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Rural Marketing

Rural Marketing

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Published by: robinkapoor on Jan 17, 2009
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03/12/2013

 
Rural Marketing
Quite clearly, large Indian companies have begun looking at rural markets seriously.Some of them are even developing exclusive marketing strategies to tap this huge mass of consumers. Of India's one billion plus population, nearly 70 per cent live in non-urban or rural areas. According to a National Council for Applied Economic Research (NCAER)study, there are as many "middle income and above" households in rural areas as there arein urban areas. There are almost twice as many "lower middle income" households inrural areas as in urban. According to NCAER's projections, the number of middle andhigh-income households in rural India is expected to grow from 80 million to 111 million by 2007. In Urban India, the same is expected to grow from 46 million to 59 million.
 Hence the absolute size of middle and high income households in Rural India isexpected to be nearly double that of Urban India.
Percentage Distribution of household population and income
H
OUSEHOLDS
P
OPULATION
I
NCOME
URAL
73.674.655.6
U
RBAN
27.425.444.4
A
LL
I
NDIA
100100100Thus we see that Rural India contributes almost 56% to the National Income as against44% contributed by Urban India. Although it is contributed by 76% of the total population, which has its own challenges like how to sell small quantities to large base of consumers.
P
ERCENTAGE
 
OF
P
OPULATION
B
ELOW
P
OVERTY
L
INE
B
Y
URAL
-U
RBAN
L
OCATION
S
TATE
 W
ISE
(1999-2000)S
TATES
URAL
U
RBAN
A
LL
-I
NDIA
36.3528.76
A
NDHRA
 
PRADESH
25.4832.28
A
SSAM
61.7812.48
B
IHAR 
58.8545.10
G
UJARAT
26.2221.70
H
ARYANA
14.8613.79
ARNATAKA
38.5024.55
ERALA
26.5031.89
M
ADHYA
P
RADESH
39.3546.29
M
AHARASTRA
50.0032.16
O
RISSA
62.6734.27
P
UNJAB
14.246.74
AJASTHAN
15.0124.36
T
AMIL
 
NADU
39.3729.82
U
TTAR 
P
RADESH
29.8736.39
W
EST
B
ENGAL
55.1616.741
 
In terms of poverty, unemployment and level of development rank of India in:1947
861991
1232000
136
OUT
 
OF
156
COUNTRIES
Thus the Situation has further worsened as per the Report on Human Development Index.
D
IAGNOSIS
O
F
T
HE
F
AILURES
The apparent disparity requires introspection to identify the gaps, which can then be bridged between rural & urban India.
1L
OW
P
RIORITY
T
O
A
GRICULTURE
Relative share (%) of agriculture to total GDP
S
ECTOR 
1950-511995-96A
GRICULTURE
5629
M
ANUFACTURING
1529
T
RANSPORT
& T
RADE
1120
B
ANKING
911
A
DMINISTRATION
(S
ERVICES
)
911Growth rates in different sectors of economy
P
ARTICULARS
1990-9191-9292-9394-95G
ROWTH
 
IN
 
REAL
GDP %
5.21.14.34.3
G
ROWTH
 
IN
 
AGRICULTURE
 
PRODUCTION
%
3.0-1.92.92.9
G
ROWTH
 
IN
 
INDUSTRIAL
 
PRODUCTION
%
8.30.62.34.1
2 S
UBSISTENCE
O
RIENTATION
O
F
A
GRICULTURE
a.Productivity is low b.Not enough value additionc.Land degradation
3 F
AILURE
O
F
L
AND
EFORMS
d.Failure of redistribution of land in favor of poor.e.Large numbers of workers dependent on agriculture leading to low labo productivity.f.Splitting of families and rise in population has shrunk the size of operational land holding.2
 
g.Landlessness is increasing forcing more and more people joining labor market every year.
4I
NADEQUATE
F
OOD
S
UPPLIES
a.At national level India is self-sufficient but inadequate at the householdlevel. b.Increase in food production mainly due to few crops like wheat & rice but production of bajra, barley etc has declined considerably (as these are thecorps used by poor in rural India).
5S
LOW
G
ROWTH
O
F
I
NFRASTRUCTURE
a.Still 40% of India’s villages are without proper roads. b.1.8 Lac villages do not have primary schools within 1 km.c.4.5 Lac villages have drinking water problem.
6I
NADEQUATE
I
NPUTS
a.Research extension systems are weak, no direct link between scientists andfarmers. b.Problems faced in the timely availability of improved seeds, fertilizers and pesticides in required quantity.c.Credit is major constraint, which adversely affects adoption of newtechnologies especially by the small farmers.
7S
LOW
D
OWN
O
F
URAL
I
NDUSTRIALIZATION
The rural industrialization has slowed down although the expenditure on ruralindustries increased from Rs.42/- crores (1
st
plan) to Rs.6334/- crores (8
th
 plan). However %age of allocation decreased from 2.1% to 1.6%.Plan outlay on rural industrialization (Rs. Crore)
P
LAN
P
UBLIC
S
ECTOR 
O
UTLAY
URAL
I
NDUSTRY
%I
1960422.1
II
46721874.0
III
85772412.8
A
NNUAL
P
LAN
66281261.9
IV
157792931.9
V
394265921.5
A
NNUAL
P
LAN
126012892.3
VI
9750017801.8
VII
18000027531.5
VIII
43410063341.63

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