Rural marketing in india assignment

And, there is a growing body of statistics to demonstrate that rural markets, fueled in part by rising purchasing power, hold real prospects for profitable growth across a wide range of industry sectors. (c) The government has increased spending in rural areas, from IIS$9 billion for the financial year ending March 2007 to an anticipated IIS$16 March 2010. 3 (d) Improved access to finance and institutional credit has brought greater cash inflows to rural households. Institutional credit to the agriculture and allied sectors increased from INANER. 6 billion (US$14. 5 billion) n 2002-03 to INNER. 6 trillion (US$55 billion) 2008-09. 4 Figure 1. 1 .

Government budgeted expenditure on rural development 20 Five reasons for greater business confidence in rural India (a) Rural spending is now less dependent on farm income, which now constitutes less than 50 percent of the total rural income. Income remittances from migrant rural populations and increases in nonfat activities such as trading and agro-processing are boosting nonfat income. (b) The increase in procurement prices (the minimum price that farmers earn on produce sold to the government) is putting more money into the hands f the rural population. A series of good harvests, on the back of several good monsoons from 2005 to 2008, has accelerated rural employment in agricultural and allied activities. (e) Policy measures such as the IIS$13. -billion waiver of agricultural loans and the National Rural Employment Guarantee Scheme (NURSES), which guarantees 100 days of employment to one member of every rural household, have helped to reduce rural under-employment and raised wages. The official minimum average per-day wage paid under NURSES has increased from INNER (IIS$I . 4) in 2006-07 to INNER (IIS$I . 8) 2008-09. 5 us billion 0 Source: Ministry of Rural Development 5 Figure 1 . AAA. FMC-?? Rural market share as percent of all India market Source: National Council for Applied Economic Research (NCAR) 6 The increase in rural purchasing power is reflected in many ways. Rural incomes have been growing at more than 7 percent over the past few years, helping to account for almost 40 percent of Indian’s total consumption of goods and services. Non-food expenditures are growing at an 8. 2 percent annual compound rate.

Figure 2. 1 . Businesses are investing in rural markets (Percent of survey respondents) 21% We also interviewed select C-suite executives from companies in a range of industries to learn more about what made them succeed in rural markets. Here are the key findings, slighting the attractions and distractions of rural markets. 9 Figure 2. 2. Rural markets offer opportunities across the value chain (Percent of survey respondents) match tax breaks Rural markets are home to resources and talent Rural markets suffer from persistent structural handicaps Rural markets encompass eager consumers who want to share the fruits of Indian’s industrial growth.

More than half of the senior executives surveyed were keen to tap rural areas’ new segments of consumers (see Figure 2. 2). From a supply-side perspective, more than 40 percent wanted to access raw materials. Unsurprisingly, more than a hired of respondents agreed that rural markets offer labor pools at much lower cost than in urban markets. Issues such as inadequate infrastructure, low literacy, and high levels of poverty raise serious question marks about the sustainability of the rural opportunity. Our survey findings indicate how concerned businesses are about these issues. Around 74 percent of respondents reported that lack of proper linkages for roads, railways and telecoms infrastructure are big hindrances.