been identified through literature review as shown in the table 2. Whereas, three indicators of
human development index were identified to assess the economic development as shown in table
3.

Table-1: Independent and Dependent Variable

Independent Variables Source Dependent Variable

Physical Performance Dollar, Economic Development

HallwardDriemeier
and Manistee (2005)
Table 2: Indicators of Physical Performance
Indicators Source Dependent Variable

Production MSME Annual Report, 2013- Physical Performance

14
Sales
Employment

Table 3: Indicators of Economic Development

Antecedent Indicators Source Dependent
Variable
Life Expectancy Index Human Human Development Economic
(LEI) Development Index Report, 2010 Development
Education Index (EI) (HDI)
Income Index (GDPI)

Research Hypothesis

To study the role of khadi and village industries on the economic development of Chhattisgarh,
it is required to evaluate the physical performance of the industry in terms of production, sales
and employment generation among the rural people as well as to identify their socio economic
development, which will eventually indicate the economic development of khadi and village
industries. It is predicated that the enhancement of the physical performance of khadi and village
industry will enhance the socio-economic development; hence it will contribute to the economic
development of the state as also evidenced by Dollar, Hallward-Driemeier and Manistee (2005).
For the purpose the study, following research hypothesis is being proposed:
H1: There is a significant contribution of Khadi and Village Industries in the Economic
Development of the Chhattisgarh State.
Research Instrument

The following instruments were formulated for collection of data to calculate the human
development index (HDI) for khadi and village industries of Chhattisgarh. Refer Table 4
Table 4: Research Instrument
Research Model

The following research model is proposed indicating the independent and dependent variables
along with their indicators as shown in figure 2.

Research Methods

For the purpose of this study, data pertaining to production, sales and employment from the
beneficiaries of khadi and village industries of Chhattisgarh were taken. The secondary data were
obtained from various issues of annual reports of khadi and village industries and economic
survey reports of Chhattisgarh government. The reference period for analysis was taken
from2009-10 to 2013-14. A comparative analysis of compound annual growth rate (CAGR) for
khadi and village industries was carried out for key growth and performance parameters like,
production, sale and employment to analyses the physical performance of khadi and village
industries.
Significant part of the study depends on secondary sources. But information has also been
obtained from primary sources which include interviews, comments, observations, opinion,
notes, etc. of the persons concerned with the Khadi and Village Industry in Chhattisgarh State.
The development of Chhattisgarh state through khadi and village industries was identified with
the help of Human Development Index. It is the index which represents the socio-economic
status (economic development) of Chhattisgarh. The data for three parameters of HDI was
collected from the beneficiaries of khadi and village industries of Chhattisgarh in the form of a
structured questionnaire. The survey was conducted on 250 beneficiaries selected on the basis of
non-probabilistic convenience sampling technique, and the data collected was analyzed to check
the socioeconomic status (economic development) of Chhattisgarh.
The primary information was also gathered through discussion with officials of KVIB of
Chhattisgarh, District Industries center (DIC), KVI distribution centers of Raipur, Ballarpur and
Jagdalpur. Materials for the present study were collected from the published annual reports,
economic survey, magazines, journals, and periodicals, have also been gone through to derive
information pertaining to the present study.
For testing the hypothesis implicit in the aforesaid objectives, both primary and secondary data
were used to analyze. Physical performance was assessed through mean and CAGR, where
graphical representation was also done for both khadi & village industries. HDI was assessed
through various formulas mentioned in literature review of this study. Hence, the role of khadi
and village industries on the economic development of Chhattisgarh was assessed with the help
of the results of the study.
RESULTS AND DISCUSSION

Firstly, a close analysis of the physical performance on the basis of three indicators i.e.
production, sales and employment generation was conducted for khadi and village industries of
Chhattisgarh to know the percentage increase in three indicators for a span of 5 years from 2009-
10 to 2013-14. Secondly, economic development of Khadi and Village Industries of
Chhattisgarhwasanalysed through human development index on the basis of three indicators i.e.
life expectancy index, education index and income index. Hence, the role of Khadi and Village
Industries through physical performance on the economic development of Chhattisgarh has been
understood in this chapter.
The Khadi production which was 177.43 lakhs in 2009-10, has increased to 210.26 lakhs in
2013-14, indicating a compound annual growth rate (CAGR) of 3.45% in the span of 5 years.
Whereas production in Village Industries indicate a continuous increase from 3015.62 lakhs in
2009-10to 6444.19 lakhs in 2013-14, presenting around double growth over the time period from
2009 to 2014, indicating a compound annual growth rate (CAGR) of 16.40%..
The performance of village industries in Chhattisgarh in terms of production was 6444.19 lakhs
in 2013-14 as compared to 3015.62lakhs in 2009-10. Village industries has registered a growth
rate (CAGR) of 16.40% in the period of five years from 2009-10 to 2013-14. The performance of
khadi sector in Chhattisgarh in terms of sales was 456.65 lakhs in 201314 as compared to
136.58lakhs in 2009-10. Khadi sector has registered a growth rate (CAGR) of 27.3% in the
Period of five years from 2009-10 to 2013-14. The performance of village industries in
Chhattisgarh in terms of production was 8858.55lakhs in 2013-14 as compared to 5236.74lakhs
in 2009-10. Village industries has registered a growth rate (CAGR) of 11.09% in the period of
five years from 2009-10 to 2013-14. The performance of khadi sector in Chhattisgarh in terms of
employment generation was 870 persons in 2013-14 as compared to 622 persons in 2009-10.
Khadi sector has registered a growth rate (CAGR) of 6.94% in the period of five years from
2009-10 to 2013-14. The performance of village industries in Chhattisgarh in terms of
employment generation was 2406 persons in 2013-14 as compared to 2500 persons in 2009-10,
which shows a decline in the number of employment generation within a span of five years.
Whereas, in the year 2010-11, a massive 19525 employment was generated. Village industries
has registered a negative growth rate (CAGR) of -0.76% in the period of five years from 2009-10
to 2013-14.
The overall physical performance of khadi and village industries for production, sales and
employment has been calculated by adding the values of both khadi sector and village industries.
The percentage increase or decrease in production, sales and employment individually for both
khadi sector and village industries is also calculated along with the overall for khadi and village
industries. All the figures show positive increase in percentage for production, sales and
employment except for employment under village industries shows a decline of 3.76% in a span
of 5 years from 2009-10 to 2013-14, but the total employment generated for khadi and village
industries is 4.93%, which shows a positive increase in 5 years.
The physical performance of khadi and village industries in terms of compound annual growth
rate (CAGR) for production, sales and employment has been calculated for both khadi sector and
village industries separately. The khadi and village industries in terms of production has grown
with 19.85% in a span of 5 years, where in terms of sales it has grown with 38.39% in a span of
5 years. The growth rate of employment generation in khadi and village industries in a span of 5
years is 6.18%.
Hence, the khadi and village industries in Chhattisgarh is performing significantly in the form of
sales for generating income to the /artisans and also through providing employment to the rural
people to earn a livelihood. The role of khadi and village industries on the economic
development of Chhattisgarh state can be understood by analyzing the impact of physical
performance of KVI on the socio-economic development of the beneficiaries of the KVI of
Chhattisgarh. Therefore, if the KVI sector is performing well, it must impact the economic
development in positive manner and hence, the people will show good level of social-economic
development in the form of HDI.
The life expectancy index for khadi sector in Chhattisgarh is 0.784 as compared to 0.829 for
village industries. The education index amounts to 0.452 for khadi sector as compared to 0.474
for village industries. The income index for khadi sector amounts to 0.513 as compared to 0.565
for village industries. On the basis of three indicators, the human development index for khadi
sector of Chhattisgarh is 0.566 and for village industries is 0.636. The mean life expectancy
index for khadi and village industries in Chhattisgarh is 0.806, education index is 0.463 and
income index is 0.539. The human development index (HDI) for khadi and village industries in
Chhattisgarh is 0.601.
The HDI attempts to rank the economic development on a scale of 0 (lowest human
development) to 1 (highest human development) based on three goals or end products of
development. The range of human development is categorized under three levels as low human
development ranges from 0.0 to 0.50, medium human development ranges from 0.51 to 0.79, and
high human development ranges from 0.80 to 1.0.
The human development index calculated in this study for khadi sector is 0.566 and for village
industries is 0.636, which indicates that both sector is having medium human development (0.51
to 0.79). Moreover, the HDI for khadi and village industries of Chhattisgarh is 0.601, which is
again under the medium human development. Hence, it indicates that Chhattisgarh has
developed economically as far as beneficiaries of khadi and village industries of Chhattisgarh is
concerned due to the significant physical performance of the KVI. The result of the study is in
accordance with the study of Dollar, Hallward-Driemeier and Manistee (2005), which indicates
that physical performance significantly impact the economic development.
So, now it has been proved that khadi and village industries of Chhattisgarh state is performing
well and it has substantially developed the rural people both socially and economically, it is the
right time to realize the importance of the contribution of KVI and to formulate and implement
the workable strategy for KVI in order to sustain the objectives of KVI which Grande has
thought of. One of the most essential strategies is globalization of Khadi and Village Industries
The relaxation in the policies of Fin the markets of the developing economies like India has
given more advantage to developed countries to capture the developing economies market. The
modern technology, hidden subsidies given by their countries and updated marketing skills help
them to conquer Indian markets. Further the developed worlds impose restrictions on the areas
where developing countries have an edge over them. Therefore, in order to safeguard the rural
programs, Indian government, has to provide suitable safety nets for MSME and KVI.
Proactively protecting the rural India from the negative externalities of globalization is the only
immediate solution. But the scenario is not favorable. The major portion of the budgetary support
given to the KVI is for disbursement of rebates on retail sales of Khadi and to subsidy on village
industries. In the past the working fund given to khadi industry was interest free. But at present 4
to 6 % of interest is charged on the working fund also. Earlier Government gave loans from plan
provisions, but of late, plan provision has depleted and the Khadi sector is being financed by the
consortium of banks (CBC) which expects working fund to be repaid in installments, along with
interest. The government of India should not forget that Khadi is not mere cloth. It is a process of
social economic reconstruction of our rural India, which amounts to be around 70%. As long as
the government continues to proclaim that their primary objective is the welfare of the people, it
has to continue to support to Khadi and village industries.
CONCLUSION

The khadi and village industries in Chhattisgarh have grown substiancally in terms of
production, sales and employment and have considerably contributed in the economic
development of Chhattisgarh. Moreover, it holds great potential for generating gainful
employment opportunities for the rural poor, arresting migration of rural workers to urban areas
and for promoting the strategy of sustainable development. However, this potential cannot be
realized without addressing some basic weaknesses with regard to the design and implementation
of the programmer and without making it fiscally sustainable. It may be necessary to constitute a
committee to examine the feasibility of the various programmers being designed and
implemented by KVIB and to suggest suitable measures for restructuring of KVIB and its
various activities, so that the primary objective of the scheme is realized with justifiable level of
fiscal support.
The Chhattisgarh Khadi and Village Industries Board is playing a vital role in generating
employment for rural poor, unemployed youth and down-trodden artisans of the state by
providing financial and technical assistance for setting up of micro and small industrial
production units. The growth rates of khadi and village industries sector in terms of production,
employment and sales are substantial. The development of khadi and village industries sector has
acquired even more relevance today on account of : (I) growing population pressure in rural
areas; (ii) rapid expansion of the lob our force especially among the marginal farmers and
landless agriculture labors; (iii) inadequate opportunities for nonagricultural work; (iv) limitation
of the organized sector in absorbing the labor force; (v) need and the capacity for creating
employment opportunities near the place of residence so as to avoid migration from rural to
urban areas. It is for these reasons the governments support is considered essential for the
continuous progress of the khadi and village industries sector. Finally, the study concludes with
the observation that Khadi and Village Industry is playing a pivotal role in Chhattisgarh’s’
economic development. Thus, khadi and village industries is the best way to fight the evil of
unemployment and to stop the migration of labor from rural to urban areas.
KVIC as a part of its commitment to rural industrialization has been assessing rural resources,
augmenting deficient resources and formulating plans, programs and schemes for effective and
balanced utilization of these parameters and determining priorities. From a highly centralized
urban planning system, the Indian economy is gradually moving towards the rural sector and it is
here that the KVIC concerns itself with the building of a long term strategic vision of the future
rural strategy and decide on priorities of the rural sector.
BIBLIOGRAPH.

 www.wikipedia.org.khadi.in
 www.economictimes.indiaimes.com.khadi.in
 www.kvic.org.in