CHAPTER 2

Rural Employment Programmes in India: An Overview

India has been witness to large scale poverty since time and memorial. As a matter of
fact, even when India gained independence, its economy was in an utterly deplorable
state, however things were worse not only at that point of time, but even when the
country was still in the shackles of the British regime. When Britishers left India, they
had divided the country in two parts, India and Pakistan. There had been no
appreciable development on the agricultural front and with the Zamindari system 1
being predominant, no new methods were introduced and only wooden ploughs and
bullock labour had been the capital in agriculture. Although commercialisation of
agriculture had taken place in some parts of the country, yet it had benefitted the
Britishers than the Indians alone.The poor farmers had become agricultural labourers
as they were unable to bear high land revenue and higher tenancy amount.

Thus, the Indian economy was stagnant for centuries and as far as industrial
development was concerned, little was done and the Britishers were even destroying
the handicrafts by following the policy of deindustrialization of India. Railway lines
had developed, but only to benefit the Britishers alone. On the educational front also,
the system was highly underdeveloped producing clerks who were suitable for white
collared jobs and there was dearth of proper infrastructure for technical and
managerial education. The country was also subject to recurrence of famines and
people were suffering in large numbers due to malaria, plague and other diseases.
Infant mortality was at its highest and literacy rate was at its lowest. In short,
Britishers had thoroughly exploited India and it was virtually drained. Immediately
after independence, the government of India had to spend a huge amount on the
rehabilitation programme and consolidation of the country was carried out by merging
several princely states into the Indian Union.

One of the rehabilitation programmes was that of planning, although under the foreign
rule many ideas were tried and tested to implement certain types of planning. The
credit for advocating planning in India however goes to M.Vishveswarayya, who

1
The Zamindari system was a way of collecting taxes from peasants. The zamindar was considered a
lord, and would collect all taxes on his lands and then hand over the collected taxes to the British
authorities keeping a portion for himself.

32
published the book “Planned Economy for India” in 1934 which led to the
establishment of a National Planning Committee by the Congress party in 1937.

When the Congress Ministry first took office, a provincial rural development council
was subsequently created and rural development associations were established in each
district where the existing rural development department served as the basis for
organizing development activities. It selected a number of blocks in each district for
intensive work and the various development departments were invited to undertake
their activities in these blocks also. But soon after, the ministry went out of office and
the various departments reverted to their old routine of acting individually in separate
compartments.

The private sector did not fall behind and in 1944, the Bombay plan was thus
prepared, which was known as the Tata-Birla plan. This plan was drafted by eight
Bombay industrialists with the main objective of increasing agricultural production by
about five hundred percent, which was expected to lead to doubling of per capita
income within a period of 15 years. So even though they planned for agriculture, the
industrialists were interested in improving the industrial sector only and hence it was
more of an industrial plan rather than a plan for all sectors of the economy. Agriculture
and allied sectors were not given any importance and estimates of the plan were based
on the statistical data of 1931-32, which was a period of depression. It was more of a
capitalistic plan whose objective was to develop the industrial sector.

People’s Plan- M.N.Roy prepared a plan entitled people’s plan simultaneously with
Bombay plan.This plan gave utmost importance to agriculture and consumer good
industries. The outlay of the plan was Rs.15000 crores but inspite of its good
intensions, this plan was utopian and far from being real.

Gandhian Plan- The Bombay Plan and the People’s Plan provoked Shrimannarayana
Agarwal to prepare a modest plan which he called as the Gandhian Plan with an outlay
of 3500 crores which laid emphasis on the village self-sufficiency and was severely
criticized. Though it’s emphasis was on the village self-sufficiency, agriculture and
small scale industries, but the financial outlays and resource position were not very
sound.

33
Post war Plans- The British Government took some interest in the Indian Economic
affairs and hence started with the Reconstruction plans. On 24th August 1944, the
government established a Planning Department. The interim government was thus
formed and it established an advisory planning board. It issued a report and meanwhile
several economists like P.S Lokanathan, K.T.Shah, P.C Ghosh, P.A. Wadia and K.T.
Merchant advocated for economic planning on an extensive scale(Joshi, 1954).

However, with the prevailing economic conditions in the country in 1949, the need for
a coordinated plan and the necessary machinery for its execution was felt all the more.
It became essential to phase the development programme in a manner so as to give
priority to those schemes which were expected to give the best economic results and
add to the material resources of the country in order to secure increased association
and participation of the people for their execution on the basis of self-help. The
Industrial Policy Resolution was issued in April 1948 which suggested setting up of a
Planning Commission, leading to formation of the Planning Commission in March
1950(ibid).

Even before the first five year plan was launched, there was Sarvodaya Plan, and as
the name indicates, it was prepared by Sarvodaya organisers on 30th Janauary 1950. It
expected an all round development and the main objectives of the plan were to remove
disparities in land holding, preparing ground for cooperative farming, achieving
equitable distribution of wealth and fixing minimum and maximum earnings for all the
people. However the plan could not take proper shape, but it paved the way for
formulating plans by the Planning Commission (ibid).

The Government asked the Planning Commission in 1950, with Prime Minister as its
Chairperson, to prepare Colombo plan for India.It was a six year plan with the
objective of improving the standard of living of the people by increasing the tempo of
economic development of member Commonwealth countries. The Colombo Plan for
India underwent several changes before it was finally merged in the First five year
plan. Originally, with an expenditure of Rs.1840 crores, it went upto Rs. 2334 crores.

The necessity of planned economic development was now felt even more strongly in
India, as it was characterised by mass poverty, low levels of income and concentration
of income in a few hands, low levels of productivity and backward technology, high

34
level of unemployment and underemployment, poor nutrition, health, housing,
illiteracy and low level of industrialisation.

The stagnation in the economy was thought to be tackled with the strategy of
momentum for planned action and also to break the vicious circle of poverty. Many
plans that had preceded the first five year plan had not achieved much success.
Therefore, soon echoes of the constitutional provisions made under the Directive
Principles of State Policy for the removal of poverty in India were heard in the
enunciations of all the five year plans with the sole aim of economic development and
social justice guaranteeing equality of opportunity, just distribution of income and
social security of the people(Srivastava, 1990).

With this aim in mind, the First Five Year Plan was launched with an immediate task
of rehabilitation of the economy. It aimed at correcting the disequilibrium caused by
war and the partition and simultaneously initiation of all-round development. The Plan
provided for a total outlay of Rs. 2069 crores only, but the actual total expenditure
incurred was Rs. 1960 crores only (Planning Commission, 1951). Not much was
allotted for industries. Infact, during the period of the first three five year plans,
investment was highly capital intensive and creation of direct employment
opportunities was low. Thus, concerted efforts were made to ameliorate the living
standard of rural masses, as a result of which various rural development programmes
were taken up for an integrated concept of growth and poverty alleviation, which has
been of utmost importance in all the five year plans. Thus, Rural Development (RD)
programmes comprised of the following dimensions:
 Improving agricultural productivity in the rural areas;
 Provision of basic infrastructure facilities in the rural areas for example,
schools, health facilities, roads, drinking water, electrification, etc;
 Provision of social services like health and education for socio-economic
development;
 Implementing schemes for the promotion of rural industry increasing; and
agriculture productivity, providing rural employment, etc.

35
2.1 Rural Development Programmes of India
2.1.1 Grow-More-Food Campaign
The urgent need for stepping up food production and bringing about development of
the people was realised even in the pre-Independence era and as a result the Grow-
More-Food Campaign was started. Under the campaign, targets for increased
agricultural production were laid down for the first time on all-India basis, but the
campaign failed to achieve its targets. Soon after Independence (1947), the Central
Government re-defined the objectives of the Grow-More-Food Campaign for the
attainment of self-sufficiency in food grains by 1952.Simultaneously the targets of
production of other crops were increased to meet the shortfall as a result of the
partition of the country. At the same time, arrangements were made for integration and
co-ordination of the entire campaign for increasing agricultural production. Some state
governments associated the masses with working of the campaign by setting up non-
official committees at the village, taluka, district and state levels. The plans were
revised from time to time to make the campaign more effective.

Though efforts were made to revitalise the Grow-More-Food Campaign, it was

observed that the system was not functioning properly and the cultivators’ response to
the programme was very poor. As a result, the Government of India in 1952 appointed
a Committee called the Grow More Food Enquiry Committee to examine the working
of the Grow-More-Food Campaign.

The findings of this Committee revealed that the problem of food production was
much wider than the mere elimination of food imports and that agricultural
improvement was a very important part of a much wider problem of raising the level
of rural life in the country. The Committee concluded that it was only by bringing
about an appreciable improvement in the standards of rural life by making it fuller and
richer. The rural masses, it was felt, could be awakened to take interest in not only
increasing agricultural production, but also improving their own conditions and
creating a will to live better. The Committee also pointed out that (i) all aspects of
village life were interrelated;(ii) improvement could be brought about by a number of
detached programmes operating independently;(iii) there was lack of unity of
efforts,(iv) the available finances were not adequate, and(v) the rural community as a
whole did not participate effectively in the campaign. In short, "the movement did not

36
arise nation-wide enthusiasm and did not become a mass movement for raising the
level of village life"(Planning Commission, 1952).

In its recommendations, the Committee proposed for: the formation of development

block, each consisting of 100 to 120 villages; and appointment of revenue officers as
development officers or extension officers, assisted by technical officers for
agriculture, animal husbandry, co-ordination and engineering. For actual work in
villages, the Committee suggested the appointment of one village level worker for
every five or ten villages who would be the joint agent for all development activities.
This worker would convey to the farmers, the lessons of research, and to experts the
problems of the farmers. Besides, he was to arrange supplies and services needed by
the farmers, including preliminary assistance in case of animal and plant diseases. The
committee also described broadly the functions of the extension service, the manner in
which the extension organisation would operate, the arrangements required in training
of the required staff, and the way in which non-official leadership should be associated
with the work of village development at the village, taluka, district and state levels.
The need for setting up an independent organisation to carry out the suggestions made;
the manner in which the assistance should be rendered to the state governments as well
as to villagers for development work; and the role of the central and stage
governments in this effort was also emphasized by the committee(ibid).

Based on these recommendations, the Planning Commission, which was set up earlier
by the Government of India to prepare a plan for development, consistent with the
available resources, gave the highest priority to the development of agriculture and
irrigation in the First Five-Year Plan. The Commission fixed substantially high targets
of internal production and decided, as recommended by the Enquiry Committee, that
the drive for food production should form part of plans for overall agricultural
development, and that agricultural improvement in turn should form an integral part of
the much wider efforts for raising the level of rural life. The Commission prescribed
"Community Development" as the method for initiating the process of transformation
of the social and economic life of villages and "Rural Extension" as its agency and
hence started the series of rural development programmes in India.

This idea of intensive all-round development work in a compact area was put into
practice as a Pilot Project in Rural Planning and Development in the Etawah District in

37
Uttar Pradesh in 1948, which can be regarded as a forerunner of the Community
Development Project in India. Albert Mayer, an American Engineer, played the key
role in the initiation and implementation of the project. The programme was based on
the principle of self-help, democracy, integrated approach, felt needs of the people,
rigorous planning, realistic targets, institutional approach, co-operation between
governmental and non-governmental organisations, close co-ordination between the
extension service and the supply agencies, and the collaboration of technical and social
scientists.

After an initial period of trial and error, a new administrative pattern was evolved. It
percolated to the village level; the activities of different nation-building departments
were channelled through one common agency and a multipurpose concept of village
level worker was introduced. Each village level worker looked after 4-5 villages. The
project was supervised by a district planning officer assisted by four specialist officers
and other supporting staff. This experiment was to be carried forward in the form of
community development programme.

2.1.2 The Community Development Project

The beginning of the Community Development Programme was made in 1952 on the
recommendations of Krishnamachari Committee, with an aim that accelerated
development can be provided only if governmental efforts are adequately
supplemented by direct and indirect involvement of the people at the grassroots level.
It was envisaged that the villages would undertake and execute the programmes of
development with actual support of the State. Accordingly, it was felt necessary to
change the structure of development administration and launching of the Community
Development Programme in 1952 was a first step in this direction. A need was felt for
building development administration, which was sensitive to the aspirations and needs
of the people. The programme covered several activities like agriculture, animal
husbandry, health, education and employment, but the focus remained on agriculture.
So initially, 55 areas comprising 27,388 villages with a population of 16.7 million
people were selected for intensive development. It was a nationwide project with the
major philosophy of induction of people in the local developmental action which
aimed at utilisation of locally available resources.

38
As a result of the Grow-More-Food Enquiry Committee Report and the successful
experience of the Etawah Project, 15 Pilot Projects were started in 1952 in selected
states with the financial assistance received from the Ford Foundation. Besides helping
in increasing agriculture production and bettering the overall economic condition of
the farmers, these projects were meant to serve as a training ground for the extension
personnel. It was soon realised that for the creation of an urge among the rural
population to live a better life and to achieve permanent plentitude and economic
freedom in the villages, a much stronger and dynamic effort was called for. It was
recognised that the success of this new effort depended upon the whole hearted co-
operation of the beneficiaries, government officials and non-officials at every stage,
including interalia the education of rural masses in the technique of rural development
besides timely provision of adequate supplies of the needed inputs and other
requirements.

For undertaking this new programme, the Government of India entered into an
operational agreement with the Government of the U.S.A under the Technical Co-
operation Programme Agreement. Under this Agreement, 55 Community
Development Projects were started in different parts of the country on 2nd October
1952 for three years.

The Projects covered nearly 25,260 villages and a population of 6.4 millions. Each
project, in turn, consisted of about 300 villages covering 400-500 square miles and
having a population of about two lakhs. The project area was divided into three
development blocks, each comprising 100 villages and a population of 60,000 to
70,000. The development blocks, in turn, were divided into groups of 5-10 villages,
each group being in the charge of a multipurpose village-level worker. The main aims
of these projects were: to increase agricultural production by all possible means; to
tackle the problems of unemployment, to improve village communications; to foster
primary education, public health and recreation, to improve housing; to promote
indigenous handicrafts and small-scale industries; and to improve the villagers lot
through their own primary effort. In short, the programme aimed at achieving all-
round socio-economic transformation of the rural people.

However, unemployment and poverty were still two major problems that were
inextricably linked with each other, but did not achieve great impetus during the initial

39
years of planning, as the main emphasis of the planners was on attaining a higher
growth rate in terms of the Gross National Product (GNP).The planners were of the
view that the benefit of growth would automatically trickle down to the masses and
thereby alleviate poverty.

In view of a very enthusiastic response received from the rural population in all
projects besides the keenness shown in the form of demands made by the people for
Community Development Programme, the Government of India decided to extend it
rapidly to other parts of the country. However, owing to limited financial and technical
manpower resources, it was also decided to launch, along with Community
Development Projects, a programme which was somewhat less comprehensive. It was
to integrate both under one comprehensive service. Accordingly, the National
Extension Service was inaugurated on 2nd October 1953 (Singh, 1999).

2.1.3 National Extension Service Programme

Under the Community Development Projects, intensive development work was taken
up in all fields, the scheme of National Extension Service was designed to provide the
essential basic staff and a small fund for the people to start the development work
essentially based on the premise of self-help. The operational unit of this service was
termed as a N.E.S.Block comprising about 100 villages and 60,000 to 70,000 people.
The N.E.S.Blocks were later converted into Community Development Blocks, which
had higher budget provisions in order to take up more intensive development
programmes. The Pattern of Community Development Programme was further revised
(modified with effect from 1 April1958). According to this pattern, there were four
stages: (1)Pre-Extension Stage, (2) Stage I Blocks, (3) Stage II Blocks, and (4) Post-
Stage II Blocks. A brief about these four stages is as follows:

(1) Pre-Extension Stage. At this stage, there was a budget provision of Rs.18,800 for
one year. The staff consisted of a block development officer, one agricultural
extension officer and five village-level workers whose main duties were to survey the
whole block area and to prepare the ground work for the intensive stage and conduct
agricultural demonstrations.

(2) Stage I Blocks. After one year of the Pre-Extension stage, the block stepped into
Stage I, with a budget provision of Rs.12 lakhs for five years for intensive

40
development. During this period, provision was made to have one block development
officer, eight extension officers, ten village level workers(VLWs), two gram sevaks,
three stockmen (veterinary), one physician and 3-4 midwives, one compounder, a
sanitary inspector and the necessary office staff. It was generally expected that because
of intensive work during this period the programme would gain momentum and the
people would subsequently follow up the programme of their own accord.

(3) Stage II Blocks. In this stage, the staffing pattern was more or less the same, but
there was a difference in the budget provision. The budget in this stage was five lakh
of rupees for a period of five years, that is, one lakh per year.

(4) Post-stage II Blocks. This was the permanent stage. It was meant for the follow up
work. The budget was one lakh of rupees per year. At this stage, all the developmental
activities as in Stage II, under the various heads, such as agriculture, animal husbandry
and co-operation, were to continue (Krishiworld, 2014).

Starting with 55 Community Development Projects in 1952, the entire country was
covered under the Community Development Programme by 1963. In all, there were
5,263 blocks, besides 101 tribal development blocks. In this new set-up of Community
Development Blocks all the Nation-building government departments were brought
together. In order to ensure co-ordination at the block level, a new post of a Block
Development Officer was created.

Although both the CDP and the NES were administered in a planned manner, these
programmes suffered from under achievement. In the early fifties, the Indian villages
had very little infrastructural facilities and, hence, they could not respond adequately
to the developmental initiatives. The schemes did not cater to the poor alone but were
concerned with the welfare of the whole rural population. Moreover, the programmes
did not register a discernible increase in agricultural production.

It was, however, seen that the Second Five Year Plan extended the community
development activities all over the country and the inception of Panchayati Raj in 1959
ensured the direct participation of people at the grassroots level. The main objectives
of the Plan were: an increase of 25% in the national income; rapid industrialisation
with particular emphasis on the development of basic and heavy industries, large
expansion of employment opportunities; and reduction of inequalities in income,

41
wealth and distribution. The Khadi and Village Industries Programme, Village
Housing Projects Scheme, Tribal Area Development Programme, Package
Programme, lntensive Agricultural District Programme were the major programmes of
rural reconstruction during this Plan Period (Planning Commission, 1956).

The Third Five Year Plan laid emphasis on reduction in poverty and promotion of
economic prosperity by way of self-employment. During this period, the Planning
Commission initiated the process of involving the States in Plan preparation. The
States were asked to compile data in respect of their developmental performance,
priorities, resource position and suggest the ways for minimising the gap between the
developed and underdeveloped regions. All these plans thus emerged were intended to
be suitable to the geography, climate, traditions and customs of the concerned States.
The important rural development programmes during this period were: Applied
Nutrition Programme, The Rural Industries Projects, Intensive Agricultural Area
Programme, High Yielding Variety Programme, Rural Works Programme, Tribal
Development Block Programme etc.

The mid-sixties were also years of severe drought and the country had to settle for
Annual Action Plan for three years (1966-69).The adverse economic situation in the
country occasioned largely by the severe drought of 1966 and 1967 made the
Government declare a 'Plan Holiday' and in the place of the Five Year Plan, India had
three annual plans for1966-'67, 1967-'68 and 1968-'69. 1960s also witnessed the Green
Revolution consequent to the introduction of new chemical fertilisers and high-
yielding seed varieties (Maheshwari, 1995).

It was, however, the fourth five year plan that brought some ray of hope by laying
special attention to poverty alleviation. The need of the hour was to address the evil of
unemployment, which would in turn do away with poverty and would to some extent
increase the purchasing power of the people as well. Thus, the government came up
with various rural development programmes mentioned above, with focus on being on
employment generation programmes. These programmes were intended to promote
self-employment as well as wage employment, the difference between the two was
that, in self-employment programmes financial support was extended in the form of
subsidies and credits to the unemployed whereas wage employment programmes made
the rural workers work to earn, wages which in turn led to asset creation.'Growth with

42
Stability' was the main objective of this Plan. The Plan expected to increase the
national income at the rate of 5.5 percent per annum through the growth of agriculture
and industries.

The Crash Scheme for Rural Employment, Drought Prone Area Programme, Small
Farmers Development Agency, Tribal Area Development Agency, Pilot Intensive
Rural Employment Programme, Minimum Needs Programme and Command Area
Development Programme were the major rural development programmes during this
period. All these programmes helped to accelerate the overall development of the
country but their contribution to reduce the rural poverty or to generate employment
was not much. The programmes that aimed at providing employment to the people are
as follows:

2.1.4 The Drought Prone Area Programme

The Drought Prone Area Programme (DPAP) was an area development programme,
initiated in 1970 to mitigate the severe scarcity conditions in the selected chronically
drought affected areas in the country. The main objectives of the programme were
restoration of ecological balance, development and management of irrigation
resources, soil and moisture conservation and afforestation, restoring of cropping
pattern and pasture development, changes in agronomic practices, livestock
development, provision of drinking water supply, and development of small and
marginal farmers and agricultural labourers (Bhattacharya, 1983).

The DPAP formerly known as Rural Works Programme(Arora, 1986), was in

operation in 54 chronically drought affected Districts in the 14 States which had been
selected on the basis of objective criteria like incidence and pattern of rainfall, severity
of occurrence of drought and existing irrigation facilities(Devi, 1996). Originally, the
programme had an objective to generate employment opportunities (Devi, 1996), with
a particular emphasis being on labour-intensive schemes. The programme was
reoriented in 1972, the programme was reoriented and as a result, its primary focus
was shifted to development works in order to provide a more or less permanent
solution to the problem of drought rather than on schemes merely to create
employment opportunities. The programme was implemented as a centrally sponsored
scheme and the expenditure was borne equally by the Central and State Governments
concerned.

43
With the progress of the programme, it became necessary to give greater attention to
the increasing capacity of the areas to withstand drought in future and make significant
dent on the problems with the help of available technology. The long term strategy for
development of these areas ultimately lay in the integrated area development approach
on the basis of available resources and needs (Reddy, 1988).

2.1.5 The Crash Scheme for Rural Employment

Another significant programme introduced during this period was the Crash Scheme
for Rural Employment (CSRE) which was again a centrally sponsored scheme
initiated in 1971, to provide employment to at least 1000 persons in each of the
selected districts for a period of 10 months in a year. The primary objective of this
scheme was to generate additional employment through a network of rural projects of
various kinds which were labour intensive in nature. Each project was to produce work
or asset of adjustable nature in consonance with the local development plans. A project
in each block was to provide employment to 100 persons over a working season of ten
months in a year. The job was based on various labour intensive rural works such as
minor irrigation, soil conservation, afforestation, link roads, etc. Assuming 25 working
days in a month, the scheme was expected to generate 2.19 lakhs mandays of
employment in every district. With a view to offer suitable manual work to every
person in the age-group of 15 to 59, which was to take care of the employment
requirements of workers for varying periods (Singh, 1992).

2.1.6 Pilot Intensive Rural Employment Project

The Pilot Intensive Rural Employment Programme (PIREP) was an adhoc scheme and
as such could not result in stable gainful employment in the real sense of the term.
Subsequently in 1972, a central sector scheme, the Pilot Intensive Rural Employment
Project (PIREP) was started and implemented in areas having different socio-
economic conditions on a pilot basis. The main objective of PIREP was to ascertain
the dimension of the problem of rural unemployment and underemployment and to
identify systems through which this unemployed and under-employed labour force
could be put to best possible use in socio-economic terms (Subramanyam, 1988).

2.1.7 The SFDA and MFALDA

The Small Farmers Development Agency (SFDA) and the Marginal Farmers and
Agricultural Labourers Development Agency (MFALDA) were introduced to improve

44
the economic conditions of small and marginal farmers and agricultural labourers by
assisting them to raise their agricultural output through adoption of agricultural inputs
including agriculture implements, development of minor irrigation i.e. dug wells,
pump sets, tube wells, community irrigation works both ground water and surface
water projects, and subsidiary occupation schemes such as animal husbandry, dairy,
sheep and goat rearing, poultry and piggery(Vidhyarti,1982).

Farmers having landholding of 1-3 hectares were categorised as small farmers and
those having landholdings below one hectare were considered as marginal farmers.
For agricultural labourers, these projects executed labour intensive rural works to
provide off-season employment and thus assure them of regular income throughout the
year. The main objective of SFDA, however, firstly was to assist potentially viable
small farmers to become surplus producers by helping them in organising and
arranging services and supplies (the services including customs service with regard to
machines, implements and similar requirements and supplies including improved seed,
fertilisers and pesticides) required by them; secondly, it was by arranging irrigation
from the most practicable sources, assisting them in securing loan facilities from co-
operative banks and other credit institutions, and also arranging facilities such as
storing, transporting, processing and marketing their produce, and thirdly by helping
them attain income through animal husbandry (dairying, poultry, piggery etc.) and
even agro-based industries (Desai, 1988).

The MFALDA programme focused on marginal farmers and agricultural labourers

whose major responsibilities were to identify the eligible marginal farmers and
agricultural labourers, investigate their problems and formulate economic programmes
for providing gainful employment to them, promote rural industries and evolve
adequate institutional, financial and administrative arrangements for implementing
various programmes, promote the creation of common facilities for the production,
processing, storage and marketing of products , and finally evaluating the programme
from time to time. The basic objective of the programme was to raise the earning
capacity of the target groups which was sought to be achieved through programmes
relating to improved agriculture and subsidiary occupation. The focus of the SFDA
was directed more towards intensive farming while the MFALDA laid stress on the

45
provision of subsidiary occupations and other employment generating programmes
(Devi, 1996).

The draft Fifth Plan proposed to strengthen and concretise the target group oriented
programmes started during the Fourth Plan period. During the Fifth Plan, emphasis
was laid on integrated spatial and functional development. The important rural
development programmes introduced during this period were: Hill Area Development
programme; Special Livestock Production Programme; Food for Work Programme;
Desert Development Programme; and Training of Rural Youth for Self-employment.

The Janata Government reconstituted the Planning Commission and announced a new
strategy in planning. The objective was changed as 'Growth for Social Justice' instead
of 'Growth with Social Justice'. The new pattern was the 'Rolling Plan', which meant
that every year the performance of the Plan would be assessed and a new Plan would
be made for the next year. The Rolling Plan started with an Annual Plan for 1978-79
and as a continuation of the terminated Fifth Plan. Thus, to ensure growth for social
justice the following employment programmes were undertaken.

2.1.8 The Special Livestock Production Programme

The Special Livestock Production Programme (SLPP) was initiated by the Ministry of
Agriculture in 1975-76 on the basis of the recommendations of the National
Commission on Agriculture. The programme aimed at providing greater employment
opportunities to the weaker sections and the rural masses (Hundekar, 1995). It
basically intended to provide financial assistance to small or marginal farmers and
agricultural labourers for setting up of poultry, piggery and sheep production units and
for rearing of cross-bred heifers (Devi, 1996). The programme consisted of two parts
viz. (i) Cross-bred heifer rearing, and (ii) Setting up of sheep, poultry and piggery
units

Under the first scheme, assistance was given to small and marginal farmers at the rate
of 50% and 66 2/3 % to agricultural labourers for feeding of cross-bredheifers from 4
to 32 months of age; and under the second scheme, subsidy was provided at the rate of
25% to small farmers 38 1/3 % to marginal farmers and agricultural labourers and
50% to scheduled tribe people. The expenditure of the programme was shared on
50:50 basis by the State and Central Governments

46
2.1.9 The Desert Development Programme
The Desert Development Programme (DDP) was started in 1977-78(Reddy, 1988),
with the objective of controlling desertification and development of conditions raising
the level of production, income, and employment of people of the areas covered under
it.

This programme was launched based on the recommendations of the National

Commission on Agriculture and was implemented in the hot arid deserts covering 13
Blocks in 21 Districts in five States - Rajasthan, Haryana, Gujarat, Himachal Pradesh,
and Jammu & Kashmir. Thus, the programme covered both hot and cold desert areas
of the country. The programme aimed at an integrated development of desert areas by
increasing the productivity, income level and employment opportunities of the people
through optimum utilisation of physical, human, livestock and other biological
resources (Devi, 1996). This was a centrally sponsored scheme and was administered
by the District Rural Development Agency (DRDA).

The major activities under the programme were Afforestation (with special emphasis
on shelter belt plantation, grass land development and sand dune stabilisation); ground
water development and utilisation; construction of water harvesting structures; rural
electrification for energising tube wells or pump sets; and Development of agriculture ,
horticulture and animal husbandry (Bhattacharya,1983).

2.1.10 The Training of Rural Youth for Self-Employment

The Training of Rural Youth for Self-Employment (TRYSEM) was launched by the
Central Government on 15 August 1979(Singh, 1992), as a tool for transforming rural
youth into a productive force and thus it is viewed as a facilitating component of
IRDP. The main aim of the programme was to equip the rural youth with necessary
skills and technical knowledge to enable them to take self-employment in different
vocations (Planning Comnmission, 1988).The operational strategy was to train at least
2, 00,000 rural youth every year or forty youths in each block. Rural youth in the age-
group of 18-35, living below the poverty line, were eligible for training. A minimum
of 30% of the trained youths were to be from the SC/ST and a minimum of 33 1/3 %
were to be women (Singh, 1992).

47
Training courses were designed with a practical focus and training was given through
‘learning by doing methods’. The vocations confined to the fields of agriculture and
allied activities, industry, sciences and business activities. Training programmes were
imparted through formal training institutions such as Industrial Training Institutes,
Polytechnics, Krishi Vigyan Kendras, Nehru Yuva Kendras, Khadi and Village
Industries Centres, Voluntary Organisations and also through reputed master
craftsmen (Desai, 1988).

During the training period, the scheme provided a monthly stipend and a necessary
tool kit (after the completion of the course) to the trainees, honorarium to trainers or
master craftsmen, subsidy to the trained youth to set up self-employment ventures to
arrange the balance of the cost of scheme through institutional finance. Besides
training, the scheme envisaged organisational and operational linkages with other
institutions so that credit, marketing and raw material supply could be provided to the
trainees at the appropriate time.

Soon the Sixth Plan was formulated taking into account the achievements and
shortcomings of the past decades of planning. The Plan that released in May 1981
declared the removal of poverty as the foremost objective. The Plan that laid stress on
rural development and its strategy and methodology for accelerating rural
development consisted of increasing production and productivity in agriculture and
allied sectors, resource and income development of vulnerable sections of the rural
population by providing them access to assets, inputs and marketing services, skill
formation and skill upgrading programmes to promote self and wage employment
amongst the rural poor, provision of additional employment opportunities to the rural
poor for employment during the lean agricultural season through NREP, and provision
of essential minimum needs (Planning Commission, 1981).

The major rural development programmes during this period were Integrated Rural
Development Programme (IRDP), National Rural Employment Programme,
Development of Women and Children in Rural Areas (DWCRA) and the 20-Point
Programme. These are briefly discussed in the succeeding text.

48
2.1.11 National Rural Employment Programme
In 1980, during the Sixth Five Year Plan, the National Rural Employment Programme
(NREP) was launched (Reddy, 1988). This programme replaced the erstwhile Food for
Work Programme and incorporated the same characteristics under which it was
envisaged to integrate the development projects and target group oriented employment
generation projects. NREP aimed at providing supplementary employment
opportunities to rural workers particularly during the lean periods of the year when
they were not able to find gainful employment. It also aimed at creation of rural
economy and steady rise in the income level of the rural poor and thereby bringing
about an improvement in the quality of life of the villagers. The main objectives of the
programme were generation of additional gainful employment for the unemployed and
under-employed persons (both men and women) in rural areas; creation of productive
community assets for direct and continuing benefits to the poverty groups and for
strengthening rural, economic and social infrastructure, leading to rapid growth of
rural economy; and steady rise in the income levels of the rural poor; and lastly
improvement of overall quality of life in rural areas (Desai, 1988).

NREP was implemented as a centrally sponsored scheme on 50:50 sharing basis

between the Centre and the States. The wages paid under the programme were to be on
par with the minimum agricultural wage prescribed for the area. The quantum of food
grains as part of wages was such so as to be adequate for the family's need.
Contractors were totally excluded from the execution of the rural works (ibid). The
implementation of the programme was entrusted to the District Rural Development
Agencies. The execution of works under the programme was mainly to be through the
Panchayati Raj institutions so that works undertaken were in consonance to the need of
the local populace.

Besides, 10% of the resources were meant for the works of direct and exclusive
benefits to the SCs and STs. Voluntary Organisations were also entrusted with the
execution of permissible work under the NREP. The assets created under the
programme included roads, school buildings, panchayat ghars, community irrigation,
plantation, etc.

49
2.1.12 The New 20- Point Programme
Since 1970s, development in general had begun to be viewed in terms of the
contribution it made to the reduction of poverty, inequality and exploitation. Rural
development was to reflect these concerns and manifested in special programmes for
the weaker sections of the rural community and the backward areas. The major rural
development programmes such as SFDA, MFALDA, NREP, IRDP, DPAP and the
MNP had become too well known. They were a part of the 20-point programme of
1982 (Maheshwari, 1995).

The 20-point programme announced on 14 January 1982 included the following main
points: to increase irrigation potential; raise production of pulses and vegetable oils;
strengthen lRDP and NREP; implement agricultural land ceiling; enforce minimum
wages for farm labourer; rehabilitation of bonded labourer; welfare plan for Scheduled
Castes and Scheduled Tribes; drinking water for millions, house sites for rural
families; slum improvement, maximisation of power generation, programmes of
afforestation, promotion of family planning; welfare plan for women and children;
elementary education for children and removal of adult illiteracy; expansion of the
public distribution system; liberalisation of investment procedures; primary health care
facilities; action against smugglers; hoarders, tax evaders and black-money operators;
and gearing up of public enterprises (ibid).

2.1.13 The Development of Women and Children in Rural Areas

The Development of Women and Children in Rural Areas (DWCRA) was a centrally
sponsored scheme started in 1982. It was formulated as a sub-scheme of IRDP so that
income-generating activities could be provided to women and enable them to become
organised participants in social development and economic self-reliance. The target
group of the DWCRA was the same as that of IRDP. The methodology of reaching it
was through group strategy rather than individual beneficiaries. The women were
expected to come together for an activity of mutual interest to all. Its primary skill was
the formation of groups of 15-20 women from poor families, preferably from
scheduled castes and scheduled tribes for delivery of services like credit, skill training,
cash and infrastructural support (Government of Kerala, 1991).

The objectives of the programme were to focus attention on the women members of
the families of the target group so as to increase their income and also to provide

50
supporting services needed to enable them to take up income generating activities.
Besides providing financial support, it also aimed at increasing women's access to
other welfare services. The programme assisted women in the following manner:-
firstly assisting individual women to take advantage of the families already available
under IRDP, where individual women were found to be incapable of taking advantage
of these facilities, they were organised into homogenous groups to take up
economically viable activities on a group basis. Secondly providing necessary
supporting services to women of target group in terms of provision for caring of
children while the mothers are at work. Thirdly provision for working conveniences,
suitable appliances so that they could improve their efficiency and reduce the
drudgery, and organising child care facilities to provide for security, health care and
nursing of the children at NREP work sites (Singh, 1992).

During the year 1980-81, the Small Farmers Development Agency (SFDA) as well as
IRDP programmes were operational until October 1980. The IRDP covered all the
blocks in the country thereafter. Nearly 2.8 million beneficiaries were assisted during
1980-81. An expenditure of Rs.150 crores was incurred by the Centre and the States
during the year. A total of about Rs.252 crores of credit was disbursed by both
cooperatives and the commercial banks for helping the transfer and acquisition of
resources to the poor families sponsored under the I.R.D.P. and the erstwhile S.F.D.A.
Of this, Rs.199 crores was the 'term-loan'. The share of scheduled castes and scheduled
tribes in the total credit disbursed by the institutional agencies during the year was 26
per cent. In the total beneficiaries assisted during the year 1980-81, the proportion of
scheduled castes was 17.9 per cent and that of scheduled tribes was 6.7per cent. It may
be seen that during the year 1980-81, for which information is available, the per
beneficiary expenditure under the combined SFDA and IRDP was about Rs.460 and
the ratio of subsidy to term credit 1: 1.33. There were fears expressed in some quarters
that this scale of transfer of financial resources may in some cases not be adequate to
generate incremental income necessary to lift the poorest rural families above the
poverty line. As the programme was extended to all the blocks only from October
1980, it took some time to undertake the relevant surveys and identify the households.
The position of both flow of subsidy and loans was expected to improve in 1981-82,
that is, after one complete year of implementing the IRDP.

51
2.1.14 The Rural Landless Employment Guarantee Programme
The Rural Landless Employment Guarantee Programme (RLEGP) was introduced in
1983 with the objective of providing employment opportunities for at least one
member of every landless household for a period upto 100 days in a year (Prasad,
1991). RLEGP aimed at creation of tangible community assets for strengthening rural
infrastructure, leading to rapid growth of rural economy. The assets that were to be
made included under it construction of link roads, digging of field channels to improve
utilisation of the irrigation potential created by large irrigation projects, land
development and reclamation of waste or degraded land with special emphasis on
ecological improvement in hilly desert areas, social forestry, soil and water
conservation and improvement of minor irrigation works (Devi, 1996).

RLEGP was a centrally sponsored programme. The wages paid under this Programme
were partly in food grains and partly in cash. The food grain component was
distributed at a subsidised rate. It was intended to improve the consumption in favour
of poorer sections of the rural population and improve their nutritional standards.
Later, RLEGP was merged with the JRY programme (Singh, 1992).

2.1.15 The Integrated Rural Development Programme

The Integrated Rural Development Programme was first introduced in March 1976 by
the then Minister of Finance. By 1979, the IRDP covered 2600 blocks in the country.
The programme was extended to cover the whole country with effect from 2nd
October 1980 on a uniform basis. The main objective of the I.R.D.P was to transfer
productive assets and thus broaden the resource base of the poorest rural families. The
programme envisaged that 600 poorest families shall be assisted in each of the 5011
development blocks in the country every year to improve their income. Thus, a total of
3 million poorest rural families each year aggregating to 15 million during the five
year period of the Sixth Plan 1980-85, were focussed to be assisted to move above the
poverty line. As mentioned earlier, these poorest families either did not possess any or
had a very small base of production. The enlargement of productive resource base in
the form of land augmenting capital transfer, that is, through irrigation, land
development, plantations, afforestation, livestock, sericulture, aquaculture, etc.,
constituted an important method of alleviating their poverty. On an average, it was
expected that out of 600 poorest families to be assisted every year in each

52
development block, 400 were targeted to be helped in agriculture and allied activities
including animal husbandry, sericulture, poultry, piggery, fishery, forestry, etc.

The finances, including subsidy and loans, necessary to transfer the ownership of
productive assets and resources were to be provided to these families to enable them in
generating income that would be sufficient to cross the poverty line. The realities of
the overall narrow land-man ratio in the country side, however, were such that a
certain number of poorest rural families had to be helped outside agriculture. The
IRDP also stipulated that about 100 families would be assisted in the secondary sector,
that is, in rural industries and another 100 in the tertiary or services and trade sector.
Assistance to these families in these sectors too were required to have transfer of
assets and inculcation of skills to them besides ensuring the back-up of necessary raw
material procurement, technical and marketing services.

Financial assistance to enable the poorest families settled in trades and occupations
was also felt to be necessary to enable them to acquire assets like tea stalls, pedal
rickshaws, transport carts, etc. Thus, the approach to alleviation of poverty in the rural
areas under IRDP comprised the transfer of assets and resources in order to broaden
the production base of those who already had some land, cattle, equipment, etc. as well
as to supply a new asset to those who were completely resourceless (except their
family labour) like the landless families. Such transfer of productive assets was,
however, seen as part of a project and a production programme and not an isolated
case of just handing over certain assets or means of production and income

The Integrated Rural Development Programme (IRDP) aimed at providing self-

employment to the rural poor through acquisition of productive assets or appropriate
skills which would generate additional income on a sustained basis to enable them to
cross the poverty line. Assistance was provided in the form of subsidy and bank credit.
The target group consisted largely of small and marginal farmers, agricultural
labourers and rural artisans living below the poverty line. The pattern of subsidy was
25 per cent for small farmers, 33-1/3 per cent for marginal farmers, agricultural
labourers and rural artisans and 50 per cent for Scheduled Castes/Scheduled Tribes
families and physically handicapped persons. The ceiling for subsidy was Rs.6000/-
for Scheduled Castes/Scheduled Tribes families and the physically handicapped; for

53
others, it was Rs.4000/- in non-DPAP/non-DDP areas and Rs.5000/- in DPAP and
DDP areas.

Within the target group, there was an assured coverage of 50 per cent for Scheduled
Castes/Scheduled Tribes, 40 per cent for women and 3 per cent for the physically
handicapped. Priority in assistance was also given to the families belonging to the
assignees of ceiling surplus land, Green Card Holders covered under the Family
Welfare Programme and freed bonded labourers.

IRDP was a Centrally Sponsored Scheme which was in operation in all the blocks of
the country since 1980. Under this scheme Central funds were allocated to States on
the basis of proportion of rural poor in a State to the total rural poor in the country.
Since the inception of the programme till 1996-97, 50.99 million families had been
covered under it at an expenditure of Rs.11434.27 crore. The total investment during
this period had been Rs.28047.65 crore which included a subsidy component of
Rs.9669.97 crore and a credit disbursement of Rs.18377.68 crore. Of the total families
assisted under this programme 44.75 per cent were Scheduled Castes/Scheduled Tribes
and 27.07 per cent women.

During the Eighth Five Year Plan the total allocation (Centre and State) under IRDP
was Rs.5048.29 crore and the total investment amounted to Rs.11541.06 crore.
However, from 1995-96 physical targeting under the programme was abolished with
the focus shifting to financial targets and qualitative parameters. Of the families
covered 50.06 per cent were Scheduled Castes/Scheduled Tribes and 33.59 per cent
women. The coverage of women was still lower than the target of 40 per cent.

The IRDP had been successful in providing incremental income to the poor families,
but in most cases the incremental income had not been adequate to enable the
beneficiaries to cross the poverty line on a sustained basis mainly because of a low per
family investment. The results of the Concurrent Evaluation (September 1992 -
August 1993) at that time revealed that of the total beneficiaries assisted under the
programme, 15.96 per cent of the old beneficiary families could cross the revised
poverty line of Rs.11,000 (at 1991-92 prices), while 54.4 per cent of the families were
able to cross the old poverty line of Rs.6,400 per annum. However, the analysis by
income group of families revealed that in case of those within initial income of

54
Rs.8501 – 11,000, 48.22% of beneficiary families could cross the poverty line of
Rs.11,000 which was quite encouraging. The analysis of the family income of the
beneficiaries revealed that a large percentage (57.34%) of the families had annual
family income from assets of more than Rs.2000. The annual income from the asset
was more than Rs.6000 in 29% cases.

The major constraint in the implementation of IRDP had been sub-critical investments
which had adversely affected the Incremental Capital Output Ratio (ICOR) levels and
thereby undermined the viability of the projects. Though the average per family
investment had been rising steadily in monetary terms, but the increase had been
inadequate in real terms, besides being sub-critical, in some cases, due to the
inflationary trends and the increase in the cost of assets (Planning Commission, 1982).
The Seventh Plan envisaged the continuance and expansion of the antipoverty
programmes. The programmes like National Rural Employment Programme (NREP),
Integrated Rural Development Programme (IRDP) and Rural Landless Employment
Guarantee Programme (RLEGP) constituted the major elements of the anti-poverty
drive. However, an expanding economy and dynamic agricultural sectors were the pre-
conditions for the anti-poverty programmes to succeed. Apart from the rural poor, this
Plan also paid attention to the poor in the urban areas as well. The Seventh plan
strategy focused attention on employment generation and poverty alleviation (Planning
Commission, 1985).

The major rural development programmes during this Plan Period were:Swarnajayanti
Gram Samridhi Yojana, Jawahar Gran Samridhi Yojana etc.,Jawahar Rozgar Yojana,
Employment Assurance Scheme, Million Wells Scheme and Indira Awaas Yojana.A
brief about theses as follows:

2.1.16 Jawahar Rozgar Yojana

Jawahar Rozgar Yojana was launched on 1 April 1989, after merging the two earlier
employment schemes namely, NREP and RLEGP (Maheshwari, 1995). The objectives
of the scheme were to provide additional employment for the unemployed and
underemployed in rural areas to create sustained employment by strengthening the
rural economic infrastructure and assets and improvement in the overall quality of life
in rural areas (Singh, 1992). Under this Scheme, all works which would resulting in
the creation of durable assets were expected to be taken up. These included social

55
forestry works; soil and water conservation works; minor irrigation works;
construction of roads; flood protection; drainage and water-logging works;
construction of sanitary latrines; land development; and houses for SCs and STs. JRY
was a centrally sponsored scheme and the expenditure was shared between the Centre
and the States in the ratio of 80:20. The guidelines for implementation of the
programme were as follows: (Prasad, 1991).
 The wage and no-wage ratio should be 60:40 since it was principally a wage-
employment scheme;
 Contractors were prohibited from the execution of any work. The work was to
be done through the elected panchayat and its members, the panchayat
secretary and the committees of beneficiaries;
 While selecting workers for employment, preference was to be given to
SC/STs and freed bonded labourers;
 30% of employment opportunities were reserved for women; and
 Minimum wages were to be paid to unskilled/casual workers as per the notified
minimum wages in the state and no discrimination was to be made in wages
between men and women workers.

2.1.17 Million Wells Scheme

The Million Wells Scheme (MWS) was launched during 1988-89. It was to provide
open irrigation wells free of cost to the poor, small and marginal farmers belonging to
SC/STs and freed bonded labourers, as a sub-scheme of NREP/RLEGP, continued
under JRY (Planning Commission, 1991). The State Governments were required to
allocate MWS resources to the Districts. The allocation was intended only for open
wells. Bore wells or tube wells were not taken up under this provision. Where wells
were not feasible due to geographical factors, the funds allotted under this scheme
were to be utilised for other schemes of minor irrigation like irrigation tanks, water
harvesting structures and also for the development of land belonging to SC/STs and
freed bonded labourers including the ceiling surplus land, Bhoodan land; etc., allotted
to them. The money earmarked was not to be diverted for any other scheme or for
categories other than SC/STs and freed bonded labourers.

56
2.1.18 Indira Awaas Yojana
Indira Awaas Yojana (IAY), was an important component of RLEGP, aiming at
construction of dwelling units, free of cost for the poorest of the poor belonging to
SCs, STs and freed bonded labourers. It was implemented under JRY (ibid).Houses
under IAY, as far as possible, were built in clusters as per micro-habitat approach so
that common facilities could be provided for the clusters. The plinth area of the house
was to be between 17 to 20 sq. mts. The design could be specific to the area keeping in
view the climatic conditions. The houses were to have a kitchen, smokeless chula and
a sanitary latrine.

The Eighth Plan had recognised the need for a re-orientation of planning in keeping
with the process of economic reforms and restructuring of the economy The objectives
of the VIII Plan were: generation of adequate employment to achieve full employment
by the turn of the century; containment of population growth through people's active
cooperation and an effective scheme of incentives and disincentives; universalisation
of elementary education and complete eradication of illiteracy among the people in the
age group of 15-35 years; provision of safe drinking water and primary health
facilities; including immunisation; accessible to all the villages and the entire
population and complete elimination of scavenging; growth and diversification of
agriculture to achieve self-sufficiency in food and general surplus for exports; and
strengthening of the structure i.e. energy, transport, communication, irrigation etc., in
order to support the growth process on a sustainable basis.The major programmes
during this Plan period were: IRDP, Jawahar Rozgar Yojana, Indira Awaas Yojana
and Million Wells Scheme (Planning Commission, 1992).

The objectives of the Ninth Plan evolved from the Common Minimum Programme of
the Government and the Chief Ministers' Conference on basic minimum services.The
suggestions were as follows: priority to agriculture and rural development with a view
to generate productive employment and eradication of poverty; accelerating the
growth rate of the economy with stable prices; ensuring food and nutritional security
for the vulnerable section of the society; providing the basic minimum services for
safe drinking water; primary health care facilities; universal primary education; shelter
and connectivity to all in time-bound population; ensuring environmental
sustainability of the development process through participation of people; containing

57
the growth rate of population, empowerment of women and socially disadvantaged
groups; promoting and developing Panchayati Raj; Co-operatives, and strengthening
efforts to build self-reliance.IRDP was renamed as Swarna Jayanti Grama Swarozgar
Yojana from 1April, 1999 onwards (Planning Commission, 1999).

2.1.19 Employment Assurance Scheme

The Employment Assurance Scheme was launched on 2nd October, 1993 in 1775
identified backward blocks situated in drought prone, desert, tribal and hill areas, in
which the revamped Public Distribution System was in operation. Gradually, the
Scheme was extended to cover all rural blocks in the country. The main objective of
the EAS was to provide 100 days of casual manual employment during the lean
agricultural season, at statutory minimum wages, to all persons above the age of 18
years and below 60 years who needed and sought work on economically productive
and labour intensive social and community works. The works comprised of watershed
development, agro-horticulture, minor irrigation works, etc. These works were
selected by the District Collector. The village panchayats were involved in the
registration of persons seeking employment and also co-ordinated and monitored the
works. A maximum of two adults per family were provided employment under the
Scheme, where they were issued family cards which entailed the details of their
employment. A total of 25.90 million persons had registered for employment under the
EAS (Planning Commission, 1992).

2.1.20 Swarnjayanti Gram Swarozgar Yojana

The single self-employment programme of Swarnjayanti Gram Swarozgar Yojana
(SGSY), was launched with effect from 1.4.1999, and was conceived keeping in view
the strengths and weaknesses of the earlier schemes of Integrated Rural Development
Programme (IRDP) and Allied Programmes along with Million Wells Scheme
(MWS).

The objective of restructuring SGSY was to make it more effective in providing

sustainable incomes through micro enterprises. The SGSY thus laid emphasis on the
focussed approach to poverty alleviation, capitalising advantages of group lending and
overcoming the problems associated with multiplicity of programmes. SGSY was
conceived as a holistic programme of micro enterprises covering all aspects of self-
employment vis-a vis organisation of the rural poor into self help groups (SHGs) and

58
their capacity building; planning of activity clusters; infrastructure build up;
technology, credit and marketing. Micro enterprises in the rural areas were also sought
to be established by building on the potential of the rural poor. The objective of the
Scheme was to bring the existing poor families above the poverty line.

Under the SGSY, the focus was on vulnerable sections among the rural poor with
SCs/STs accounting for 50 per cent, women 40 per cent and the disabled 3 per cent of
the beneficiaries. The list of BPL households, identified through BPL census, duly
approved by the Gram Sabha, formed the basis for assistance to families under SGSY.
The beneficiaries also called Swarozgaris were either individuals or groups. While the
identification of individual beneficiaries was made through a participatory approach,
the programme laid emphasis on organisation of poor into SHGs and their capacity
building. The SHG consisted of 10 to 20 persons. However, in case of minor
irrigation, disabled, the minimum was 5 persons. Under the scheme, progressively,
majority of the funding was provided for SHGs. The key activities were to be selected
with the approval of the Panchayat Samiti at the block level and DRDAs/Zila Parishad
at the district level. SGSY adopted a project approach with project reports being
prepared for each key activity in association with banks and financial institutions. It
was envisaged that a major share of SGSY assistance was to be in activity clusters.

The SGSY was a credit-cum-subsidy programme, with credit as the critical component
and subsidy as a minor and enabling element. Accordingly, the SGSY envisages
greater involvement of banks and promotion of multiple credit rather than a one-time
credit injection. Subsidy under SGSY was provided at 30 per cent of the project cost,
subject to a maximum of Rs.7500. In respect of SCs/STs, it was 50 per cent subject to
a maximum of Rs.10000. For groups, the subsidy was 50 per cent subject to a ceiling
of Rs.1.25 lakh. There was no monetary limit on subsidy for irrigation projects.
Subsidy under SGSY was back ended to ensure proper utilisation of funds by the
target group. In keeping with the need of proper infrastructure essential for the
success of micro enterprises, 20 per cent (25 per cent in the case of North Eastern
States) of SGSY allocation for each district was to be set apart under SGSY
Infrastructure Fund for this purpose.Since SGSY laid emphasis on skill development
through well designed training courses; the DRDAs were allowed to set apart 10 per
cent of the SGSY allocation on training to be maintained as SGSY Training Fund to be

59
utilised to provide both orientation and training programmes to Swarozgaris. For this
purpose, training facilities of polytechnics, Krishi Vigyan Kendras, Khadi and Village
Industries Boards, State Institutes of Rural Development are available. Extension
Training Centres, reputed voluntary organisations and departmental training institutes
could be utilised. The Scheme also sought also sought to ensure upgradation of the
technology in the identified activity clusters and for promoting marketing of the goods.

The SGSY was implemented by the District Rural Development Agencies (DRDAs)
through the Panchayat Samitis. However, the process of planning, implementation and
monitoring involved coordination with banks and other financial institutions,; the
PRIs; the NGOs and technical institutions in the district. Hence, the implementation of
SGSY calls for integration of various agencies - DRDAs, banks, line departments,
Panchayati Raj Institutions (PRIs), Non-Governmental Organisations (NGOs) and
other semi-government organisations. Funds under the SGSY were shared by the
Centre and the States in the ratio of 75:25. The Central allocation was distributed in
relation to the incidence of poverty in the States. However, there was a provision of
considering additional parameters like absorption capacity and special requirements.

The year 1999-2000 was the first year of the implementation of SGSY. As such,
considerable detailed preparatory work and planning were carried out in order to
ensure the successful implementation of the scheme. In order to finalise the guidelines
of the Scheme, views were sought/consultations were held with State Governments,
banks and NGOs. Many State Governments had reported that formation of SHGs took
considerable time and was one of the prime reasons for less than expected
performance under the scheme in 1999-2000. However, the establishment of SHGs
would gather momentum in the coming years and significantly contribute to the
success of micro enterprises as vehicles for economic empowerment of BPL families.

In 1999-2000 (up to February, 2000) an expenditure of Rs.804.23 crore was incurred

under the scheme as against the total allocation of Rs.1467.73 crore. During this
period, more than 3.40 lakh self help groups were assisted. A Central outlay of
Rs.1000.00 crore had been provided for the scheme in 2000-01.

SGSY has been restructured as National Rural Livelihoods Mission (NRLM), now
renamed as ‘Aajeevika’, (formally launched on 3rd June 2011 at Banswara, Rajasthan)

60
to implement it in a mission mode in a phased manner for targeted and with time
bound Involvement of NGOs/ CBOs/Animators in delivery of results. Aajeevika
recognises that the poor people have the potential to come out of poverty with proper
handholding, training, capacity building and credit linkage. Aajeevika also believes
that a strong institutional architecture, owned by the poor, enables them to access
institutional credit for various purposes, pursue livelihoods based on their resources,
skills and preferences and also to access other services and entitlements, both from the
public and private sector. Therefore, Aajeevika is expected to focus on building strong
institutions of the poor into Self Help Groups (SHGs), their federations and livelihoods
collectives.

The two major strategic shifts under Aajeevika, vis-à-vis SGSY are that (i) Aajeevika
is a demand driven programme and the states will formulate their own poverty
reduction action plans under it based on their past experience, resources and skills base
and (ii) Aajeevika is to provide for a professional support structure for programme
implementation at all levels from National to Sub district level in different streams.

In order to improve the present status of women in agriculture, and to enhance the
opportunities for her empowerment, Government of India has announced
“MahilaKisan Sashaktikaran Pariyojana” (MKSP), as a sub-component of the
Aajeevika (National Rural Livelihood Mission). MKSP recognises the centrality of
women in agriculture and therefore aims to provide direct and indirect support to
enable them to achieve sustainable agriculture production. It is to initiate learning
cycle by which women are enabled to learn and adopt appropriate technologies and
farming systems. MKSP is to be implemented as a sub-component of Aajeevika
through specially formulated projects (Planning Commission, 2002).

2.1.21 Jawahar Gram Samridhi Yojana

The Jawahar Rozgar Yojana (JRY) has been recasted as the Jawahar Gram Samridhi
Yojana (JGSY) with effect from 1st April 1999 with thrust on creation of rural
infrastructure.While the JRY resulted in creation of durable assets, the overriding
priority of the programme was the creation of wage employment. It was felt that a
stage had come when rural infrastructure needed to be taken up in a planned manner
and accorded priority. The Gram Panchayats have therefore been asked to effectively
determine their infrastructure needs and the responsibility of implementing the

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programme has been entrusted to the Gram Panchayats. The funds are directly released
to the Gram Panchayats by the DRDAs/Zilla Parishads. The JGSY is implemented as a
CSS with funding in the ratio of 75:25 between the Centre and the States.

The primary objective of JGSY is creation of demand driven community village

infrastructure including durable assets at the village level and assets to enable the rural
poor to increase the opportunities for sustained employment. The secondary objective
of the scheme is generation of supplementary employment for the unemployed poor in
the rural areas. The wage employment under the programme is given to Below Poverty
Lines (BPL) families. While there is no sectoral earmarking of resources under JGSY,
22.5 per cent of the annual allocation is a must to be spent on individual beneficiary
schemes for SCs/STs and 3 per cent is to be utilised for creation of barrier free
infrastructure for the disabled. All works that result in the creation of durable
productive community assets can be taken up under the programme as per the felt need
of the area/people by the village panchayat. These include creation of infrastructure for
SCs/STs habitations; infrastructure support for SGSY; infrastructure required for
supporting agricultural activities in the village; community infrastructure for
education; and health, roads and other social, economic and physical infrastructure.

The wages under the programme are either the minimum wages notified by the States
or higher wages as fixed by the States through the prescribed procedure. The wage
material ratio of 60:40 can be suitably relaxed so as to enable the building up of
demand driven rural infrastructure. However, efforts are required to be made to ensure
that labour intensive works are taken up with sustainable low cost technology. Under
the Scheme, village panchayats have the sole authority for the preparation of the
Annual Action Plan and its implementation, which needs to be accepted by the Gram
Sabha (Planning Commission, 1997).

Thus, the Gram Sabha is empowered to approve schemes/works. The completion of

the incomplete works is to be given priority over new works and works which cannot
be completed within two financial years are not to be included. At the village level, the
entire work relating to coordination, review, supervision and monitoring of the
programme is the responsibility of the village panchayat. The village panchayats have
the power to execute works/schemes upto Rs.50, 000 with the approval of the Gram
Sabha. In addition, Gram Sabha has been vested with one duty of undertaking Social

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Audit. At the village level, monitoring and vigilance committees are also set up to
oversee and supervise the works/schemes undertaken.

At the district level, the DRDAs/Zilla Parishads and at the intermediate level the
Panchayat Samitis have the overall responsibility for guidance, coordination,
supervision, periodical reporting and monitoring the implementation of the
programme.Village Panchayats may spend up to a maximum of 7.5 per cent of the
funds or Rs.7500/- whichever is less during a year on the administrative contingencies
and for technical consultancy. The village panchayat is permitted to spend up to a
maximum of 15 per cent on maintenance of the public assets created within its
geographical boundary. Since the entire funds would be utilised by the village
panchayats under JGSY, the innovative JRY has been discontinued (ibid).

The primary objective of the JGSY has undergone a change from employment
generation to rural infrastructure. As such, the States have taken time to adjust their
monitoring mechanism as per the new monitoring parameters from employment
generation to number of works undertaken/completed. During 1999-2000, 5.84 lakh
works were completed as against a target of 8.57 lakh works. An expenditure of
Rs.1841.80 crore was incurred during 1999-2000 as against a total allocation of
Rs.2209.24 crore (ibid).

2.1.22 Sampoorna Grameen Rozgar Yojana

The Sampoorna Grameen Rozgar Yojana(SGRY) was launched on 25th September
2001 by merging the then schemes of Jawahar Gram Samridhi Yojana (JGSY) and
Employment Assurance Scheme (EAS). The objectives of the Programme were to
provide additional wage employment in the rural areas, food security, and the creation
of durable community, social and economic infrastructure in the rural areas. The
programme was self-targeting in nature and laid special emphasis in providing wage
employment to women, scheduled castes(SC), scheduled tribes(ST) and parents of
children withdrawn from hazardous occupations. The Scheme was exclusively
implemented by the Panchayti Raj Institutions (PRIs).

The Sampoorna Grameen Rozgar Yojana (SGRY) was a Centrally Sponsored Scheme
(CSS) on cost sharing basis between the Centre and the States in the ratio of 75:25.
Foodgrains were provided, through Food Corporation of India (FCI), free of cost to

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States and UTs. The payment of foodgrains was made by the Ministry of Rural
Development to the FCI directly. Every worker seeking employment under the SGRY
was provided minimum 5 kgs of foodgrains (in kind) per manday as part of wages.
However, due to shortage of foodgrains, 3 kgs of foodgrains per day was provided
from 1.11.2005. No contractors were permitted to be engaged for execution of any of
the works and no middle men /intermediate agencies were to be employed for
executing works under the Scheme. Use of Machinery, which may displace manual
labour, was also not permissible with a view to create maximum possible additional
employment opportunities. Facilities like drinking water, rest sheds for the workers
and crèches for the children coming with working mothers were to be provided. The
works to be taken up were to be labour intensive leading to the creation of additional
wage employment, durable assets and infrastructure like water conservation, water
harvesting, drought proofing, etc. There was a provision of Special Component under
the SGRY for augmenting food security through additional wage employment in the
calamity affected rural areas as well (Planning Commission, 2002).

2.1.23 National Food For Work Programme

The National Food For Work Programme was launched on 14th November 2004 in 150
identified backward districts where there was not only a high demand for wage
employment but also the need for local level community assets. The Programme was
launched with an aim to ensure a minimum level of employment and income to the
poor; give the poor an opportunity to develop their collective strength, improve their
economic position and reduce their vulnerability; discourage migration; provide access
to health, education and welfare services in the village itself; and expedite the
construction of environment-friendly infrastructure works which would enhance the
productivity levels and provide a basis for promoting economic activities in the
region. The District Magistrate was responsible for planning, implementation,
monitoring and supervision of the programme at the district level (Planning
Commission, 2002). This programme was then merged alongwith the Sampoorna
Grameen Rozgar Yojana to form the National Rural Employment Guarantee Act.

2.2 Mahatma Gandhi National Rural Employment Guarantee Act

The latest form of wage employment program is the Mahatma Gandhi National Rural
Employment Guarantee Scheme (MGNREGS) which guarantees 100 days of

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employment to the rural unemployed poor. The unique feature which distinguishes this
scheme from previous employment schemes is that the MGNREGS comes with a legal
guarantee. Accordingly, MGNREGS is implemented under the Mahatma Gandhi
National Rural Employment Guarantee Act (MGNREGA) – a law enacted by Indian
Parliament in 2005. This is a milestone achieved in the sense that it makes 100 days of
employment or payment of unemployment benefit an enforceable right of the citizen
to demand employment. Thus, MGNREGS is a public works program with a
difference, which moves away from being a purely supply-side intervention to one
which caters to demand for wage employment at individual/family level in rural areas.

Resources for schemes under MGNREGS are provided mostly by Central

Government. Previous wage employment schemes such as Sampoorna Grameen
Rojgar Yojana (SGRY) and the National Food for Work Program (NFFWP) have been
merged under the MGNREGS. The schemes are to be formulated and implemented by
the State Governments through the respective Panchyati Raj Institutions (PRIs).
Initially, in 2005-06, MGNREGS was launched in more than 150 such backward
districts of the country, which were identified by the Planning Commission in
consultation with the Ministry of Rural Development and the State Governments.
However, since April 1, 2008, it has been extended to all the districts of the country.

The Mahatma Gandhi National Rural Employment Guarantee Scheme aims at

enhancing the livelihood security of the people in rural areas by guaranteeing hundred
days of wage employment in a financial year to a rural household whose adult
members volunteer to do unskilled manual work. The objective of the scheme is to
create durable assets and strengthen the livelihood resource base of the rural poor. The
choice of works suggested in the Act addresses causes of chronic poverty like drought,
deforestation, soil erosion, etc., so that the process of employment generation is
sustainable. The Act envisages that the schemes will lead to large scale creation of
livelihood assets in rural areas that can have a sustainable impact on rural poverty.
Upholding the Rights perspective, the Act clearly defines the fundamental principles
and the basic entitlements of the labourers and workers, which include:

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MGNREGA – Fundamental Principles and Basic Entitlements
Fundamental Principles:
 Employment on demand
 Legal right
 Universal entitlement
 Participatory approach
 Accountability to PRIs
 Full Transparency
Basic Entitlements:
 Equal wages for men and women
 Work within 5 kilometres
 Payment of minimum wages on weekly or fortnightly basis
 Worksite facilities
 Medical expenses for injured/ ex-gratia for deceased
 Unemployment allowance if work is not allotted (MoRD, 2008).
The details of implementation of the scheme have been dealt in the next chapter

Conclusion
India's development performance since the inception of State initiated planned process
has several achievements to its credit. The basic task of economic planning in India
has been to bring about a structural transformation of the economy so as to achieve a
high and substantial rate of growth; progressive improvement in the standard of living;
eradication of poverty and unemployment; providing material basis for a self-reliant
social economy; and ensuring social justice.To mention a few, there were
achievements of self-sufficiency in food, stagnant changes in the structure of the
economy such as fall in the shares of non-agricultural sectors, the expression and
diversification of the industrial sector and growth in scientific and technical
manpower.

In spite of this, India's performance with regard to rural development had not been
very impressive with a population growth rate of 2.2% per annum, thus, not making a
qualitative improvement in the standard of living of the people. There has also been a
little change in the overall income inequalities and majority of the population still lives
in the state of abject poverty (Planning Commission, 2013). Nevertheless, with the

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help of a constructive strategy for rural development through poverty alleviation
programmes, a variable acceptance of principle of growth with social justice and the
adoption of decentralised planning process, it is expected that the country would
progressively eliminate poverty.

Therefore, as evident from the above analysis, various employment generation and
other rural development programmes have for sure made their mark and a lot has been
done to achieve the desired goals of eliminating poverty and increasing the standard of
living of the people. Programmes have been framed from time to time, but the fact
remains that such programmes have addressed the issue of transient poverty but have
lacked successful implementation, which requires an appropriate policy framework,
adequate funds and an effective delivery mechanism. However, it has been observed
that mere availability of funds or well designed policies are not enough for the
effectiveness of such programmes.

The success depends on the capability of the delivery system to absorb and utilise the
funds in a cost-effective manner, an effective and responsive district level mechanism
and also a responsible and non-bias grassroot mechanism. Powers, however, need to
be devolutionised to the PRIs if proper implementation has to be ensured. However,
their activities also need to be monitored closely so that the rural people are not
exploited in the garb of material benefits.This can only be possible with adequate level
of commitment, motivation and competence, and above all people’s participation at
all levels. With the newly conceptualised MGNREGA, as it is called now, certainly
things can change, but what is required is strong political will and bureaucratic
commitment, and of course, literacy to increase the awareness quotient of the people
who stand to be the main beneficiaries of such development programmes.

The functioning of MGNREGA has not been very smooth in many states and
corruption, nepotism and bungling of funds have become a regular feature, barring the
exceptional performance of some states like, Tamil Nadu, Chhattisgarh and Gujarat,
etc. Thus, the need of the hour is to implement the programme in its true spirit so that
the poor are benefitted and are able to break the vicious circle of poverty to be at par
with their fellow countrymen. MGNREGA can definitely make a difference, if the real
people reap the real benefits of the programme.

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