Rural India has left the pandemic behind

The Indian economy along with the global economy have faced three heavy challenges in the recent past – the Covid-19 pandemic, the Russia-Ukraine war and climate change. However, the story of India’s rural economy has been one of resilience.

- Saptarshi Deb

In 2020-21, agriculture was the only sector of the economy that remained strong, growing steadily. In 2021-22, farm exports crossed $51 billion. Along with the provision of basic food grains, agriculture was also India's primary employer. The Centre for Monitoring Indian Economy (CMIE) records that between 2019 and 2022, agriculture added 11 million new jobs while the rest of the economy shed 15 million jobs.

According to KMPG’s report titled ‘India’s rural economy: Key to economic revival and sustainable and equitable growth’ published in December 2020, “In the last few years rural consumption has been key to India’s growth mainly driven by increased disposable income. With a focus on self-reliance – ‘Atma Nirbharta,’ rural India has emerged as a significant investment theme. Most recently, due to the pandemic, rural India has positioned itself to lead the demand resurgence.”

The importance of the rural agricultural sector can be understood from the fact that the sector accounts for around 14% of the country’s economy and holds sway over 42% of the total employment.

Rise in consumption