rural economy: industry is optimistic about sentiment of rural economy: CII

The Rural Business Confidence Index for October 2021 stood at 63.9 thanks to improved rural credit, leading the industry to be bullish and optimistic about sentiment in the rural economy, said the Confederation of Indian Industry in its first rural business confidence index developed in partnership with CRIF High. Brand.

According to CII, the index shows that despite the COVID-19 pandemic, retail loan disbursement in rural India has grown 23% in value, from Rs 10.10 lakh crore over the course of in fiscal year 2018-19 at Rs 12.45 lakh crore in fiscal year 2020-21 and 30% in volume from 506 lakhs in fiscal year 2018-19 at 661 lakhs in fiscal year 2020 -21).

Even the disbursement of commercial loans during this period, although led by small-scale loans, grew by about 100% in volume, from 2.4 lakh in fiscal year 2018- 19 to 4.9 lakh during fiscal year 2020-21), but a decrease of 33% by value from Rs 7.25 lakh crore during fiscal year 2018-19 to Rs 4.83 lakh crore during of the 2020-21 fiscal year), he said.

However, loans from microfinance institutions experienced a decrease of 9% in value, from Rs 1.23 lakh crore in fiscal year 2018-19 to Rs 1.12 lakh crore in fiscal year 2020- 21 and 19% in volume from 396 lakhs in fiscal year 2018-19 to 320 lakhs in fiscal year 2020-21 during the same period.

The survey of different industry sectors in different geographies shows that 59% of respondents expect their organization’s order books to improve, affecting businesses in rural India, while 48% of respondents expect the profitability of their organization to improve, ICN said.

In addition, 54% of respondents expect an improvement in the ease of access to credit for the rural economy. rural growth.

“CII strongly believes that the establishment of geographically distributed centers of economic growth, especially in rural India, is essential to promote equitable and sustainable growth and, most importantly, to realize the vision of Aatma Nirbhar Bharat,” said Chandrajit Banerjee, Managing Director of CII. .

“The aim of this index is to fill the information gap by creating a mechanism capable of capturing the performance of the rural economy and supporting strategic decision-making,” Banerjee said, adding that it would help all parties. key stakeholders to create new paradigms and chart new paths for the country’s economic growth.

Industry estimates that two-thirds of India’s workforce live in rural areas, and the rural economy contributes nearly 46% of our national income. “The COVID-19 outbreak has brought about a significant structural change in the country and rural India has shown exemplary resilience during this phase. As the next few years are crucial for the continued economic growth of the country, it is imperative to have a holistic mechanism capable of assessing and forecasting sentiment in rural businesses, ”added Navin Chandani, Managing Director and CEO of CRIF High Mark .

The Rural Business Confidence Index is an industry-first attempt to provide insight into rural business sentiment for all stakeholders. This is a comprehensive view of macroeconomic factors affecting rural India, data from rural credit bureaus, and views of micro, small, medium and large enterprises in all geographies and different sectors.

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