Less than half of the approximately 500 million working Indians are now engaged in agriculture as their “usual status”— and this in a country where nearly 70% of the population still lives in villages. In other words, India has more villagers than farmers in its workforce.
What this means is that more than a quarter of Indian villagers in the workforce now get most of their income outside of agriculture, which fits well with the results of several micro studies on the economic diversification of rural India. It is also worth remembering that many families that still primarily live off the land—who identify themselves as farmers—have also invested in tiny enterprises in their villages, so the old assumption that equated rural India almost completely with agriculture will soon have to be buried.
The other big change is rapid urbanization. The new census for 2011 shows that urban India added more people than rural India did over the previous 10 years. The granular details are even more interesting. Rural population is stagnating in most of the dynamic states of peninsular India, as well as some northern states such as Punjab, with a large majority of the population growth in these states coming from cities. Population growth in the large states of the Gangetic belt such as Uttar Pradesh and Bihar continue to be driven by rural expansion. Read More