strategy

Developing profitable scope of rural industrial operations

Synonyms:
Focusing on potential for industrial development in rural communities
Offering adequate rural industrialization
Providing sufficient rural industrialization
Context:
ln developing countries, where a major portion of the population lives in the countryside, commercial enterprise has a long-term interest in developing rural purchasing power building a major market for its products in the rural areas. Some agro-industries, as producers of goods and services for rural use' know enough about the social and economic circumstances of villages make an intelligent contribution to their development. Such corporations have of their own initiative and sometimeswith the encouragement of the government applied their managerial, technical, financial and research skills to rural development.
Implementation:
The experience of most industrial companies (although there are some honourable exceptions) is that their top-down style of management results in a technocratic approach to development. This may misfire by failing to involve properly the decisions of the villagers concerned. Nevertheless, some outstanding work has been done, The Mafatlal Group's Surat and Standard Cotton Mills Rural Development Project embraces nine villages spread over some 16,000 acres with 25,000 people in all. The report of the Central lnternational Event field visit states. It is an example of how a project starting from the basic need of supplying food to the area has gone on to include, not only the provision of other services, but also inspired the commitment and dedication of the whole community. It is an outstanding example of private sector initiative which focused on a major perceived need. It had the effect of stabilising the life style of a hapless nomadic tribal people through the irrigation of their land. The management skills which the co-ordinating agent brought to bear have yielded results of wide scope and rapid success. It is a replicable mode of launching community development from very low baseline. A private sector agent forged the linkage in bringing to the Iocal community both technical and financial resourcesand a sense of prideand commitmentamong the tribal peopIes themselves in tackling their own situation.

lndustries tend to view the rural scene out of enlightened self-interest or long-range commercial motives as a part of the consumer economy. A more organic and creative role may be expected of industries which see the rural areas in the light of the producer economy. Among these are companies which rely for raw materials upon agriculture, forest and fishery' and produce such as fresh and processed foodstuffs, sugar, tobacco, dairy, tea, coffee and cocoa companies. Some are knowledgeable about rural areas and have a long-term business concern about their development. They see that if the villages are to be reliable suppliers of quality produce they will need research, infrastructural, technical, credit and welfare support.

Through non-farm income generation the private sector can provide a means of obtaining the working capital to bring marginal land into workable condition and to initiate supplementary enterprises. Typically companies of this type are Iocated with ready access to the villages. Their interest in rural development may stem from a wish to visibly fulfill their social responsibility.

Subjects:
Communities
Rural
Industry
Development
Potential
Type Classification:
C: Cross-sectoral strategies